Today, the U.S. Education Department announced final rules that aim to crack down on the for-profit college industry and restore Pell Grants for prisoners, among other things.
More specifically, the Education Department's rules carry out the removal of the federal ban on incarcerated students receiving Pell Grants and clarify the requirements and approval process for participating prison education programs. The final regulations also increase oversight of college conversions, updating the agency's approval process for the sale of a college to new owners or the conversion of a for-profit college into a nonprofit entity.
The alteration to the 90/10 rule carries out new funding restrictions recently enacted by Congress. As part of last year's American Rescue Plan, lawmakers expanded the 90 percent cap on for-profit colleges' funding to include all types of federal funding, including veterans' benefits. Previously, federal law did not count military and veterans' education benefits as federal aid toward that threshold. The updated formula now applies GI Bill benefits and Pentagon tuition assistance toward that limit and the proposed regulations implement that change. Under the new rules, revenue from the sale of institutional loans, income-share agreements, or similar alternative financing options also count in the 90/10 calculation.
"Today, we're raising the bar for oversight and accountability for colleges and career schools that prioritize profiting off federal financial aid programs over preparing students for success in the workforce," said U.S. Secretary of Education Miguel Cardona in a statement. "These new rules crack down on some of the most deceptive practices we see in higher education, such as predatory marketing tactics that target U.S. service members and veterans, and changes in ownership designed to evade accountability to taxpayers. I'm also proud that starting July 1, 2023, incarcerated students will have access to federal Pell Grants to enroll in high-quality prison education programs that we know reduce their risk of returning to prison and prepare these individuals to lead productive and meaningful lives in their communities."
AACRAO, along with 16 other higher education associations, previously submitted comments on the proposed regulatory changes, expressing general support for the goals of the rules and offering a number of recommended improvements to the language on change in ownership and prison education programs.
U.S. Education Department Press Release