Education Dept. Says For-Profit Colleges’ Argument Against Rule ‘Is Nonsense’

The U.S. Department of Education last week continued its legal quest to require for-profit colleges and other institutions offering programs leading to gainful employment to publicly report information about their students’ debt burdens. In a federal-court filing on Thursday it contended that the Association of Private Sector Colleges and Universities’ claim that such data would be meaningless to students “is nonsense.”

In June a federal-district court vacated the core piece of the gainful-employment regulation, finding that the department had arbitrarily set three key benchmarks in the rule that institutions eventually would have to meet to remain eligible to receive federal student aid.

The department then sought to have the reporting portion of the regulation reinstated.

The association, which filed the initial lawsuit challenging the regulation, also opposes the department’s attempt to reinstate the reporting requirement, now that those benchmarks have been thrown out.

“If the department is unable to understand and explain the relationship between its artificial debt measures and ‘gainful employment,’ prospective students—without any meaningful guideposts—are likely to be even more lost,” it argued in a brief filed in mid-August.

In its response, filed in the U.S. District Court here, the department countered that even without the debt-measure thresholds, the data would be meaningful. “The percentage of a program’s graduates that are currently repaying their loans and the percentage of monthly earnings that graduates are using to make payments on their student loans is valuable information that many—if not all—prospective students considering whether to enroll in a program would like to have,” the department wrote in its court filing.

The department has not said whether it plans to seek an appeal of the broader ruling, or to rewrite the regulation. Either course would probably take months or years, and the push to reinstate the reporting requirement appeared to be a way to keep some aspect of the gainful-employment regulation in effect in the interim.