\n<\/p>\n
The revamped proposal could cut failing programs off from federal student aid entirely.<\/p>\n
Photo illustration by Justin Morrison\/Inside Higher Ed | skodonnell\/E+\/Getty Images | tarras79\/iStock\/Getty Images<\/p>\n
After a week of talks and a final compromise from the Education Department, an advisory committee on Friday signed off on regulations that would require all postsecondary programs to pass a single earnings test.<\/p>\n
The new accountability metric, set to take effect in July, could eventually cut failing programs off from all federal student aid funds\u2014an enhanced penalty that appeared key to the committee reaching consensus Friday. Before the compromise, programs that fail the earnings test would only have lost access to federal student loans. Under the proposal, college programs will have to show that their graduates earn more than a working adult with only a high school diploma.<\/p>\n
In the course of negotiations, committee members repeatedly argued that allowing failing programs to receive the Pell Grant didn\u2019t sufficiently protect students or taxpayer funds, and it appeared unlikely that without more significant changes, the committee would reach unanimous agreement.<\/p>\n
But now, failing programs will also lose eligibility for the Pell Grant if their institution doesn\u2019t pass a separate test, which measures whether failing programs account for either half of the institution\u2019s students or federal student aid funds. If either condition is met in two consecutive years, the programs will be cut off. The timing of the two tests and consequences mean that it will take at least three years for institutions to lose all access to federal student aid. Individual programs lose access to loans after failing the earnings test in two consecutive years.<\/p>\n
Preston Cooper, the committee member representing taxpayers and the public interest, who had opposed the department\u2019s initial proposal, said the agency\u2019s compromise would \u201cprotect a lot of students.\u201d<\/p>\n
\u201cBy some of our calculations here, this would protect around 2\u00a0percent of students and close to a billion dollars a year in Pell Grant funds,\u201d he said.<\/p>\n
The department unveiled this new penalty late Friday morning after what ED\u2019s lead negotiator Dave Musser called an \u201cextremely productive\u201d closed-door meeting with nearly all of the committee members. The proposed regulations aren\u2019t yet final. The department is required to release them for public comment and review that feedback before issuing a final rule. <\/p>\n
Other committee members also praised the compromise as \u201creasonable\u2019 and \u201ccommon-sense.\u201d Members representing states and accreditors said the revised earnings test and new penalties would help to ensure institutions offer credentials that boost graduates\u2019 earnings. Some suggested that the accountability framework could better inform discussions between institutions and employers, as it sets clear standards.<\/p>\n
\u201cAnd those standards are going to influence the decisions that [employers] make, and that\u2019s going to be a pretty large educational effort,\u201d said Randy Stamper with the Virginia Community College System, who represented states on the committee. \u201cBut at least we have the tool to hang our hat on to make points that low-earning programs are a result of low pay, and I think that will help us.\u201d <\/p>\n
The department\u2019s proposal essentially combines two accountability metrics\u2014the Do No Harm standard that Congress passed last summer and the existing gainful-employment rule. Gainful employment only applies to certificate programs and for-profit institutions, whereas Do No Harm covers all programs except certificates.<\/p>\n
Tamar Hoffman, the committee member representing legal aid, consumer protection and civil rights groups, was the only person to abstain from voting. (Abstaining doesn\u2019t block consensus.)<\/p>\n
\u201cThe reason I\u2019m abstaining from this vote is because it was made very clear to me throughout this process that protections for students in certificate programs would be taken away altogether if I blocked consensus, and those students are just too important for me to take that risk, especially with the long history of abuse in certificate programs,\u201d Hoffman said.<\/p>\n
About 6\u00a0percent of all programs would fail the combined earnings test, including about 29\u00a0percent of undergraduate certificates, according to department data. Roughly 650,000 students were enrolled in a failing program as of the 2024\u201325 academic year, half of whom attend a for-profit institution.<\/p>\n
\u201cProprietary institutions are eager to be able to demonstrate where we have programs that are of great value and have good outcomes,\u201d said Jeff Arthur, the committee member representing the for-profit higher education sector. \u201cWe\u2019re looking forward to having that opportunity to have a level comparison for the first time across several metrics with all other programs.\u201d <\/p>\n
Education Under Secretary Nicholas Kent praised the committee\u2019s work in his closing remarks, saying they made history by adopting a standard accountability metric that will ensure the taxpayer investment in higher education is working for everyone.<\/p>\n
\u201cFor years, we have been bogged down in ineffective measures that simply failed to capture the full picture of how all programs were actually performing,\u201d he said. \u201cThis new framework is different. It\u2019s about ensuring that all programs meet a baseline for financial value, a baseline that reflects the needs of students and taxpayers alike.\u201d<\/p>\n
Friday\u2019s meeting ends two rounds of negotiations at the Education Department to implement Congress\u2019s One Big Beautiful Bill Act. In November, a different advisory committee reached consensus on regulations related to repayment plans, graduate student loan caps and what\u2019s become a controversial plan to designate 11 degree programs as eligible for a higher borrowing limit. Then, in December, this advisory committee approved rules to expand the Pell Grant to short-term workforce training programs. <\/p>\n
The department still has to take public comments and finalize those rules before July 1. Kent said the regulations for the student loan provisions should be published later this month.<\/p>\n
Several outside policy experts doubted whether the department could get through the necessary negotiations and reach consensus on all the topics\u2014a point that Kent addressed as he called out some of the media coverage surrounding the talks.<\/p>\n
\u201cAnd yet, here we are today,\u201d he said. \u201cTogether, we have built something that will stand the test of time and end the regulatory whiplash. Once again, those who bet against us were wrong. They continue to severely underestimate this administration and this committee.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
The revamped proposal could cut failing programs off from federal student aid entirely. Photo illustration by Justin Morrison\/Inside Higher Ed | skodonnell\/E+\/Getty Images | tarras79\/iStock\/Getty Images After a week of talks and a final compromise from the Education Department, an advisory committee on Friday signed off on regulations that would require all postsecondary programs to<\/p>\n","protected":false},"author":1,"featured_media":41156,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[57],"tags":[4518,6231,181,76],"class_list":{"0":"post-41155","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-education","8":"tag-earnings","9":"tag-panel","10":"tag-signs","11":"tag-test"},"_links":{"self":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts\/41155","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=41155"}],"version-history":[{"count":0,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts\/41155\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/media\/41156"}],"wp:attachment":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=41155"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=41155"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=41155"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}