As Inside Higher Ed reports, “After 10 months, more than 100 meetings with for-profit colleges and other stakeholders and 90,000 written comments, the Education Department today formally unveiled its second attempt to craft a new system for determining whether vocational programs prepare their graduates for ‘”gainful employment.’” The process has been a long and rocky one, especially for those whose own version of gainful employment relies on servicing the for-profit education space.
The largest of the for-profit schools are publicly traded companies. Looking at their stock prices over the past year has provided a glimpse into the rule making process. For those not following the rule making process, an entire sector has waited with baited breath as these rules determine the allocation and availability of federal funding. Given that federal funds make up the preponderance of revenue at for-profit education institutions. Any change to their availability could have severe impacts on a companies ability to generate revenue and thus the amount of leads they would purchase.
Again as Inside Higher Ed reports, “the final rules focus on the amount of debt that students in for-profit and certificate programs take on, and on their prospects for paying it off. The final regulations offer colleges significantly more leeway, lowering the required debt-to-income ratios and giving institutions more chances to improve before they lose eligibility for federal financial aid.” Good news? Just take a look at the market today. As usual, there are those on both sides that aren’t happy with the rules, but given that new rules were happening, it’s nice to see ones that truly tried to balance the needs of both sides with the students still winning, i.e., receiving an education with greater accountability to their professional needs.