In advance of last night’s State of the Union address by President Obama, federal officials, including the incoming chair of the House Subcommittee on Higher Education, Lifelong Learning and Competitiveness, aired ideological differences over issues that are likely to be at the heart of major policy struggles during the new Congress. Discussion on for-profit schools, the controversial gainful employment regulation, college financial aid funding, and the evolving role of government in higher education emerged as top issues Tuesday morning at the 2011 annual conference of the Council for Higher Education Accreditation. The council is an association that represents more than 3,000 postsecondary institutions and helps set policies for the 60 accrediting organizations recognized by the council, including regional and national accreditors .
U.S. Rep. Virginia Foxx (R-North Carolina), who is the new chairwoman of the House Education and Labor’s subcommittee on higher education, reiterated her party’s mantra that good government is small and that, the larger it becomes, the more difficult it is to maintain transparency and flexibility. She plans to hold subcommittee hearings during which experts can offer advice about how to streamline federal government regulation of American higher education institutions.
In addition, Foxx also said that she plans to explore whether state and local governments are better suited to handle oversight of higher education. Rather than “rushing to legislate,” Foxx said she would focus more on holding hearings. She also hinted that the Pell grant program would receive a lot more scrutiny because of its explosive growth.
Foxx recognizes the need to hold institutions that receive federal aid accountable, but said that she is not certain that the proposed gainful employment rule makes sense. She also suggested that it might make more sense to apply the rule to both nonprofit and for-profit institutions.
That’s the sort of talk that makes Dr. Larry Earvin, president and CEO of Huston-Tillotson University nervous.
“Given that many of our HBCUs are liberal arts institutions, there’s considerable concern about the gainful employment rule and its impact on [them],” Earvin said. “Liberal arts institutions tend to provide education for students in a variety of areas and not just one specific career path. If you’re talking about schools of business or engineering or programs like that, then gainful employment has a certain applicability.”
Dr. Eduardo Ochoa, assistant secretary for postsecondary education, who also addressed the conference, said that the Department of Education will release a final gainful employment regulation in “the early part of this year” and that it has been revised to allay some of the fears expressed by the for-profit sector, although he declined to provide details.
“It’s a little bit frustrating for me to watch some of the for-profits’ advertising because many of the things that they’re most concerned about and are trying to fight against are things that we’ve heard about in the hearings, and we’ve listened and really taken a lot of it to heart,” he said. “The regulations as they come out are going to be significantly different. I think they’re going to be better, more nuanced.”
Ochoa also discussed the very different missions of for-profits and nonprofits to defend the need for the rule. For-profits, he said, developed a business model from scratch that is focused on making profits and increasing market share. They identified a segment of the market that wasn’t being served and figured out how to serve them and operate as a business, he said, unburdened by such issues as tenure or multi-dimensional missions. The question for for-profits, he added, is whether their “profit-maximizing behavior” has led to the need for a gainful employment regulation.
“That’s a very different culture obviously than the one we have in the traditional higher education sector, where growth for growth’s sake is not really anything that drives most institutions,” Ochoa said. “Actually, most institutions consciously limit their growth; they stay a certain side and focus instead on achievement and an increasingly selective student body as a means of raising their prestige.”
In response to Foxx’s remarks, like Earvin, Ochoa conceded that there could possibly be some way to justify the application of a gainful employment rule to nonprofit programs that lead to a specific career path.
“Personally, I don’t think it should apply to every single program [such as] programs in liberal arts and other basic disciplines that are not in fact primarily geared to direct career employment,” he said. “They certainly make their graduates more employable, but in very unpredictable ways in a whole variety of occupations, some of which may pay more than others. So it would be very hazardous to tie those kinds of programs directly to these outcomes.”