April 2016


Early last month, APSCU lost their appeal in litigation against the U.S. Department of Education’s gainful employment regulation. APSCU President Steve Gunderson issued a statement following the ruling cautioning regulators to be careful of overregulation citing concerns that GE Regs and Debt to Earnings ratios don’t define academic quality. I have to agree with him…Unfortunately, GE is here to stay.

 Last week, Ed officials and non-federal negotiators failed to reach a consensus in their negotiations to map out an equitable system to implement “Borrower Defense” legislation. Some negotiators accused ED of negotiating in bad faith, and playing games, after they failed to provide their implementation language to the negotiators until late in the day on the last day of the rulemaking session.

 When the Neg-Reg process ends this way, Ed is free to write the rules as they see fit. Among the proposed rules we expect Ed to implement are a new repayment rate calculation and disclosure requirement that would track repayment rates for five years after a cohort enters repayment and tough restrictions on the use of arbitration clauses which some schools use in their enrollment agreements.

 A Notice of Proposed Rulemaking (NPRM) is expected this summer, with a 45-day public comment period, and final rules will be issued by November 1, 2016. The final rules will be effective July 1, 2017.

 In other news, the American Bar Association is considering key actions aimed at increasing accreditation standards for law schools. Proposed changes would require law schools to increase the bar exam pass rate to 75 percent or higher to remain accredited. Other changes are aimed at increasing the quality of externships and admissions standards.

 Finally, the Department of Defense is jumping into the enforcement game and is looking at schools that agreed to adhere to the principles outlined in Executive Order 13607 “Establishing Principles of Excellence for Educational Institutions Servicing Service Members (etc.).  As part of the Department of Defense Voluntary Education Partnership Memorandum of Understanding, schools agreed to refrain from deceptive or abusive marketing, and to follow certain procedures for recruiting service members and others. Schools that signed the DoD MOU, could get a visit from the pentagon if they don’t strictly adhere to the guidelines. University of Phoenix is just one of the big names that has already been placed on probationary status cutting off DOD Tuition Assistance to new and transfer students. UoP faces a pending termination of its MOU which will terminate their DoD Tuition Assistance program entirely unless they can successfully prove to the DoD that they are in compliance and have taken proper corrective action. 

 That’s the latest stuff on the horizon folks – Got questions? Drop me a line.

 Make a Great Day!

 Peter Terebesi

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