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About Campus Progress' Initiative on For-Profit Colleges

Campus Progress supports measures to ensure that taxpayer dollars spent on higher education go to helping students to learn, gain skills, and succeed in the job market – rather than to high-priced, low-quality, deceptively-marketed programs that rip off students and taxpayers.  Campus Progress and our allies have highlighted disturbing practices at some for-profit colleges across the country. For-profit schools currently serve 10 percent of U.S. students but account for 25 percent of federal student aid—and nearly half of student loan defaults. While there are some quality programs at for-profit schools, too many for-profit programs are marked by skyrocketing tuition, high dropout rates, and insurmountable debt for many students. Numerous investigations have exposed deceptive and intimidating recruiting tactics, fraudulent reporting on student job placement, and other misconduct that can wreck the lives of Americans struggling to support themselves and their families.

In July 2010, the Department of Education proposed regulations to enforce current laws that require programs, like those offered at for-profit colleges, to prepare students for "gainful employment." These regulations asked two important questions:

• Is the program burying students in overwhelming debt?
• Is it training students to earn a living?

In an effort to kill the proposed rule, for-profit education companies hired scores of big-name lobbyists and consultants, increased campaign contributions to members of Congress, and bombarded the airwaves with slick, misleading TV commercials. In 2010, alone, the industry spent over $8.1 million on lobbying, compared with $3.3 million in 2009, and industry executives and political action committees gave more than $2 million in 2010 campaign contributions, almost double the 2008 amount.

In June 2011, after nearly ten months of debate, a series of hearings, a public comment period, and scores of meetings with organizations on both sides of the issue, the Department of Education announced its final “gainful employment” rule. The full rule can be found on the Department’s website here. 

Since then, lobbyists and lawyers for the for-profit college industry have continued to chip away at and slow the implementation of the rule. In March 2013, a federal judge sided with the for-profit college industry and blocked the administration from enforcing the rule. While the rule is a first step towards protecting students and taxpayers, given the overwhelming evidence that the worst for-profit colleges are abusing students and taxpayers, the rule isn't strong enough. One of the most drastic differences between the original rule and the final is that colleges won’t be at risk of losing eligibility until 2015 – three years later than originally proposed. This piece from Inside Higher Ed has a good breakdown of the rule’s changes and what they might mean for students and taxpayers.

Ensuring the rule is implemented is a first critical step towards protecting students and taxpayers, but given the overwhelming evidence that the worst for-profit colleges are abusing students and taxpayers, the rule isn't can be strengthened and more can be donestrong enough. One of the most drastic differences between the original rule and the final is that colleges won’t be at risk of losing eligibility until 2015 – three years later than originally proposed. This piece from Inside Higher Ed has a good breakdown of the rule’s changes and what they might mean for students and taxpayers.

Despite these concessions, the for-profit college industry and their defenders continue to fight against any attempts to reign in their waste, fraud and abuse. We believe that members of Congress from both parties should support a path forward that starts directing federal resources to programs that actually help students to learn, graduate, and succeed in the job market. It is our hope that, collectively, the rules issued by the Administration, ongoing investigations by state attorneys general, and increasing scrutiny by Congress and the media will ultimately compel for-profit schools to clean up their act or else shut their doors.

Campus Progress is proud to have joined with a diverse coalition of civil rights, consumer, educator, and student groups who came together to stand up for students and taxpayers. However, the fight is far from over, and we will continue to stand with our partners and stand up for students.

See our partner website: ProtectStudentsAndTaxpayers.org.

 

Coverage of The Gainful Employment Rule From Campus Progress

Read More Coverage of The Gainful Employment Rule From Campus Progress

The Gainful Employment Rule

In February 2011, the Department of Education issued regulations to enforce current laws that require programs, like those offered at for profit colleges, to prepare students for "gainful employment."

Programs that don't meet minimal standards should not receive taxpayer support. Instead, federal financial aid should go to programs that genuinely help students build successful careers. Recent court rulings have blocked the implementation of the rule and young people need to speak up to overcome the lobbying by the for-profit college industry.

Tell Your Story

For-Profit College Students Speak Out About Abuses

Essential Reading:

• Fact Sheet: The 2010 Proposed Gainful Employment Rule
• Questions and Answers on the Proposed Gainful Employment Rule
• Department of Education Issues Final Gainful Employment Rule
• Why Did For-Profit College Stocks Rise After the Gainful Employment Rule Was Released?
• New Gainful Employment Rule Lets Many Schools off the Hook
• For Guidance on For-Profit Colleges, Look to the GI Bill