Yesterday after the close, the Department of Education (DOE) delivered a draft of the Negotiated Rulemaking (NegReg) regulations that align with a negative scenario:
1) Tying Title IV eligibility to a “gainful employment” metrics including cost of program , loan debt, and income after graduation. (apparantly to be applied to vocational programs only)
2) Getting rid of all 12 incentive compensation safe harbors .
ED’s proposals for gainful employment standard will determine the appropriate levels of debt allowable for each vocational program/degree offering and thus may effectively result in tuition caps
Eliminating all 12 safe harbors could restrict a school’s ability to utilize 3rd party call centers for qualification & hot transfer and potentially diminish internet generated starts, thus stalling enrollment growth.
Still much speculation and uncertainty…
OOH man, I am not so sure here! I think the Govt. is clearly saying “we will stop your growth”. We don’t like what you are doing & we will stop you. From the people I talk to, it’s clear the Govt. is on a mission, even if the mission is led by a corrupt goal of hurting the for profits for the sake of the community colleges & state schools
I don’t get it! The Government wants to increase the number/percentage of college graduates in this county to improve our country. The demographics which tend to have the lowest % of college graduates tend to be the urban/inner city minorities. Yet, that demographic also tends to have the lowest graduation rates & highest default rate, thus since the for profits risk their title IV if their grad rate gets too low and/ or default rate, they are almost forced not to go after the segment of the population which needs it most… also, the for profits spend the most on advertising & marketing, the result is that they effectively reach & stimulate activity from theses demographics that otherwise would remain silent. Why does the govt. want one thing while they put laws in place which effectively block firms from addressing the core issues?
I would worry less about the metrics tied to meaningful employment and more about the safe harbors. Putting real teeth into the first issue would affect med schools, and at least half of the programs in the typical state university and they won’t permit that. As for the safe harbors, I think we need to be prepared to implement models of performance based employment that are not considered performance based compensation. there is a good chance that the safe harbors will become less safe in the next round.
Separately, I think it is a mistake to see the DoED as being of one mind on these issues. There is much internal conflict and, therefore, opportunity to educate. Among other things, I am amazed to observe that no one has pointed out that performance-based compensation is more ethical than paying the individual who works hard and long the same as one who does the least required to get by. We have a strand of accountability and “just desserts” in our culture and we need to connect the dots between those values and performance based compensation (for all employees, including faculty, by the way — hence, another challenge).