In the episode, Tony discussed the Department of Education’s most recent suite of regulations impacting institutions’ participation in the Title IV program, specifically with respect to certification, financial responsibility and administrative capability.
On October 10, 2023, the U.S. Department of Education published the final rule on financial value transparency and gainful employment (88 Fed. Reg. 70004). The regulation restores and expands an accountability framework for career-specific training programs. At the same time, the regulation creates, for the first time, a new disclosure framework applicable to educational programs offered by all institutions participating in the Title IV, Higher Education Act (HEA) federal student aid funding programs.
This summary provides an overview of important facts and key elements of the final rule.
Read the full Alert on the Duane Morris LLP website.
The update also lists immediate changes in the interpretation of DCL 23-03 that the Department wanted to communicate immediately:
Specifically, the Department does not consider contracts involving the following activities to constitute third-party servicer relationships:
- Study abroad programs.
- Recruitment of foreign students not eligible for Title IV aid.
- Clinical or externship opportunities that meet requirements under existing regulations because they are closely monitored by qualified personnel at an institution.
- Course-sharing consortia and arrangements between Title IV-eligible institutions to share employees to teach courses or process financial aid.
- Dual or concurrent enrollment programs provided through agreements with high schools and local education agencies, which are exempt because they do not involve students receiving Title IV aid.
- Local police departments helping to compile and analyze crime statistics, unless they write or file a report on behalf of an institution for compliance purposes.
- The Department will identify any other services that fall into this category as it reviews comments.
- The Department also intends to remove the provision of the guidance document pertaining to foreign ownership of a third-party servicer. It will consider any further changes in the context of an announced future negotiated rulemaking on Third Party Servicer issues.
- The Department will carefully review public comments on areas of confusion or concern and consider clarifying and narrowing the scope of the guidance in several areas, including software and computer services, student retention, and instructional content. These clarifications could include other areas as it continues to review comments and seeks to balance the need for greater transparency and oversight against administrative burden, among other factors.
- While the Department reviews the comments and prepares revisions to the guidance letter, previous Dear Colleague Letters GEN 12-08, GEN 15-01, and GEN 16-15 (as amended by our March 8, 2017, electronic announcement) remain in effect.
Institutions of higher education (IHEs) and companies providing services to IHEs (including so-called online program managers or OPMs) should take careful note of two announcements by the U.S. Department of Education that could significantly impact the institution/service provider relationship and the Department’s oversight of that relationship.
First, and most immediately effective, the Department has revised its subregulatory guidance regarding the activities that make an entity providing services to an IHE a “Third Party Servicer” (TPS) for Title IV purposes. In a significant expansion over prior guidance, an OPM providing services to an IHE related to student recruiting and retention, providing software products and services involving Title IV administration activities, or providing educational content and instruction are now defined as a TPS. Being defined as a TPS comes with significant increased risk and compliance obligations by the third party and the institution. There is an open public comment period on this change through March 17, 2023.
Read the full text of this Alert on the Duane Morris website.
Important Update: On February 28, 2023, the Department published an update to Dear Colleague Letter 23-03 that makes clear the guidance does not become effective until September 1, 2023. The reporting deadline for institutions and third-party servicers to report to the Department is also extended until September 1, 2023. Further, the Department extended the comment period through March 30, 2023.
A video replay of the webinar “What Does It All Mean? The U.S. Department of Education’s Regulatory Reach Over Service Providers for Institutions of Higher Education” is available to view.
Yesterday, October 14, 2021, UpdateED published the first of a three-part recap of last week’s U.S. Department of Education Negotiated Rulemaking Session, focusing on the proposed Borrower Defense to Repayment provisions. (see here)
Up today: the proposed changes to Closed School Loan Discharges (CSLD) and False Certification Discharges (FCD). Continue reading “U.S. Department of Education Negotiated Rulemaking – Session One Recap: Part Two”
Later this month the Department of Education will embark on the first steps towards a massive rewrite of programs authorized by Title IV of the Higher Education Act of 1965. The Department is seeking input on a wide range of federal higher education topics, as identified in the notice, as well as input on how the Department could address gaps in postsecondary outcomes such as retention, completion, loan repayment, and student loan default by race, ethnicity, gender, and other key student characteristics. Continue reading “U.S. Department of Education Proposes Massive Rewrite of Title IV Regulations”
On March 17, 2021, Southern District of New York Judge Lorna G. Schofield ruled that most of the 2019 Borrower Defense to Repayment Rule would survive cross-motions for summary judgement. On one issue, however, Judge Schofield ruled for the Plaintiff, the New York Legal Assistance Group (NYLAG), finding that the 2019 Rule’s three-year statute of limitations on defensive claims was not a logical outgrowth of and deviated too sharply from the 2018 Notice of Proposed Rulemaking. Continue reading “The 2019 Borrower Defense Rule Survives Summary Judgment (Mostly) Intact”
On March 8, 2021, the Biden Administration published an Executive Order on “Guaranteeing an Educational Environment Free from Discrimination on the Basis of Sex, Including Sexual Orientation or Gender Identity.” In short, the EO requires the U.S. Department of Education to reassess how it directs college campuses to investigate sexual violence – specifically, the 2020 Title IX Rule, 85 FR 30026 – as well as other regulations related to Title IX. Continue reading “President Biden Issues Executive Order Directing U.S. Department of Education to Reassess Title IX Rules”
Expanding access to postsecondary education for low income students includes more than just assistance with tuition and fees. Many low income students also need help with daily food costs while they pursue higher education. That need can adversely impact academic progress if not addressed. Needs have been exacerbated by the pandemic and high unemployment, and impact students whether they study on ground or online. Food insecurity among college students is gaining more attention, with the opening of college food pantries and other community support initiatives. The federal government is also stepping up. The U.S. Department of Education, in coordination with the U.S. Department of Agriculture, has issued new guidance to postsecondary institutions to raise awareness about temporarily expanded Supplemental Nutrition Assistance Program (SNAP) eligibility for students and urges institutions to make students aware of this resource. The expansion of benefits will be in effect until 30 days after the COVID-19 public health emergency is lifted. The new guidance can be found here: https://ifap.ed.gov/electronic-announcements/022321SNAPbenefitseligiblestudsCOVID19pandemic