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Shoptalk 610, June 28, 2011


Industry Update

ED provides clarification on identifying gainful employment programs

It can sometimes be confusing to determine if an educational program is considered a gainful employment (GE) program. To assist schools in making such determinations, ED has provided guidance in recent months to clarify the Program Integrity final rules published on October 29, 2010:

  • Dear Colleague Letter (DCL) GEN-11-10 was published on April 20, 2011. The initial section of the DCL lists GE programs and non-GE programs at institutions of higher education, proprietary institutions of higher education, and postsecondary vocational institutions (in addition to foreign schools).
  • Electronic announcement #3, published on May 20, 2011, provides a correction to the provisions of DCL GEN-11-10 regarding teacher certification programs at all schools. Only those teacher certification programs that lead to an educational credential being awarded to program completers are considered to be GE programs. Programs that simply provide required coursework for a student to obtain a state teaching credential, without issuing a program completion credential, are not considered GE programs.

New guidance
In electronic announcement #11, published on June 24, 2011, ED references the previous guidance above and provides additional clarification in response to recent school inquiries. This new e-announcement summarizes the basic principles to be used in identifying GE programs:

  • Nearly all educational programs offered by a for-profit institution, and nearly all non-degree programs at a public or private nonprofit institution, are GE programs.
  • All educational programs that lead to a degree at a public or private nonprofit institution are not GE programs.

The e-announcement also steps schools through a series of questions and answers that can be used to determine if a particular educational program is a GE program. These questions are repeated below, and a TG flowchart combining this new guidance with ED's prior guidance has been developed to provide a more complete visual reference.

Question 1: Does the institution wish to have the educational program be, or remain, eligible for Title IV aid?

No. If the answer is no, the program is NOT eligible for Title IV aid and, therefore is not a GE Program.

Yes. If the answer is yes, continue to the next question.

Question 2: Does the coursework lead to a degree, certificate, or other credential awarded by the institution?

No. If the answer is no, the program is NOT eligible for Title IV aid and therefore is not a GE Program. [See Note A below for three exceptions where the program is Title IV eligible but not a GE Program.]

Yes. If the answer is yes, continue to the next question.

Question 3: Is the institution a for-profit (proprietary) institution?

Yes. If the answer is yes, the program is a GE Program. [See Note B below for two exceptions where the program is not a GE Program.]

No. If the answer is no, continue to the next question.

Question 4: Is the credential that is awarded by the public or private nonprofit institution a degree — associate, bachelor's, graduate, or professional (e.g., MD, DDS, DVM, JD)?

Yes. If the answer is yes, the program is not a GE Program.

No. If the answer is no, the program is a GE Program.

Note A: There are three exceptions to the general rule that, to be eligible for Title IV aid, a student must be a regular student (that is, enrolled in a program that leads to a degree, certificate, or other credential awarded by the institution). While these three exceptions allow students to receive all or some types of Title IV aid, they do not create GE programs. The three exceptions, with regulatory citations, are:

  1. A program of at least two years that is acceptable for full credit toward a bachelor's degree and qualifies the student for admission into the third year of a bachelor's degree program. Otherwise eligible students may receive funding from any of the Title IV student aid programs. [34 CFR 668.8(b)(1)(ii)]
  2. Coursework necessary for the student to receive a state professional teaching credential or certification where the institution itself does not provide a certificate or other credential. Students must be enrolled at least half time and are eligible only for the Federal Work-Study and Title IV loan programs. Note that similar courses of study that do result in a certificate or other non-degree credential being awarded by the institution are GE Programs. [34 CFR 668.32(a)(1)(iii)]
  3. Preparatory courses of study that do not lead to a degree, certificate, or other credential awarded by the institution and that provide course work necessary for enrollment in an eligible program. Students are eligible for no longer than one twelve-month period and only for the Direct Loan Program. [34 CFR 668.32(a)(1)(ii)]

Note B: The two exceptions to the general rule that all programs offered by for-profit institutions are GE Programs are:

  1. Programs that lead to a bachelor's degree in liberal arts if the institution has been accredited by a regional accrediting agency since October 1, 2007 and the institution has offered the program since January 1, 2009. Otherwise eligible students may receive funding from any of the Title IV student aid programs. [34 CFR 600.5(a)(5)(i)(B)]
  2. Preparatory courses of study that provide course work necessary for enrollment in an eligible program. Students are eligible for no longer than one twelve-month period and only for the Direct Loan Program. [34 CFR 668.32(a)(1)(ii)]

As a reminder, if an educational program is considered to be a GE program, it is subject to the new disclosure and reporting requirements effective July 1, 2011. These apply to each GE program, even one leading to successful outcomes under the new rules, in the interest of promoting informed decision making by students.

Disclosures are to be provided by July 1, 2011, while the first GE program reports will be submitted to ED by October 1, 2011. Notification requirements for new GE programs apply to programs scheduled to begin on or after July 1, 2011. The program success measures published on June 13, 2011, will not take effect until July 1, 2012.

Learn more
In addition to the TG flowchart entitled, "Identifying a Gainful Employment (GE) Program," a wealth of other resources on TG's Program Integrity Final Rules Web page and ED's Gainful Employment Information page are available to assist schools in understanding the new requirements. For questions, please contact TG's Customer Assistance team at (800) 845-6267, or send an email message to cust.assist@tgslc.org.

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ED requests comments on expansion of NSLDS

In the June 24, 2011, Federal Register, ED published a notice proposing to revise the National Student Loan Data System (NSLDS) in light of changes to the Program Integrity regulations. In accordance with the Privacy Act of 1974, ED and other federal agencies must publish a notice requesting public comment when any systems of records are altered.

In this notice, ED proposes to revise NSLDS to make updates needed as a result of the Program Integrity regulations that apply to institutions that participated in the federal student financial aid programs under Title IV of the Higher Education Act, specifically as it relates to new requirements on programs that prepare students for gainful employment in a recognized occupation. As a result of these regulatory changes, ED expanded the categories of records maintained in this system, the categories of individuals covered by the system, the system's purposes, and the routine uses to reflect needed programmatic disclosures.

Public comments on the proposed routine uses in the altered system of records notice are due on or before July 25, 2011. Address all comments about the proposed routine uses in this altered system of records to:

Director, NSLDS Systems
Operations and Aid Delivery Management Services, FSA
U.S. Department of Education
Union Center Plaza (UCP)
830 First Street, N.E., Room 44E3
Washington, DC 20202-5454

You can also call (202) 377-3547. Or if you prefer to send comments by email, send comments to comments@ed.gov. You must include the term "NSLDS comments'' in the subject line of your email.

These changes to NSLDS will become effective at the later date of: (1) The expiration of the 40-day period for OMB review on July 30, 2011; or (2) July 25, 2011, unless the system of records needs to be changed as a result of public comment or OMB review.

For more information
For more information on revisions to NSLDS, you may send correspondence to:

Director, NSLDS Systems
Operations and Aid Delivery Management Services, FSA
U.S. Department of Education
UCP
830 First Street, N.E.,
Washington, DC 20202-5454

For inquiries by phone, call (202) 377-3547. For more information about Program Integrity final rules, visit TG's Program Integrity Final Rules Web page. You can also contact TG's customer assistance team at (800) 845-6267, or send an email message to cust.assist@tgslc.org.

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Gainful Employment Webinar #1 — Implementation of the Reporting and Disclosure Requirements — now available

In an electronic announcement published on June 24, 2011, ED announced the availability of Gainful Employment Webinar #1 — Implementation of the Reporting and Disclosure Requirements of the October 29, 2010, Final Regulations Related to Gainful Employment Programs. The materials for the May webinars (held on May 25 and May 26) include the webinars' presentations, recordings, and transcripts.

Users can access these materials online. Alternately, these materials can be viewed by visiting the Information for Financial Aid Professionals (IFAP) website. Simply click the "Tools for Schools" Box, select "Conference Presentations," then select "Audio Presentations (Podcast)" under the "By Conference Type" heading.

Learn more
Check ED's Gainful Employment Information Page for updates that provide the latest guidance on implementation of the GE rules on disclosures, reporting, new programs, and debt measures for programs.

You can refer to TG's Program Integrity Final Rules Web page to view and download resources related to the final rules. For particular questions, you can also contact TG's Customer Assistance team at (800) 845-6267, or send an email message to cust.assist@tgslc.org.

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ED announces Gainful Employment Webinar #2 — Reporting Gainful Employment Data to NSLDS

On June 13, 2011, ED announced another webinar in the series about regulatory requirements for schools that offer educational programs which prepare students for gainful employment in a recognized occupation. This webinar will offer technical information on the National Student Loan Data System (NSLDS) gainful employment (GE) reporting process, including report format selection, a discussion of the online reporting option using NSLDS Professional Access, the school setup for submission of data to NSLDS, as well as the process for reviewing and correcting gainful employment data. Relevant information is described in the NSLDS Gainful Employment User Guide.

The gainful employment final regulations require schools participating in the student financial assistance programs to report, by October 1, 2011, and once a year thereafter, certain information to ED about students who are enrolled in GE Programs. In addition to reviewing the NSLDS Gainful Employment User Guide, it is important that financial aid administrators and other campus personnel participating in the webinar review the October 29 regulations and the information provided in Dear Colleague Letter (DCL) GEN-11-10.

The 90-minute sessions will be offered on Tuesday, June 28, 2011, at 11 a.m. Eastern Time, and again on Wednesday, June 29, 2011, at 1:30 p.m. Eastern Time. Advance registration is required for this training and will be available on a first-come, first-served basis. Register for the webinar online.

Learn more
For more information on gainful employment program rules, visit ED's Gainful Employment Information page or TG's Program Integrity Final Rules Web page where all of the new regulatory requirements are explained. For questions, please contact TG's Customer Assistance team at (800) 845-6267, or send an email message to cust.assist@tgslc.org.

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