The first of three negotiating sessions that will re-examine the U.S. Department of Education’s rules that affect proprietary higher-education institutions got under way here on Monday.
Much of Monday’s meeting was spent laying the groundwork for the sessions, dealing with such matters as reviewing and adopting protocols, approving agenda issues, and introducing members of the negotiating committee. The panel consists of federal officials and representatives of institutions and other parties affected by the rules.
The other sessions in this process, known as negotiated rule-making, will take place in December and January. A final decision on any revisions in the rules is not expected until next year.
As for what the sessions might achieve, Harris N. Miller, president of the Career College Association, said his organization’s member institutions were simply hoping for “clarity on the issues.” “We don’t want to be left with ambiguity,” he said.
The real work of the committee is expected to begin on Tuesday, when members will discuss the first four of 14 agenda issues: how to define a high-school diploma, the administration of “ability to benefit” tests, misrepresentation in information that institutions provide to potential students, and incentive compensation for student recruiters.
Those issues are expected to be the most watched among representatives of for-profit institutions. Other parties interested in the regulations include financial analysts and capital investors, many of whom crowded into the conference room where the weeklong session is taking place.
Validating Educational Credentials
The department decided to revisit the definition of a high-school diploma as part of its efforts to ensure that only students with a legitimate high-school education or its equivalent are able to receive federal student aid for higher education.
There is concern that confirming the authenticity of a student’s high-school experience has become more difficult, in part because of the proliferation of high-school diploma mills.
The Government Accountability Office, in a report released in August, recommended that the department clearly state its policy against the use of diploma mills to obtain federal student aid. The GAO also recommended that the department use information that is already available, such as lists published by states, to provide guidance to institutions of higher education in confirming the validity of high-school diplomas.
Closely related to the issue of high-school diplomas is the ability to benefit from higher education. When a student does not have a high-school diploma or a GED, and has not completed high school through home schooling, the student has to pass an ability-to-benefit test to qualify for student aid.
In its report in August, the GAO cited the department for weak oversight of the administration of such tests and recommended that the regulations be revised to strengthen controls over the testing process.
Misrepresentation and Safe Harbors
The negotiating sessions will also explore whether the department needs to revise the regulations or provide additional guidance to institutions of higher education about the types of statements and communication that could constitute “misrepresentation.”
The concern is that students could be lured to certain institutions by promises of employability after graduation and then take on considerable financial debt after enrolling.
Also expected to generate a lot of discussion is the department’s plan to revisit the rules governing compensation for student recruiters.
Consumer advocates and admissions officers from traditional colleges have urged the department to do away with the 12 “safe harbors” that it adopted in 2002 to clarify a ban on incentive compensation for recruiters. Opponents of the safe harbors argued that the exemptions, which allow colleges to pay enrollment-based commissions under certain circumstances, encourage recruiters to sign up unqualified students.
Lobbyists and for-profit college officials say that the safe harbors provided much-needed clarity to the ban, which was enacted a decade earlier.
Before Monday’s meeting, 14 individuals representing a range of constituents—including for-profit and nonprofit colleges, accrediting agencies, students, and loan guarantors—were selected to be part of the negotiating committee. The panel also includes two officials from the Education Department.
An additional member from a testing company was approved to join the group on Monday. An attempt to bring on additional members from the for-profit sector failed.
C. Todd Jones, who is president and general counsel of the Association of Independent Colleges and Universities of Ohio and a member of the committee, was concerned that the panel was getting too large. “We are going down a path where the size of the panel becomes too unwieldy,” he said.
Back in May, Education Department officials announced the new rule-making sessions, saying the agency wanted to take a “fresh look” at several rules because their was a new administration at the helm.
If consensus is not reached at the end of the negotiated-rule-making process, the department can draft new regulations without the committee’s input.