Education Dept. Issues Final Rule Tying Federal Student Aid to Graduates’ Earnings
“If a program cannot show that it leaves its graduates financially better off than if they had never enrolled, it should not be underwritten by federal taxpayers”
Linda McMahon is such an outstanding Education Secretary that it’s a bummer she could be the last one.
The College Fix reports:
Education Department finalizes rule tying federal student aid to graduates’ earnings
The U.S. Department of Education issued its final rule tying federal aid to graduates’ earnings Monday.
“Under the new Student Tuition and Transparency System (STATS) and Earnings Accountability rule, undergraduate programs will be required to demonstrate that their graduates earn more than the typical high school diploma holder, and graduate programs will be required to demonstrate that their graduates earn more than the typical bachelor’s degree holder,” a news release from the department states.
Programs that fail in two out of three years lose access to federal Direct Loans.
“The Trump Administration is hitting the hard reset button on higher education and implementing commonsense reforms that will drive down the cost of higher education and hold all institutions, regardless of sector, accountable for low earnings outcomes,” Under Secretary of Education Nicholas Kent said.
“If a program cannot show that it leaves its graduates financially better off than if they had never enrolled, it should not be underwritten by federal taxpayers,” he said.
The Education Department initially proposed the rule in April, building on the existing Gainful Employment rule by introducing a broader “earnings test,” The College Fix previously reported.
After reviewing nearly 10,000 public comments on the proposed rule, the department added several exemptions and delays.
In the final version, the department will delay penalties for programs that train students for occupations where most workers earn tips so the department can use cleaner earnings data after the “No Tax on Tips” policy takes effect.
Further, schools that do not participate in federal Direct Loans are exempt from automatic penalties.
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Comments
Why should ANY education be “underwritten” by tax payers?
Engineers and scientists don’t start earning right away.
So we continue to reward under achievers…
Another way to look at it is that we are rewarding the schools who fail their students by insuring more students will be failed.
A car dealer underwrites a loan because they know that they can repo the vehicle. I wonder how many colleges would adopt this policy to stay afloat?
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