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Department of Education Amends Regulations to Rescind Gainful Employment Rule

Tim Gaber

Jul 29 2019

3 min read

In the IFAP – Electronic Announcement #122 dated June 28, 2019, the Department of Education announced early implementation of the Rescission of the Gainful Employment (GE) Rule. The final rule was published on July 1, 2019 rescinding the GE regulations (2014 Rule) in the Federal Register.

Who Does the GE Rule Impact?

The statutory and regulatory GE requirements are subject to institutions that offer the following Title IV eligible programs:

All non-degree education programs offered by public or private non-profit institutions are GE programs with the following four exceptions:

Preparatory coursework necessary for enrollment in a Title IV eligible program [34 CFR 668.32(a)(1)(ii)];
Approved Comprehensive Transition and Postsecondary (CTP) programs for students with intellectual disabilities [34 CFR 668.231];
Programs that are at least two years long and are designed to be fully transferable to a bachelor’s degree program and for which the school does not confer a credential [34 CFR 668.8(b)(1)(ii)]; and
Teacher certification programs the institution does not award a credential for [34 CFR 668.32(a)(1)(iii)]

Generally, all Title IV eligible programs offered by a for-profit institutions are subject to the GE Rule. However, there are three exceptions:

Preparatory coursework necessary for enrollment in a Title IV eligible program [34 CFR 668.32(a)(1)(ii)];
Approved CTP programs for students with intellectual disabilities [34 CFR 668.231]; and

A limited number of bachelor degree programs in liberal arts if offered by the institution since January 2009 and if the school has been regionally accredited since October 2007 [34 CFR 600.5(a)(5)(i)(B)]

When is Rescission of the GE Rule Effective?

The rescission of the GE regulations is effective July 1, 2020. However, institutions may elect for early implementation beginning on July 1, 2019.

What Does Early Implementation Mean?

Institutions that early implement will not be required to

Report GE data for the 2018-2019 award year to the National Student Loan Data System (NSLDS), which will be due October 1, 2019
Comply with the current requirements in 34 CFR 668.412 (d) and (e) that require institutions to include the disclosure template, or a link thereto, in their GE program promotional materials and directly distribute the disclosure template to prospective students which was effective on July 1, 2019
Post the GE Disclosure Template and may remove the template and any other GE disclosures that are required under 34 CFR 668.412 from their web pages
Comply with the certification requirements for GE programs under 34 CFR 668.414.

To Implement or to Not Implement?

It is important to note that institutions that decide not to early implement will be expected to comply with the GE regulations until July 1, 2020.

If the decision is made to early implement the Rescission of the GE Rule, an institution must document its early implementation internally. It does not have to publish its decision to do so; however, it must make such documentation available upon request by the Department.

This publication contains general information only and Sikich is not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or any other professional advice or services. This publication is not a substitute for such professional advice or services, nor should you use it as a basis for any decision, action or omission that may affect you or your business. Before making any decision, taking any action or omitting an action that may affect you or your business, you should consult a qualified professional advisor. In addition, this publication may contain certain content generated by an artificial intelligence (AI) language model. You acknowledge that Sikich shall not be responsible for any loss sustained by you or any person who relies on this publication.

About the Author

Tim Gaber

Tim Gaber, CPA, is the Leader of Sikich’s Title IV Audit and Consulting Practice, overseeing and managing audits, examinations and other special projects related to a wide range of services. In his leadership position, Tim keeps the practice on top of ever-changing rules and regulations within this sector by developing and providing training to staff and clients.