DeKALB – The U.S. Department of Education has issued new rules and regulations that looks to protect students from unaffordable college debt and keep colleges accountable for providing financial aid.
From 2013 through 2022, the Department of Education acquired more than $1.6 billion in liabilities from colleges, however only $344 million were collected throughout that time.
The rules establish changes that cover the following four areas: financial responsibility, administrative capability, certification procedures and the ability to benefit.
Plans to enact financial responsibility will better identify warning signs from colleges that make it easier for the Department to secure letters of credit or other forms of upfront financial protection.
Responsibilities involving administrative capability will provide clearer information regarding financial aid, scholarships and loans that will need to be repaid. Colleges will not be able to withhold transcripts for federally funded courses and will require adequate career services and limit employing those with a history of risky management of the Federal student aid programs.
Certification procedures would provide additional conditions established by the Department of Education that clearly state warning signs in colleges that would allow institutions to require a teach-out plan or placing limits on new programs and locations.
Finally, the final ability benefit rules will better establish the process for accessing financial aid to those without a high school diploma or its equivalent.
U.S. Secretary of Education Miguel Cardona said that with this action in place, students will have a better opportunity for success after college.
“Too many students have been abandoned by shady colleges that close their doors and leave borrowers with unaffordable debt and little hope of completing their educational journeys and embarking on rewarding careers,” Cardona said. “We are raising the bar for accountability and making sure that when students invest in higher education, they get a solid return on that investment and a greater shot at the American dream.”
The final regulations are expected to be published to the Federal Register on October 31, 2023. The rules will go into effect July 1, 2024.
