Course Project Paper firstname.lastname@example.org Executive Summary
Gainful employment is a hot topic in Washington D.C. right now. The Department of Education is looking at developing regulations to be imposed on for-profit schools and their ability to obtain federal funding for their programs. These regulations are currently only designed to be imposed on the for-profit schools rather than the entire higher-education system. Schools that do not meet the requirements will not be granted federal funding. These regulations should be imposed on all schools that provide federal funding, rather than just the for-profit sector. The purpose of gainful employment is to ensure that colleges are providing knowledge that can translate into higher paying jobs and make sure that the education cost is proportional to the salary made after graduation. Regarding this piece of legislation, all schools should be evaluated in the same manner as the purpose of this legislation is to protect society and students by ensuring the schooling is necessary and priced appropriately.
Some colleges can provide funding to students under Title IV of the Higher Education Act of 1965 because they prepare students for gainful employment in a recognized occupation. Currently regulation is only directed at for-profit schools that provide federal funding, not all schools that provide federal funding. The regulations evaluate the cost of school with relation to pay after graduation and the loan repayment rates of students. Specifically the regulation evaluates the qualifications in the following manner:
Debt-to-earnings ratio less than 8%
The debt-to-discretionary income ratio less than 20%
Loan repayment rate of less than 45%
For a school to qualify they must have a program that a student could enroll in, obtain a job after graduation, and the student will be able to pay off the loan in a reasonable amount of time and afford to pay off the education. In the end, the regulations are designed to protect students from colleges that are concerned about making a profit and have no concern for the financial situation of their students after graduation.
The regulations have not been finalized at this point in time; however the public comment period has ended. There have been reports of changes being made to some of the percentages, and just because a school doesn’t meet one of the requirements does not mean it will not be eligible for financial aid. Also, there have been discrepancies in whether the evaluations will be based on an individual program or the school in general. In addition there is also some discussion as to how far back you look when determining the rates. There is talk of evaluating the previous three years; in addition they look at overall debt from school, not just financial aid. This would evaluate financial aid, student loans, and institutional loans; showing a true debt load from attending college.
Currently the regulation is only designed to be imposed on the for-profit sector rather than all schools that provide federal funding. The regulations should be imposed on all schools rather than just the for-profit schools. The purpose of the funding is to protect students from unrealistic debt loads, not to protect the government run programs from the other schools and systems available for students. It seems somewhat unrealistic to only evaluate a minority of the higher education sector, rather than the entire sector.
Is the regulation necessary for schools at all? With the regulations, and the metrics behind them, the regulations are absolutely necessary. These metrics are acceptable for most for-profit schools, early projections show that less than 5% of the for-profit schools will not be eligible for financial aid under these metrics. In addition, the purpose of the regulations is to limit the amount of debt that students must undertake in order to further their