Led by New York Attorney General (AG), Barbara Underwood, a coalition of 16 state AGs are pushing back against the proposal of Department of Education Secretary (DOE), Betsy DeVos, to rescind Gainful Employment regulations. The intention of these regulations, slated to go into effect on July 1, 2018, is to increase transparency and accountability of colleges, both traditional and for-profit. 

In a letter to DeVos, the coalition pointed out that the Gainful Employment rules provide “crucial disclosures” to students. This is particularly true for for-profit online colleges. States cannot protect students who attend out-of-state online schools. The letter notes “widespread misconduct” by for-profit online schools, in particular, misrepresenting student employment and salary outcomes.  

Delay of the rule, according to the letter, will allow schools that operate beyond state oversight to continue to offer predatory loans and misrepresent student outcomes and school accreditation. In addition, without the rule, online schools can continue to misstate requirements for obtaining state professional licenses. This can leave students stranded without a usable degree.  

DeVos’s Letter

In an August 10 letter announcing cancellation of the rule, DeVos stated that students deserve “useful information” and that schools should not be targeted because of their “tax status.” According to the letter, DOE updates to the College Scorecard or similar tools provide “actionable and accurate information.”

The DOE is inviting public comment before implementing the repeal and DeVos insists that the new approach will “aid students across all sectors of higher education and improve accountability.”

According to Underwood, this is untrue. “The Trump-DeVos Department of Education continues to put special interests ahead of the students they serve. Our coalition of Attorneys General will continue to fight back.”

Support for the Gainful Employment Rule

AGs from states including Hawaii, California, Delaware, Virginia, Maryland, Oregon, Minnesota, and North Carolina signed the letter. These AGs believe the Gainful Employment rule helps prospective students make informed choices. Students need critical information such as average debt load, loan repayment rate, graduation rate, appropriate employment rate, and average earnings. The rule allows the government to pull federal student loans and grants from schools that repeatedly fail in these categories.

For-profit student loan default rates that are twice as high as public institutions. Still, DeVos aims to end the Gainful Employment rule on July 1, 2019. The rules are purportedly “burdensome” and reinforce “inaccurate and outdated” beliefs that vocational programs are less valuable to students.

The DOE has not yet announced when the 30 day comment period will begin, but it is sure to be contentious.