Summary of Latest Regulatory Guidance and Recommendations

Gainful Employment Rulemaking:

 Three sessions of negotiations held without reaching consensus.  Notice of Proposed Rulemaking: March 25, 2014.  Over 95,000 comments received.  Final rule: October 31, 2014 (212 pages).  Effective date: July 1, 2015.

Which Programs are GE Programs at a Proprietary Institution?

 All programs except for preparatory coursework necessary for enrollment in an eligible program; and  Bachelor’s degree programs in liberal arts offered since January 2009, which re offered by a proprietary institution that has been regionally accredited since October 2007.

Gainful Employment Metrics:

 Debt-to-Earnings (D/E) rates

o Annual Earnings D/E Rate o Discretionary Income D/E Rate o Passing: Annual D/E < = 8% or Discretionary D/E < = 20% o Failing: Annual D/E > 12% or Discretionary > 30% o Zone: Annual D/E > 8% and < = 12% Discretionary D/E > 20% and < = 30%

NOTE: Discretionary Income = Annual Earnings – ($11,670 (2014 Poverty Level) X 1.5) Poverty Guideline for 2015 will be used.

 Program Loses Title IV Eligibility if:

o D/E Measures - Fails in two out of three years; OR o D/E Measures - Fails or in the zone for four consecutive years.

{D0587119.DOCX / 1 } 1 When does GE Reporting Begin?

 Per Electronic Announcement of February 11, 2015 #52, GE reporting functionality is now available on the National Student Loan Data System (NSLDS). See: http://www.ifap.ed.gov/eannouncements/021115GainfulEmployEA52NSLDSFuncNowA vailVolunGEReporting.html.

GE Reporting:

 Report all Title IV students by July 31, 2015: Report 2008-2009 through 2013-2014 award years.

 Report 2014-2015 award year by October 1, 2015.

 ONLY submit data on students enrolled in a GE program;  ONLY submit data on Title IV recipients; and  ONLY submit data for programs that exist as of July 1, 2015.

NOTE: Data that had been submitted in 2011 will not be available to re-use so institutions must resubmit.

 GE Data – Students to Include:

o All Title IV students enrolled in the GE Program; o A student enrolled in more than one GE Program must be reported separately for each program; o A student who ‘stopped out’ and re-entered the same GE Program during the same award year must be reported separately for each enrollment; and o A student who was enrolled in the same GE Program during multiple award years must be reported separately for each award year.

 GE Student’s Loan Debt:

o All the actual loan debt/total costs are attributed to the highest credentialed undergraduate GE program completed. o Students are included if student received only Title IV grants and no loans.

{D0587119.DOCX / 1 } 2 Gainful Employment Implementation:

Disclosures Reporting Program Draft Disclosures Certifications D/E Rates

1/31/2015 7/31/2015 12/31/2015 Summer 2016 1/1/2017

(Current Rules) (2008/2009 to (New Rules) 2013/2014)

10/1/2015

(2014/2015)

Debt-to-Earnings Rate Calculation Process:

Reporting Schools Schools Schools Schools Receive May Challenge Receive Draft May 7/31/2015/ Completer Completer List Debt-to-Earnings Challenge 10/1/2015 Lists Data Rates D/E Rate Details Schools Report GE data to NSLDS

Schools Receive Final Debt-to-Earnings Rates *

*Schools may notify FSA of Intent to file an Alternative Earnings Appeals within 14 days after issuance of Notice of Determination including final D/E rates and must submit Appeal documents within 60 days of the Notice of Determination. It is not too early to begin gathering earnings data using survey of graduates accompanied by an auditor’s attestation or from a State-sponsored data system.

Reminders and Helpful Hints:

1. Review each program to ensure that the appropriate Classification of Instructional Program (CIP) code has been assigned.

o If each program within a credential level has a unique CIP code, then each program will be unique for GE purposes.

{D0587119.DOCX / 1 } 3 o If within a single credential level, there are two or more programs with the same 6-digit CIP code, then programs will be consolidated for GE purposes. o Programs at different credential levels but have the same 6-digit CIP code are considered different GE programs. o Neither the name of the program nor the location is relevant because it is the OPE ID of the institution.

2. Each CIP code and credential level should match what is disclosed on the Eligibility and Certification Approval Report (ECAR).

3. Separate disclosures can be made for programs that share the same CIP code and credential level if the program lengths are different (i.e., more than 3 months, 12 weeks, or one Title IV payment period), if tuition and fees and other costs differ by more than 10%, or programs offered in different states that require different placement rate calculations and different minimum requirements. (EA #25)

4. For reporting, once the template and instructions are released, convene a task force or group so that different people can be responsible for different data. Carefully review the GE Reporting Guide found at: http://ifap.ed.gov/nsldsmaterials/attachments/NSLDSGainfulEmploymentUG.pdf. This will ensure that that everyone involved will have a good understanding of the data to be reported, the correct field names, the correct format of the data, etc. On February 12, 2015, the Department released the NSLDS Gainful Employment Spreadsheet Submittal Format to assist with uploading the information. It can be found at: https://www.fsadownload.ed.gov/Repository/NSLDSGainEmpFeb2015/FSA_Download_ GE_Spreadsheet_Submittal_Cover_letter.pdf.

5. For reporting purposes, correctly identify the cohort period:

o For 2014-2015 award year (1st year): . Two-year cohort period: 2010-2011 and 2011-2012 . Four-Year cohort period: 2008-2009 to 2011-2012

6. For reporting, build from existing data/spreadsheets. For example, each year, institutions report 12-month enrollment to IPEDS. This same group would be the students to be reported by award year. A school could cross reference all of the enrollments a student has to see if any of those enrollments fall between July 1 and June 30 of that award year. If there are multiple enrollments, a new record for each enrollment is created.

7. Other institutional records can be matched against spreadsheet to extract loan data for Withdrawals and Graduates.

8. It is recommended to work on one award year at a time, complete the spreadsheet, and submit before moving on. If the format or something else is wrong, the institution will find out before submitting the other award years.

{D0587119.DOCX / 1 } 4 9. By December 31, 2015, an institution must provide a certification that each of its currently eligible gainful employment programs included on the ECAR meets the requirements of an eligible GE program. Secretary needs to provide procedures.

o As a condition of continued participation in the Title IV programs, an institution must certify that each of its GE programs meet the requirements. . With one exception, the Department will require each institution to provide to the Department by no later than December 31, 2015 a “transitional” certification signed by the institution’s most senior executive officer that each of the institution’s currently eligible GE programs included on its Eligibility and Certification Approval Report (ECAR) meets the requirements outlined in 34 CFR 668.414(d). There is an exception to this rule: if the institution already has made the required certification in its program participation agreement between July 1 and December 31, 2015, then the institution is not required to provide the transitional certification to the Department. . In addition to the transitional certification, institutions will be required to provide a similar certification in their program participation agreement. Specifically, on a going forward basis on and after the July 1, 2015 effective date of the new regulations, an institution will be required to certify in its program participation agreement with the Department that each of the institution’s currently eligible GE programs included on its ECAR meets the requirements of 34 CFR 668.414(d). This continuing certification procedure will be combined and synchronized with the existing PPA certification process. o An institution must update the certification within 10 days if there are any changes in the approvals for a program, or other changes for a program that makes an existing certification no longer accurate. o The certification is to be signed by the senior executive officer. o The institution is certifying: . It is approved by it recognized accrediting agency. . The GE Program is programmatically accredited if it is required by a Federal government entity or a government agency in the State in which it is physically located or in which the institution is required to obtain approval under 34 CFR 600.9. . For the State in which the institution is located or in which the institution is otherwise required to obtain State approval, each eligible GE program satisfies the applicable educational prerequisites for professional licensure or certification requirements in that State so that a student who completes the program and seeks employment in that State qualifies to take any licensure or certification exam that is needed for the student to practice or find employment in an occupation that the program prepares the student to enter. . For a GE program for which the institution seeks to establish eligibility for title IV funds, the program is not substantially similar [programs share a four-digit CIP code] to a program offered by the institution in the past

{D0587119.DOCX / 1 } 5 three years, became ineligible for Title IV funds under the D/E rates measure or was failing, or in the zone with respect to the D/E rates measure and was voluntarily discontinued by the institution. . Ensure that the institution retains and maintains all approvals for each GE program.

o NOTE: The Department is expected to publish additional guidance regarding the GE certification requirements during the 2015 calendar year. Institutions should ensure that they have consulted and accounted for any such guidance before making the required certifications by the applicable deadlines.

o NOTE: The Department has stated (at page 64989 of the Preamble of the October 31, 2014 final regulations) that the certification requirements will create an enforcement mechanism for the Department to take action if a required approval has been lost, or if a certification that was provided was false. The Department also stated that Federal or State law enforcement agencies also may be able to prosecute any misrepresentations made by institutions in their own investigations and enforcement actions.

Sharon H. Bob, Ph.D. Higher Education Specialist Powers Pyles Sutter and Verville, PC 1501 M Street, NW Suite 700 Washington, DC 20005 T: 202-872-6772 F: 202-785-1756 [email protected] February 27, 2015

{D0587119.DOCX / 1 } 6