The Department of Education’s proposed new rules for for-profit colleges has sent armies of lobbyists to the hill, inspired interesting campaign contributions, generated articles by education pundits across America, and even fueled Senate hearings.
But the actual regulations—under which schools wouldn’t be eligible for federal financial aid if average graduates need to spend more than 8 percent of starting salaries to service student loans—will not destroy for-profit colleges and throw many students out of higher education, as proprietary schools suggest. According to a new paper by Ben Miller over at Education Sector:
Out of more than 12,600 programs, about 4 percent, or just over 500 programs, would lose eligibility because of the new standard. This includes 8 percent of bachelor’s degree programs, 6 percent of associate degree programs, and 1 percent of programs that are generally certificate programs of two years or less.
But something else would change, however. As Miller explains:
A much larger number—some 65 percent—are likely to fall in a middle ground between full eligibility and total ineligibility called “eligible with a debt warning,” which requires colleges to, among other things, post prominent cigarette pack-style “debt warnings” alerting potential students to the likelihood that enrolling could be hazardous to their financial health.
This would allow for-profit colleges to remain open, and profitable, but they’d have to operate a little differently. College would have to reconfigure tuition polices relative to student debt, and might have to change their career services.
That doesn’t sound like the worst thing in the world. [Image via]