Protecting Students from Worthless Degrees Act
Bill: S.5188 | Sponsor: Sen. Merkley, Jeff (D-OR)
Policy area: Education

Summary:
Protecting Students from Worthless Degrees Act
This bill makes an institution of higher education (IHE) ineligible to receive federal student financial assistance if it fails to meet certain requirements. It also requires an IHE to make certain certifications about its gainful employment programs.
Specifically, an IHE that offers a degree or certificate program to prepare students for entry into a profession that requires licensing or certification as a precondition for entry is not eligible to receive any federal student financial assistance unless (1) a student is fully qualified to take the required entry examination or be licensed or certified for the profession upon the successful completion of the program, and (2) the institution provides timely placement for all of the academically related pre-licensure requirements for entry into the profession (e.g., clinical placements or internships).
An IHE must also certify that each eligible gainful employment program meets specified requirements, including approval or accreditation by a recognized agency and satisfaction of applicable educational prerequisites for professional licensure or certification. If an IHE does not satisfy such prerequisites, it must notify a student who intends to enroll in the program and obtain a handwritten acknowledgement from the student that they wish to enroll.
Lastly, an IHE that offers distance education or correspondence courses must be legally authorized within each state in which its enrolled students are located.

To provide consumer protections for students.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Protecting Students from Worthless 
Degrees Act''.

SEC. 2. DEFINITIONS.

    In this Act:
            (1) Federal financial assistance program.--The term 
        ``Federal financial assistance program'' means a program 
        authorized and funded by the Federal Government under any of 
        the following provisions of law:
                    (A) Title IV of the Higher Education Act of 1965 
                (20 U.S.C. 1070 et seq.).
                    (B) Title I of the Workforce Innovation and 
                Opportunity Act (29 U.S.C. 3111 et seq.).
                    (C) The Adult Education and Family Literacy Act (29 
                U.S.C. 3271 et seq.).
                    (D) Chapter 30, 31, 32, 33, 34, or 35 of title 38, 
                United States Code.
                    (E) Chapter 101, 105, 106A, 1606, 1607, or 1608 of 
                title 10, United States Code.
                    (F) Section 1784a, 2005, or 2007 of title 10, 
                United States Code.
            (2) Freely associated states.--The term ``freely associated 
        States'' means the Republic of the Marshall Islands, the 
        Federated States of Micronesia, and the Republic of Palau.
            (3) Institution of higher education.--The term 
        ``institution of higher education''--
                    (A) with respect to a program authorized under 
                paragraph (1)(A), has the meaning given the term in 
                section 102 of the Higher Education Act of 1965 (20 
                U.S.C. 1002);
                    (B) with respect to a program authorized under 
                paragraph (1)(B), has the meaning given the term in 
                section 3 of the Workforce Innovation and Opportunity 
                Act (29 U.S.C. 3102);
                    (C) with respect to a program authorized under 
                paragraph (1)(C), has the meaning given the term 
                ``postsecondary educational institution'' under section 
                203 of the Adult Education and Family Literacy Act (29 
                U.S.C. 3272);
                    (D) with respect to a program authorized under 
                paragraph (1)(D), has the meaning given the term 
                ``educational institution'' under section 3452 of title 
                38, United States Code;
                    (E) with respect to a program authorized under 
                paragraph (1)(E), means an educational institution that 
                awards a degree or certificate and is located in any 
                State; and
                    (F) with respect to a program authorized under 
                paragraph (1)(F), means an educational institution that 
                awards a degree or certificate and is located in any 
                State.
            (4) State.--The term ``State'' includes, in addition to the 
        several States of the United States, the Commonwealth of Puerto 
        Rico, the District of Columbia, Guam, American Samoa, the 
        United States Virgin Islands, the Commonwealth of the Northern 
        Mariana Islands, and the freely associated States.

SEC. 3. PROTECTIONS IN OCCUPATIONS REQUIRING STATE LICENSURE.

    Notwithstanding any other provision of law, an institution of 
higher education is not eligible to participate in a Federal financial 
assistance program with respect to any program of postsecondary 
education or training, including a degree or certificate program and 
any program offered by distance education or correspondence courses to 
students located in a State other than where the institution is 
physically located, that is designed to prepare students for entry into 
a recognized occupation or profession that requires licensing or other 
established requirements as a pre-condition for entry into such 
occupation or profession, unless, by not later than 1 year after the 
date of enactment of this Act--
            (1) the successful completion of the program fully 
        qualifies a student, in the metropolitan statistical area in 
        which the student resides, in the State in which the student 
        resides, and in any State in which the institution indicates, 
        through advertising or marketing activities or direct contact 
        with potential students, that a student will be prepared to 
        work in the occupation or profession after successfully 
        completing the program, to--
                    (A) take any examination required for entry into 
                the recognized occupation or profession in the 
                metropolitan statistical area and any State described 
                in this paragraph, including satisfying all Federal, 
                State, or professionally mandated programmatic and 
                specialized accreditation requirements, if any; and
                    (B) be certified or licensed or meet any other 
                academically related pre-conditions that are required 
                for entry into the recognized occupation or profession 
                in any such State; and
            (2) the institution offering the program provides timely 
        placement for all of the academically related pre-licensure 
        requirements for entry into the recognized occupation or 
        profession, such as clinical placements, internships, or 
        apprenticeships.

SEC. 4. CERTIFICATION REQUIREMENTS FOR GAINFUL EMPLOYMENT PROGRAMS.

    Section 487 of the Higher Education Act of 1965 (20 U.S.C. 1094) is 
amended--
            (1) in subsection (a), by adding at the end the following:
            ``(30) The institution will--
                    ``(A) provide to the Secretary not later than the 
                first December 31 following the date of enactment of 
                the Protecting Students from Worthless Degrees Act (or, 
                for any institution that does not have an active 
                program participation agreement as of such date, the 
                first December 31 after the institution enters into the 
                agreement), in accordance with procedures established 
                by the Secretary, a certification signed by the most 
                senior executive officer of the institution that the 
                institution and each of the eligible gainful employment 
                programs included on the eligibility and certification 
                approval report of the institution meet the 
                requirements of subsection (k);
                    ``(B) include with its certification an explanation 
                of how each eligible gainful employment program is not 
                substantially similar to any ineligible or discontinued 
                program described in subsection (k)(2)(D); and
                    ``(C) update the certification within 10 days if 
                there are any changes in the approvals for an eligible 
                gainful employment program, or other changes for an 
                eligible gainful employment program that make the 
                existing certification no longer accurate.''; and
            (2) by adding at the end the following:
    ``(k) Certification Requirements for Gainful Employment Programs.--
            ``(1) Definition of gainful employment program.--The term 
        `gainful employment program' means a program of training that--
                    ``(A) in order to qualify for assistance under this 
                title, is required under subsection (b)(1)(A)(i) or 
                (c)(1)(A) of section 102, or section 101(b)(1), to 
                satisfy gainful employment requirements; and
                    ``(B) is offered by an institution eligible to 
                receive assistance under this title.
            ``(2) In general.--Each eligible gainful employment program 
        included on the eligibility and certification approval report 
        of an institution of higher education shall comply with each of 
        the following:
                    ``(A) The gainful employment program is approved by 
                a recognized accrediting agency or is otherwise 
                included in the institution's accreditation by its 
                recognized accrediting agency, or, if the institution 
                is a public postsecondary vocational institution, the 
                program is approved by a recognized State agency for 
                the approval of public postsecondary vocational 
                education in lieu of accreditation.
                    ``(B) The gainful employment program is 
                programmatically accredited, if such accreditation is 
                required by--
                            ``(i) a Federal governmental entity;
                            ``(ii) a governmental entity in the State 
                        in which the institution is located; or
                            ``(iii) a governmental entity in a State in 
                        which the institution is not physically 
                        located, if the institution--
                                    ``(I) offers postsecondary 
                                education through distance education or 
                                correspondence courses to students 
                                located in that State; or
                                    ``(II) is otherwise subject to that 
                                State's jurisdiction, as determined by 
                                that State.
                    ``(C) The gainful employment program satisfies the 
                applicable educational prerequisites for professional 
                licensure or certification requirements in the State in 
                which the institution is located or a State described 
                in subparagraph (B)(iii), so that a student who 
                completes the program and seeks employment in any such 
                State qualifies to take any licensure or certification 
                examination that is needed for the student to practice 
                or find employment in an occupation that the program 
                prepares students to enter.
                    ``(D) The gainful employment program is not 
                substantially similar to a program offered by the 
                institution that, in any of the 3 years prior to the 
                date of the eligibility and certification approval 
                report--
                            ``(i) became ineligible for funding under 
                        this title due to a debt to earning rates 
                        measure, or any subsequent outcome measure, 
                        that the Secretary determines serves the best 
                        interests of students and taxpayers; and
                            ``(ii) was voluntarily discontinued by the 
                        institution.
            ``(3) Requirements ensuring student awareness.--Before an 
        institution offering a gainful employment program enrolls any 
        student who intends to reside, practice, or seek employment in 
        a State for which the program does not satisfy the applicable 
        educational prerequisites for professional licensure or 
        certification requirements needed for that occupation in that 
        State, the institution shall--
                    ``(A) notify the student that the gainful 
                employment program does not satisfy the prerequisites; 
                and
                    ``(B) obtain from the student a handwritten 
                statement, in the student's own words and signed by the 
                student, acknowledging that the student wishes to 
                enroll in the gainful employment program despite 
                knowing that the gainful employment program does not 
                meet the licensure or certification requirements for 
                the occupation in the State in which the student 
                intends to reside, practice, or seek employment.
            ``(4) Requirements regarding reestablishment of 
        eligibility.--The institution shall not seek to reestablish the 
        eligibility of a gainful employment program that is ineligible 
        for funding under this subsection until not less than 3 years 
        following the date specified in the notice of determination 
        informing the institution of the program's ineligibility.''.

SEC. 5. STATE AUTHORIZATION REQUIREMENTS FOR DISTANCE EDUCATION 
              PROGRAMS.

    Section 101 of the Higher Education Act of 1965 (20 U.S.C. 1001(a)) 
is amended--
            (1) in subsection (a)(2), by inserting ``, in accordance 
        with subsection (d)'' before the semicolon; and
            (2) by adding at the end the following:
    ``(d) State Authorization.--
            ``(1) In general.--An institution that offers postsecondary 
        education through distance education or correspondence courses 
        shall meet the requirements of subsection (a)(2) by being 
        legally authorized within each State in which the institution's 
        enrolled students are located, subject to paragraph (2).
            ``(2) State authorization reciprocity agreements.--An 
        institution described in paragraph (1) that is located in a 
        State that participates in a State authorization reciprocity 
        agreement with another State and that is covered by such State 
        authorization reciprocity agreement, is considered to meet 
        State requirements for the institution to be legally offering 
        postsecondary distance education or correspondence courses in 
        the other State--
                    ``(A) subject to any additional requirements of 
                that State; and
                    ``(B) if the institution documents, in the manner 
                required by the Secretary, that each State in which the 
                institution's enrolled students are located has a State 
                process--
                            ``(i) to review and take appropriate action 
                        on complaints from any of such enrolled 
                        students concerning the institution, including 
                        enforcing applicable State law; and
                            ``(ii) to make the complaints public.
            ``(3) State authorization reciprocity agreement defined.--
        In this subsection, the term `State authorization reciprocity 
        agreement' means an agreement between 2 or more States that--
                    ``(A) authorizes an institution located and legally 
                authorized in a State covered by the agreement to 
                provide postsecondary education through distance 
                education or correspondence courses to students located 
                in other States covered by the agreement; and
                    ``(B) does not prohibit any State in the agreement 
                from enforcing the State's own statutes and 
                regulations, regardless as to whether such statutes and 
                regulations are general and apply to all educational 
                institutions or specifically directed at a subset of 
                educational institutions.''.
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