A failure to protect students and taxpayers

A couple of weeks ago, Senate Budget Committee Chairman Mike Enzi (R-Wyo.) wrote to the secretary of Defense regarding its first departmentwide audit of the Pentagon. In his letter, the senator noted, “taxpayers must have trust and confidence that their hard-earned dollars are being spent wisely.”

While our focus is on the Department of Education and its work, the National Association for College Admission Counseling (NACAC) certainly supports this sentiment. While most members of Congress call for responsible use of taxpayer dollars, the sad truth is that the execution of this idea is not universally applied across federal agencies.

{mosads}A clear example of this disconnect through the Department of Education is the waste, fraud and abuse at many unscrupulous proprietary colleges. These colleges received tens of billions of dollars from the U.S. government, but do a poor job of educating students. I have written before about the high dropout rates, debt and poor job placement rates students that attend unscrupulous for-profit colleges endure. Unfortunately, Congress has failed to address these systematic problems.

In fact, Congress is headed in the opposite direction. In December, the House Education and the Workforce Committee passed the so-called PROSPER Act. The bill is a massive step backward in the effort to ensure responsible use of taxpayer dollars. Not only does it fail to rein in these abusive practices, it eliminates critical safeguards designed to hold these colleges accountable, including: gainful employment, borrower defense to repayment, and the 90/10 rule. If this bill is signed into law, career education programs would no longer be required to prepare students to be “gainfully employed” in a job that allows them to meaningfully pay off their student loans after graduation; students defrauded by a college will no longer be protected by having their student loans forgiven; and/or colleges will no longer be required to earn revenue outside of federal sources (many for-profit colleges already derive close to 90 percent of their revenue—the current maximum allowed—from Higher Education Act Title IV funds).

As if that is not bad enough, the PROSPER Act would also eliminate cohort default rates—preventing the government, students, counselors and others from knowing how many students are in default—and combine all forms of colleges under one definition, eliminating any distinction about the college’s tax status and governance structure (shareholders as in the case of for-profit colleges, or a president, board of regents and students in the case of non-profit colleges). It would also weaken a ban on incentive compensation, allowing colleges to put the financial interests of recruiters ahead of the students they try to enroll, a practice NACAC has prohibited for more than 50 years.

NACAC is not alone in its concern about the direction the House bill would take higher education, and it is unclear what direction the Senate will go. Health, Education, Labor and Pensions Committee Chairman Lamar Alexander (R-Tenn.) has been critical of many of these regulations in recent years, despite spending time trying to rein in these same abuses as the secretary of Education. To be fair, Democrats in the past, have resisted strong regulations to protect students and taxpayers using the false argument about “college access” that many of the sector’s proponents utilize today. Unfortunately, some Democrats continue to cling to these talking points.

The current effort and desire to get the Pentagon’s budget in order is critical but no less important than the Department of Education’s budget. NACAC would encourage Enzi—a former chairman of the HELP Committee—and other members of Congress to be consistent and clear-eyed about how tax dollars are misused across federal programs.

Rose is the director for Government Relations at the National Association for College Admission Counseling.