Dems urge Obama administration to ‘close loopholes’ in college regs

Democrats are urging the Obama administration to “close loopholes” in new rules targeting colleges and universities that do not prepare their students to find jobs after graduation.

The so-called gainful employmentregulations from the Department of Education are intended to prevent graduates from being “buried in debt,” but critics say they do not go far enough and will allow for-profit schools like the University of Phoenix to take advantage of their students.

Rep. Raúl Grijalva (D-Ariz.) called on the Obama administration to also offer loan forgiveness and debt restructuring to students who attend a school that does not measure up to the gainful employment regulations.

“Relief for students has to be part of the discussion,” Grijalva said Friday during a press call hosted by the student advocacy group Young Invincibles.

The Education Department estimates nearly 1,400 college programs serving some 840,000 students will fail the new requirements, which could ultimately lead to lost federal aid unless steps are taken to correct the problem.

The Obama administration defended the gainful employment regulations as a way to protect students from accumulating loads of debt for a degree that does not translate into a good-paying job.

These schools will be required to show that their students are earning enough money upon graduation to pay for their student loans.

Under the new rules set to go into effect in July, graduation rates, the salaries of former students and how much debt they have will be monitored to help determine the effectiveness of a particular degree.

But Sen. Chris MurphyChris MurphyRand Paul roils the Senate with NATO blockade Lawmakers want Trump commitment to help Iraq post-ISIS Ten years later, House Dems reunite and look forward MORE (D-Conn.) complained the gainful employment regulations do not account for students who leave school before graduation.

“We need a metric for all the kids who are dropping out,” Murphy said during the press call.

Many students attend a for-profit college “only to find out the school’s a joke,” said Rory O’Sullivan, deputy director of Young Invincibles.

“We shouldn’t punish those students for leaving failed programs,” he added.

Grijalva and Murphy say for-profit schools should also be restricted from spending government aid on marketing and recruitment.

Murphy complained that for-profit schools received about $32 billion last year in taxpayer-fund money, but only a small portion of it was spent on educating the students. 

He pointed to 2009 figures showing the University of Phoenix spent about $892 per student on instruction, while it spent $2,225 per student on marketing.

“The taxpayers are being cheated, and the student is being cheated, as well,” Grijalva said.