Letter to the Hon. Betsy DeVos, Secretary of Education - Sen. Tina Smith Blasts DeVos Proposal That Would Leave Minnesota Students at Hands of Predatory Career Training Programs

Letter

Dear Secretary DeVos:

I write in strong opposition to the Department of Education's proposal to rescind the "gainful

employment" rule. I encourage the Department to withdraw its proposal to rescind this rule,

because with that proposal the Department would fail to adequately protect students and

borrowers from low-performing career training programs. If the Department gets rid of the

gainful employment rule, it will be abdicating its responsibility to provide guardrails for students

seeking to attend career training programs. I am concerned that this proposal runs counter to the

intent of the Higher Education Act and inappropriately prioritizes the interests of unscrupulous

colleges over students and taxpayers.

The Higher Education Act is clear on the importance of career training programs, but also

recognizes these programs' particular objectives, which is why Congress required that such

programs offer students a path to "gainful employment in a recognized occupation." The statute

requires eligibility standards and concrete accountability for such programs, whether they are

offered at for-profit or nonprofit colleges. The Department's proposal to publish program

outcomes data is necessary and helpful, but insufficient for the purposes of gainful employment.

The Department's proposal to remove the gainful employment rule will leave students in

Minnesota and across the nation, at risk. I am concerned for the almost 13,000 students in

Minnesota who have graduated from one of 73 programs identified for concerning or

unmanageable debt levels relative to their earnings as of April 2018--programs that have either

failed or are in the zone, under the gainful employment rule. These graduates have borrowed

almost $290 million to finance their education. These expensive and poorly performing

programs stand in contrast to the career training sector overall in Minnesota, which has over

28,000 students graduating from 3 13 programs that pass the gainful employment rule. Far from

constituting federal overreach--based on the number of programs identified (73) out of the total

number of programs (386)--the gainful employment rule takes a reasonable and well-targeted

approach to determining the worst performing programs or programs at risk of low-performance.

The gainful employment rule and Department data appropriately identify programs in Minnesota

that perform well and those that perform poorly. For example, an undergraduate certificate

program in massage therapy offered by Globe University had 93 graduates who had

mean annual earnings of only $18,073 and total median debt of $18,545, with a median annual

loan payment of $2,561. Sanford-Brown College offers a criminal justice bachelors degree

program that had 68 graduates who had median earnings of $29,673 and total median debt of

$36,575, with a median annual loan payment of $3,896. The gainful employment rule identified

all of these programs as failing, and rightly so.

The rule also identified gainful employment programs in Minnesota that are successful for their

graduates. According to data from the Department, Ridgewater College offers a welding

technology undergraduate certificate program that had 48 graduates who had mean annual

earnings of $40,078 and a total median debt of $6,619, with a median annual loan payments of

$914. Ridgewater College also offers an undergraduate certificate program in massage therapy

that had 51 graduates who had $18,367 in mean annual earnings and a total median debt of

$5,069, with median annual loan payments of $700. Minnesota West Community and Technical

College offers an undergraduate certificate program for licensed practical/vocational nurse

training that had 73 graduates who had median annual earnings of $40,103 and total median debt

of $5,851, with median annual loan payments of $808.

Student outcomes, like debt-to-earnings data, are vital for assessing the value of career training

programs. The explicit purpose of this type of education is for graduates to access training for a

specific career with appropriate compensation. If a career training program is too expensive

relative to the wages its graduates earn, then it has failed to prove itself a worthwhile investment

for students' time, effort, or taxpayer-supported federal student aid.

Colleges that offer career training programs that provide graduates high levels of debt and poor

labor market outcomes should be prompted to reexamine their practices and should face the

possibility of losing access to federal student aid if they fail to improve. Without such

consequences, federal student aid will continue to flow to subpar programs and put students'

financial situations needlessly at risk. By proposing to rescind the gainful employment rule, the

Department eliminates consequences for unscrupulous career training programs and places the

burden of risk entirely on students, who might be so unlucky as to attend, invest in, and graduate

from a program that will not pay off. The decision to eliminate the gainful employment rule is

equivalent to handing a $5.3 billion check of taxpayer dollars to programs that will bring no

economic benefit to students, according to the Department's own cost-benefit analysis.

The Department's proposal would have serious consequences for students in Minnesota and

around the country looking to improve their lives by investing in their education. I reiterate my

strong opposition to the Department's proposal and strongly urge the Department to abandon it.

Instead, I strongly encourage the Department to guard against poor-performing career and

technical education programs that harm students, including those in Minnesota, by fully

enforcing the existing gainful employment rule.

Sincerely,

Source