New Rules on Colleges and Federal Aid

In an update to the discussion over vocational programs and how much debt load students will be allowed to carry for the schools to maintain eligibility for federal funds, Inside Higher Ed reports that higher education officials and the Department of Education are still trying to hammer out a deal:

A team of negotiators representing all sectors of higher education on Monday forcefully opposed a U.S. Department of Education proposal to determine whether vocational programs prepare their students for “gainful employment” by establishing a maximum ratio between recent graduates’ debt repayment loads and their annual salaries.

Apparently the Education Department has given up on its original suggestion to “link programs’ tuitions with the salaries of their graduates.” This plan, while arguably reasonable, was greatly unpopular with colleges. Proprietary schools, which enroll a great deal of their students thanks to loans, were particularly vocal in their objections.

The department is now working on a new proposal centering on debt relative to salary. According to the article:

As proposed, the rule would require that the annual debt repayment load for recent graduates of vocational programs and most for-profit offerings be no more than 8 percent of the salary of a recent graduate working in the field for which a program had prepared a student.

Daniel Luzer

Daniel Luzer is the news editor at Governing Magazine and former web editor of the Washington Monthly. Find him on Twitter: @Daniel_Luzer