aacrao 2011
AACRAO 2011 Enrollment and Academic Records Requirements for Federal Student Aid Purposes Jeff Baker Federal Student Aid U.S. Department of Education March 16, 2011
Today’s Topics ❧ Authorities and Responsibilities ❧ Federal Student Aid Programs ❧ Appropriations and Budget ❧ Institution and Program Eligibility ❧ Student Eligibility Requirements
2
Today’s Topics ❧ Registration and Enrollment ❧ Attendance Monitoring ❧ Withdrawals ❧ Consumerism/Disclosures ❧ Gainful Employment
3
Authorities and Responsibilities
4
Authorities and Responsibilities ❧ Statutory Authority – Higher Education Act of 1965, as amended (the HEA). ❧ Title I – Institutional Eligibility ❧ Title IV – Student Assistance Programs ❧ Regulatory Authority – ❧ Institutional Eligibility - 34 CFR Part 600 ❧ Student Assistance Programs – 34 CFR Part 668 to Part 694. 5
Authorities and Responsibilities ❧ Executive Branch Responsibility – ❧ U.S. Department of Education ❧ Arne Duncan, Secretary of Education ❧ Office of Postsecondary Education ❧ Eduardo Ochoa, Assistant Secretary ❧ Federal Student Aid ❧ Bill Taggart, Chief Operating Officer
6
Federal Student Aid Programs
7
The Programs ❧ Federal Work-Study Program – ❧ Undergraduate and Graduate Students ❧ Any enrollment status ❧ Regular FWS Program ❧ Work-Colleges ❧ Job Location and Development
8
The Programs ❧ Grants – ❧ Undergraduate students only ❧ Federal Pell Grant Program ❧ Federal Supplemental Educational Opportunity Grant Program (FSEOG) ❧ Iraq/Afghanistan Service Grant
9
The Programs ❧ Grants – ❧ National SMART Grant Program and Academic Competitiveness Grant Program - Ends June 30, 2011 ❧ Leveraging Educational Assistance Partnership Program (LEAP) - Proposed by Congress for termination as of June 30, 2011
❧ TEACH Grant Program - Proposed by President for termination 10
The Programs ❧ Loans – ❧ Undergraduate and Graduate Students ❧ Enrollment of at least one-half time ❧ Federal Perkins Loan Program ❧ Federal Direct Loan Program ❧ Direct Subsidized Stafford Loans ❧ Direct Unsubsidized Stafford Loans ❧ Direct PLUS Loans ❧ Direct Consolidation Loans 11
The Programs ❧ Loans – ❧ Federal Family Education Loan Program ❧ Same components as Direct Loans ❧ No new loans after June 30, 2010
12
Appropriations and Program Budget
13
Aid Available Program Pell Grant
FY 2012**
35,772,935,000 $
36,072,930,000
(AY 11-12)
$
(Max Award)
FSEOG FWS Perkins LEAP
FY 2011*
(AY 12-13)
$5,550
Direct Loans
958,816,000 1,170,845,000 970,705,000 161,556,000 ― $ 131,360,000 $ 135,635,000,000
TOTAL
$174,801,217,000 $187,666,621,000
Student Success
TEACH/PTF
$ $ $ $
$5,550
$ $ $
958,816,000 1,170,845,000 2,167,202,000 ― $ 50,000,000 $ 211,828,000 $ 147,035,000,000 14
Institution and Program Eligibility
15
Institution Eligibility ❧ Institution must – ❧ Be accredited ❧ Be state approved ❧ Apply to the Department of Education ❧ Demonstrate financial responsibility ❧ Demonstrate administrative capability ❧Execute Program Participation Agreement (PPA) ❧Be audited each year ❧Be subject to ED program reviews ❧Be recertified every four to six years 16
Institution Eligibility ❧ Responsible offices ❧ Financial Aid Office ❧ Business Office ❧ Admissions Office ❧ Registrar's Office ❧ Athletics ❧ Police/Security ❧ Public Affairs ❧ Research ❧ Placement ❧ Housing 17
Eligible Program ❧ Eligible Program is one that – ❧Leads to a degree, certificate, or other credential awarded by the institution. ❧Exception for transfer programs and teacher certification programs. ❧Certain minimum length in terms of credit/clock hours and weeks of instructional time. ❧In general must either lead to a degree or to “gainful employment”. 18
Student Eligibility Requirements
19
Regular Student ❧ Student must be enrolled as a “regular student” in an eligible program. ❧ Regular student – ❧Enrolled in an eligible program ❧Objective is to earn degree, certificate, or other credential awarded by the institution. ❧Exception for transfer programs and teacher certification 20
High School Diploma ❧ High school diploma or alternative – ❧In general student must have earned a high school diploma or equivalent (GED). ❧Can be home schooled.
21
High School Diploma ew Regulations – Requires institutions to develop and follow procedures to evaluate the validity of a student's high school diploma if the institution or the Secretary has reason to believe that the diploma is not valid or was not obtained from an entity that provides secondary school education. ffective July 1, 2011 22
High School Diploma ❧ FAFSA will ask student to indicate high school. ❧ First-year students only. ❧ Being on the list does not mean approved. ❧ Not being on the list does not mean unapproved or questionable. 23
Ability–to-Benefit ❧ Students who are beyond the age of compulsory attendance but who do not have a high school diploma or its recognized equivalent must meet Abilityto-Benefit (ATB) criteria. ❧ Successfully pass an ED approved ATB test. ❧ Successfully participate in an ED approved state ATB process. ❧ Successfully complete six credit hours or 225 clock hours of college work. 24
Citizenship ❧ Must be a U.S. citizen or eligible noncitizen. ❧Eligible non-citizen includes permanent residents and certain refugees, asylum applicants, and others. ❧ED performs electronic data matching with DHS and SSA.
25
Defaults and Overpayments • A student who is in default on a Title IV loan or who owes an overpayment on a Title IV grant is not eligible unless the student has – ❧ Fully paid the defaulted loan or the overpayment. ❧ Made satisfactory arrangements with the holder of the loan (school, guaranty agency, or ED) or the overpayment (school or ED). ❧ ED maintains data in NSLDS. 26
Satisfactory Academic Progress ❧ Student must be making satisfactory academic progress (SAP) under the school’s financial aid SAP policy. ❧ More latter???
27
Registration and Enrollment
28
Registration ❧ Aid may be disbursed only to an eligible regular student who is registered – ❧All of the registration requirements (except payment of fees) have been completed. ❧ Aid is disbursed on a payment period basis – term (semester, quarter, trimester, etc.). ❧ Aid may be disbursed up to ten days prior to the first day of classes for a payment period.
29
Enrollment Level ❧ Student’s enrollment level (grade level) impacts types and amounts of aid – ❧ Grants only for undergraduate students ❧ Loan amounts dependent on grade level ❧ School must have a system for notifying the financial aid office anytime a student’s grade level changes.
30
Enrollment Status ❧ Student’s enrollment status impacts types and amounts of aid – ❧ Loans only available for half-time or more. ❧ Amount of Pell and other grants varies with enrollment statuses. ❧ Change in enrollment status may impact costs and thus award amounts. ❧ Must have a system for notifying the financial aid office anytime a student’s enrollment status changes. 31
Enrollment Status ❧ Special reporting for students with federal loans when enrollment status becomes less than half-time. ❧ School must have a system for notifying the lender or ED if a student’s enrollment status changes. ❧ Direct to loan holder (lender, ED) ❧ NSLDS Enrollment Reporting Process ❧ Third –Party Servicers ❧ National Student Clearinghouse 32
Attendance Monitoring
33
Attendance Monitoring ❧ School must have a system for identifying students who registered for, but failed to begin attendance in any or all classes. ❧ If student failed to begin any classes school is liable for any aid disbursed. ❧ If student began attendance in some but not all, recalculation is required and school may be liable. ❧ Does not require school to take attendance. ❧ Does require school to have process. 34
Attendance Monitoring ❧ School must have a system for identifying students who registered for, but failed to begin attendance in any or all classes. ❧Faculty add-drop process ❧Reviewing grades at end of term ❧If school does not have and use a grading system that differentiates between an “earned ‘F’ and an ‘F’ that is the result of the student never attending or withdrawing, student is considered to have never attended or withdrew. 35
Withdrawals
36
Withdrawals ❧ Return To Title IV Aid (R2T4) ❧Statutory and regulatory requirements. ❧In general, the amount of Title IV aid student “earned” is determined by applying the same percentage of the payment period the student completed before withdrawal to the amount of aid awarded for the payment period ❧Withdrawal date or date of last attendance is critical. 37
Withdrawals ❧ Return To Title IV Aid (R2T4) ❧Any amounts disbursed above the amount earned must be returned by either the school or the student according to a regulatory formula. ❧If amount earned has not been fully disbursed, student may be eligible for additional disbursements.
38
Withdrawals ❧ School must have a procedure for determining whether a federal aid recipient who began attendance completed the period or should be treated as a withdrawal. ❧If school does not have and use a grading system that differentiates between an “earned ‘F’ and an ‘F’ that is the result of the student never attending, student is considered to have never attended or withdrew. 39
Withdrawals ❧ Schools that are required to take attendance are expected to have a procedure for routinely monitoring attendance records to determine when a student withdraws. ❧ New regulatory requirement - An institution is required to take attendance if an outside entity or the institution itself – ❧Requires instructors to take attendance, or ❧Has a requirement that can only be met by taking attendance. 40
Withdrawals ❧ Official Withdrawals – ❧School must document a student’s official withdrawal date, as well as the date of the institution’s determination that the student withdrew. ❧Schools are required to make available to students a statement specifying the requirements for officially withdrawing from the school. 41
Withdrawals ❧ Unofficial Withdrawals – ❧Schools that are required to take attendance (or that otherwise choose to use unofficial attendance records) use those records to determine last date of attendance. ❧Schools that do not use attendance records, may assume last date of attendance to be at the 50% point of the payment period. 42
Satisfactory Academic Progress
43
Satisfactory Academic Progress ❧ Student must be making satisfactory academic progress (SAP) under the school’s financial aid (SAP) policy. ❧Policy school specific under general statutory and regulatory guidelines. ❧Must be at least as strict as academic policies. ❧Must be checked at least once each year. ❧Policy must be provided to students. 44
Consumerism and Disclosure
45
Consumerism and Disclosures ❧ School must provide consumer information and disclosures ❧ Examples – ❧ Student “Right to Know” ❧ Completion Rates ❧ Athletics ❧ Campus crime ❧ Fire safety ❧ Copyright ❧ Missing students 46
Gainful Employment
47
GAINFUL EMPLOYMENT ❧In general, only two types of programs Title IV eligible – ❧Leads to a degree ❧Leads to gainful employment in a recognized occupation. ❧Gainful employment should provide students with training that will allow them to become employed and earn sufficient to justify costs. 48
GAINFUL EMPLOYMENT ❧NPRM published on July 26, 2010. ❧Final regulations for some provisions published on October 29, 2010. ❧Effective July 1, 2011 ❧More final regulations scheduled to be published early in 2011. ❧Effective July 1, 2012
49
GAINFUL EMPLOYMENT ❧ Covered Programs ❧Proprietary Institutions ❧All programs, except for ❧Certain programs leading to baccalaureate degree in liberal arts.
50
GAINFUL EMPLOYMENT ❧ Covered Programs – ❧Public and Private Non-profit Institutions ❧Non-degree/certificate programs. ❧Two exceptions ❧Transfer program ❧Comprehensive transition program for students with intellectual disabilities 51
GAINFUL EMPLOYMENT ❧ GE Reporting ❧ Institutions must report to ED information on students enrolled in gainful employment programs. ❧ Student Identifiers ❧ Enrollment Status ❧ Non-Title IV educational debt ❧ Effective July 1, 2011 52
GAINFUL EMPLOYMENT ❧ Disclosures ❧ Institutions must provide prospective students with information about each gainful employment program. ❧ Costs ❧ Occupations ❧ Completion rates ❧ Placement rates ❧ Median loan debt.
❧ Effective July 1, 2011
53
GAINFUL EMPLOYMENT ❧ Additional Gainful Employment Programs ❧ Institutions seeking to add a gainful employment program must inform ED before beginning program. ❧ Must document an employment need in their community for graduates of the program. ❧ Effective July 1, 2011 54
GAINFUL EMPLOYMENT ❧ Gainful Employment Metrics ❧ Final rule to be published in 2011 ❧ Effective July 1, 2012 ❧ Defines “gainful” to be when a substantial number of the program’s students – ❧ Are repaying their Title IV loans (Repayment Rate) ❧ Have a reasonable debt burden (Debt to Earnings Ratio). 55
Gainful Employment Metrics Repayment
The percentage of the outstanding principal
Rate
balance of the federal loans taken by the academic program’s former students who entered repayment in the previous four years that has been repaid.
56
Gainful Employment Metrics Debt to
For the academic program’s completers, the
Earnings
average educational loan payments (federal,
Ratio
private, and institutional financing plans) as a proportion of the borrower’s income (either discretionary income or average annual earnings). Loan payment amount based on a 10year amortization schedule at 6.8 percent.
57
Today’s Topics ❧ Authorities and Responsibilities ❧ Federal Student Aid Programs ❧ Appropriations and Budget ❧ Institution and Program Eligibility ❧ Student Eligibility Requirements
2
Today’s Topics ❧ Registration and Enrollment ❧ Attendance Monitoring ❧ Withdrawals ❧ Consumerism/Disclosures ❧ Gainful Employment
3
Authorities and Responsibilities
4
Authorities and Responsibilities ❧ Statutory Authority – Higher Education Act of 1965, as amended (the HEA). ❧ Title I – Institutional Eligibility ❧ Title IV – Student Assistance Programs ❧ Regulatory Authority – ❧ Institutional Eligibility - 34 CFR Part 600 ❧ Student Assistance Programs – 34 CFR Part 668 to Part 694. 5
Authorities and Responsibilities ❧ Executive Branch Responsibility – ❧ U.S. Department of Education ❧ Arne Duncan, Secretary of Education ❧ Office of Postsecondary Education ❧ Eduardo Ochoa, Assistant Secretary ❧ Federal Student Aid ❧ Bill Taggart, Chief Operating Officer
6
Federal Student Aid Programs
7
The Programs ❧ Federal Work-Study Program – ❧ Undergraduate and Graduate Students ❧ Any enrollment status ❧ Regular FWS Program ❧ Work-Colleges ❧ Job Location and Development
8
The Programs ❧ Grants – ❧ Undergraduate students only ❧ Federal Pell Grant Program ❧ Federal Supplemental Educational Opportunity Grant Program (FSEOG) ❧ Iraq/Afghanistan Service Grant
9
The Programs ❧ Grants – ❧ National SMART Grant Program and Academic Competitiveness Grant Program - Ends June 30, 2011 ❧ Leveraging Educational Assistance Partnership Program (LEAP) - Proposed by Congress for termination as of June 30, 2011
❧ TEACH Grant Program - Proposed by President for termination 10
The Programs ❧ Loans – ❧ Undergraduate and Graduate Students ❧ Enrollment of at least one-half time ❧ Federal Perkins Loan Program ❧ Federal Direct Loan Program ❧ Direct Subsidized Stafford Loans ❧ Direct Unsubsidized Stafford Loans ❧ Direct PLUS Loans ❧ Direct Consolidation Loans 11
The Programs ❧ Loans – ❧ Federal Family Education Loan Program ❧ Same components as Direct Loans ❧ No new loans after June 30, 2010
12
Appropriations and Program Budget
13
Aid Available Program Pell Grant
FY 2012**
35,772,935,000 $
36,072,930,000
(AY 11-12)
$
(Max Award)
FSEOG FWS Perkins LEAP
FY 2011*
(AY 12-13)
$5,550
Direct Loans
958,816,000 1,170,845,000 970,705,000 161,556,000 ― $ 131,360,000 $ 135,635,000,000
TOTAL
$174,801,217,000 $187,666,621,000
Student Success
TEACH/PTF
$ $ $ $
$5,550
$ $ $
958,816,000 1,170,845,000 2,167,202,000 ― $ 50,000,000 $ 211,828,000 $ 147,035,000,000 14
Institution and Program Eligibility
15
Institution Eligibility ❧ Institution must – ❧ Be accredited ❧ Be state approved ❧ Apply to the Department of Education ❧ Demonstrate financial responsibility ❧ Demonstrate administrative capability ❧Execute Program Participation Agreement (PPA) ❧Be audited each year ❧Be subject to ED program reviews ❧Be recertified every four to six years 16
Institution Eligibility ❧ Responsible offices ❧ Financial Aid Office ❧ Business Office ❧ Admissions Office ❧ Registrar's Office ❧ Athletics ❧ Police/Security ❧ Public Affairs ❧ Research ❧ Placement ❧ Housing 17
Eligible Program ❧ Eligible Program is one that – ❧Leads to a degree, certificate, or other credential awarded by the institution. ❧Exception for transfer programs and teacher certification programs. ❧Certain minimum length in terms of credit/clock hours and weeks of instructional time. ❧In general must either lead to a degree or to “gainful employment”. 18
Student Eligibility Requirements
19
Regular Student ❧ Student must be enrolled as a “regular student” in an eligible program. ❧ Regular student – ❧Enrolled in an eligible program ❧Objective is to earn degree, certificate, or other credential awarded by the institution. ❧Exception for transfer programs and teacher certification 20
High School Diploma ❧ High school diploma or alternative – ❧In general student must have earned a high school diploma or equivalent (GED). ❧Can be home schooled.
21
High School Diploma ew Regulations – Requires institutions to develop and follow procedures to evaluate the validity of a student's high school diploma if the institution or the Secretary has reason to believe that the diploma is not valid or was not obtained from an entity that provides secondary school education. ffective July 1, 2011 22
High School Diploma ❧ FAFSA will ask student to indicate high school. ❧ First-year students only. ❧ Being on the list does not mean approved. ❧ Not being on the list does not mean unapproved or questionable. 23
Ability–to-Benefit ❧ Students who are beyond the age of compulsory attendance but who do not have a high school diploma or its recognized equivalent must meet Abilityto-Benefit (ATB) criteria. ❧ Successfully pass an ED approved ATB test. ❧ Successfully participate in an ED approved state ATB process. ❧ Successfully complete six credit hours or 225 clock hours of college work. 24
Citizenship ❧ Must be a U.S. citizen or eligible noncitizen. ❧Eligible non-citizen includes permanent residents and certain refugees, asylum applicants, and others. ❧ED performs electronic data matching with DHS and SSA.
25
Defaults and Overpayments • A student who is in default on a Title IV loan or who owes an overpayment on a Title IV grant is not eligible unless the student has – ❧ Fully paid the defaulted loan or the overpayment. ❧ Made satisfactory arrangements with the holder of the loan (school, guaranty agency, or ED) or the overpayment (school or ED). ❧ ED maintains data in NSLDS. 26
Satisfactory Academic Progress ❧ Student must be making satisfactory academic progress (SAP) under the school’s financial aid SAP policy. ❧ More latter???
27
Registration and Enrollment
28
Registration ❧ Aid may be disbursed only to an eligible regular student who is registered – ❧All of the registration requirements (except payment of fees) have been completed. ❧ Aid is disbursed on a payment period basis – term (semester, quarter, trimester, etc.). ❧ Aid may be disbursed up to ten days prior to the first day of classes for a payment period.
29
Enrollment Level ❧ Student’s enrollment level (grade level) impacts types and amounts of aid – ❧ Grants only for undergraduate students ❧ Loan amounts dependent on grade level ❧ School must have a system for notifying the financial aid office anytime a student’s grade level changes.
30
Enrollment Status ❧ Student’s enrollment status impacts types and amounts of aid – ❧ Loans only available for half-time or more. ❧ Amount of Pell and other grants varies with enrollment statuses. ❧ Change in enrollment status may impact costs and thus award amounts. ❧ Must have a system for notifying the financial aid office anytime a student’s enrollment status changes. 31
Enrollment Status ❧ Special reporting for students with federal loans when enrollment status becomes less than half-time. ❧ School must have a system for notifying the lender or ED if a student’s enrollment status changes. ❧ Direct to loan holder (lender, ED) ❧ NSLDS Enrollment Reporting Process ❧ Third –Party Servicers ❧ National Student Clearinghouse 32
Attendance Monitoring
33
Attendance Monitoring ❧ School must have a system for identifying students who registered for, but failed to begin attendance in any or all classes. ❧ If student failed to begin any classes school is liable for any aid disbursed. ❧ If student began attendance in some but not all, recalculation is required and school may be liable. ❧ Does not require school to take attendance. ❧ Does require school to have process. 34
Attendance Monitoring ❧ School must have a system for identifying students who registered for, but failed to begin attendance in any or all classes. ❧Faculty add-drop process ❧Reviewing grades at end of term ❧If school does not have and use a grading system that differentiates between an “earned ‘F’ and an ‘F’ that is the result of the student never attending or withdrawing, student is considered to have never attended or withdrew. 35
Withdrawals
36
Withdrawals ❧ Return To Title IV Aid (R2T4) ❧Statutory and regulatory requirements. ❧In general, the amount of Title IV aid student “earned” is determined by applying the same percentage of the payment period the student completed before withdrawal to the amount of aid awarded for the payment period ❧Withdrawal date or date of last attendance is critical. 37
Withdrawals ❧ Return To Title IV Aid (R2T4) ❧Any amounts disbursed above the amount earned must be returned by either the school or the student according to a regulatory formula. ❧If amount earned has not been fully disbursed, student may be eligible for additional disbursements.
38
Withdrawals ❧ School must have a procedure for determining whether a federal aid recipient who began attendance completed the period or should be treated as a withdrawal. ❧If school does not have and use a grading system that differentiates between an “earned ‘F’ and an ‘F’ that is the result of the student never attending, student is considered to have never attended or withdrew. 39
Withdrawals ❧ Schools that are required to take attendance are expected to have a procedure for routinely monitoring attendance records to determine when a student withdraws. ❧ New regulatory requirement - An institution is required to take attendance if an outside entity or the institution itself – ❧Requires instructors to take attendance, or ❧Has a requirement that can only be met by taking attendance. 40
Withdrawals ❧ Official Withdrawals – ❧School must document a student’s official withdrawal date, as well as the date of the institution’s determination that the student withdrew. ❧Schools are required to make available to students a statement specifying the requirements for officially withdrawing from the school. 41
Withdrawals ❧ Unofficial Withdrawals – ❧Schools that are required to take attendance (or that otherwise choose to use unofficial attendance records) use those records to determine last date of attendance. ❧Schools that do not use attendance records, may assume last date of attendance to be at the 50% point of the payment period. 42
Satisfactory Academic Progress
43
Satisfactory Academic Progress ❧ Student must be making satisfactory academic progress (SAP) under the school’s financial aid (SAP) policy. ❧Policy school specific under general statutory and regulatory guidelines. ❧Must be at least as strict as academic policies. ❧Must be checked at least once each year. ❧Policy must be provided to students. 44
Consumerism and Disclosure
45
Consumerism and Disclosures ❧ School must provide consumer information and disclosures ❧ Examples – ❧ Student “Right to Know” ❧ Completion Rates ❧ Athletics ❧ Campus crime ❧ Fire safety ❧ Copyright ❧ Missing students 46
Gainful Employment
47
GAINFUL EMPLOYMENT ❧In general, only two types of programs Title IV eligible – ❧Leads to a degree ❧Leads to gainful employment in a recognized occupation. ❧Gainful employment should provide students with training that will allow them to become employed and earn sufficient to justify costs. 48
GAINFUL EMPLOYMENT ❧NPRM published on July 26, 2010. ❧Final regulations for some provisions published on October 29, 2010. ❧Effective July 1, 2011 ❧More final regulations scheduled to be published early in 2011. ❧Effective July 1, 2012
49
GAINFUL EMPLOYMENT ❧ Covered Programs ❧Proprietary Institutions ❧All programs, except for ❧Certain programs leading to baccalaureate degree in liberal arts.
50
GAINFUL EMPLOYMENT ❧ Covered Programs – ❧Public and Private Non-profit Institutions ❧Non-degree/certificate programs. ❧Two exceptions ❧Transfer program ❧Comprehensive transition program for students with intellectual disabilities 51
GAINFUL EMPLOYMENT ❧ GE Reporting ❧ Institutions must report to ED information on students enrolled in gainful employment programs. ❧ Student Identifiers ❧ Enrollment Status ❧ Non-Title IV educational debt ❧ Effective July 1, 2011 52
GAINFUL EMPLOYMENT ❧ Disclosures ❧ Institutions must provide prospective students with information about each gainful employment program. ❧ Costs ❧ Occupations ❧ Completion rates ❧ Placement rates ❧ Median loan debt.
❧ Effective July 1, 2011
53
GAINFUL EMPLOYMENT ❧ Additional Gainful Employment Programs ❧ Institutions seeking to add a gainful employment program must inform ED before beginning program. ❧ Must document an employment need in their community for graduates of the program. ❧ Effective July 1, 2011 54
GAINFUL EMPLOYMENT ❧ Gainful Employment Metrics ❧ Final rule to be published in 2011 ❧ Effective July 1, 2012 ❧ Defines “gainful” to be when a substantial number of the program’s students – ❧ Are repaying their Title IV loans (Repayment Rate) ❧ Have a reasonable debt burden (Debt to Earnings Ratio). 55
Gainful Employment Metrics Repayment
The percentage of the outstanding principal
Rate
balance of the federal loans taken by the academic program’s former students who entered repayment in the previous four years that has been repaid.
56
Gainful Employment Metrics Debt to
For the academic program’s completers, the
Earnings
average educational loan payments (federal,
Ratio
private, and institutional financing plans) as a proportion of the borrower’s income (either discretionary income or average annual earnings). Loan payment amount based on a 10year amortization schedule at 6.8 percent.
57
