Court Throws Huge Wrench in Higher Education Transparency Efforts

Source: Amy Laitinen, New America Foundation, Higher Ed Watch blog, March 20, 2013

A federal district court judge dealt a huge blow yesterday to the U.S. Department of Education’s efforts to regulate the for-profit college sector. More broadly, the court’s decision in the case, which deals with the Department’s Gainful Employment regulations, could make it much more difficult to bring greater transparency and accountability to higher education as a whole.

The roots of this case go back to June when the federal district court vacated some of the Department of Education’s Gainful Employment (GE) regulations. While the judge affirmed the department’s authority to regulate on GE and held up requirements that GE programs disclose information like median debt to students, he found that one of the three measures used to determine whether a program prepared students for gainful employment — the student loan repayment rate — “lacked a reasoned basis.” And since the judge concluded that all the metrics were intertwined, he threw them all out. With no metrics to report, the disclosure requirements included in the regulations were also effectively eliminated.
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Now What?
Source: Paul Fain, Inside Higher Ed, March 21, 2013

A federal court has again ruled against the U.S. Department of Education on its “gainful employment” regulations, with a decision that is likely to complicate a possible appeal. It could also fuel broader debates about government data collection in higher education. Gainful employment, which was created in 2011, seeks to measure the performance of vocational programs, mostly at for-profit institutions but also at some nonprofit colleges….What happens next is unclear. The regulations remain in limbo. And the new ruling appears to set a higher bar for an appeal, said Michael Hays, a D.C.-based lawyer and head of the litigation group at Dow Lohnes….