Transcript Slide 1

Gainful Employment
MSFAA
Lansing, MI
February 1, 2012
Gainful Employment
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The Law - HEA

An educational program is Title IV eligible only if
the program:
 If offered by a public or non-profit institution,
leads to a degree;
or
 If offered by any institution, “leads to gainful
employment in a recognized occupation”
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What is a GE Program?

At proprietary institutions all programs are GE
Programs except for  Preparatory coursework necessary for
enrollment in an eligible program
 Programs leading to a bachelor’s degree in liberal
arts offered since January 2009 that have been
regionally accredited since 2007
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What is a GE Program?

At public institutions and not-for-profit
institutions all programs are GE Programs,
except for  Programs that lead to a degree
 Programs of at least two years in length that
are designed to be fully transferable to a
bachelor’s degree program and do not lead
to a credential awarded by the institution
 Preparatory coursework necessary for
enrollment in an eligible program
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What is a GE Program?
At all institutions, GE Programs do not include –
 Teacher certification coursework that does not
lead to a certificate awarded by the institution
 Collection of classes required by state, but not leading
to an institutional credential

If the institution awards a certificate/diploma
for teacher certification coursework, it is a GE
program.
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GE Program Identifiers

A Gainful Employment program is identified by
the:
 6-digit OPEID of the institution offering the
program (8-digits for reporting)
 6-digit CIP Code (Classification of Instructional
Program) assigned to the program by the
institution
 2-digit Credential Level
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GE Program ID Number
Undergraduate Certificate in Ornamental
Horticulture at Faber College
00100201060301
6 Digit OPE ID #
CIP Code Credential Level
Credential Levels

01 = Undergraduate certificate (or diploma
programs)

02 = Associate’s degree


03 = Bachelor’s degree
04 = Post baccalaureate certificate (includes postgraduate certificate programs)

05 = Master’s degree

06 = Doctoral degree

07 = First-professional degree
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Disclosure Information

Disclosure Information on Program’s website
home page  Must be simple and meaningful
 Must contain direct links from any other
webpage with general, academic or admission
information about the program
 Must be in an open format that can be
retrieved, downloaded, indexed, and searched
by commonly used web search applications
Disclosure Information

Disclose for each GE Program:
 Occupations (by name and SOC code) that
program prepares students to enter
 Links to occupational profiles on O*NET
 Program costs –
 Tuition and fees
 Room and board
 Books and supplies
 May include other costs
Disclosure Information

Disclose for each GE Program:
 On-time completion rate  Denominator - Number of students who
completed program during most recently
completed award year for which information
is available
 Numerator - Number of students who
completed within normal time, as published
by institution (Not 150% of normal time).
Disclosure Information

Disclose for each GE Program:
 Job placement rates for students completing
the program
 Use formula that the institutional
accreditor, program accreditor, or the state
requires
 Must be disclosed on a program basis, even
if formula is for institutional level placement
rates
Disclosure Information

Disclose for each GE Program:
 Median loan debt incurred by students who
complete the program
Title IV loan debt (FFEL and Direct Loan
only) – Amount borrowed.
Private educational loan debt – Amount
borrowed
Institutional finance plans
Amount owed
Annual Reporting
Multiple reporting methods
 Batch using SAIG mailbox
◦ Fixed width format
◦ Comma separated value (CSV)

Online via NSLDS
◦ Direct online entry
 Under Enroll tab, GE List, Gainful Employment Add
◦ NSLDS GE Submittal Template
 Download at fsadownload.ed.gov
 Allows upload of 50 records at one time
Annual Reporting


Institution must report information on students who
were enrolled in a GE Program for each award year Information includes:
 Student identifying information
 Program identifying information
 Amounts from private education loans and from
institutional financing plans
 Enrollment information
 Tuition and Fees (Optional)
Annual Reporting
Student identifiers
 For each student who enrolled in a GE
Program during the award year
 Social Security Number
 First, middle and last name
 Date of birth
 Use student’s Social Security Administration
information
Annual Reporting
Program Information
 For each student enrolled in a GE Program
 Institutions OPEID (8 digit) where student
attended
 Name of program as established by
institution
 Classification of Instructional Program (CIP)
code of educational program
 Credential Level
Annual Reporting
Private education loan information
 Defined in 12 CFR 226.46(b)(5) by the Federal
Reserve Board
 Total amount of non-Title IV loan received to
pay costs associated with attendance in the GE
Program
 Examples – loans from financial institutions,
credit unions, states and other localities,
guaranty agencies, and postsecondary
educational institutions
Annual Reporting
Institutional Financing Plan information
 Includes –
 Loans
 Extensions of credit
 Payment plans or
 Other financing mechanisms
 That would otherwise not be considered a
private education loan but that results in a debt
obligation that a student must pay to an
institution after leaving the program
GE Metrics
Two metrics established via regulation
 Repayment Rate
 A percentage of the loan amounts that a GE
Program’s former students are repaying
 Debt-to-Earnings Ratios
 Annual Income Ratio
 Discretionary Income Ratio
 For the GE Program’s completers, the average
educational loan annual repayment amount as a
proportion of the average borrowers’ annual
income.
Repayment Rate
 Repayment Rate is a percentage of the Title IV
loan amounts that a GE Program’s former
students are repaying (weighted for loan
balance)
 ED calculates a GE Program’s Repayment
Rate using the program’s former students
whose Title IV loans entered repayment
during the applicable cohort period (e.g.,
2YP)
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Performance Requirements
GE Program considered to lead to gainful
Employment if it has• Repayment Rate of at least 35% OR
• Annual loan payment under the debt-toearnings ratios of 12% or less of annual
earnings OR
• Annual loan payment of 30% or less of
discretionary income
Cohort Period Used


“2YP”
◦ two year period consisting of the third and fourth
federal fiscal years preceding the federal fiscal year
for which the Repayment Rate calculation is
performed.
Informational rates to be issued in April 2012
◦ For the most recently completed federal fiscal year of 2011,
included the program’s former students who entered
repayment on FFEL or Direct Loan Program loans during
fiscal years 2007 and 2008. That is between October 1, 2006
and September 30, 2008. It tracks repayment activity on
these loans during the fiscal year 2011, between October 1,
2010 and September 30, 2011.
Repayment Rate
Loan repayment rate for a program calculated
annually using the following ratio:
OOPB of LPF plus OOPB of PML
OOPB
 OOPB = Original Outstanding Principal Balance
 LPF = Loans Paid in Full
 PML = Payments-Made Loans
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Repayment Rate
A loan is successfully being repaid if:
 Its balance is reduced by at least $1.00 over the
course of the year or paid in full;
 It is on track to being forgiven due to public service
employment;
 Borrower is making payments under an
interest‐only or income‐based repayment plan, but
limited to no more than 3% of the OOPB; or
 For post-baccalaureate programs, is a consolidation
loan and all interest accrued over the course of the
year has been paid.
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Repayment Rate
Example
Former Students OOPB
Student A
$ 2,000
Student B
3,000
Student C
5,000
Student D
10,000
Total OOPB
$20,000 for 2YP
Only Student D successfully paying on loan
Repayment Rate = $10,000 / $20,000 = 50%
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Debt-to-Earnings Ratio
Annual Income
Calculated annual loan payment based on
median loan debt
Higher of the mean or median annual
earnings
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Debt-to-Earnings Ratio
Discretionary Income
Calculated annual loan payment based on
median loan debt
Higher of the mean or median annual earnings
less 150% of HHS Poverty Guidelines for single
person
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Debt to Earnings Ratios
Median Loan Debt is the lesser of
 total tuition and fees assessed the student for
enrollment in all programs OR
 sum of ◦ total FFEL and Direct Loan Program loans owed for
attendance in the gainful employment program, as
reflected in NSLDS
◦ private education loans, as reported by the
institution
◦ debt obligations arising from institutional financing
plans, as reported by the institution
Debt-to-Earnings Ratios
SSA will provide the median and mean earnings
of the GE Program’s completers
 ED will use the higher of the two averages
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Debt-to-Earnings Ratios
Exclude students - With one or more loans in a militaryrelated deferment status
 With loans discharged, or pending
discharge, for death or total and
permanent disability
 Enrolled in Title IV eligible program
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Debt-to-Earnings
Annual Loan Payment—
 The program's completers’ median loan debt –
Amortized at 6.8% over –
10 years for a certificate, associate
degree, and post-baccalaureate program
15 years for a baccalaureate or master’s
program
20 years for a doctoral and first
professional degree program
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Performance Requirements
Upon one year’s failure, institution must provide
warnings to students and prospective students
that provide –
 Notice of the program’s failure and the amount
by which the program failed
 Any plans the institution has for improving the
program
 Must establish a three‐day waiting period after
the warnings are provided before students can
enroll

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Performance Requirements

Upon failing two years out of three, institution
must, in addition to the one-year warnings, also
tell students and prospective students that —
 Their debts may be unaffordable
 The program may lose Title IV eligibility
 What transfer options exist
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Performance Requirements
Upon being a failing program for three out of
four years, the educational program loses
eligibility for Federal student aid
 Initial targeting of the worst programs by
capping loss of Title IV eligibility for FY 2014
rates only at 5 percent each of public, nonprofit,
and for-profit programs

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To Add GE Program
 Institutions must notify ED at least 90 days before the
first day of class when adding a new educational
program that leads to gainful employment in a
recognized occupation (GE Program)
 If the first day of class is on or after July 1, 2011
and before October 1, 2011, notification was
due by July 1, 2011
 If the first day of class is on or after October 1,
2011, institutions must provide notification to the
Department at least 90 days prior to the first day
of class
To Add GE Program
Institution’s notification must include  An electronic E-App with GE Program details
 Accrediting agency approval
 State approval
 Notice of Intent to Offer an Educational Program;
and
 Section L of the E-App containing original
signature of the appropriate official
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Notice Of Intent To Offer GE Program

To ensure Notice of Intent is complete please:
◦ Describe the process used for
 Determining the need for the program, and
 Developing the program content
◦ Describe the process used to evaluate if the
resulting content is appropriate to meet the
need
◦ Clearly identify the external parties involved in
the development, review, or approval of the
program, what their review disclosed, and
actions taken in response
Notice Of Intent To Offer GE Program
 If program is currently taught at the institution
it is ok to mention actual placement rates
 Focus on benefit to students/employers –
make a clear connection between the
program, the job it prepares the student for,
and the local, regional, or national market
need for employees in that job
Notice Of Intent To Offer GE Program

Institution’s notice of intent must include:
 How institution determined need for the program
 How the program was designed to meet local market
needs
 If an online program, how designed to meet regional or
national market needs
 Contain any wage analysis performed
 How program was reviewed/approved/developed with
business advisory committees, program integrity boards,
public/private oversight agencies, and any businesses likely
to employ graduates
 Demonstrate approved by, or included in, school
accreditation
 Provide the date of the first day41 of class
Approval Required
 If the institution did not provide the required
notification timely, it must wait for Departmental
approval before disbursing funds to students
enrolled in the new GE Program
 Example - for programs beginning between July
1, 2011 and October 1, 2011 must have
provided new GE notifications by July 1, 2011
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Approval Required
Approval is also required if  The institution is provisionally certified
 The institution is adding a Direct Assessment
Program
 The institution is adding a Comprehensive
Transition and Postsecondary (CTP) Program
or
 The Department advises the institution that
it must wait for approval
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Jamie A. Malone
Training Officer
U.S. Department of Education
312-730-1528
[email protected]
My supervisor is:
Jo Ann Borel
Title IV Training Supervisor
[email protected]
202-377-3930
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