For-profit Colleges Win Brief Reprieve from Obama Administration

The Obama administration said Friday it would postpone action on a proposal to regulate for-profit colleges and trade schools, granting the industry a reprieve of a few months but warning that it intends to proceed with regulations meant to ensure that students are not overburdened by debt.

In late July, the Education Department proposed standards for career-education programs, based on the debt-to-income ratios of their graduates and loan repayment rates of their former students.

The "gainful-employment" proposal drew more than 91,000 comments, more than double the department’s previous record. Officials said they will review the comments and hold more hearings and meetings, with a goal of acting in early 2011.

Previously, the department had aimed to finalize the rule by Nov. 1.

Education Secretary Arne Duncan said a delay in action does not mean a delay in implementation. He said the government would push for a rule to take effect, as planned, in July 2012.

"Let me be clear: We’re moving forward on gainful-employment regulations," Duncan said in a statement. "While a majority of career colleges play a vital role in training our workforce to be globally competitive, some bad actors are saddling students with debt they cannot afford in exchange for degrees and certificates they cannot use."

Harris N. Miller, president of the Association of Private Sector Colleges and Universities, said in a statement: "This action allows time for careful consideration of the issues involved and the opportunity to avoid issuing a rule that would harm students, job growth and communities."

The Washington Post Co., through its subsidiary Kaplan, operates for-profit schools with about 112,000 students. The Post Co. also owns more than 8 percent of the stock of higher education provider Corinthian Colleges, which has about 110,000 students.


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