Colleges Weigh In on Rules

The public comment period for the majority of the U.S. Department of Education’s proposed regulations aimed at protecting the integrity of the Title IV federal financial aid program ended at midnight Tuesday.

Department officials have the next three months to read and consider close to 1,800 comments posted on (including duplicates) — ranging in length from a sentence or two to 100-page dossiers — submitted by a mix of college presidents, financial aid officers, associations, companies, and rank-and-file students and employees. Final rules must be published by Nov. 1 to go into effect on July 1, 2011, as the department has planned.

While a comprehensive examination of all the comments would take far longer than the day since the comment period ended, Inside Higher Ed has parsed the comments submitted by many prominent stakeholders and observers to try to get a sense of the suggestions that could sway department officials to make revisions, or reaffirm the approach of their proposed regulations.

The issues that garnered the most comments were incentive compensation, definition of a credit hour, state authorization, and debt and job-placement disclosures related to the department’s gainful employment regulations. (Comments on the department’s proposal to keep tabs on for-profit programs’ debt service-to-income ratios and repayment rates aren’t due until mid-September.)

Comments on the rules related to incentive compensation — the Congressional ban on paying recruiters based directly or indirectly on their ability to secure enrollments and federal financial aid — were generally divided along sector lines. Nonprofit institutions generally voiced support for the department’s decision to eliminate the 12 “safe harbors” that were added to the regulations in 2002 (amid resistance from many nonprofits), but asked for regulatory clarification on certain issues of concern. For-profit colleges, meanwhile, asked the department to reinstate the safe harbors, which the department has in recent months begun referring to as “exceptions” to the law.

Department officials contend that the safe harbors helped breed aggressive recruiting practices at for-profit institutions over the course of the last decade, an issue to be examined today at a Senate Health, Education, Labor and Pensions Committee hearing on the “student recruitment experience” at for-profit (or "market-driven," as they prefer) colleges.

Nearly all comments (from for-profit and nonprofit institutions alike) on the department’s proposed language that would establish a federal definition of a credit hour opposed the proposal. The proposed regulations codifying the responsibility of states to authorize colleges that operate within their borders also attracted many critical comments from a wide-ranging group of institutions.

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