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Regulation | 12 Months Ended
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Dec. 31, 2013
Regulation [Abstract] |
Regulation | 17. Regulation The Department of Education previously attempted to define “an eligible program of training to prepare students for gainful employment in a recognized occupation.” After a federal court invalidated the Department’s regulation, the Department established a negotiated rulemaking committee to consider the issue of gainful employment. The negotiations did not result in the required consensus, and the Department has indicated that it expects to issue a Notice of Proposed Rulemaking for public comment in early 2014. Although it is not yet known what will be included in the Department’s Notice of Proposed Rulemaking, the most recent proposal by the Department put before the Committee included three metrics, as described in more detail in Part I, Item I, Regulation. The proposal included measurements of program cohort default rates (“pCDR”), annual debt-to-earnings, and discretionary debt-to-earnings. Under the proposal, a program would remain eligible for Title IV funding if it has a cohort default rate less than 30%, and the annual loan payment of a typical graduate of the program does not exceed 8% of the average or median annual earnings, or 20% of the average or median discretionary income. Under the annual and discretionary debt-to-earnings metrics, a program would become Title IV ineligible for three years if it fails either metric for two out of three years, or is in a warning zone for four consecutive years. Under the pCDR, a program would become Title IV ineligible for 3 years if the three-year default rate of three consecutive cohorts of students is greater than or equal to 30%.

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