Federal Register / Vol. 83, No. 157 / Tuesday, August 14, 2018 / Proposed Rules 40167 

(ii) No vessel shall remain in this 

anchorage for more than 24 hours 

without permission from the Captain of 

the Port. 

(4) Anchorage No. 3B, general 

anchorage. (i) All waters of the Patapsco 

River, bounded by a line connecting the 

following points: 

Latitude Longitude 

39°14′32.48′′ N 76°33′11.31′′ W 

39°14′46.23′′ N 76°33′25.83′′ W 

39°14′57.51′′ N 76°33′08.14′′ W 

39°14′43.76′′ N 76°32′53.63′′ W 

These coordinates are based on 

NAD 83. 

(ii) No vessel shall remain in this 

anchorage for more than 24 hours 

without permission from the Captain of 

the Port. 

(5) Anchorage No. 3C, general 

anchorage. (i) All waters of the Patapsco 

River, bounded by a line connecting the 

following points: 

Latitude Longitude 

39°14′46.23′′ N 76°33′25.83′′ W 

39°14′50.06′′ N 76°33′29.86′′ W 

39°14′59.42′′ N 76°33′15.17′′ W 

39°14′55.60′′ N 76°33′11.14′′ W 

These coordinates are based on 

NAD 83. 

(ii) No vessel shall remain in this 

anchorage for more than 72 hours 

without permission from the Captain of 

the Port. 

(6) Anchorage No. 4, general 

anchorage. (i) All waters of the Patapsco 

River, bounded by a line connecting the 

following points: 

Latitude Longitude 

39°13′52.92′′ N 76°32′29.60′′ W 

39°14′04.38′′ N 76°32′41.69′′ W 

39°14′09.35′′ N 76°32′39.89′′ W 

39°14′17.96′′ N 76°32′26.44′′ W 

39°14′05.32′′ N 76°32′13.09′′ W 

39°14′00.05′′ N 76°32′17.77′′ W 

These coordinates are based on 

NAD 83. 

(ii) No vessel shall remain in this 

anchorage for more than 24 hours 

without permission from the Captain of 

the Port. 

(7) Anchorage No. 5, general 

anchorage. (i) All waters of the Patapsco 

River, bounded by a line connecting the 

following points: 

Latitude Longitude 

39°14′07.89′′ N 76°32′58.23′′ W 

39°13′34.82′′ N 76°32′23.66′′ W 

39°13′22.25′′ N 76°32′28.90′′ W 

Latitude Longitude 

39°13′21.20′′ N 76°33′11.94′′ W 

These coordinates are based on 

NAD 83. 

(ii) No vessel shall remain in this 

anchorage for more than 72 hours 

without permission from the Captain of 

the Port. 

(8) Anchorage No. 6, general 

anchorage. (i) All waters of the Patapsco 

River, bounded by a line connecting the 

following points: 

Latitude Longitude 

39°13′42.98′′ N 76°32′19.11′′ W 

39°13′20.65′′ N 76°31′55.58′′ W 

39°13′34.00′′ N 76°31′33.50′′ W 

39°14′01.95′′ N 76°32′02.65′′ W 

39°13′51.01′′ N 76°32′18.71′′ W 

These coordinates are based on 

NAD 83. 

(ii) No vessel shall remain in this 

anchorage for more than 72 hours 

without permission from the Captain of 

the Port. 

(9) Anchorage No. 7, Dead ship 

anchorage. (i) All waters of Curtis Bay, 

bounded by a line connecting the 

following points: 

Latitude Longitude 

39°13′00.40′′ N 76°34′10.40′′ W 

39°13′13.40′′ N 76°34′10.81′′ W 

39°13′13.96′′ N 76°34′05.02′′ W 

39°13′14.83′′ N 76°33′29.80′′ W 

39°13′00.40′′ N 76°33′29.90′′ W 

These coordinates are based on 

NAD 83. 

(ii) The primary use of this anchorage 

is to lay up dead ships. Such use has 

priority over other uses. Permission 

from the Captain of the Port must be 

obtained prior to the use of this 

anchorage for more than 72 hours. 

(b) Definitions. As used in this 

section— 

Certain dangerous cargo means 

certain dangerous cargo as defined in 

§ 160.202 of this chapter. 

COTP means Captain of the Port 

Sector Maryland—National Capital 

Region. 

(c) General regulations. (1) Except as 

otherwise provided, this section applies 

to vessels over 20 meters long and all 

vessels carrying or handling certain 

dangerous cargo while anchored in an 

anchorage ground described in this 

section. 

(2) Except in cases where unforeseen 

circumstances create conditions of 

imminent peril, or with the permission 

of the Captain of the Port, no vessel 

shall be anchored in Baltimore Harbor 

or the Patapsco River outside of the 

anchorage areas established in this 

section for more than 24 hours. No 

vessel shall anchor within a tunnel, 

cable or pipeline area shown on a 

government chart. No vessel shall be 

moored, anchored, or tied up to any 

pier, wharf, or other vessel in such 

manner as to extend into established 

channel limits. No vessel shall be 

positioned so as to obstruct or endanger 

the passage of any other vessel. 

(3) Except in an emergency, a vessel 

that is likely to sink or otherwise 

become an obstruction to navigation or 

the anchoring of other vessels may not 

occupy an anchorage, unless the vessel 

obtains permission from the Captain of 

the Port. 

(4) Upon notification by the Captain 

of the Port to shift its position, a vessel 

at anchor must get underway and shall 

move to its new designated position 

within two hours after notification. 

(5) The Captain of the Port may 

prescribe specific conditions for vessels 

anchoring within the anchorages 

described in this section, including, but 

not limited to, the number and location 

of anchors, scope of chain, readiness of 

engineering plant and equipment, usage 

of tugs, and requirements for 

maintaining communication guards on 

selected radio frequencies. 

(6) No vessel at anchor or at a mooring 

within an anchorage may transfer oil to 

or from another vessel unless the vessel 

has given the Captain of the Port the 

four hours advance notice required by 

§ 156.118 of this chapter. 

(7) No vessel shall anchor in a ‘‘dead 

ship’’ status (propulsion or control 

unavailable for normal operations) 

without prior approval of the Captain of 

the Port. 

Dated: August 1, 2018. 

Meredith L. Austin, 

Rear Admiral, U.S. Coast Guard, Commander, 

Fifth Coast Guard District. 

[FR Doc. 2018–17469 Filed 8–13–18; 8:45 am] 

BILLING CODE 9110–04–P 

DEPARTMENT OF EDUCATION 

34 CFR Parts 600 and 668 

[Docket ID ED–2018–OPE–0042] 

RIN 1840–AD31 

Program Integrity: Gainful Employment 

AGENCY: Office of Postsecondary 

Education, Department of Education. 

ACTION: Notice of proposed rulemaking. 

SUMMARY: The Secretary proposes to 

rescind the gainful employment (GE) 

regulations, which added to the Student 

Assistance General Provisions 


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requirements for programs that prepare 

students for gainful employment in a 

recognized occupation. The Department 

plans to update the College Scorecard, 

or a similar web-based tool, to provide 

program-level outcomes for all higher 

education programs, at all institutions 

that participate in the programs 

authorized by title IV of the Higher 

Education Act of 1965, which would 

improve transparency and inform 

student enrollment decisions through a 

market-based accountability system. 

DATES: We must receive your comments 

on or before September 13, 2018. 

ADDRESSES: Submit your comments 

through the Federal eRulemaking Portal 

or via postal mail, commercial delivery, 

or hand delivery. We will not accept 

comments submitted by fax or by email 

or those submitted after the comment 

period. To ensure that we do not receive 

duplicate copies, please submit your 

comments only once. In addition, please 

include the Docket ID at the top of your 

comments. 

• Federal eRulemaking Portal: Go to 

www.regulations.gov to submit your 

comments electronically. Information 

on using Regulations.gov, including 

instructions for accessing agency 

documents, submitting comments, and 

viewing the docket, is available on the 

site under ‘‘Help.’’ 

• Postal Mail, Commercial Delivery, 

or Hand Delivery: The Department 

strongly encourages commenters to 

submit their comments electronically. 

However, if you mail or deliver your 

comments about the proposed 

regulations, address them to Ashley 

Higgins, U.S. Department of Education, 

400 Maryland Ave. SW, Mail Stop 294– 

20, Washington, DC 20202. 

Privacy Note: The Department’s policy is 

to make all comments received from 

members of the public available for public 

viewing in their entirety on the Federal 

eRulemaking Portal at www.regulations.gov. 

Therefore, commenters should be careful to 

include in their comments only information 

that they wish to make publicly available. 

FOR FURTHER INFORMATION CONTACT: 

Scott Filter, U.S. Department of 

Education, 400 Maryland Ave. SW, 

Room 290–42, Washington, DC 20024. 

Telephone: (202) 453–7249. Email: 

scott.filter@ed.gov. 

If you use a telecommunications 

device for the deaf (TDD) or a text 

telephone (TTY), call the Federal Relay 

Service (FRS), toll free, at 1–800–877– 

8339. 

SUPPLEMENTARY INFORMATION: 

Executive Summary: 

Purpose of This Regulatory Action: 

As discussed in more detail later in 

this notice of proposed rulemaking 

(NPRM), the proposed regulations 

would rescind the GE regulations and 

remove them from subpart Q of the 

Student Assistance and General 

Provisions in 34 CFR part 668. 

We base our proposal to rescind the 

GE regulations on a number of findings, 

including research results that 

undermine the validity of using the 

regulations’ debt-to-earnings (D/E) rates 

measure to determine continuing 

eligibility for participation in the 

programs authorized by title IV of the 

Higher Education Act of 1965, as 

amended (title IV, HEA programs). 

These findings were not accurately 

interpreted during the development of 

the 2014 GE regulations, were published 

subsequent to the promulgation of those 

regulations, or were presented by 

committee members at negotiated 

rulemaking sessions. The Department 

has also determined that the disclosure 

requirements included in the GE 

regulations are more burdensome than 

originally anticipated and that a 

troubling degree of inconsistency and 

potential error exists in job placement 

rates reported by GE programs that 

could mislead students in making an 

enrollment decision. Additionally, the 

Department has received consistent 

feedback from the community that the 

GE regulations were more burdensome 

than previously anticipated through the 

disclosure and reporting requirements 

that were promulgated in 2014. 

Finally, the Department has 

determined that in order to adequately 

inform student enrollment choices and 

create a framework that enables 

students, parents, and the public to hold 

institutions of higher education 

accountable, program-level outcomes 

data should be made available for all 

title IV-participating programs. The 

Department plans to publish these data 

using the College Scorecard, or its 

successor site, so that students and 

parents can compare the institutions 

and programs available to them and 

make informed enrollment and 

borrowing choices. However, the 

College Scorecard is not the subject of 

this regulation. For a more detailed 

discussion, see Significant Proposed 

Regulations. 

Section 410 of the General Education 

Provisions Act (GEPA) authorizes the 

Secretary to make, promulgate, issue, 

rescind, and amend rules and 

regulations governing the manner of 

operations of, and governing the 

applicable programs administered by, 

the Department (20 U.S.C. 1221e–3). 

Additionally, section 414 of the 

Department of Education Organization 

Act authorizes the Secretary to prescribe 

such rules and regulations as the 

Secretary determines necessary or 

appropriate to administer and manage 

the functions of the Secretary or the 

Department (20 U.S.C. 3474). 

Summary of the Major Provisions of 

This Regulatory Action: As discussed 

under ‘‘Purpose of This Regulatory 

Action,’’ the proposed regulations 

would rescind the GE regulations. 

Please refer to the Summary of Proposed 

Changes section of this NPRM for more 

details on the major provisions 

contained in this NPRM. 

Costs and Benefits: As further detailed 

in the Regulatory Impact Analysis, the 

benefits of the proposed regulations 

would include a reduction in burden for 

some institutions, costs in the form of 

transfers as a result of more students 

being able to enroll in a postsecondary 

program, and more educational program 

choices for students where they can use 

title IV aid. 

Invitation to Comment: We invite you 

to submit comments regarding these 

proposed regulations. 

To ensure that your comments have 

maximum effect in developing the final 

regulations, we urge you to identify 

clearly the specific section or sections of 

the proposed regulations that each of 

your comments addresses, and provide 

relevant information and data whenever 

possible, even when there is no specific 

solicitation of data and other supporting 

materials in the request for comment. 

We also urge you to arrange your 

comments in the same order as the 

proposed regulations. Please do not 

submit comments that are outside the 

scope of the specific proposals in this 

NPRM, as we are not required to 

respond to such comments. 

We invite you to assist us in 

complying with the specific 

requirements of Executive Orders 12866 

and 13563 and their overall requirement 

of reducing regulatory burden that 

might result from these proposed 

regulations. Please let us know of any 

further ways we could reduce potential 

costs or increase potential benefits 

while preserving the effective and 

efficient administration of the 

Department’s programs and activities. 

During and after the comment period, 

you may inspect all public comments 

about the proposed regulations by 

accessing Regulations.gov. You may also 

inspect the comments in person at 400 

Maryland Ave. SW, Washington, DC, 

between 8:30 a.m. and 4 p.m., Eastern 

Time, Monday through Friday of each 

week except Federal holidays. To 

schedule a time to inspect comments, 

please contact the person listed under 

FOR FURTHER INFORMATION CONTACT. 

Assistance to Individuals with 

Disabilities in Reviewing the 


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Federal Register / Vol. 83, No. 157 / Tuesday, August 14, 2018 / Proposed Rules 40169 

Rulemaking Record: On request, we will 

provide an appropriate accommodation 

or auxiliary aid to an individual with a 

disability who needs assistance to 

review the comments or other 

documents in the public rulemaking 

record for the proposed regulations. To 

schedule an appointment for this type of 

accommodation or auxiliary aid, please 

contact the person listed under FOR

FURTHER INFORMATION CONTACT. 

Background 

The Secretary proposes to amend 

parts 600 and 668 of title 34 of the Code 

of Federal Regulations (CFR). The 

regulations in 34 CFR parts 600 and 668 

pertain to institutional eligibility under 

the Higher Education Act of 1965, as 

amended (HEA), and participation in 

title IV, HEA programs. We propose 

these amendments to remove the GE 

regulations, including the D/E rates 

calculations and the sanctions and 

alternate earnings appeals related to 

those calculations for GE programs, as 

well as the reporting, disclosure, and 

certification requirements applicable to 

GE programs. 

The Department seeks public 

comment on whether the Department 

should amend 34 CFR 668.14 to require, 

as a condition of the Program 

Participation Agreement, that 

institutions disclose, on the program 

pages of their websites and in their 

college catalogues that, if applicable, the 

program meets the requirements for 

licensure in the State in which the 

institution is located and whether it 

meets the requirements in any other 

States for which the institution has 

determined whether the program 

enables graduates to become licensed or 

work in their field; net-price, 

completion rates, withdrawal rates, 

program size, and/or any other items 

currently required under the GE 

disclosure regulations. The Department 

also asks whether it should require 

institutions to provide links from each 

of its program pages to College 

Scorecard, its successor site, or any 

other tools managed by the Department. 

Public Participation 

On June 16, 2017, we published a 

notice in the Federal Register (82 FR 

27640) announcing our intent to 

establish a negotiated rulemaking 

committee under section 492 of the HEA 

to develop proposed regulations to 

revise the GE regulations published by 

the Department on October 31, 2014 (79 

FR 64889). We also announced two 

public hearings at which interested 

parties could comment on the topics 

suggested by the Department and 

propose additional topics for 

consideration for action by the 

negotiated rulemaking committee. The 

hearings were held on— 

July 10, 2017, in Washington, DC; and 

July 12, 2017, in Dallas, TX. 

Transcripts from the public hearings 

are available at https://www2.ed.gov/ 

policy/highered/reg/hearulemaking/ 

2017/index.html. 

We also invited parties unable to 

attend a public hearing to submit 

written comments on the proposed 

topics and to submit other topics for 

consideration. Written comments 

submitted in response to the June 16, 

2017, Federal Register notice may be 

viewed through the Federal 

eRulemaking Portal at 

www.regulations.gov, within docket ID 

ED–2017–OPE–0076. Instructions for 

finding comments are also available on 

the site under ‘‘Help.’’ 

Negotiated Rulemaking 

Section 492 of the HEA, 20 U.S.C. 

1098a, requires the Secretary to obtain 

public involvement in the development 

of proposed regulations affecting 

programs authorized by title IV of the 

HEA. After obtaining extensive input 

and recommendations from the public, 

including individuals and 

representatives of groups involved in 

the title IV, HEA programs, the 

Secretary in most cases must subject the 

proposed regulations to a negotiated 

rulemaking process. If negotiators reach 

consensus on the proposed regulations, 

the Department agrees to publish 

without alteration a defined group of 

regulations on which the negotiators 

reached consensus unless the Secretary 

reopens the process or provides a 

written explanation to the participants 

stating why the Secretary has decided to 

depart from the agreement reached 

during negotiations. Further information 

on the negotiated rulemaking process 

can be found at: www2.ed.gov/policy/ 

highered/reg/hearulemaking/hea08/negreg-faq.html. 

On August 30, 2017, the Department 

published a notice in the Federal 

Register (82 FR 41197) announcing its 

intention to establish two negotiated 

rulemaking committees and a 

subcommittee to prepare proposed 

regulations governing the Federal 

Student Aid programs authorized under 

title IV of the HEA. The notice set forth 

a schedule for the committee meetings 

and requested nominations for 

individual negotiators to serve on the 

negotiating committee. 

The Department sought negotiators to 

represent the following groups: Twoyear public institutions; four-year public 

institutions; accrediting agencies; 

business and industry; chief financial 

officers (CFOs) and business officers; 

consumer advocacy organizations; 

financial aid administrators; general 

counsels/attorneys and compliance 

officers; legal assistance organizations 

that represent students; minorityserving institutions; private, proprietary 

institutions with an enrollment of 450 

students or less; private, proprietary 

institutions with an enrollment of 451 

students or more; private, non-profit 

institutions; State higher education 

executive officers; State attorneys 

general and other appropriate State 

officials; students and former students; 

and groups representing U.S. military 

service members or veteran Federal 

student loan borrowers. The Department 

considered the nominations submitted 

by the public and chose negotiators who 

would represent the various 

constituencies. 

The negotiating committee included 

the following members: 

Laura Metune, California Community 

Colleges, and Matthew Moore 

(alternate), Sinclair Community College, 

representing two-year public 

institutions. 

Pamela Fowler, University of 

Michigan-Ann Arbor, and Chad Muntz 

(alternate), The University System of 

Maryland, representing four-year public 

institutions. 

Anthony Mirando, National 

Accrediting Commission of Career Arts 

and Sciences, and Mark McKenzie 

(alternate), Accreditation Commission 

for Acupuncture and Oriental Medicine, 

representing accrediting agencies. 

Roberts Jones, Education & Workforce 

Policy, and Jordan Matsudaira 

(alternate), Urban Institute and Cornell 

University, representing business and 

industry. 

Sandy Sarge, SARGE Advisors, and 

David Silverman (alternate), The 

American Musical and Dramatic 

Academy, representing CFOs and 

business officers. 

Whitney Barkley-Denney, Center for 

Responsible Lending, and Jennifer 

Diamond (alternate), Maryland 

Consumer Rights Coalition, representing 

consumer advocacy organizations. 

Kelly Morrissey, Mount Wachusett 

Community College, and Andrew 

Hammontree (alternate), Francis Tuttle 

Technology Center, representing 

financial aid administrators. 

Jennifer Blum, Laureate Education, 

Inc., and Stephen Chema (alternate), 

Ritzert & Layton, PC, representing 

general counsels/attorneys and 

compliance officers. 

Johnson M. Tyler, Brooklyn Legal 

Services, and Kirsten Keefe (alternate), 

Empire Justice Center, representing legal 


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40170 Federal Register / Vol. 83, No. 157 / Tuesday, August 14, 2018 / Proposed Rules 

assistance organizations that represent 

students. 

Thelma L. Ross, Prince George’s 

Community College, and John K. Pierre 

(alternate), Southern University Law 

Center, representing minority-serving 

institutions. 

Jessica Barry, School of Advertising 

Art, and Neal Heller (alternate), 

Hollywood Institute of Beauty Careers, 

representing private, proprietary 

institutions with an enrollment of 450 

students or less. 

Jeff Arthur, ECPI University, and Marc 

Jerome (alternate), Monroe College, 

representing private, proprietary 

institutions with an enrollment of 451 

students or more. 

C. Todd Jones, Association of 

Independent Colleges & Universities in 

Ohio, and Tim Powers (alternate), 

National Association of Independent 

Colleges and Universities, representing 

private, non-profit institutions. 

Christina Whitfield, State Higher 

Education Executive Officers 

Association, representing State higher 

education executive officers. 

Christopher Madaio, Office of the 

Attorney General of Maryland, and Ryan 

Fisher (alternate), Office of the Attorney 

General of Texas, representing State 

attorneys general and other appropriate 

State officials. 

Christopher Gannon, United States 

Student Association, and Ahmad 

Shawwal (alternate), University of 

Virginia, representing students and 

former students. 

Daniel Elkins, Enlisted Association of 

the National Guard of the United States, 

and John Kamin (alternate), The 

American Legion’s National Veterans 

Employment & Education Division, 

representing groups representing U.S. 

military service members or veteran 

Federal student loan borrowers. 

Gregory Martin, U.S. Department of 

Education, representing the Department. 

The negotiated rulemaking committee 

met to develop proposed regulations on 

December 4–7, 2017, February 5–8, 

2018, and March 12–15, 2018. 

At its first meeting, the negotiating 

committee reached agreement on its 

protocols and proposed agenda. The 

protocols provided, among other things, 

that the committee would operate by 

consensus. Consensus means that there 

must be no dissent by any member in 

order for the committee to have reached 

agreement. Under the protocols, if the 

committee reached a final consensus on 

all issues, the Department would use the 

consensus-based language in its 

proposed regulations. Furthermore, the 

Department would not alter the 

consensus-based language of its 

proposed regulations unless the 

Department reopened the negotiated 

rulemaking process or provided a 

written explanation to the committee 

members regarding why it decided to 

depart from that language. 

During the first meeting, the 

negotiating committee agreed to 

negotiate an agenda of eight issues 

related to student financial aid. These 

eight issues were: Scope and purpose, 

gainful employment metrics (later 

renamed debt-to-earnings metrics), debt 

calculations, sanctions, alternate 

earnings appeals, program disclosures, 

reporting requirements, and certification 

requirements. Under the protocols, a 

final consensus would have to include 

consensus on all eight issues. 

During committee meetings, the 

committee reviewed and discussed the 

Department’s drafts of regulatory 

language and the committee members’ 

alternative language and suggestions. At 

the final meeting on March 15, 2018, the 

committee did not reach consensus on 

the Department’s proposed regulations. 

For this reason, and according to the 

committee’s protocols, all parties who 

participated or were represented in the 

negotiated rulemaking and the 

organizations that they represent, in 

addition to all members of the public, 

may comment freely on the proposed 

regulations. For more information on 

the negotiated rulemaking sessions, 

please visit: https://www2.ed.gov/ 

policy/highered/reg/hearulemaking/ 

2017/gainfulemployment.html. 

Data Correction 

During the third meeting of the 

negotiated rulemaking committee, the 

Department provided negotiators with a 

number of scatterplots in response to a 

request from several negotiators to 

compare student loan repayment rates 

between Pell Grant recipients and 

students who did not receive a Pell 

Grant at individual institutions. The 

Department incorrectly concluded that 

the repayment rate between Pell Grant 

recipients and Pell Grant non-recipients 

at all institutions was 1:1. While the 

repayment rates of Pell Grant recipients 

and non-recipients are correlated, there 

is not a 1:1 relationship between them. 

The Department’s analysis shows the 

difference between the repayment rates 

of Pell Grant recipients and nonrecipients is about 20 percentage points 

on average. At institutions with low 

repayment rates among all students, the 

gap between Pell Grant recipients and 

non-recipients is relatively higher. The 

gap shrinks among institutions with 

very high overall repayment rates; 

however, many of these institutions 

serve small proportions of Pell Grant 

recipients and are highly selective 

institutions (based on mean SAT math 

scores). The negotiators have been 

informed of the earlier error and the 

updated scatterplots are available on the 

Department’s GE negotiated rulemaking 

website. 

Summary of Proposed Changes 

The proposed regulations would 

rescind the GE regulations in subpart Q 

of 34 CFR part 668, which establish the 

eligibility requirements for a program 

that prepares students for gainful 

employment in a recognized 

occupation, including the D/E rates 

measures, alternate earnings appeals, 

reporting and disclosure requirements, 

and certifications. 

Significant Proposed Regulations 

We group major issues according to 

subject. We discuss other substantive 

issues under the sections of the 

proposed regulations to which they 

pertain. Generally, we do not address 

proposed regulatory provisions that are 

technical or otherwise minor in effect. 

Origin and Purpose of the Gainful 

Employment Regulations 

The definition of ‘‘gainful 

employment’’ established in the 2014 

regulations created a new metric that 

established bright-line standards for a 

GE program’s continuing participation 

in title IV, HEA programs. 

The GE regulations establish a 

methodology for calculating mean D/E 

rates for programs that prepare students 

for gainful employment in a recognized 

occupation. The GE regulations also 

establish a range of acceptable D/E rates 

programs must maintain in order to 

retain eligibility to participate in the 

title IV, HEA programs. GE programs 

include non-degree programs at public 

and non-profit institutions and all 

programs (including undergraduate, 

graduate, and professional degree 

programs) at proprietary institutions. 

Under the regulations, GE programs 

must have a graduate debt-todiscretionary earnings ratio of less than 

or equal to 20 percent or debt-to-annual 

earnings ratio of less than or equal to 8 

percent to receive an overall passing 

rate. Programs with both a discretionary 

earnings rate greater than 30 percent (or 

a negative or zero denominator) and an 

annual earnings rate greater than 12 

percent (or a zero denominator) receive 

an overall failing rate. Programs that fail 

the D/E rates measure for two out of 

three consecutive years lose title IV 

eligibility. Non-passing programs that 

have debt-to-discretionary income ratios 

greater than 20 percent and less than or 

equal to 30 percent or debt-to-annual 

income ratios greater than 8 percent and 


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1U.S. Department of Labor—Bureau of Labor 

Statistics. (July 10, 2018). Economic News Release: 

Job Openings and Labor Turnover Summary. 

Available at www.bls.gov/news.release/ 

jolts.nr0.htm. 

2Baum, S. & Schwartz, S. How Much Debt is Too 

Much? Defining Benchmarks for Manageable 

Student Debt. College Board, 2008. Available at 

https://files.eric.ed.gov/fulltext/ED562688.pdf. 

3 Ibid. 

4 Gladieux, L. Federal Student Aid Policy: A 

History and an Assessment. Financing 

Postsecondary Education: The Federal Role. 

October 1995. Available at https://www2.ed.gov/ 

offices/OPE/PPI/FinPostSecEd/gladieux.html. 

5Ma, J., Pender, M. & Welch, M. Education Pays 

2016: The Benefits of Higher Education for 

Individuals and Society, CollegeBoard, 2016. Fig. 

2.4. 

6Hillman, N. & Weichman, T. Education Deserts: 

The Continued Significance of ‘‘Place’’ in the 

Twenty-First Century, American Council on 

Education, 2016. Available at www.acenet.edunewsroom/Pages/CPRS-Viewpoints-EducationDeserts.aspx. 

less than or equal to 12 percent are 

considered to be in the ‘‘zone.’’ 

Programs with a combination of zone or 

failing overall rates for four consecutive 

years lose title IV eligibility. 

The first D/E rates were published in 

2017, and the Department’s analysis of 

those rates raises concern about the 

validity of the metric and how it affects 

the opportunities for Americans to 

prepare for high-demand occupations in 

the healthcare, hospitality, and personal 

services industries, among others. At a 

time when 6 million jobs remain 

unfilled due to the lack of qualified 

workers,1 the Department is reevaluating the wisdom of a regulatory 

regime that creates additional burden 

for, and restricts, programs designed to 

increase opportunities for workforce 

readiness. We further believe the GE 

regulations reinforce an inaccurate and 

outdated belief that career and 

vocational programs are less valuable to 

students and less valued by society, and 

that these programs should be held to a 

higher degree of accountability than 

traditional two- and four-year degree 

programs that may have less market 

value. 

Research Findings That Challenge the 

Accuracy and Validity of the D/E Rates 

Measure 

In promulgating the 2011 and 2014 

regulations, the Department cited as 

justification for the 8 percent D/E rates 

threshold a research paper published in 

2006 by Baum and Schwartz that 

described the 8 percent threshold as a 

commonly utilized mortgage eligibility 

standard.2 However, the Baum & 

Schwartz paper makes clear that the 8 

percent mortgage eligibility standard 

‘‘has no particular merit or justification’’ 

when proposed as a benchmark for 

manageable student loan debt.3 The 

Department previously dismissed this 

statement by pointing to Baum and 

Schwartz’s acknowledging the 

‘‘widespread acceptance’’ of the 8 

percent standard and concluding that it 

is ‘‘not unreasonable.’’ 79 FR 64889, 

64919. Upon further review, we believe 

that the recognition by Baum and 

Schwartz that the 8 percent mortgage 

eligibility standard ‘‘has no particular 

merit or justification’’ when proposed as 

a benchmark for manageable student 

loan debt is more significant than the 

Department previously acknowledged 

and raises questions about the 

reasonableness of the 8 percent 

threshold as a critical, high-stakes test of 

purported program performance. 

Research published subsequent to the 

promulgation of the GE regulations adds 

to the Department’s concern about the 

validity of using D/E rates as to 

determine whether or not a program 

should be allowed to continue to 

participate in title IV programs. As 

noted in the 2014 proposed rule, the 

Department believed that an 

improvement of quality would be 

reflected in the program’s D/E rates (79 

FR 16444). However, the highest quality 

programs could fail the D/E rates 

measure simply because it costs more to 

deliver the highest quality program and 

as a result the debt level is higher. 

Importantly, the HEA does not limit 

title IV aid to those students who attend 

the lowest cost institution or program. 

On the contrary, because the primary 

purpose of the title IV, HEA programs is 

to ensure that low-income students have 

the same opportunities and choices in 

pursuing higher education as their 

higher-income peers, title IV aid is 

awarded based on the institution’s 

actual cost of attendance, rather than a 

fixed tuition rate that limits low-income 

students to the lowest cost institutions.4

Other research findings suggest that 

D/E rates-based eligibility creates 

unnecessary barriers for institutions or 

programs that serve larger proportions 

of women and minority students. Such 

research indicates that even with a 

college education, women and 

minorities, on average, earn less than 

white men who also have a college 

degree, and in many cases, less than 

white men who do not have a college 

degree.5

Disagreement exists as to whether this 

is due to differences in career choices 

across subgroups, time out of the 

workforce for childcare responsibilities, 

barriers to high-paying fields that 

disproportionately impact certain 

groups, or the interest of females or 

minority students in pursuing careers 

that pay less but enable them to give 

back to their communities. Regardless of 

the cause of pay disparities, the GE 

regulations could significantly 

disadvantage institutions or programs 

that serve larger proportions of women 

and minority students and further 

reduce the educational options available 

to those students. 

It is also important to highlight the 

importance of place in determining 

which academic programs are available 

to students. A student may elect to 

enroll in a program that costs more 

simply because a lower-cost program is 

too far from home or work or does not 

offer a schedule that aligns with the 

student’s work or household 

responsibilities. The average first-time 

undergraduate student attending a twoyear public institution enrolls at an 

institution within eight miles of his or 

her home. The distance increases to 18 

miles for the average first-time 

undergraduate student enrolling at a 

four-year public institution.6

Accordingly, we believe that while it is 

important for a student to know that a 

program could result in higher debt, it 

is not appropriate to eliminate the 

option simply because a lower-cost 

program exists, albeit outside of the 

student’s reasonable travel distance. In 

the same way that title IV programs 

enable traditional students to select the 

more expensive option simply because 

of the amenities an institution offers, or 

its location in the country, they should 

similarly enable adult learners to select 

the more expensive program due to its 

convenience, its more personalized 

environment, or its better learning 

facilities. We support providing more 

information to students and parents that 

enables them to compare the outcomes 

achieved by graduates of the programs 

available to them. However, due to a 

number of concerns with the calculation 

and relevance of the debt level included 

in the rates we do not believe that the 

D/E rates measure achieves a level of 

accuracy that it should alone determine 

whether or not a program can 

participate in title IV programs. 

While the Department denied the 

impact of these other factors in the 2014 

GE regulations, it now recognizes a 

number of errors included in its prior 

analysis. For example, in the 2014 final 

rule (79 FR 64889, 65041–57), the 

Department stated that changes in 

economic outlook would not cause a 

program to fail the D/E rates measure or 

remain in the zone for four years. This 

conclusion was based on the finding 

that the average recession lasted for 11.1 

months, which would not be long 

enough to impact a program’s outcomes 


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7www.federalreservehistory.org/essays/great_

recession_of_200709. 

8Abel, Jaison & Deitz, Richard. 

Underemployment in the Early Career of College 

Graduates Following the Great Recession, Working 

Paper No. 22654, National Bureau of Economic 

Research, September 2016. Available at 

www.nber.org/papers/w22654. 

9https://money.cnn.com/2011/05/17/news/ 

economy/recession_lost_generation/index.htm. 

10The count of programs includes programs that 

had preliminary rates calculated, but were not 

designated with an official pass, zone, or fail status 

due to reaccreditation and reinstatements of 

eligibility during the validation process of 

establishing D/E rates. 

for the number of years required to go 

from ‘‘zone’’ to failing. However, the 

Great Recession lasted for well over two 

years, and was followed by an extended 

‘‘jobless’’ recovery, which would have 

significantly impacted debt and 

earnings outcomes for a period of time 

that would have exceeded the zone 

period, had the GE regulations been in 

place during that period.7 The Great 

Recession had an unusually profound 

impact on recent college graduates, who 

were underemployed at an historic rate, 

meaning that graduates were working in 

jobs that prior to the Great Recession 

did not require a college credential.8

The Department concedes that an 

extended recession coupled with 

rampant underemployment, could have 

a significant impact on a program’s D/ 

E rates for a period of time that would 

span most or all of the zone period. 

Underemployment during the Great 

Recession was not limited to the 

graduates of GE programs, but included 

graduates of all types of institutions, 

including elite private institutions.9

The GE regulations were intended to 

address the problem of programs that 

are supposed to provide training that 

prepares students for gainful 

employment in a recognized 

occupation, but were leaving students 

with unaffordable levels of loan debt 

compared to the average program 

earnings (79 FR 16426). However, the 

Department believes there are other 

tools now available to enable students 

with lower incomes to manage high 

levels of debt. While the existence of 

income-driven repayment plans does 

not address the high cost of college— 

and, in fact, could make it even easier 

for students to borrow more than they 

need and institutions to charge high 

prices—the Department’s plans to 

increase transparency will help address 

these issues. Furthermore, the increased 

availability of these repayment plans 

with longer repayment timelines is 

inconsistent with the repayment 

assumptions reflected in the shorter 

amortization periods used for the D/E 

rates calculation in the GE regulations. 

In addition, a program’s D/E rates can 

be negatively affected by the fact that it 

enrolls a large number of adult students 

who have higher Federal borrowing 

limits, thus higher debt levels, and may 

be more likely than a traditionally aged 

student to seek part-time work after 

graduation in order to balance family 

and work responsibilities. The 

Department recognizes that it is 

inappropriate to penalize institutions 

simply because the students they serve 

take advantage of the higher borrowing 

capacity Congress has made available to 

those borrowers. It is also inappropriate 

to penalize institutions because students 

seek part-time work rather than fulltime work, or are building their own 

businesses, which may result in lower 

earnings early on. Regardless of whether 

students elect to work part-time or fulltime, the cost to the institution of 

administering the program is the same, 

and it is the cost of administering the 

program that determines the cost of 

tuition and fees. In general, programs 

that serve large proportions of adult 

learners may have very different 

outcomes from those that serve large 

proportions of traditionally aged 

learners, and yet the D/E rates measure 

fails to take any of these important 

factors into account. 

Most importantly, the first set of D/E 

rates, published in 2016, revealed that 

D/E rates, and particularly earnings, 

vary significantly from one occupation 

to the next, and across geographic 

regions within a single occupation. The 

Department had not predicted such 

substantial differences in earnings due 

to geography, which may have been 

exacerbated by the Great Recession and 

the speed with which individual States 

reduced their unemployment rate. 

While the Department intended for D/ 

E rates to serve as a mechanism for 

distinguishing between high- and lowperforming programs, data discussed 

during the third session of the most 

recent negotiated rulemaking 

demonstrated that even a small change 

in student loan interest rates could shift 

many programs from a ‘‘passing’’ status 

to ‘‘failing,’’ or vice versa, even if 

nothing changed about the programs’ 

content or student outcomes. The 

Department believes that examples such 

as that illustrated here should be 

corrected and our justifications in the 

2014 GE regulation did not adequately 

take these nuances into account 

sufficiently. Table 1 shows how changes 

in interest rate would affect outcomes 

under the D/E rates measure. For 

example, if the interest rate is seven 

percent, 831 programs would fail 

compared to only 716 programs if the 

interest rate is six percent. 

TABLE 1—NUMBER AND PERCENTAGE OF GE 2015 PROGRAMS THAT WOULD PASS, FAIL, OR FALL INTO THE ZONE

USING DIFFERENT INTEREST RATES 10

Interest rate 

(%) 

Number of programs Percentage of programs 

Pass Zone Fail Pass Zone Fail 

3 ............................................................... 7,199 998 440 83 12 5 

4 ............................................................... 7,030 1,085 522 81 13 6 

5 ............................................................... 6,887 1,135 615 80 13 7 

6 ............................................................... 6,720 1,201 716 78 14 8 

7 ............................................................... 6,551 1,255 831 76 15 10 

8 ............................................................... 6,326 1,353 958 73 16 11 

Source: Department analysis of GE 2015 rates. 

The Department agrees with a 

statement made by a negotiator that any 

metric that could render a program 

ineligible to participate in title IV, HEA 

programs simply because the economy 

is strong and interest rates rise is faulty. 

The Department believes that it is 

during these times of economic growth, 

when demand for skilled workers is 

greatest, that it is most critical that 

shorter-term career and technical 

programs are not unduly burdened or 

eliminated. 

In addition, the Department now 

recognizes that assigning a 10-year 

amortization period to graduates of 


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11ACCSC Standards of Accreditation, Appendix 

VII—Guidelines for Employment Classification, 

2015, Available at www.accsc.org/ 

UploadedDocuments/July%202015/Guidelines%

20for%20Employment.pdf. 

12https://nces.ed.gov/npec/data/Calculating_

Placement_Rates_Background_Paper.pdf. 

13https://www2.ed.gov/policy/highered/reg/ 

hearulemaking/2012/ipeds-summary91013.pdf. 

certificate and associate degree 

programs for the purpose of calculating 

D/E rates creates an unacceptable and 

unnecessary double standard since the 

REPAYE plan regulations promulgated 

in 2015 provide a 20-year amortization 

period for these same graduates. The 

REPAYE plan acknowledges that 

undergraduate completers may well 

need to extend payments over a longer 

amortization period, and makes it clear 

that extended repayment periods are an 

acceptable and reasonable way to help 

students manage their repayment 

obligations. Therefore, it is not 

appropriate to use an amortization 

period of less than 20 years for any 

undergraduate program D/E rates 

calculations or of less than 25 years for 

any graduate program D/E rates 

calculations. 

Concerns About Disclosures Required 

Under the GE Regulations 

As the Department is proposing to 

rescind the GE regulations in total, the 

disclosures required under the current 

regulations also would be rescinded. 

Generally, we are concerned that it is 

not appropriate to require these types of 

disclosures for only one type of program 

when such information would be 

valuable for all programs and 

institutions that receive title IV, HEA 

funds. However, we cannot expand the 

GE regulations to include programs that 

are not GE programs. In that regard, as 

indicated above, we are interested in 

comments on whether the Department 

should require that all institutions 

disclose information, such as net price, 

program size, completion rates, and 

accreditation and licensing 

requirements, on their program web 

pages, or if doing so is overly 

burdensome for institutions. 

The Department has also discovered a 

variety of challenges and errors 

associated with the disclosures required 

under the GE regulations. For example, 

there is significant variation in 

methodologies used by institutions to 

determine and report in-field job 

placement rates, which could mislead 

students into choosing a lower 

performing program that simply appears 

to be higher performing because a less 

rigorous methodology was employed to 

calculate in-field job placement rates. 

In some cases, a program is not 

required to report job placement 

outcomes because it is not required by 

its accreditor or State to do so. In other 

cases, GE programs at public 

institutions in some States (such as 

community colleges in Colorado) define 

an in-field job placement for the 

purpose of the GE disclosure as any job 

that pays a wage, regardless of the field 

in which the graduate is working. 

Meanwhile, institutions accredited by 

the Accrediting Commission of Career 

Schools and Colleges must consider the 

alignment between the job and the 

majority of the educational and training 

objectives of the program, which can be 

a difficult standard to meet since 

educational programs are designed to 

prepare students broadly for the various 

jobs that may be available to them, but 

jobs are frequently more narrowly 

defined to meet the needs of a specific 

employer.11

The original 2011 GE regulations 

required NCES to ‘‘develop a placement 

rate methodology and the processes 

necessary for determining and 

documenting student employment.’’ 12

This requirement arose out of negotiator 

concerns about the complexity and 

subjectivity of the many job placement 

definitions used by States, institutional 

accreditors, programmatic accreditors 

and institutions themselves to evaluate 

outcomes. The Department convened a 

Technical Review Panel (TRP), but in 

2013 the TRP reported that not only 

were job placement determinations 

‘‘highly subjective’’ in nature, but that 

the TRP could not come to consensus on 

a single, acceptable definition of a job 

placement that could be used to report 

this outcome on GE disclosures, nor 

could it identify a reliable data source 

to enable institutions to accurately 

determine and report job placement 

outcomes.13 In light of the failure of the 

TRP to develop a consistent definition 

of a job placement, and well-known 

instances of intentional or accidental job 

placement rate misrepresentations, the 

Department believes it would be 

irresponsible to continue requiring 

institutions to report job placement 

rates. Instead, the Department believes 

that program-level earnings data that 

will be provided by the Secretary 

through the College Scorecard or its 

successor is the more accurate and 

reliable way to report job outcomes in 

a format that students can use to 

compare the various institutions and 

programs they are considering. 

The Department also believes that it 

underestimated the burden associated 

with distributing the disclosures 

directly to prospective students. In 

2018, the Department announced that it 

was allowing institutions additional 

time to meet the requirement in 

§ 668.412(e) to directly distribute the 

disclosure template to prospective 

students, as well as the requirement in 

§ 668.412(d) to include the disclosure 

template or a link thereto in program 

promotional materials, pending 

negotiated rulemaking (82 FR 30975; 83 

FR 28177). A negotiator representing 

financial aid officials confirmed our 

concerns, stating that large campuses, 

such as community colleges that serve 

tens of thousands of students and are in 

contact with many more prospective 

students, would not be able to, for 

example, distribute paper or electronic 

disclosures to all the prospective 

students in contact with the institution. 

Although in decades past, institutions 

may have included these materials in 

the packets mailed to a prospective 

student’s home; many institutions no 

longer mail paper documents, and 

instead rely on web-based materials and 

electronic enrollment agreements. The 

Department notes that § 668.412(e) 

requires that disclosures be made only 

to a prospective student before that 

individual signs an enrollment 

agreement, completes registration, or 

makes a financial commitment to the 

institution and that the institution may 

provide the disclosure to the student by 

hand-delivering the disclosure template 

to the prospective student or sending 

the disclosure template to the primary 

email address used by the institution for 

communicating with the prospective 

student. However, ED recognizes that 

even this requirement has an associated 

burden, especially since institutions are 

required to retain documentation that 

each student acknowledges that they 

have received the disclosure. The 

Department believes that the best way to 

provide disclosures to students is 

through a data tool that is populated 

with data that comes directly from the 

Department, and that allows prospective 

students to compare all institutions 

through a single portal, ensuring that 

important consumer information is 

available to students while minimizing 

institutional burden. 

Finally, more than a few disclosures 

exclude outcomes because the program 

had fewer than 10 graduates in the 

award year covered by the disclosure 

template. Because the Department does 

not collect data from the disclosures 

through a central portal or tool, it has 

been unable to compare the number of 

completers reported on the GE 

disclosures posted by programs with the 

number reported through other survey 

tools. Therefore, it is difficult to know 

if these reports of less than 10 graduates 

are accurate. 


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14https://nces.ed.gov/pubs/web/97578g.asp. 

15www.forbes.com/sites/stevecohen/2012/09/29/

the-three-biggest-lies-in-college-admission/ 

#9ed5ccc1754f. 

16www.nytimes.com/2012/02/01/education/

gaming-the-college-rankings.html. 

17www.cnn.com/2014/10/22/us/unc-reportacademic-fraud/index.html. 

18www.wsj.com/articles/temple-university-fires-adean-over-falsified-rankings-data-1531498822. 

19 Delisle, J. and Cooper, P. (2017). Measuring 

Quality or Subsidy? How State Appropriations Rig 

the Federal Gainful Employment Test. Do state 

subsidies for public universities favor the affluent? 

Brookings Institute. Available at www.aei.org/ 

publication/measuring-quality-or-subsidy-howstate-appropriations-rig-the-federal-gainfulemployment-test/. 

20https://www.irs.gov/newsroom/irs-releasesnew-tax-gap-estimates-compliance-rates-remainstatistically-unchanged-from-previous-study. 

Covered Institutions and Programs 

Under its general authority to publish 

data related to title IV program 

outcomes, and in light of changes to the 

National Student Loan Data System 

related to the 150% subsidized loan 

rules requiring institutions to report 

program CIP codes, the Department 

believes that it is important and 

necessary to publish program-level 

student outcomes to inform consumer 

choice and enable researchers and 

policy makers to analyze program 

outcomes. The Department does not 

believe that GE data can adequately 

meet this goal or inform consumer 

choice since only a small proportion of 

postsecondary programs are required to 

report program-level outcomes data and, 

even among GE programs, many 

programs graduate fewer than 10 

students per year and are not required 

to provide student outcome information 

on the GE disclosure. In addition, the 

Department does not believe it is 

appropriate to attach punitive actions to 

program-level outcomes published by 

some programs but not others. In 

addition, the Department believes that it 

is more useful to students and parents 

to publish actual median earnings and 

debt data rather than to utilize a 

complicated equation to calculate D/E 

rates that students and parents may not 

understand and that cannot be directly 

compared with the debt and earnings 

outcomes published by non-GE 

programs. For all the reasons set forth in 

this NPRM, the Department believes it 

would be unwise policy to continue 

using the D/E rates for reporting or 

eligibility purposes. 

In addition, the GE regulations 

targeted proprietary institutions, aiming 

to eliminate poor performers and ‘‘bad 

actors’’ in the sector. While bad actors 

do exist in the proprietary sector, the 

Department believes that there are good 

and bad actors in all sectors and that the 

Department, States, and accreditors 

have distinct roles and responsibilities 

in holding all bad actors accountable. 

Prior to 2015, when the Department 

started collecting program-level data for 

all completers, the GE regulations 

provided a unique opportunity for the 

Department to calculate program-level 

outcomes. Now that the Department 

collects program information for all 

completers, it can easily expand 

program-level outcomes reporting for all 

institutions. Therefore, not only does 

the Department believe that the D/E 

rates calculation is not an appropriate 

measure for determining title IV 

eligibility, the availability of programlevel data for all completers makes it 

possible to provide median earnings and 

debt data for all programs, thereby 

providing a more accurate mechanism 

for providing useful information to 

consumers. 

Further, the Department has reviewed 

additional research findings, including 

those published by the Department in 

follow-up to the Beginning 

Postsecondary Survey of 1994, and 

determined that student demographics 

and socioeconomic status play a 

significant role in determining student 

outcomes.14 The GE regulations failed to 

take into account the abundance of 

research that links student outcomes 

with a variety of socioeconomic and 

demographic risk factors, and similarly 

failed to acknowledge that institutions 

serving an older student population will 

likely have higher median debt since 

Congress has provided higher borrowing 

limits for older students who are less 

likely than traditional students to 

receive financial support from parents. 

Students select institutions and 

college majors for a wide variety of 

reasons, with cost and future earnings 

serving as only two data points within 

a more complex decision-making 

process. For the reasons cited 

throughout this document, the 

Department has reconsidered its 

position. 

Well-publicized incidents of nonprofit institutions misrepresenting their 

selectivity levels, inflating the job 

placement rates of their law school 

graduates, and even awarding credit for 

classes that never existed demonstrate 

that bad acts occur among institutions 

regardless of their tax status.15 16 17 18

The GE regulations underestimated 

the cost of delivering a program and 

practices within occupations that may 

skew reported earnings. According to 

Delisle and Cooper, because public 

institutions receive State and local 

taxpayer subsidies, ‘‘even if a for-profit 

institution and a public institution have 

similar overall expenditures (costs) and 

graduate earnings (returns on 

investment), the for-profit institution 

will be more likely to fail the GE rule, 

since more of its costs are reflected in 

student debt.’’ 19 Non-profit, private 

institutions also, in general, charge 

higher tuition and have students who 

take on additional debt, including 

enrolling in majors that yield societal 

benefits, but not wages commensurate 

with the cost of the institution. 

Challenges have been brought alleging 

cosmetology and hospitality programs 

have felt a significant impact due to the 

GE regulations. In the case of 

cosmetology programs, State licensure 

requirements and the high costs of 

delivering programs that require 

specialized facilities and expensive 

consumable supplies may make these 

programs expensive to operate, which 

may be why many public institutions do 

not offer them. In addition, graduates of 

cosmetology programs generally must 

build up their businesses over time, 

even if they rent a chair or are hired to 

work in a busy salon. 

Finally, since a great deal of 

cosmetology income comes from tips, 

which many individuals fail to 

accurately report to the Internal 

Revenue Service, mean and median 

earnings figures produced by the 

Internal Revenue Service underrepresent the true earnings of many 

workers in this field in a way that 

institutions cannot control.20 Litigation 

filed by the American Association of 

Cosmetology Schools (AACS) asserting 

similar claims highlighted the 

importance of the alternate earnings 

appeal to allow institutions to account 

for those earnings. 

While the GE regulations include an 

alternate earnings appeals process for 

programs to collect data directly from 

graduates, the process for developing 

such an appeal has proven to be more 

difficult to navigate than the 

Department originally planned. The 

Department has reviewed earnings 

appeal submissions for completeness 

and considered response rates on a caseby-case basis since the response rate 

threshold requirements were set aside in 

the AACS litigation. Through this 

process, the Department has 

corroborated claims from institutions 

that the survey response requirements of 

the earnings appeals methodology are 

burdensome given that program 

graduates are not required to report their 

earnings to their institution or to the 

Department, and there is no mechanism 

in place for institutions to track students 

after they complete the program. The 

process of Departmental review of 

individual appeals has been timeVerDate Sep<11>2014 17:23 Aug 13, 2018 Jkt 244001 PO 00000 Frm 00016 Fmt 4702 Sfmt 4702 E:\FR\FM\14AUP1.SGM 14AUP1

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21American Association of Community College. 

(September 20, 2017). Comments of the American 

Association of Community Colleges. Docket ID: ED– 

2017–OS–0074. Available at https://

www.regulations.gov/document?D=ED-2017-OS0074-15336. 

22www.ed.gov/news/press-releases/obamaadministration-takes-action-protect-americanspredatory-poor-performing-ca/. 

23www.washingtonpost.com/news/fact-checker/ 

wp/2014/04/11/the-obama-administrations-claimthat-72-percent-of-for-profits-programs-havegraduates-making-less-than-high-school-dropouts/ 

24 Ibid. 

25Cheeseman Day, J. & Newburger, E. The Big 

Payoff: Educational Attainment and Synthetic 

Estimates of Work-Life Earnings, Current 

Population Reports, U.S. Department of Commerce, 

Economics and Statistics Administration, U.S. 

Census Bureau, 2002. Available at www.census.gov/ 

content/dam/Census/ibrary/publications/2002/ 

demo/p23–210.pdf. 

26nces.ed.gov/pubs2006/2006321.pdf. 27www.brookings.edu/wp-content/uploads/2016/ 

07/Deconstructing-and-Reconstructing-the-CollegeScorecard.pdf. 

28 trends.collegeboard.org/sites/default/files/ 

education-pays-2016-full-report.pdf. 

29nces.ed.gov/pubs/web/97578g.asp. 

30Witteveen, D. & Attewell, P. The earnings 

payoff from attending a selective college. Social 

Science Research 66 (2017) 154–169. Available at 

www.sciencedirect.com/science/article/pii/ 

S0049089X16301430. 

consuming and resource-intensive, with 

great variations in the format and 

completeness of appeals packages. The 

contents of some of these review 

packages would suggest continued 

confusion about requirements on the 

part of schools that would be 

problematic if those earnings were still 

tied to any kind of eligibility threshold. 

Executive Order 13777 instructs 

agencies to reduce unnecessary burden 

on regulated entities, while at the same 

time emphasizing the need for greater 

transparency. The Department believes 

that its proposed rescission of the GE 

regulations is consistent with Executive 

Order 13777 because the GE regulations 

place tremendous burden upon certain 

programs and institutions, as evidenced 

by comments from negotiators 

representing institutions not currently 

covered by the GE regulations that 

extending the regulations to include 

their institution would impose 

tremendous and costly burden. As noted 

by various associations and institutions 

in response to the Department’s request 

for public feedback on which 

regulations should be repealed, 

modified, or replaced, a large number of 

community colleges whose GE programs 

have not been in danger of failing the D/ 

E rates measure have complained about 

the cost of complying with the GE 

regulations, which has been viewed as 

far out of proportion with the 

corresponding student benefits. For 

example, the American Association of 

Community Colleges pointed to the 

regulations’ extensive reporting and 

disclosure requirements.21 Despite this 

additional burden to GE programs, the 

GE regulations provide only limited 

transparency since the regulations apply 

to a small subset of title IV-eligible 

programs. Instead, the Department 

believes that its efforts to expand the 

College Scorecard, which includes all 

programs that participate in the title IV, 

HEA programs, to include program-level 

earnings, debt, and other data, will 

better accomplish our goal of increasing 

transparency. 

The GE regulations include, among 

other things, a complicated formula for 

calculating a program’s D/E rates, a set 

of thresholds that are used to determine 

whether a program’s D/E rates are 

passing, failing, or in the zone, and a 

number of disclosure requirements. The 

D/E rates measure compares median 

student loan debt (including 

institutional, private, and Federal loan 

debt), as reported by institutions and the 

National Student Loan Data System, to 

the higher of mean and median earnings 

obtained from the Social Security 

Administration. 

Further, we believe that the analysis 

and assumptions with respect to 

earnings underlying the GE regulations 

are flawed. In 2014, upon the 

introduction of the GE regulations, the 

Department claimed that graduates of 

many GE programs had earnings less 

than those of the average high school 

dropout.22 The Washington Post 

highlighted several errors in this 

comparison including that the 

Department failed to explain that the 

three-year post-graduation GE earnings 

compared the earnings of recent 

graduates with the earnings of a 

population of high school graduates that 

could include those who are nearing the 

end of 40-year careers or who own 

successful long-existing businesses.23

Further comparisons to non-college 

graduates need to be contextualized, 

given that the average person who 

completes a registered apprenticeship 

earns a starting salary of more than 

$60,000 per year, and some college 

graduates who pursue careers in allied 

health, education, or human services— 

regardless of what college they 

attended—earn less than non-college 

graduates who complete an 

apprenticeship program.24

The Census Bureau, in its landmark 

2002 report, The Big Payoff, was careful 

to explain that individual earnings may 

differ significantly due to a variety of 

factors, including an individual’s work 

history, college major, personal 

ambition, and lifestyle choices.25 The 

report also pointed out that even some 

individuals with graduate degrees, such 

as those in social work or education, 

may fail to earn as much as a high 

school graduate who works in the 

skilled trades. In other words, both debt 

and earnings outcomes depend on a 

number of factors other than program 

quality or institutional performance. 

There are tremendous complexities 

involved in comparing earnings, 

especially since prevailing wages differ 

significantly from one occupation to the 

next and one geographic region to the 

next.26 Therefore, a bright-line D/E rates 

measure ignores the many research 

findings that were either not taken into 

account in publishing the GE 

regulations or that were published since 

the GE regulations were promulgated, 

that have demonstrated over and over 

again that gender, socioeconomic status, 

race, geographic location, and many 

other factors affect earnings.27 28 29 Even 

among the graduates of the Nation’s 

most prestigious colleges, earnings vary 

considerably depending upon the 

graduate’s gender, the field the graduate 

pursued, whether or not the graduate 

pursued full-time work, and the 

importance of work-life balance to the 

individual.30 And yet, the Department 

has never contended that the majors 

completed by the lower-earning 

graduates were lower performing or 

lower quality than those that result in 

the highest wages. 

Additional Disclosures 

The Department published in the 

Federal Register on November 1, 2016, 

regulations known as the Borrower 

Defenses to Repayment (BD) regulations 

(81 FR 75926). The effective date of the 

BD regulations was most recently 

delayed until July 1, 2019 (83 FR 6458) 

to allow for additional negotiated 

rulemaking to reconsider those 

regulations. Following the conclusion of 

the negotiated rulemaking process, on 

July 31, 2018, the Department published 

in the Federal Register a notice of 

proposed rulemaking in which the 

Department proposes, among other 

things, to withdraw (i.e., rescind) 

specified provisions of the BD 

regulations already published but not 

yet effective. 

Among these BD regulations are two 

disclosures that were included among 

the topics for negotiation by the GE 

negotiating committee, as part of the 

larger discussion about the disclosure 

requirements in the GE regulations. One 

of these provisions would have required 

proprietary institutions to provide a 

warning to students if the loan 

repayment rate for the institution did 

not meet a specified bright-line 


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standard. The other provision would 

have required institutions to notify 

students if the institution was required 

under other provisions of the BD 

regulations to provide the Department 

with financial protection, such as a 

letter of credit. 

In response to the 2016 Borrower 

Defense proposed regulations, the 

Department received many comments 

contending that the regulations unfairly 

targeted proprietary institutions (81 FR 

75934). Others commented that the loan 

repayment rate disclosure reflected 

financial circumstances and not 

educational quality. The Department 

believes that these comments are in line 

with how the Department views GE and 

the reasons provided for rescinding it. 

As such, the Department also proposes 

to remove the requirement for 

institutions to disclose information 

related to student loan repayment rates. 

With respect to the financial protection 

disclosure, the Department believes that 

matters such as the calculation of an 

institution’s composite score and 

requirements regarding letters of credit 

are complex and beyond the level of 

understanding of a typical high school 

graduate considering enrollment in a 

postsecondary education program. 

Therefore, a student may misjudge the 

meaning of such a disclosure to indicate 

the imminent closure of the institution, 

which is not necessarily the case. While 

in certain instances, a letter of credit 

may serve as an indicator of financial 

risk to taxpayers, there are other 

instances where this may not be the 

case. Therefore, the Department 

proposes to remove the requirement for 

institutions to disclose that they are 

required to post a letter of credit and the 

related circumstances. 

In discussion with the negotiators, 

those representing attorneys general, 

legal organizations, and student 

advocacy groups opposed eliminating 

these disclosures because they believed 

the disclosures would benefit students. 

However, the Department believes that 

these disclosures will not provide 

meaningful or clear information to 

students, and will increase cost and 

burden to institutions that would have 

to disclose this information. 

Although these two disclosures were 

discussed by the negotiated rulemaking 

committee convened to consider the GE 

regulations, because they are formally 

associated with the borrower defense 

regulations, their proposed withdrawal 

is addressed through the proposed 

regulatory text in the 2018 notice of 

proposed rulemaking relating to the BD 

regulations. 

In summary, the Department proposes 

to rescind the GE regulations for a 

number of reasons, including: 

• Research findings published 

subsequent to the promulgation of the 

regulation confirm that the D/E rates 

measure is inappropriate for 

determining an institution’s continuing 

eligibility for title IV participation; 

• A review of GE disclosures posted 

by institutions over the last two years 

has revealed troubling inconsistencies 

in the way that job placement rates are 

determined and reported; 

• The use of a standardized 

disclosure template and the physical 

distribution of disclosures to students is 

more burdensome than originally 

predicted; and 

• GE outcomes data reveal the 

disparate impact that the GE regulation 

has on some academic programs. 

In July 2018, the Department 

published a notice of proposed 

rulemaking that more appropriately 

addresses concerns about institutional 

misrepresentation by providing direct 

remedies to students harmed by such 

misrepresentations (83 FR 37242). In 

addition, the Department believes that 

by publishing outcomes data through 

the College Scorecard for all title IV 

participating programs, it will be more 

difficult for institutions to misrepresent 

likely program outcomes, including 

earnings or job placement rates, which 

should not be determined or published 

until such time that a reliable data 

source is identified to validate such 

data. For the reasons cited above, the 

Department proposes to amend or 

rescind the GE regulations. 

Scope of the Proposed Regulations 

1. Removal of GE Regulations 

The Department proposes to rescind 

the GE regulations because, among other 

things, they are based on a D/E metric 

that has proven to not be an appropriate 

proxy for use in determining continuing 

eligibility for title IV participation; they 

incorporate a threshold that the 

researchers whose work gave rise to the 

standard questioned the relevance of to 

student loan borrowing levels; and they 

rely on a job placement rate reporting 

requirement that the Department was 

unable to define consistently or provide 

a data source to ensure its reliability and 

accuracy and that has since been 

determined is unreliable and vulnerable 

to accidental or intentional 

misreporting. In addition, because the 

GE regulations require only a small 

portion of higher education programs to 

report outcomes, they do not adequately 

inform consumer choice or help 

borrowers compare all of their available 

options. 

Therefore, the Department proposes to 

rescind the GE regulations. Removal of 

the GE regulations would include 

removing the provisions in § 668.401 

through § 668.415, including the 

provisions regarding the scope and 

purpose of those regulations (§ 668.401), 

the gainful employment framework 

(§ 668.403), calculating D/E rates, 

issuing and challenging those rates, and 

providing for a D/E rates alternate 

earnings appeal (§ 668.404-§ 668.406). 

Consequently, by removing the 

provisions pertaining to the D/E rates 

measure, the consequences of the D/E 

rates measure would also be removed 

from the regulations (§ 668.410), as well 

as the required certifications (§ 668.414). 

In addition, current sections that 

condition title IV eligibility on 

outcomes under the D/E rates measure, 

the methodology for calculating the D/ 

E rates, the reporting requirements 

necessary to calculate D/E rates and 

certain other certifications and 

disclosures, and subpart R pertaining to 

program cohort default rates, a potential 

disclosure item, would no longer be 

required, and the Department proposes 

to remove those sections, as well 

(§§ 668.411–668.413; subpart R). 

2. Technical and Conforming Changes 

Proposed § 600.10(c)(1) would remove 

current paragraph (i) and redesignate 

the remaining paragraphs. Current 

§ 600.10(c)(1)(i) establishes title IV 

eligibility for GE programs. The 

Department’s proposed regulations 

would remove the GE regulations 

referenced in this paragraph, and 

therefore we are proposing to remove 

this paragraph and renumber this 

section. This technical correction was 

proposed during the negotiations 

because the Department proposed 

removing the GE regulations and 

moving to a disclosure-only framework. 

Discussion related to the removal of 

sanctions and the disclosure framework 

is summarized above, but there were no 

additional comments made solely on 

this technical change. Additionally, 

proposed § 600.10(c)(1)(iii) would 

require programs that are at least 300 

clock hours but less than 600 clock 

hours and do not admit as regular 

students only persons who have 

completed the equivalent of an 

associate’s degree to obtain the 

Secretary’s approval to be eligible for 

title IV aid student loans. This is 

consistent with § 668.8(d) where 

programs of at least 300 clock hours are 

referenced and is consistent with the 

statute. This proposal was also made 

during the negotiations, but the 


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committee did not have comments 

related to this aspect of the proposals. 

The Department also proposes to 

remove references to subpart Q in 

§ 600.21(a)(11) as part of its proposed 

removal of the GE regulations. Likewise, 

we propose technical edits to § 668.8(d) 

to remove references to subpart Q. The 

Department also proposes to remove 

and reserve current § 668.6, which lists 

disclosure requirements for GE 

programs that ceased to have effect 

upon the effective date of the disclosure 

requirements under the 2014 GE 

regulations. 

Executive Orders 12866, 13563, and 

13771 

Under Executive Order 12866, it must 

be determined whether this regulatory 

action is ‘‘significant’’ and, therefore, 

subject to the requirements of the 

Executive order and subject to review by 

the Office of Management and Budget 

(OMB). Section 3(f) of Executive Order 

12866 defines a ‘‘significant regulatory 

action’’ as an action likely to result in 

a rule that may— 

(1) Have an annual effect on the 

economy of $100 million or more, or 

adversely affect a sector of the economy, 

productivity, competition, jobs, the 

environment, public health or safety, or 

State, local, or Tribal governments or 

communities in a material way (also 

referred to as an ‘‘economically 

significant’’ rule); 

(2) Create serious inconsistency or 

otherwise interfere with an action taken 

or planned by another agency; 

(3) Materially alter the budgetary 

impacts of entitlement grants, user fees, 

or loan programs or the rights and 

obligations of recipients thereof; or 

(4) Raise novel legal or policy issues 

arising out of legal mandates, the 

President’s priorities, or the principles 

stated in the Executive order. 

This proposed regulatory action is an 

economically significant regulatory 

action subject to review by OMB under 

section 3(f) of Executive Order 12866 

because it would have an annual effect 

on the economy of over $100 million. 

Under Executive Order 13771, for 

each new regulation that the 

Department proposes for notice and 

comment or otherwise promulgates that 

is a significant regulatory action under 

Executive Order 12866 and that imposes 

total costs greater than zero, it must 

identify two deregulatory actions. For 

FY 2018, any new incremental costs 

associated with a new regulation must 

be fully offset by the elimination of 

existing costs through deregulatory 

actions, unless required by law or 

approved in writing by the Director of 

the OMB. Because these proposed 

regulations do not impose total costs 

greater than zero, the requirement to 

offset new regulations in Executive 

Order 13771 would not apply. 

We have also reviewed these 

regulations under Executive Order 

13563, which supplements and 

explicitly reaffirms the principles, 

structures, and definitions governing 

regulatory review established in 

Executive Order 12866. To the extent 

permitted by law, Executive Order 

13563 requires that an agency— 

(1) Propose or adopt regulations only 

on a reasoned determination that their 

benefits justify their costs (recognizing 

that some benefits and costs are difficult 

to quantify); 

(2) Tailor its regulations to impose the 

least burden on society, consistent with 

obtaining regulatory objectives and 

taking into account—among other 

things, and to the extent practicable— 

the costs of cumulative regulations; 

(3) In choosing among alternative 

regulatory approaches, select those 

approaches that maximize net benefits 

(including potential economic, 

environmental, public health and safety, 

and other advantages; distributive 

impacts; and equity); 

(4) To the extent feasible, specify 

performance objectives, rather than the 

behavior or manner of compliance a 

regulated entity must adopt; and 

(5) Identify and assess available 

alternatives to direct regulation, 

including economic incentives—such as 

user fees or marketable permits—to 

encourage the desired behavior, or 

provide information that enables the 

public to make choices. 

Executive Order 13563 also requires 

an agency ‘‘to use the best available 

techniques to quantify anticipated 

present and future benefits and costs as 

accurately as possible.’’ The Office of 

Information and Regulatory Affairs of 

OMB has emphasized that these 

techniques may include ‘‘identifying 

changing future compliance costs that 

might result from technological 

innovation or anticipated behavioral 

changes.’’ 

We are issuing this proposed 

regulatory action only on a reasoned 

determination that its benefits justify its 

costs. In choosing among alternative 

regulatory approaches, we selected 

those approaches that would maximize 

net benefits. Based on the analysis that 

follows, the Department believes that 

these proposed regulations are 

consistent with the principles in 

Executive Order 13563. 

We also have determined that this 

regulatory action would not unduly 

interfere with State, local, and Tribal 

governments in the exercise of their 

governmental functions. 

Regulatory Impact Analysis 

In accordance with the Executive 

orders, the Department has assessed the 

potential costs and benefits, both 

quantitative and qualitative, of this 

regulatory action. This proposed 

regulatory action would have an annual 

economic benefit of approximately $209 

million in reduced paperwork burden 

and increased transfers to Pell Grant 

recipients and student loan borrowers 

and subsequently institutions of about 

$518 million annually at the 7 percent 

discount rate, as further explained in 

the Analysis of Costs and Benefits 

section. 

A. Need for Regulatory Action 

This regulatory action is necessary to 

comply with Executive Order 13777, 

whereby the President instructed 

agencies to reduce unnecessary burden 

on regulated entities and to increase 

transparency. Because the GE 

regulations significantly burden certain 

programs and institutions but provide 

limited transparency at only a small 

subset of title IV-eligible programs, the 

Department proposes to rescind them. 

Furthermore, when developing the GE 

regulations, the Department, as noted in 

feedback received from multiple 

institutions, underestimated the burden 

on institutions associated with the use 

of a standardized disclosure template in 

publishing program outcomes and 

distributing notifications directly to 

prospective and current students. For 

example, the estimate did not include 

an assessment of burden on the 

government to support the development 

of an approved disclosure template and 

the distribution of the template 

populated with the appropriate data. 

The Department has determined that it 

would be more efficient to publish data 

using the College Scorecard, not only to 

reduce reporting burden but to enable 

students to more readily review the data 

and compare institutions. 

B. Analysis of Costs and Benefits 

These proposed regulations would 

affect prospective and current students; 

institutions with GE programs 

participating in the title IV, HEA 

programs; and the Federal government. 

The Department expects institutions 

and the Federal government would 

benefit as the action would remove 

highly burdensome reporting, 

administrative costs, and sanctions. The 

Department has also analyzed the costs 

of this regulatory action and has 

determined that it would impose no 

additional costs ($0). As detailed earlier, 


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31The count of programs includes programs that 

had preliminary rates calculated, but were not 

designated with an official pass, zone, or fail status 

due to reaccreditation and reinstatements of 

eligibility during the validation process of 

establishing D/E rates. 

32The count of programs includes programs that 

had preliminary rates calculated, but were not 

designated with an official pass, zone, or fail status 

due to reaccreditation and reinstatements of 

eligibility during the validation process of 

establishing D/E rates. 

pursuant to this proposed regulatory 

action, the Department would remove 

the GE regulations and adopt no new 

ones. 

1. Students 

The proposed removal of the GE 

regulations may result in both costs and 

benefits to students, including the costs 

and benefits associated with continued 

enrollment in zone and failing GE 

programs and the benefit of reduced 

information collections. Students may 

see costs from continued enrollment in 

programs that may have, if the GE 

regulations were in effect, lost title IV 

eligibility and the student would have 

discontinued enrollment. Students may 

also see benefits from not having to 

transfer to another institution in cases 

where their program would have lost 

title IV eligibility. Burden on students 

will be reduced by not having to 

respond to schools to acknowledge 

receipt of disclosures. 

There are student costs and benefits 

associated with enrollment in a program 

that would have otherwise lost 

eligibility to participate in the title IV, 

HEA programs under the GE 

regulations; however, the actual 

outcome for students enrolled in failing 

or zone programs under the GE 

regulations is unknown. Under the GE 

regulations, if a GE program becomes 

ineligible to participate in the title IV, 

HEA programs, students would not be 

able to receive title IV aid to enroll in 

it. Because D/E rates have been 

calculated under the GE regulations for 

only one year, no programs have lost 

title IV, HEA eligibility. However, 2,050 

programs were identified as failing 

programs or programs in the zone based 

on their 2015 GE rates and are at risk of 

losing eligibility under the GE 

regulations. In 2015–16, 329,250 

students were enrolled in zone GE 

programs and 189,920 students were 

enrolled in failing programs. 

Under the proposed regulations, the 

Department would discontinue certain 

GE information collections, which is 

detailed further in the Paperwork 

Reduction Act of 1995 section of this 

preamble. Two of these information 

collections impact students—OMB 

control number 1845–0123 and OMB 

control number 1845–0107. By 

removing these collections, the 

proposed regulations would reduce 

burden on students by 2,167,129 hours 

annually. The burden associated with 

these information collections is 

attributed to students being required to 

read the warning notices and certify that 

they received them. Therefore, using the 

individual hourly rate of $16.30, the 

benefit due to reduced burden for 

students is $35,324,203 annually 

(2,167,129 hours per year * $16.30 per 

hour). 

2. Institutions 

The proposed regulations would also 

benefit institutions administering GE 

programs. These institutions would 

have a reduced paperwork burden and 

no longer be subject to a potential loss 

of title IV eligibility. The table below 

shows the distribution of institutions 

administering GE programs by sector. 

TABLE 2—INSTITUTIONS WITH 2015 

GE PROGRAMS 31

Type Institutions Programs 

Public ........ 865 2,493 

Private ....... 206 476 

Proprietary 1,546 5,681 

Total ... 2,617 8,650 

All 2,617 institutions with GE 

programs would see savings from 

reduced reporting requirements due to 

removal of the GE regulations. As 

discussed further in the Paperwork 

Reduction Act of 1995 section of this 

preamble, reduction in burden 

associated with removing the GE 

regulatory information collections for 

institutions is 4,758,499 hours. 

Institutions would benefit from these 

proposed changes, which would reduce 

their costs by $173,923,138 annually 

using the hourly rate of $36.55. 

Under the proposed regulations, 

programs that had or have D/E rates that 

are failing or in the zone could see 

benefits because they would no longer 

be subject to sanctions, incur the cost of 

appealing failing or zone D/E rates, or be 

at risk of losing their title IV eligibility. 

Specifically, 778 institutions 

administering 2,050 zone or failing GE 

programs would receive these benefits, 

which represents 24 percent of the 8,650 

2015 GE programs. Disaggregation of 

these program counts and counts by 

institutional type are provided in the 

table below. 

TABLE 3—INSTITUTIONS WITH 2015 GE ZONE OR FAILING PROGRAMS 32

Type Institutions Zone programs 

Failing programs Zone or failing 

programs 

Public ........................................................................................................................................... 9 9 ........................ 9 

Private ......................................................................................................................................... 34 68 21 89 

Proprietary ................................................................................................................................... 735 1,165 787 1,952 

Total ..................................................................................................................................... 778 1,242 808 2,050 

Cosmetology undergraduate certificate 

programs are the most common type of 

program in the zone or failing 

categories. Among the 895 cosmetology 

undergraduate certificate programs with 

a 2015 GE rate, 91 failed the D/E rates 

measure and 270 fell into the zone. 

Table 4 shows the most frequent types 

of programs with failing or zone D/E 

rates. These programs and their 

institutions would be most significantly 

affected by the proposed removal of GE 

sanctions as they would continue to be 

eligible to participate in title IV, HEA 

programs. As indicated in the 

Accounting Statement, the money 

received by these institutions is a 

transfer from the taxpayers through 

students who choose to attend the 

institutions’ programs. 


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33The count of programs includes programs that 

had preliminary rates calculated, but were not 

designated with an official pass, zone, or fail status 

due to reaccreditation and reinstatements of 

eligibility during the validation process of 

establishing D/E rates. 

34Salary Table 2018–DCB effective January 2018. 

Available at www.opm.gov/policy-data-oversight/ 

pay-leave/salaries-wages/salary-tables/pdf/2018/ 

DCB_h.pdf. 

35 Ibid. 

36See 79 FR 211, Table 3.4: Student Response 

Assumptions, p. 65077, published October 31, 

2014. Available at www.regulations.gov/ 

document?D=ED-2014-OPE-0039-2390. The dropout 

rate increased from 5 percent for a first zone result 

and 15 percent for a first failure to 20 percent for 

the fourth zone, second failure, or ineligibility. 

TABLE 4—ZONE OR FAILING 2015 GE PROGRAMS BY FREQUENCY OF PROGRAM TYPES 33

CIP Credential level Zone Fail Zone or Fail All programs 

Cosmetology/Cosmetologist, General. ..... Undergraduate Certificate ........................ 270 91 361 895 

Medical/Clinical Assistant. ........................ Associates Degree ................................... 35 56 91 119 

Medical/Clinical Assistant. ........................ Undergraduate Certificate ........................ 78 12 90 424 

Massage Therapy/Therapeutic Massage. Undergraduate Certificate ........................ 43 4 47 270 

Business Administration and Management, General..Associates Degree ................................... 24 22 46 74 

Legal Assistant/Paralegal. ........................ Associates Degree ................................... 20 25 45 58 

Barbering/Barber. ...................................... Undergraduate Certificate ........................ 22 16 38 96 

Graphic Design. ........................................ Associates Degree ................................... 16 17 33 45 

Criminal Justice/Safety Studies. ............... Associates Degree ................................... 20 11 31 41 

Massage Therapy/Therapeutic Massage. Associates Degree ................................... 8 19 27 33 

All other programs .................................... ................................................................... 706 535 1,241 6,595 

Total ................................................... ................................................................... 1,242 808 2,050 8,650 

3. Federal Government 

Under the proposed regulations, the 

Federal government would benefit from 

reduced administrative burden 

associated with removing provisions in 

the GE regulations and from 

discontinuing information collections. 

The Federal government would incur 

annual costs to fund more Pell Grants 

and title IV loans, as discussed in the 

Net Budget Impact section. 

Reduced administrative burden due to 

the proposed regulatory changes would 

result from removing the provisions in 

the GE regulations regarding sending 

completer lists to institutions, 

adjudicating completer list corrections, 

adjudicating challenges, and 

adjudicating alternate earnings appeals. 

Under the GE regulations, the 

Department expects to receive about 500 

earnings appeals annually and estimates 

that it would take Department staff 10 

hours per appeal to evaluate the 

information submitted. Using the hourly 

rate of a GS–13 Step 1 in the 

Washington, DC area of $46.46,34 the 

estimated benefit due to reduced costs 

from eliminating earnings appeals is 

$232,300 annually (500 earnings 

appeals * 10 hours per appeal * $46.46 

per hour). Similarly, the Department 

sends out 31,018 program completer 

lists to institutions annually and 

estimates that it takes about 40 hours 

total to complete. Using the hourly rate 

of a GS–14 Step 1 in the Washington, 

DC area of $54.91,35 the estimated 

benefit due to reduced costs from 

eliminating sending completer lists is 

$2,196 annually (40*54.91). Institutions 

can correct and challenge the lists, and 

for the 2015 D/E rates the Department 

processed 90,318 completer list 

corrections and adjudicated 2,894 

challenges. The Department estimates it 

took Department staff 1,420 hours total 

to make completer list corrections. 

Similarly, the Department estimates it 

took $1,500,000 in contractor support 

and 1,400 hours of Federal staff time 

total to adjudicate the challenges. Using 

the hourly rate of a GS–13 step 1 in the 

Washington, DC area of $46.46, the 

estimated benefit due to reduced costs 

from eliminating completer lists, 

corrections, and challenges is 

$1,631,017 ($1,500,000 contractor 

support + (1420 + 1400) staff hours * 

$46.46 per hour). 

Finally, under the proposed 

regulations, the Department would 

rescind information collections with 

OMB control numbers 1845–0121, 

1845–1022, and 1845–0123. This would 

result in a Federal government benefit 

due to reduced contractor costs of 

$23,099,946 annually. Therefore, the 

Department estimates an annual benefit 

due to reduced administrative costs 

under the proposed regulations of 

$24,965,459 ($232,300 + $2,196 + 

$1,631,017 + $23,099,946). 

The Department would also incur 

increased budget costs due to increased 

transfers of Pell Grants and title IV 

loans, as discussed further in the Net 

Budget Impacts section. The estimated 

annualized costs of increased Pell 

Grants and title IV loans from 

eliminating the GE regulations is 

approximately $518 to $527 million at 

7 percent and 3 percent discount rates, 

respectively. The Department recognizes 

that this may be offset by student and 

institutional response to institutional 

and program level disclosures in the 

College Scorecard and other resources, 

but, as discussed in the Net Budget 

Impact section, the Department does not 

specifically quantify those impacts. 

C. Net Budget Impacts 

The Department proposes to remove 

the GE regulations, which include 

provisions for GE programs’ loss of title 

IV, HEA program eligibility based on 

performance on the D/E rates measure. 

In estimating the impact of the GE 

regulations at the time they were 

developed and in subsequent budget 

estimates, the Department attributed 

some savings in the Pell Grant program 

based on the assumption that some 

students, including prospective 

students, would drop out of 

postsecondary education as their 

programs became ineligible or 

imminently approached ineligibility. 

This assumption has remained in the 

baseline estimates for the Pell Grant 

program, with an average of 

approximately 123,000 dropouts 

annually over the 10-year budget 

window from FY2019 to FY2028. By 

applying the estimated average Pell 

Grant per recipient for proprietary 

institutions ($3,649) for 2019 to 2028 in 

the PB2019 Pell Baseline, the estimated 

net budget impact of the GE regulations 

in the PB2019 Pell baseline is 

approximately $¥4.5 billion. As was 

indicated in the Primary Student 

Response assumption in the 2014 GE 

final rule,36 much of this impact was 

expected to come from the warning that 

a program could lose eligibility in the 

next year. If we attribute all of the 

dropout effect to loss of eligibility, it 

would generate a maximum estimated 

Federal net budget impact of the 

proposed regulations of $4.5 billion in 


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40180 Federal Register / Vol. 83, No. 157 / Tuesday, August 14, 2018 / Proposed Rules 

37See 79 FR 211, pp 65081–82, available at 

www.regulations.gov/document?D=ED-2014-OPE0039-2390. 

costs by removing the GE regulations 

from the PB2019 Pell Grant baseline. 

The Department also estimated an 

impact of warnings and ineligibility in 

the analysis for the final 2014 GE rule, 

that, due to negative subsidy rates for 

PLUS and Unsubsidized loans at the 

time, offset the savings in Pell Grants by 

$695 million.37 The effect of the GE 

regulations is not specifically identified 

in the PB2019 baseline, but it is one of 

several factors reflected in declining 

loan volume estimates. The 

development of GE regulations since the 

first negotiated rulemaking on the 

subject was announced on May 26, 

2009, has coincided with demographic 

and economic trends that significantly 

influence postsecondary enrollment, 

especially in career-oriented programs 

classified as GE programs under the GE 

regulations. Enrollment and aid 

awarded have both declined 

substantially from peak amounts in 

2010 and 2011. 

As classified under the GE 

regulations, GE programs serve nontraditional students who may be more 

responsive to immediate economic 

trends in making postsecondary 

education decisions. Non-consolidated 

title IV loans made at proprietary 

institutions declined 48 percent 

between AY2010–11 and AY2016–17, 

compared to a 6 percent decline at 

public institutions, and a 1 percent 

increase at private institutions. The 

average annual loan volume change 

from AY2010–11 to AY2016–17 was 

¥10 percent at proprietary institutions, 

¥1 percent at public institutions, and 

0.2 percent at private institutions. If we 

attribute all of the excess decline at 

proprietary institutions to the potential 

loss of eligibility under the GE 

regulations and increase estimated 

volume in the 2-year proprietary risk 

group that has the highest subsidy rate 

in the PB2019 baseline by the difference 

in the average annual change (12 

percent for subsidized and unsubsidized 

loans and 9 percent for PLUS), then the 

estimated net budget impact of the 

removal of the ineligibility sanction in 

the proposed regulations on the Direct 

Loan program is a cost of $848 million. 

Therefore, the total estimated net 

budget impact from the proposed 

regulations is $5.3 billion cost in 

increased transfers from the Federal 

government to Pell Grant recipients and 

student loan borrowers and 

subsequently to institutions, primarily 

from the elimination of the ineligibility 

provision of the GE regulations. 

However, this estimate assumes that a 

borrower who could no longer enroll in 

a GE program that loses title IV 

eligibility would not enroll in a different 

program that passes the D/E rates 

measure, but would instead opt out of 

a postsecondary education experience. 

The long-term impact to the student and 

the government of the decision to 

pursue no postsecondary education 

could be significant, but cannot be 

estimated for the purpose of this 

analysis. 

This is a maximum net budget impact 

and could be offset by student and 

institutional behavior in response to 

disclosures in the College Scorecard and 

other resources. Generally, the 

Department does not attribute a 

significant budget impact to disclosure 

requirements absent substantial 

evidence that such information will 

change borrower or institutional 

behavior. The Department welcomes 

comments on the net budget impact 

analysis. Information received will be 

considered in development of the Net 

Budget Impact analysis of the final rule. 

D. Accounting Statement 

As required by OMB Circular A–4 we 

have prepared an accounting statement 

showing the classification of the 

expenditures associated with the 

provisions of the proposed regulations 

(see Table 5). This table provides our 

best estimate of the changes in annual 

monetized transfers as a result of the 

proposed regulations. The estimated 

reduced reporting and disclosure 

burden equals the ¥$209 million 

annual paperwork burden calculated in 

the Paperwork Reduction Act of 1995 

section (and also appearing on page 

65004 of the regulatory impact analysis 

accompanying the 2014 final rule). The 

annualization of the paperwork burden 

differs from the 2014 final rule as the 

annualization of the paperwork burden 

for that rule assumed the same pattern 

as the 2011 rule that featured multiple 

years of data being reported in the first 

year with a significant decline in burden 

in subsequent years. 

TABLE 5—ACCOUNTING STATEMENT: CLASSIFICATION OF ESTIMATED EXPENDITURES

[In millions] 

Category Benefits 

Discount Rate .......................................................................................................................................................... 7% 3% 

Reduced reporting and disclosure burden for institutions with GE programs under the GE regulations. ............. $209 $209 

Category Costs 

Discount Rate .......................................................................................................................................................... 7% 3% 

Costs ........................................................................................................................................................................ ........................ ........................

Category Transfers 

Discount Rate .......................................................................................................................................................... 7% 3% 

Increased transfers to Pell Grant recipients and student loan borrowers from elimination of ineligibility provision 

of GE regulations. ................................................................................................................................................ $518 $527 


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Federal Register / Vol. 83, No. 157 / Tuesday, August 14, 2018 / Proposed Rules 40181 

Regulatory Flexibility Act (RFA) 

Certification 

The U.S. Small Business 

Administration (SBA) Size Standards 

define proprietary institutions as small 

businesses if they are independently 

owned and operated, are not dominant 

in their field of operation, and have total 

annual revenue below $7,000,000. 

Nonprofit institutions are defined as 

small entities if they are independently 

owned and operated and not dominant 

in their field of operation. Public 

institutions are defined as small 

organizations if they are operated by a 

government overseeing a population 

below 50,000. 

The Department lacks data to identify 

which public and private, nonprofit 

institutions qualify as small based on 

the SBA definition. Given the data 

limitations and to establish a common 

definition across all sectors of 

postsecondary institutions, the 

Department uses its proposed datadriven definitions for ‘‘small 

institutions’’ (Full-time enrollment of 

500 or less for a two-year institution or 

less than two-year institution and 1,000 

or less for four-year institutions) in each 

sector (Docket ID ED–2018–OPE–0027) 

to certify the RFA impacts of these 

proposed regulations. Using this 

definition, there are 2,816 title IV 

institutions that qualify as small entities 

based on 2015–2016 12-month 

enrollment. 

When an agency issues a rulemaking 

proposal, the RFA requires the agency to 

‘‘prepare and make available for public 

comment an initial regulatory flexibility 

analysis’’ which will ‘‘describe the 

impact of the proposed rule on small 

entities.’’ (5 U.S.C. 603(a)). Section 605 

of the RFA allows an agency to certify 

a rule, in lieu of preparing an analysis, 

if the proposed rulemaking is not 

expected to have a significant economic 

impact on a substantial number of small 

entities. 

The proposed regulations directly 

affect all institutions with GE programs 

participating in title IV aid. There were 

2,617 institutions in the 2015 GE cohort, 

of which 1,357 are small entities. This 

represents approximately 20 percent of 

all title IV-participating institutions and 

48 percent of all small institutions. 

Therefore, the Department has 

determined that the proposed 

regulations would not have a significant 

economic impact on a substantial 

number of small entities. 

Further, the Department has 

determined that the impact on small 

entities affected by the proposed 

regulations would not be significant. For 

these 1,357 institutions, the effect of the 

proposed regulations would be to 

eliminate GE paperwork burden and 

potential loss of title IV eligibility. We 

believe that the economic impacts of the 

proposed paperwork and title IV 

eligibility changes would be beneficial 

to small institutions. Accordingly, the 

Secretary hereby proposes to certify that 

these proposed regulations, if 

promulgated, would not have a 

significant economic impact on a 

substantial number of small entities. 

The Department invites comment from 

members of the public who believe 

there will be a significant impact on 

small institutions. 

Paperwork Reduction Act of 1995 

As part of its continuing effort to 

reduce paperwork and respondent 

burden, the Department provides the 

general public and Federal agencies 

with an opportunity to comment on 

proposed or continuing, or the 

discontinuance of, collections of 

information in accordance with the 

Paperwork Reduction Act of 1995 (PRA) 

(44 U.S.C. 3506(c)(2)(A)). This helps 

ensure that: The public understands the 

Department’s collection instructions, 

respondents can provide the requested 

data in the desired format, reporting 

burden (time and financial resources) is 

minimized, collection instruments are 

clearly understood, and the Department 

can properly assess the impact of 

collection requirements on respondents. 

Respondents also have the opportunity 

to comment on our burden reduction 

estimates. 

A Federal agency may not conduct or 

sponsor a collection of information 

unless OMB approves the collection 

under the PRA and the corresponding 

information collection instrument 

displays a currently valid OMB control 

number. Notwithstanding any other 

provision of law, no person is required 

to comply with, or is subject to penalty 

for failure to comply with, a collection 

of information if the collection 

instrument does not display a currently 

valid OMB control number. 

The proposed regulations would 

rescind the GE regulations. That action 

would eliminate the burden as assessed 

to the GE regulations in the following 

previously approved information 

collections. 

1845–0107—Gainful Employment 

Disclosure Template 

Individuals—13,953,411 respondents 

for a total of 1,116,272 burden hours 

eliminated. 

For Profit Institutions—2,526 

respondents for a total of 1,798,489 

burden hours eliminated. 

Private Non Profit Institutions—318 

respondents for a total of 27,088 burden 

hours eliminated. 

Public Institutions—1,117 

respondents for a total of 176,311 

burden hours eliminated. 

1845–0121—Gainful Employment 

Program—Subpart R—Cohort Default 

Rates 

For Profit Institutions—1,434 

respondents for a total of 5,201 burden 

hours eliminated. 

Private Non Profit Institutions—47 

respondents for a total of 172 burden 

hours eliminated. 

Public Institutions—78 respondents 

for a total of 283 burden hours 

eliminated. 

1845–0122—Gainful Employment 

Program—Subpart Q—Appeals for Debt 

to Earnings Rates 

For Profit Institutions—388 

respondents for a total of 23,377 burden 

hours eliminated. 

Private Non Profit Institutions—6 

respondents for a total of 362 burden 

hours eliminated. 

Public Institutions—2 respondents for 

a total of 121 burden hours eliminated. 

1845–0123—Gainful Employment 

Program—Subpart Q—Regulations 

Individuals—11,793,035 respondents 

for a total of 1,050,857 burden hours 

eliminated. 

For Profit Institutions—28,018,705 

respondents for a total of 2,017,100 

burden hours eliminated. 

Private Non Profit Institutions— 

442,348 respondents for a total of 76,032 

burden hours eliminated. 

Public Institutions—2,049,488 

respondents for a total of 633,963 

burden hours eliminated. 

The total burden hours and proposed 

change in burden hours associated with 

each OMB Control number affected by 

the proposed regulations follows: 


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40182 Federal Register / Vol. 83, No. 157 / Tuesday, August 14, 2018 / Proposed Rules 

Regulatory section OMB control 

No. Burden hours 

Estimated cost 

$36.55/hour 

for institutions; 

$16.30/hour 

for individuals 

§ 668.412 ..................................................................................................................................... 1845–0107 ¥3,118,160 ¥$91,364,240 

§§ 668.504, 668.509, 668.510, 668.511, 668.512 ....................................................................... 1845–0121 ¥5,656 ¥206,727 

§ 668.406 ..................................................................................................................................... 1845–0122 ¥23,860 ¥872,083 

§§ 668.405, 668.410, 668.411, 668.413, 668.414 ....................................................................... 1845–0123 ¥3,777,952 ¥116,804,291 

Total ...................................................................................................................................... ........................ ¥6,925,628 ¥209,247,341 

We have prepared Information 

Collection Requests which will be filed 

upon the effective date of these 

proposed regulations to discontinue the 

currently approved information 

collections noted above. 

Note: The Office of Information and 

Regulatory Affairs in OMB and the 

Department review all comments posted at 

www.regulations.gov. 

We consider your comments on 

discontinuing these collections of 

information in— 

• Evaluating the accuracy of our 

estimate of the burden reduction of the 

proposed discontinuance, including the 

validity of our methodology and 

assumptions; 

• Enhancing the quality, usefulness, 

and clarity of the information we 

collect; and 

• Minimizing the burden on those 

who must respond. This includes 

exploring the use of appropriate 

automated, electronic, mechanical, or 

other technological collection 

techniques. 

OMB is required to make a decision 

concerning the collections of 

information contained in these 

proposed regulations between 30 and 60 

days after publication of this document 

in the Federal Register. Therefore, to 

ensure that OMB gives your comments 

full consideration, it is important that 

OMB receives your comments on these 

Information Collection Requests by 

September 13, 2018. This does not affect 

the deadline for your comments to us on 

the proposed regulations. 

If your comments relate to the 

Information Collection Requests for 

these proposed regulations, please 

indicate ‘‘Information Collection 

Comments’’ on the top of your 

comments. 

Intergovernmental Review 

These programs are not subject to 

Executive Order 12372 and the 

regulations in 34 CFR part 79. 

Assessment of Educational Impact 

In accordance with section 411 of 

GEPA, 20 U.S.C. 1221e–4, the Secretary 

particularly requests comments on 

whether the proposed regulations would 

require transmission of information that 

any other agency or authority of the 

United States gathers or makes 

available. 

Accessible Format: Individuals with 

disabilities can obtain this document in 

an accessible format (e.g., Braille, large 

print, audiotape, or compact disc) on 

request to the person listed under FOR

FURTHER INFORMATION CONTACT. 

Electronic Access to This Document: 

The official version of this document is 

the document published in the Federal 

Register. You may access the official 

edition of the Federal Register and the 

Code of Federal Regulations via the 

Federal Digital System at: www.gpo.gov/ 

fdsys. At this site you can view this 

document, as well as all other 

documents of this Department 

published in the Federal Register, in 

text or Portable Document Format 

(PDF). To use PDF you must have 

Adobe Acrobat Reader, which is 

available free at the site. 

You may also access documents of the 

Department published in the Federal 

Register by using the article search 

feature at: www.federalregister.gov. 

Specifically, through the advanced 

search feature at this site, you can limit 

your search to documents published by 

the Department. (Catalog of Federal 

Domestic Assistance Number does not 

apply.) 

List of Subjects 

34 CFR Part 600 

Colleges and universities, Foreign 

relations, Grant programs-education, 

Loan programs-education, Reporting 

and recordkeeping requirements, 

Selective Service System, Student aid, 

Vocational education. 

34 CFR Part 668 

Administrative practice and 

procedure, Aliens, Colleges and 

universities, Consumer protection, 

Grant programs-education, Loan 

programs-education, Reporting and 

recordkeeping requirements, Selective 

Service System, Student aid, Vocational 

education. 

Dated: August 9, 2018. 

Betsy DeVos, 

Secretary of Education. 

For the reasons discussed in the 

preamble, and under the authority at 20 

U.S.C. 3474 and 20 U.S.C. 1221e–3, the 

Secretary of Education proposes to 

amend parts 600 and 668 of title 34 of 

the Code of Federal Regulations as 

follows: 

PART 600—INSTITUTIONAL 

ELIGIBILITY UNDER THE HIGHER 

EDUCATION ACT OF 1965, AS 

AMENDED 

■ 1. The authority citation for part 600 

continues to read as follows: 

Authority: 20 U.S.C. 1001, 1002, 1003, 

1088, 1091, 1094, 1099b, and 1099c, unless 

otherwise noted. 

■ 2. Section 600.10 is amended by 

revising paragraphs (c)(1) and (2) to read 

as follows: 

§ 600.10 Date, extent, duration, and 

consequence of eligibility. 

* * * * * 

(c) * * * 

(1) An eligible institution that seeks to 

establish the eligibility of an 

educational program must— 

(i) Pursuant to a requirement 

regarding additional programs included 

in the institution’s program 

participation agreement under 34 CFR 

668.14, obtain the Secretary’s approval; 

(ii) For a direct assessment program 

under 34 CFR 668.10, and for a 

comprehensive transition and 

postsecondary program under 34 CFR 

668.232, obtain the Secretary’s approval; 

and 

(iii) For an undergraduate program 

that is at least 300 clock hours but less 

than 600 clock hours and does not 

admit as regular students only persons 

who have completed the equivalent of 

an associate degree under 34 CFR 

668.8(d)(3), obtain the Secretary’s 

approval. 

(2) Except as provided under 

§ 600.20(c), an eligible institution does 

not have to obtain the Secretary’s 

approval to establish the eligibility of 


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Federal Register / Vol. 83, No. 157 / Tuesday, August 14, 2018 / Proposed Rules 40183 

1 Docket No. R2013–10, Order on Price 

Adjustments for Market Dominant Products and 

Related Mail Classification Changes, November 21, 

2013, at 5–35 (Order No. 1890). 

2 Docket No. R2013–10R, Order Resolving Issues 

on Remand, January 22, 2016 (Order No. 3047). 

3Notice of Proposed Rulemaking on Motions 

Concerning Mail Preparation Changes, January 22, 

2016, at 1–2 (Order No. 3048). The Notice of 

Proposed Rulemaking on Motions Concerning Mail 

Preparation Changes was published in the Federal 

Register on February 1, 2016. See 81 FR 5085 

(February 1, 2016). 

4 Docket No. R2013–10R, Order Resolving Motion 

for Reconsideration of Commission Order No. 3047, 

July 20, 2016 (Order No. 3441). 

5Petition for Review, United States Postal Serv. 

v. Postal Reg. Comm’n, 886 F.3d 1253 (D.C. Cir. 

2018). 

6Order Adopting Final Procedural Rule for Mail 

Preparation Changes, January 25, 2018, at 22–23 

(Order No. 4393). The Order Adopting Final 

Procedural Rule for Mail Preparation Changes was 

published in the Federal Register on March 5, 2018. 

See 83 FR 4585 (March 5, 2018). See also Revised 

Notice of Proposed Rulemaking, March 27, 2017 

(Order No. 3827). The Revised Notice of Proposed 

Rulemaking was published in the Federal Register 

on March 31, 2017. See 82 FR 16015 (March 31, 

2017). 

any program that is not described in 

paragraph (c)(1) of this section. 

* * * * * 

■ 3. Section 600.21 is amended by 

revising the paragraph (a)(11) 

introductory text to read as follows: 

§ 600.21 Updating application information. 

(a) * * * 

(11) For any program that is required 

to provide training that prepares a 

student for gainful employment in a 

recognized occupation— 

* * * * * 

PART 668—STUDENT ASSISTANCE 

GENERAL PROVISIONS 

■ 4. The authority citation for part 668 

continues to read as follows: 

Authority: 20 U.S.C. 1001–1003, 1070g, 

1085, 1088, 1091, 1092, 1094, 1099c, and 

1099c–1, unless otherwise noted. 

§ 668.6 [Removed and Reserved] 

■ 5. Remove and reserve § 668.6. 

■ 6. Section 668.8 is amended by 

revising paragraphs (d)(2)(iii) and 

(d)(3)(iii) to read as follows: 

§ 668.8 Eligible program. 

* * * * * 

(d) * * * 

(2) * * * 

(iii) Provide training that prepares a 

student for gainful employment in a 

recognized occupation; and 

(3) * * * 

(iii) Provide undergraduate training 

that prepares a student for gainful 

employment in a recognized 

occupation; 

* * * * * 

Subpart Q—[Removed and Reserved] 

■ 7. Remove and reserve subpart Q, 

consisting of §§ 668.401 through 

668.415. 

Subpart R—[Removed and Reserved] 

■ 8. Remove and reserve subpart R, 

consisting of §§ 668.500 through 

668.516. 

[FR Doc. 2018–17531 Filed 8–10–18; 4:15 pm] 

BILLING CODE 4000–01–P 

POSTAL REGULATORY COMMISSION 

39 CFR Part 3010 

[Docket No. RM2016–6; Order No. 4751] 

Motions Concerning Mail Preparation 

Changes 

AGENCY: Postal Regulatory Commission. 

ACTION: Proposed rulemaking. 

SUMMARY: The Commission is noticing 

the partial rescindment of a previously 

proposed rule. This notice informs the 

public of the docket’s reinstatement, 

invites public comment, and takes other 

administrative steps. 

DATES: Comments are due on or before 

September 13, 2018. 

ADDRESSES: Submit comments 

electronically via the Commission’s 

Filing Online system at http://

www.prc.gov. Those who cannot submit 

comments electronically should contact 

the person identified in the FOR FURTHER

INFORMATION CONTACT section by 

telephone for advice on filing 

alternatives. 

FOR FURTHER INFORMATION CONTACT: 

David A. Trissell, General Counsel, at 

202–789–6820. 

SUPPLEMENTARY INFORMATION: 

Table of Contents 

I. Introduction 

II. Background 

III. Description of the Proposed Rule 

IV. Comments Requested 

I. Introduction 

The Commission initiates this notice 

of proposed rulemaking (NPR) to 

partially rescind the rule concerning 

procedures for mail preparation changes 

in response to the recent decision in 

United States Postal Serv. v. Postal Reg. 

Comm’n, 886 F.3d 1253 (D.C. Cir. 2018). 

II. Background 

In Docket No. R2013–10R, the 

Commission determined that a change 

to the Intelligent Mail Barcoding (IMb) 

requirements constituted a change in 

rates requiring compliance with the 

price cap under 39 U.S.C. 3622.1 The 

Postal Service appealed the 

Commission’s determination to the 

United States Court of Appeals for the 

District of Columbia (the Court). In 

United States Postal Serv. v. Postal Reg. 

Comm’n, 785 F.3d 740, 751 (D.C. Cir. 

2015), the Court found that ‘‘changes in 

rates’’ under 39 U.S.C. 3622 could 

include changes to mail preparation 

requirements and were not limited to 

‘‘only changes to the official posted 

prices of each product.’’ Id. However, 

the Court remanded the matter to the 

Commission so that it could articulate 

an intelligible standard to determine 

when mail preparation requirement 

changes constitute changes in rates 

subject to the price cap. Id. at 744. 

In response to the Court’s remand, the 

Commission issued Order No. 3047, 

which set forth a standard to determine 

when mail preparation changes require 

compliance with the Commission’s 

price cap rules.2 Under § 3010.23(d)(2), 

the Postal Service must make reasonable 

adjustments to its billing determinants 

to account for the effects of 

classification changes that result in the 

introduction, deletion, or redefinition of 

rate cells. The standard established by 

the Commission in Order No. 3047 

provided that mail preparation changes 

could have rate effects when they 

resulted in the deletion or redefinition 

of rate cells as set forth by 

§ 3010.23(d)(2). Order No. 3047 at 59. In 

conjunction with Order No. 3047, the 

Commission initiated a separate 

rulemaking proceeding in this docket to 

develop a procedural rule that would 

ensure the Postal Service properly 

accounted for the rate effects of mail 

preparation changes ‘‘in accordance 

with the Commission’s standard 

articulated in Order No. 3047.’’ 3

While the rulemaking was pending, 

the Postal Service requested the 

Commission reconsider the standard set 

forth in Order No. 3047. In response, the 

Commission issued Order No. 3441 

resolving the request for reconsideration 

and maintaining the standard 

articulated in Order No. 3047.4 The 

Postal Service petitioned the Court for 

review of the revised standard set forth 

in Order Nos. 3047 and 3441.5

During the pendency of the appellate 

proceedings, the Commission issued 

Order No. 4393 in this docket, adopting 

a final procedural rule concerning mail 

preparation changes.6 The final rule 

institutes publication requirements for 

changes to mail preparation rules and 

requires the Postal Service to (1) 

affirmatively designate whether or not a 

change to a mail preparation 


amozie on DSK3GDR082PROD with PROPOSALS1