Education Secretary Betsy DeVos' proposal to kill the "gainful employment" regulation goes further than other draft plans circulated by the Trump administration. | Getty Images DeVos rolls back rules aimed at low-performing for-profit and career colleges

Education Secretary Betsy DeVos moved Friday to completely eliminate Obama-era regulations that were meant to cut off federal funding to low-performing programs at for-profit schools and other career colleges.

The Education Department unveiled a proposal to rescind the “gainful employment” regulation, which was a centerpiece of the Obama administration’s crackdown on for-profit education companies.


The goal of the rule, which took effect in 2015, was to make sure that students who graduate from for-profit schools or other career-oriented programs make enough money to repay their student loans. But the schools, and congressional Republicans, have long criticized the regulation as unfair and overly burdensome.

DeVos said in a statement that “instead of targeting schools simply by their tax status, this administration is working to ensure students have transparent, meaningful information about all colleges and all programs.”

The department plans to detail program-level outcomes, such as graduates’ median debt and median earnings, for all colleges and universities. Critics say that is inadequate as a way to hold for-profit schools accountable because there aren’t any sanctions for low-performing institutions.

“Our new approach will aid students across all sectors of higher education and improve accountability,” DeVos said.

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The decision was welcomed by for-profit colleges, who have battled the Education Department over the regulation for nearly a decade.

Steve Gunderson, who leads the industry trade group Career Education Colleges and Universities, said that the Trump administration’s plan to publish program-level data for all schools is a fairer approach.

“The issue of gainful employment has endured for nine years and spanned across two presidencies,” Gunderson said in a statement. “Now is the time to move beyond ideological attacks on any one sector of higher education and establish a uniform commitment to transparency of outcomes that can stand the test of time.”

Sen. Lamar Alexander (R-Tenn.), who chairs the Senate education committee, praised DeVos for ending a “clumsy rule” that targeted for-profit schools.

“This reset gives Congress an opportunity to create a more effective measure of accountability for student debt and quality of institutions,” Alexander said, adding that Congress should focus on holding colleges accountable for loan repayment rates.

Congressional Democrats and consumer groups slammed DeVos’ move.

Rep. Bobby Scott, (D-Va.), the top Democrat on the House education committee, said that the Trump administration is “violating its duty to faithfully execute the laws passed by Congress” by repealing the Obama-era regulation without any proposed replacement.

“While the Trump administration can eliminate the Obama-era rule that set clear standards for enforcement, it cannot discard the legal requirement for schools to provide their students a worthwhile education,” Scott said in a statement.

Sen. Patty Murray, (D-Wash.), the top Democrat on the Senate education committee, blasted the DeVos proposal as “extreme” and said it would “pad the pockets of for-profit colleges.”

Higher Learning Advocates, a bipartisan advocacy group whose board includes former Education Secretary Margaret Spellings and former Rep. George Miller (D-Calif.), criticized the decision as “a backward step for accountability.”

James Kvaal, one of the architects of the Obama-era policy who now leads The Institute for College Access & Success, said that eliminating the rule shows the Trump administration has “little interest in protecting students or taxpayers from excessive, unaffordable student debts.”

Education Department officials, echoing long-standing industry complaints about the policy, argued in an 88-page notice that the Obama regulations “significantly burden certain programs and institutions but provide limited transparency at only a small subset” of the college programs that receive federal student aid.

The Trump administration estimated that the repeal of the regulations would cost taxpayers $5.3 billion over the next decade. That’s higher than an earlier internal department analysis, published last week by POLITICO, projecting a $4.7 billion cost.

Officials expect that repealing the regulation will lead to an uptick in Pell grants and federal student loans flowing to programs that would have otherwise failed — or been on the verge of failing — under the Obama-era standards.

DeVos’ proposal to kill the regulation goes further than previous draft plans circulated by the Trump administration. Earlier proposals would have gutted the penalties associated with the rule, but they would have kept mandatory consumer disclosures by colleges to prospective students.

The Trump administration instead said it plans to update the Education Department’s College Scorecard website with expanded data about the outcomes of students who attend all colleges and universities receiving federal aid. The department plans to calculate and publish the earnings and debt levels of graduates broken down by individual academic programs.

The Scorecard website is not required by any law or regulation, and so the Trump administration’s promise to expand the data published on it isn’t binding on the department.

Democratic attorneys general from 17 states and the District of Columbia are suing DeVos over her previous delays in enforcing the “gainful employment” rule.

The Education Department said it would accept public comments on the proposed elimination of the regulation for 30 days.

The department must publish a final regulation by Nov. 1 for it to take effect in July 2019.

