The impact of new gainful employment regulations on… Harvard?

Career College Central Summary:

  • The overwhelming attention paid to the proposed GE regulations has focused on their impact on for-profit institutions and community colleges. And indeed, these two categories of institution have the greatest stake in the gainful employment conversation.
  • However, the regulations also will impact nonprofit four-year institutions, from Harvard University to the local liberal arts college.
  • And while postsecondary goliaths like Harvard no doubt will manage with ease, smaller institutions with limited resources may find the new rule more challenging to administer.
  • For most four-year nonprofit institutions, non-degree programs represent a small percentage of their overall portfolio. But non-degree programming is not inconsequential within the sector.
  • In the preamble to the proposed GE regulations, the Department estimated that of the approximately 50,000 GE programs presently being offered by postsecondary institutions, “about 60 percent of these programs are at public institutions, 10 percent at private non-profit institutions, and 30 percent at for-profit institutions.”
  • The 2012 GE informational rates published by the Department, which categorize GE programs by institution, suggest that approximately 4.5 percent of all GE programs are offered by four-year, non-profit institutions.
  • Assuming that ratio holds across the universe of 50,000 programs referenced in the proposed regulations, roughly 2,200 non-degree programs offered by such institutions would be covered under the law.However, even if a school’s GE program satisfies the noted tests, there remains the administrative burden associated with the proposed disclosure and reporting requirements.
  • Under the proposed rules, for each GE program, institutions would be required to produce data covering six years (award years 2008-09 through 2013-14) by July 31, 2015.
  • The proposed rules also would expand student disclosure requirements significantly, by some measures tripling the information that must be reported to the Department for each GE program and disclosed on the school’s website, in pre-enrollment disclosures, and in related marketing materials.
  • For smaller institutions with limited administrative resources, or for larger institutions with robust non-degree program portfolios, this administrative burden could prove significant.
  • And of course, there always is the potential that a program may not pass the debt-to-income test or program-based cohort default rate test.

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