Washington, DC, February 6, 2015 – Today, the Association of Private Sector Colleges and Universities, representing over 1,400 institutions educating millions of students, filed a motion for summary judgment in its suit challenging the U.S. Department of Education's new "gainful employment" regulation (APSCU v. Arne Duncan).
In 2012, the United States District Court for the District of Columbia invalidated the Department's prior effort to impose a "gainful employment" regulation because a central part of the regulation lacked a reasoned basis and "was not based on any facts at all." As APSCU explained in its brief filed today, the Department has adopted a regulation that is even "more irrational and arbitrary" than the vacated regulation. APSCU's motion asks the Court to "hold unlawful the Department's new rule and repudiate the Department's stubborn disregard for controlling law and administrative procedure."
Key arguments in the motion include:
Exceeds the Department's Statutory Authority
Harmful to Student Access
Arbitrary and Capricious In Violation of the Administrative Procedure Act
Background on the gainful employment regulation
The Department's gainful employment regulation prohibits students enrolled in programs at certain institutions of higher education—primarily private sector institutions—from receiving federal student aid under Title IV of the Higher Education Act of 1965 unless the program satisfies a biased and arbitrary earnings metric.
The debt-to-earnings metric is set at eight percent – a level that would disqualify a law degree from George Washington University Law School, a bachelor's in hospitality administration from Stephen F. Austin State University and a bachelor's in social work from University of Texas. Further, according to the Department's own data, 43 percent of graduates from public colleges and 56 percent from private non-profit colleges would fail the metric.
Although the Department states that its new debt-to-earnings metric evaluates whether programs "prepare students for gainful employment in a recognized occupation," the Department's metric does not in fact assess program quality. Instead, the regulation measures factors that are unrelated to program quality and beyond institution control—including students' individual employment choices, local job-market conditions, and students' financial circumstances. The regulation also imposes on institutions an array of new reporting and disclosure requirements.