Posts Tagged ‘New Orleans’

According to the Career College Association (CCA), the proposed Gainful Employment (GE) regulation change will limit access to higher education for hundreds of thousands of non-traditional students (primarily working adults and lower income students) at a time when job creation, often requiring skills training or retraining, is a paramount national public policy goal.

Further, pertinent points from the CCA in regards to the many flaws in the GE metric are as follows:

  • According to data released by the Department of Education (“ED”), if the same metric were applied to traditional medical schools, most would fail. An analysis of the data provided show that institutions in the private not-for-profit and public sector that serve populations similar to those attending private sector colleges and universities (i.e. non-traditional, minority, and lower socioeconomic populations) have similar repayment rates. Yet, ED is targeting just one sector—for-profit career colleges that afford students the opportunity and flexibility to work fulltime while pursuing their academic goals.
  • Schools in our sector serve proportionately more low income and minority students who are under-represented in postsecondary education than the traditional sector. This regulation implicitly discriminates against African American and Hispanic students by eliminating program choice and access.
  • Economists have shown that it takes seven years or more after graduation, not three years, for those with higher degrees to begin to experience the real financial advantage of additional education in the marketplace. This is especially true for non-traditional student-workers who are attending college to develop the necessary skills and ascertain the academic credibility that will empower them to move into an entirely new field and/or increase their chances of advancing within their current organization.
  • ED states institutions could comply with the metric by lowering their tuition. Not only is this a back-door way to control tuition pricing, it is a false premise. Students will still be able to take out the same amount of federal loans even if a school lowers tuition because institutions are not permitted to limit loan eligibility even when that eligibility far exceeds institutional charges.
  • ED is telling lower income students who rely on title IV Federal aid to assist them in achieving their postsecondary dreams where they can go to school, what they can study, and what careers they can enter. A student who can afford to pay out of pocket can make his/her own choices.

In fact, not only will the new GE rule potentially dictate who can attend college, where they can attend, and what they can study; if enacted in its current form, hundreds of thousands of non-traditional students may see the elimination of their existing career focused certificate and degree programs in business, education, and healthcare.
The question is why? If the real problem is the inability of students to repay loans, why not consider a cap on the total amount students can borrow?  By establishing borrowing limits based on actual tuition costs and required fees, a college/university would be able to ensure that students can only borrow the actual amount they need to cover the costs of their education while potentially reducing the repayment problem by disallowing students to borrow the mandated maximum amount (which often exceeds the amount required to cover tuition/costs and the excess is often used to fund non-education related matters).  By allowing financial administrators to act as bona fide financial advisers to their students, borrowers and lenders would benefit from a prudent approach that more accurately assesses each student’s needs.  Instead, ED’s proposal will attempt to solve the loan repayment problem by installing a fixed price tuition scheme that will inhibit the working poor from obtaining the funding required to achieve the education they need in order to be competitive in today’s tough job market.  Additionally, the proposal will restrict what programs a career college can offer based on loan repayment statistics that favor larger, public institutions.
Please click here to send a letter to the Department of Education expressing your concerns over the proposed gainful employment regulation change before the September 9, 2010 deadline.

Brian Stoddard