Activities related to the U.S. Department of Education’s regulatory reform agenda and other federal issues

In This Issue:

• Activities Related to USDE Regulatory Reform Agenda
• USDE Negotiated Rulemaking Committees Announced; Borrower Defense, Gainful Employment Rules Enforcement Delayed

Activities Related to USDE Regulatory Reform Agenda

Since the arrival of the new Administration, the U.S. Department of Education (USDE) has undertaken a number of regulatory review and reform activities to identify regulations that may be appropriate for repeal, replacement or modification and to explore ways to reorganize USDE and reduce its workforce (see Federal Update #59).  

Recently:

• USDE published a notice in the Federal Register on August 11, 2017, extending the public comment period on regulations that may be appropriate for repeal, replacement or modification for an additional 30 days. USDE’s original request for comments was published on June 22, 2017. Comments are now due by now September 20, 2017; comments can be submitted through the Federal eRulemaking Portal.
• A Federal Register notice was published by USDE on August 25, 2017, announcing that two public hearings will be held as part of USDE’s effort to gather information and comments on department regulations related to postsecondary education. The hearings are scheduled for September 26, 2017, at Salt Lake Community College in Sandy, Utah, and October 4, 2017, at USDE headquarters in Washington, DC. The hearings will be held from 9:00 a.m. to 4:00 p.m., local time.
• Separate from USDE’s formal call for comments, USDE’s regulatory reform task force asked for ideas and suggestions on regulatory reform from higher education stakeholders. On August 3, 2017, the Council for Higher Education Accreditation (CHEA) sent a letter to the Task Force on changes that the USDE could make to improve its work to “best serve the needs of America’s students.” Issues addressed in CHEA’s letter – which was based on the CHEA Position Paper on Regulatory Relief for Accreditation – included removing the definition of credit hour, revising negotiated rulemaking to assure that it is a balanced, transparent and consultative process and rethinking the role of the National Advisory Committee on Institutional Quality and Integrity (NACIQI) and considering creation of an alternative for the committee’s structure and its operation, along with other areas where USDE regulations could be modified.

USDE Negotiated Rulemaking Committees Announced; Borrower Defense, Gainful Employment Rules Enforcement Delayed

Earlier this summer, USDE announced that the borrower defense to repayment and the gainful employment regulations would be delayed and renegotiated (see Federal Update #59). Following that announcement:

• In the Federal Register notice of August 30, 2017, USDE announced that two negotiated rulemaking committees will be established, one focusing on borrower defense and financial responsibility issues and the other focusing on gainful employment issues. USDE will also form a financial responsibility subcommittee to provide expert advice to the negotiated rulemaking committee on borrower defense and financial responsibility issues. USDE is seeking nominations for negotiators to serve on the two committees and for individuals with specific expertise in both financial accounting standards and USDE’s financial responsibility standards for institutions to serve on the subcommittee. Accrediting organizations are listed as key stakeholder constituents for both committees and the financial responsibility subcommittee. Nominations, which must be received by September 29, 2017, can be sent to [email protected]. 
• The new compliance date for the borrower defense to repayment rule and gainful employment regulations has been set for July 1, 2018, a year later than the previous requirement (see July 5, 2017, Federal Register notice.)
• In a related development, U.S. District Judge Rudolph Contreras, on June 29, 2017, blocked the enforcement of part of the gainful employment rule only for members of the American Association of Cosmetology Schools. The court decision directed that cosmetology schools be given broader options to challenge debt-to-earnings data and more time to appeal USDE data.
• A notice was published by USDE in the Federal Register on August 18, 2017, establishing new deadlines for “alternate earnings appeals and for submitting alternate earnings appeals.” The deadline for submitting a notice of intent to file an alternate earnings appeal is now October 6, 2017, and the deadline to file an alternate earnings appeal is February 1, 2018. While the new deadlines were established in light of the court order regarding cosmetology schools, the deadlines apply to all institutions and programs covered by the gainful employment regulations.

USDE also requested public comment on this issue, to be considered as USDE decides whether to take any additional action in connection with the upcoming negotiated rulemaking. Comments are due by September 18, 2017, and can be submitted through the Federal eRulemaking Portal.