Last week, the U.S. Department of Education (ED) issued two Dear Colleague Letters (DCL) addressing aspects of the federal student financial aid program integrity regulations published on October 29, 2010, and an electronic announcement regarding trial three-year cohort default rates (CDRs). For background on the program integrity regulations, please refer to our November 2010 education investors alert.
- DCL on gainful employment. On April 20, ED issued a DCL providing guidance on new requirements for institutions that offer programs that prepare students for gainful employment in a recognized occupation (GE Programs). View the DCL. The DCL does not address the eligibility of GE Programs, but it notes that ED is in the process of finalizing its regulations on that topic.
- DCL on state authorization. On April 20, ED issued a DCL addressing new state authorization requirements in the context of distance education. View the DCL. Although the effective date of the distance education state authorization requirements is July 1, 2011, according to the DCL, ED will take no enforcement action against an institution for violation of such requirements until July 1, 2014, provided an institution is making good faith efforts to come into compliance.
- Electronic announcement on CDRs. On April 21, ED issued an electronic announcement explaining that the fiscal year 2008 unofficial trial three-year CDRs released by ED on February 4, 2011 contained an error that caused some institutions' CDRs to be incorrectly inflated. View the announcement. ED has corrected the error and recalculated the 2008 trial three-year CDRs for all institutions, which are available at federalstudentaid.ed.gov/datacenter/cohort.html.
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