University Business - September 2012 - (Page 28)

financial aid The Gainful Employment Ruling Continuing efforts to improve financial literacy for borrowers By Jessica Sondgeroth D espite Federal District Court Judge Rudolph Contreras’ ruling that negates a primary metric of the U.S. Department of Education’s “gainful employment” regulations, the DOE still has authority to regulate gainful employment programs and schools should continue to look for ways to promote the financial success of their students. While it remains unknown what will become of the gainful employment regulations, it doesn’t hurt to continue operating as though the gainful employment measures are in effect by strengthening default prevention, financial literacy, counseling and other efforts to reduce borrowing and improve loan repayment. The Obama administration published the gainful employment metrics last year, amid criticism that some for-profit colleges were piling students with debt in exchange for low-value or incomplete credentials and degrees. The DOE established these regulations to tie an academic program’s eligibility for Title IV federal student aid funds to whether it can “prepare students for gainful employment in a recognized occupation.” The rules were due to be implemented July 1, 2012, with the first set of meaningful metrics to be released during 2013. The rule included three metrics to evaluate the performance of academic programs. Contreras’ ruling overturns the loan repayment rate, on the basis that the 35 percent repayment rate threshold was too arbitrarily contrived by the DOE as a performance standard for compliance. Helping students succeed academically is one way institutions can improve student loan repayment rates. “The Department does not identify any expert studies or industry practices indicating that a repayment rate of 35 percent would be a ‘meaningful performance standard,’ but rather emphasizes that the number was chosen because approximately one quarter of gainful employment programs would fail a test set at that level,” Contreras writes in his ruling. “Because one of the debt measures lacks a reasoned basis, that regulation will be vacated as arbitrary and capricious. Because the majority of the related rules cannot stand without the debt measures, they will be vacated, as well.” The ruling leaves the DOE with the choice to appeal the decision or create new metrics, but it does not overturn its authority to regulate certain programs and institutions to ensure they are preparing students for gainful employment. “Concerned about inadequate programs and unscrupulous institutions, the Department has gone looking for rats in rat holes [sic.]—as the statute empowers it to do,” Contreras wrote in his ruling. Institutional leaders would be prudent to continue to address the gainful employment requirements by establishing a default prevention plan, either adopting the DOE’s sample plan (available at www.ifap.ed.gov/ifap) or customizing their own. Schools should also engage borrowers, work to better identify at-risk students and improve loan counseling efforts. Research shows that many factors affect borrowers’ chances of successfully repaying their student loan and avoiding default. These factors include: • Borrower characteristics like family income and academic preparedness in high school. Jessica Sondgeroth is the web reporter and editor at the National Association of Student Financial Aid Administrators, www.nasfaa.org. 28 | September 2012 universitybusiness.com http://www.ifap.ed.gov/ifap http://www.nasfaa.org http://www.universitybusiness.com

Table of Contents for the Digital Edition of University Business - September 2012

University Business - September 2012
Contents
Editor’s Note
College Index
Ad Index
Behind the News
Viewpoint
Independent Outlook
Financial Aid
Virtual Viewbooks: Ready? Or Not?
Technology Changes Everything
Connecting Learners, On Campus and Off
The Changing Face of the CIO
Efficiency Greats
The Administrator's Bookshelf
Oceans of Data
Education Innovators
Internet Technology
End Note

University Business - September 2012

http://www.nxtbook.com/pmg/UB/UB_1019
http://www.nxtbook.com/pmg/UB/UB_0819
http://www.nxtbook.com/pmg/UB/UB_0719
http://www.nxtbook.com/pmg/UB/UB_0619
http://www.nxtbook.com/pmg/UB/UB_0419
http://www.nxtbook.com/pmg/UB/UB_0319
http://www.nxtbook.com/pmg/UB/UB_0119
http://www.nxtbook.com/pmg/UB/UB_1218
http://www.nxtbook.com/pmg/UB/UB_1118
http://www.nxtbook.com/pmg/UB/UB_1018
http://www.nxtbook.com/pmg/UB/UB_0918
http://www.nxtbook.com/pmg/UB/UB_0818
http://www.nxtbook.com/pmg/UB/UB_0718
http://www.nxtbook.com/pmg/UB/UB_0618
http://www.nxtbook.com/pmg/UB/UB_0518
http://www.nxtbook.com/pmg/UB/UB_0418
http://www.nxtbook.com/pmg/UB/UB_0318
http://www.nxtbook.com/pmg/UB/UB_0218
http://www.nxtbook.com/pmg/UB/UB_0118
http://www.nxtbook.com/pmg/UB/UB_1217
http://www.nxtbook.com/pmg/UB/UB_1117
http://www.nxtbook.com/pmg/UB/UB_1017
http://www.nxtbook.com/pmg/UB/UB_0917
http://www.nxtbook.com/pmg/UB/UB_0817
http://www.nxtbook.com/pmg/UB/UB_0717
http://www.nxtbook.com/pmg/UB/UB_0617
http://www.nxtbook.com/pmg/UB/UB_0517
http://www.nxtbook.com/pmg/UB/UB_0417
http://www.nxtbook.com/pmg/UB/UB_0317
http://www.nxtbook.com/pmg/UB/UB_0217EPUB
http://www.nxtbook.com/pmg/UB/UB_0217
http://www.nxtbook.com/pmg/UB/UB_0117
http://www.nxtbook.com/pmg/UB/UB_1216
http://www.nxtbook.com/pmg/UB/UB_1116
http://www.nxtbook.com/pmg/UB/UB_1016
http://www.nxtbook.com/pmg/UB/UB_0916
http://www.nxtbook.com/pmg/UB/UB_0816
http://www.nxtbook.com/pmg/UB/UB_0816CG
http://www.nxtbook.com/pmg/UB/UB0716
http://www.nxtbook.com/pmg/UB/GlobalSellSheet
http://www.nxtbook.com/pmg/UB/UB_0616
http://www.nxtbook.com/pmg/UB/UB_0516
http://www.nxtbook.com/pmg/UB/UB0416
http://www.nxtbook.com/pmg/UB/UB0316
http://www.nxtbook.com/pmg/UB/UB_0216r2
http://www.nxtbook.com/pmg/UB/UBGuide
http://www.nxtbook.com/pmg/UB/UB0116
http://www.nxtbook.com/pmg/UB/UB
http://www.nxtbook.com/nxtbooks/pmg/ub201511
http://www.nxtbook.com/nxtbooks/pmg/ub201510
http://www.nxtbook.com/nxtbooks/pmg/ub201509
http://www.nxtbook.com/nxtbooks/pmg/ub201508
http://www.nxtbook.com/nxtbooks/pmg/ub201508_ConsultantsGuide
http://www.nxtbook.com/nxtbooks/pmg/ub201507
http://www.nxtbook.com/nxtbooks/pmg/ub201506
http://www.nxtbook.com/nxtbooks/pmg/ub201506_AudioVisualSolutions
http://www.nxtbook.com/nxtbooks/pmg/ub201505
http://www.nxtbook.com/nxtbooks/pmg/ub201504
http://www.nxtbook.com/nxtbooks/pmg/ub201503
http://www.nxtbook.com/nxtbooks/pmg/ub201502
http://www.nxtbook.com/nxtbooks/pmg/ub201501
http://www.nxtbook.com/nxtbooks/pmg/ub201501_FinancialServicesGuide
http://www.nxtbook.com/nxtbooks/pmg/ub201412
http://www.nxtbook.com/nxtbooks/pmg/ub201411
http://www.nxtbook.com/nxtbooks/pmg/ub201410
http://www.nxtbook.com/nxtbooks/pmg/ub201409
http://www.nxtbook.com/nxtbooks/pmg/ub201408
http://www.nxtbook.com/nxtbooks/pmg/ub201408_ConsultantsGuide
http://www.nxtbook.com/nxtbooks/pmg/ub201407
http://www.nxtbook.com/nxtbooks/pmg/ub201406
http://www.nxtbook.com/nxtbooks/pmg/ub201406_AudioVisualSolutions
http://www.nxtbook.com/nxtbooks/pmg/ub201405
http://www.nxtbook.com/nxtbooks/pmg/ub201404
http://www.nxtbook.com/nxtbooks/pmg/ub201403
http://www.nxtbook.com/nxtbooks/pmg/ub201402
http://www.nxtbook.com/nxtbooks/pmg/ub201401
http://www.nxtbook.com/nxtbooks/pmg/ub201401_FinancialServicesGuide
http://www.nxtbook.com/nxtbooks/pmg/ub201312
http://www.nxtbook.com/nxtbooks/pmg/ub201311
http://www.nxtbook.com/nxtbooks/pmg/ub201310
http://www.nxtbook.com/nxtbooks/pmg/ub201309
http://www.nxtbook.com/nxtbooks/pmg/ub201308
http://www.nxtbook.com/nxtbooks/pmg/ub201308_ConsultantsGuide
http://www.nxtbook.com/nxtbooks/pmg/ub201307
http://www.nxtbook.com/nxtbooks/pmg/ub201306_AudioVisualSolutions
http://www.nxtbook.com/nxtbooks/pmg/ub201306
http://www.nxtbook.com/nxtbooks/pmg/ub201305
http://www.nxtbook.com/nxtbooks/pmg/ub201304
http://www.nxtbook.com/nxtbooks/pmg/ub201303
http://www.nxtbook.com/nxtbooks/pmg/ub201302
http://www.nxtbook.com/nxtbooks/pmg/ub201301
http://www.nxtbook.com/nxtbooks/pmg/ub201301_FinancialServicesGuide
http://www.nxtbook.com/nxtbooks/pmg/ub1212
http://www.nxtbook.com/nxtbooks/pmg/ub1112
http://www.nxtbook.com/nxtbooks/pmg/ub1012
http://www.nxtbook.com/nxtbooks/pmg/ub0912
http://www.nxtbook.com/nxtbooks/pmg/ub_cg12
http://www.nxtbook.com/nxtbooks/pmg/ub070812
http://www.nxtbook.com/nxtbooks/pmg/ub0612
http://www.nxtbook.com/nxtbooks/pmg/ub_avguide0612
http://www.nxtbook.com/nxtbooks/pmg/ub0512
http://www.nxtbook.com/nxtbooks/pmg/ub0412
http://www.nxtbook.com/nxtbooks/pmg/ub0312
http://www.nxtbook.com/nxtbooks/pmg/ub0212
http://www.nxtbook.com/nxtbooks/pmg/ub_financeguide0112
http://www.nxtbook.com/nxtbooks/pmg/ub1211
http://www.nxtbook.com/nxtbooks/pmg/ub1011
http://www.nxtbook.com/nxtbooks/pmg/ub0911
http://www.nxtbook.com/nxtbooks/pmg/ub_cg11
http://www.nxtbook.com/nxtbooks/pmg/ub0711
http://www.nxtbook.com/nxtbooks/pmg/ub0611_av
http://www.nxtbook.com/nxtbooks/pmg/ub0611
http://www.nxtbook.com/nxtbooks/pmg/ub0511
http://www.nxtbook.com/nxtbooks/pmg/ub0411
http://www.nxtbook.com/nxtbooks/pmg/ub0311
http://www.nxtbook.com/nxtbooks/pmg/ub0211
http://www.nxtbook.com/nxtbooks/pmg/ub0111
http://www.nxtbook.com/nxtbooks/pmg/ub_financeguide0111
http://www.nxtbook.com/nxtbooks/pmg/ub1110
http://www.nxtbook.com/nxtbooks/pmg/ub1010
http://www.nxtbook.com/nxtbooks/pmg/ub0910
http://www.nxtbook.com/nxtbooks/pmg/ub_2010financeguide
http://www.nxtbook.com/nxtbooks/pmg/ub_2010consultants
http://www.nxtbook.com/nxtbooks/pmg/ub_2010avguide
http://www.nxtbook.com/nxtbooks/pmg/ub0710
http://www.nxtbook.com/nxtbooks/pmg/ub0610
http://www.nxtbook.com/nxtbooks/pmg/ub0510
http://www.nxtbook.com/nxtbooks/pmg/ub0410
http://www.nxtbook.com/nxtbooks/pmg/ub0310
http://www.nxtbook.com/nxtbooks/pmg/ub0210
http://www.nxtbook.com/nxtbooks/pmg/ub0110
http://www.nxtbook.com/nxtbooks/pmg/ub1109
http://www.nxtbook.com/nxtbooks/pmg/ub1009
http://www.nxtbook.com/nxtbooks/pmg/ub0909
http://www.nxtbook.com/nxtbooks/pmg/ub0709
http://www.nxtbook.com/nxtbooks/pmg/ub_fg09
http://www.nxtbook.com/nxtbooks/pmg/ub0609
http://www.nxtbook.com/nxtbooks/pmg/ub0509
http://www.nxtbook.com/nxtbooks/pmg/ub0409
http://www.nxtbook.com/nxtbooks/pmg/ub0309
http://www.nxtbook.com/nxtbooks/pmg/ub0209
http://www.nxtbook.com/nxtbooks/pmg/ub0109
http://www.nxtbook.com/nxtbooks/pmg/ub1208
http://www.nxtbook.com/nxtbooks/pmg/ub1108
http://www.nxtbook.com/nxtbooks/pmg/ub1008
http://www.nxtbook.com/nxtbooks/pmg/ub0908
http://www.nxtbook.com/nxtbooks/pmg/ub0808
http://www.nxtbook.com/nxtbooks/pmg/ub0708
http://www.nxtbook.com/nxtbooks/pmg/ub0608
http://www.nxtbook.com/nxtbooks/pmg/ub0508
http://www.nxtbook.com/nxtbooks/pmg/ub0408
http://www.nxtbook.com/nxtbooks/pmg/ub0308
http://www.nxtbook.com/nxtbooks/pmg/ub0208
http://www.nxtbook.com/nxtbooks/pmg/ub0907
http://www.nxtbook.com/nxtbooks/pmg/ub0807
http://www.nxtbook.com/nxtbooks/pmg/ub0707
http://www.nxtbook.com/nxtbooks/pmg/ub0607
http://www.nxtbook.com/nxtbooks/pmg/ub0507
http://www.nxtbook.com/nxtbooks/pmg/ub0407
http://www.nxtbook.com/nxtbooks/pmg/ub0307
http://www.nxtbook.com/nxtbooks/pmg/ub0207
http://www.nxtbook.com/nxtbooks/pmg/ub0107
http://www.nxtbook.com/nxtbooks/pmg/ub1206
http://www.nxtbook.com/nxtbooks/pmg/ub1106
http://www.nxtbook.com/nxtbooks/pmg/ub1006
http://www.nxtbook.com/nxtbooks/pmg/ub0906
http://www.nxtbook.com/nxtbooks/pmg/ub0806
http://www.nxtbook.com/nxtbooks/pmg/ub0706
http://www.nxtbook.com/nxtbooks/pmg/ub0606-GG
http://www.nxtbook.com/nxtbooks/pmg/ub0606
http://www.nxtbook.com/nxtbooks/pmg/ub0506
http://www.nxtbook.com/nxtbooks/pmg/ub0406
http://www.nxtbookMEDIA.com