For-profit colleges and concerns over ‘gainful employment’
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The Obama Administration has unveiled proposed new regulations on for-profit colleges and vocational programs. They’re known as the “gainful employment” rules because career colleges are supposed to prepare their students for gainful employment.
That means jobs that pay enough to pay off those sizeable loans so many students take on. This isn’t the first time the administration has tried to crack down on the multi-billion dollar for-profit college business.
Here’s a look at some of the numbers involved in the rulemaking:
The number of pages in the U.S. Department of Education’s new Notice of Proposed Rulemaking, which spells out new guidelines on for-profit colleges and vocational programs. A previous version of the so-called “gainful employment” rule was tossed out by a federal judge, so the latest draft is an attempt to be “as legally bullet-proof as possible,” says New America Foundation policy analyst Ben Miller.
The approximate size of the federal student aid program. Career programs that don’t meet the proposed new guidelines could lose access to this huge source of revenue.
The maximum default rate for career programs eligible for federal student aid. Under the proposed rules, programs risk losing eligibility for federal student aid if more than 30 percent of their former students are in default after three years of leaving school, or if graduates have to spend more than 8 percent of their earnings (or more than 20 percent of their discretionary income) on student loan payments.
The estimated percentage of programs that would fail under the new guidelines. Most of them are at for-profit colleges. Programs would have time to improve before becoming ineligible for aid.
The number of days the public has to comment on the draft regulations before they’re finalized.
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