Students & Taxpayers Will Be Better Protected Under Ed Department’s Efforts, Says Inspector General
WASHINGTON – Recent higher education proposals and other efforts by the U.S. Department of Education, including a “gainful employment” regulation currently under negotiation, would help better protect students and taxpayers from waste and fraud, according to an analysis by the agency’s independent inspector general released today. This analysis is contrary to a House GOP-authored bill, H.R. 2637, that would block these efforts to strengthen the integrity of federal student-aid programs.
“We believe the changes embodied in the new [department] regulations – including changes in the areas of a credit hour definition, gainful employment, State authorization, and incentive compensation – will improve protections for students and taxpayers,” wrote Kathleen Tighe, the Department of Education’s inspector general.
H.R. 2637, however, would overturn existing efforts and stymie future efforts by the Department of Education to ensure that taxpayer dollars in student financial aid programs are spent appropriately, including the “gainful employment” proposal that is currently being negotiated in the Department of Education. The letter notes that proprietary, for-profit institutions are particularly concerning, as the sector has seen rapid growth, increases in loan debt, and escalating default problems. Proprietary schools enroll only 13 percent of all students receiving Title IV aid but they account for almost half of all federal loan defaults. The inspector general believes the department’s proposals to set minimum standards and ensure student aid dollars fund programs that prepare students for gainful employment after school "do not seem unreasonable".
“With rising tuition and tight budgets, it’s more important than ever to make sure families and taxpayers are not getting ripped off from unscrupulous higher education institutions,” said Rep. George Miller (D-Calif.), the senior Democratic member of the House Education and the Workforce Committee who requested the analysis. “Simply put, students and families should be protected from the most predatory institutions that over-promise and over-charge. These institutions’ programs should be held accountable when they aren’t performing.”
“Federal regulations are crucial to establish protections for students and safeguards for taxpayers from unscrupulous institutions that are in it, not for the students, but for profit only. With this letter, the IG agrees that this is the appropriate direction to take,” said Rep. Ruben Hinojosa, the ranking member of the Higher Education Subcommittee.
In addition, H.R. 2637 would also stop the department from defining a credit hour. Credit hours are used to determine the amount of federal aid for which a student is eligible. In 2010, the Department of Education’s inspector general found multiple instances of accrediting agencies approving institutions of higher education for accreditation even though its evaluators noted the institution had an “egregious” credit hour policy. These policies were wasting taxpayer dollars and under serving students by granting a dramatically inflated number of credit hours for certain education programs.
“Defining a credit hour protects students and taxpayers from inflated credit hours, improper designation of full-time student status, the over-awarding of Title IV funds and excessive borrowing by students,” wrote Tighe. “To protect students and ensure that the taxpayers’ investment in education provides value, we believe that a definition of a credit hour is needed to provide meaning to the law and the regulations.”
Read the full letter from the inspector general.
For more information on H.R. 2637, click here.
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