Obama Alums Launch Coalition to Challenge DeVos

A group of former Obama administration officials is launching a legal aid effort to assist students who are defrauded or suffer from discrimination.

The organization, called the National Student Legal Defense Network, will work with state attorneys general and other advocacy groups to bring lawsuits on students' behalf, according to the Associated Press. The AP and The Washington Post reported the group's launch.

The network's co-founder Aaron Ament, a former chief of staff to the general counsel at the Department of Education under Obama, told those outlets that the deregulatory agenda of Education Secretary Betsy DeVos means there is a need for more groups to step up to protect students.

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Department of Ed rejects calls to update oversight measures

Even as GAO and others say department needs to do more to monitor institutions for financial risks, department doesn't plan changes.

Bipartisan Policy Ideas on Higher Education

The Urban Institute this week released 10 new papers from a bipartisan, high-profile group of scholars and experts on federal higher education policy.

"The federal role in higher education has grown over the past two decades, and now, a new administration has the opportunity to strengthen policies that support students and their colleges and universities," the institute said. "To help inform these decisions, we offer a series of memos written by a bipartisan group of scholars and policy analysts and rooted in an understanding of the importance and limits of the federal role in higher education."

The memos cover the following areas:

  • Data and transparency
  • Institutional accountability
  • Accreditation
  • Innovation
  • Workforce development
  • For-profit colleges
  • Understanding and modifying student behaviors and decisions
  • Pell grants and student aid simplification
  • Student loan repayment
  • Private loan financing mechanisms
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Education Dept. Confirms Initial Approval of Kaplan, EDMC Deals

The U.S. Department of Education on Wednesday confirmed that it has granted initial approval to acquisitions of Kaplan University and Education Management Corp., two large for-profits. The proposed transactions by Purdue University to acquire Kaplan and create a new online university, and by the Dream Center, a nonprofit missionary group, to buy EDMC and its for-profit campus chains, both have drawn controversy. Earlier this week Buzzfeed reported that the feds had signed off on the deals, citing emails the publication obtained.

The state of Indiana has backed Purdue's move. But the public university still must get approval from the Higher Learning Commission, the regional accreditor for both Purdue and Kaplan.

EDMC is overseen by several accreditors. One has rejected part of the deal, while another has backed it.

A department spokeswoman confirmed the feds' initial approval of both transactions. But she said those decisions are not final.

"The department has preliminarily concluded that, based on the information provided to the department, there are no current impediments to the requests for approval of change of ownership," she said via email. "But, keep in mind, a preacquistion determination is not a final approval. The department has laid out clear criteria each university must meet as well as conditions it would impose if it were to approve any change of ownership transaction and subsequently enable the acquiring parties to retain Title IV eligibility. We also notified the parties of additional documents and information that must be submitted for the department to conduct its final review of a formal change in ownership application."

Purdue described the approval process in a news release, noting that the department included conditions with its initial backing of the deal. Those conditions have not yet been publicly released.



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Democrats Grill Ed Dept. Nominee

Democrats used a Senate nomination hearing Tuesday to press the Department of Education's nominee for general counsel on questions involving federal Title IX policy and oversight of for-profit colleges.

Carlos Muniz, the nominee for general counsel and a former Florida deputy attorney general, is only the third Senate-confirmed education official to be nominated by the administration, after Secretary Betsy DeVos and Assistant Secretary Peter Oppenheim. While Muniz revealed little about how he would act on specific issues, the hearing highlighted areas where congressional Democrats will continue to clash with the department and DeVos.

Senator Patty Murray, the ranking Democrat on the Senate education committee, said the secretary's "lack of understanding of education issues and current law make it clear she needs an independent" counsel.

Muniz said he understood his "ultimate duty will be to the law, not to any individual or objective."

Democratic senators asked Muniz to commit to upholding the preponderance-of-evidence standard in campus-based Title IX proceedings (he didn't directly answer); asked him whether he would "stand in the way" of other federal agencies investigating for-profits colleges (he said he didn't have a view on the authority of other agencies); and asked him to explain why the Florida AG didn't investigate Trump University or for-profit colleges like Bridgepoint Education (he cited a low number of complaints from Floridians).

It was widely reported last year that Florida Attorney General Pam Bondi received a campaign donation from then candidate Donald Trump before declining to pursue an investigation of Trump University, a real estate training program. Her office insisted there was no connection between the donation and that decision. A federal judge this year approved a $25 million settlement between Trump and former students of the real estate seminar.

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Report: Education Dept. to Back Kaplan, EDMC Deals

The Trump administration's Education Department will sign off on controversial acquisitions of two large for-profit college chains, according to a report by BuzzFeed, which cited department emails the publication said it obtained.

Purdue University in April announced its plan to acquire Kaplan University in a complex deal to create a new nonprofit online university. The state of Indiana approved the acquisition, and experts predicted the Trump administration would as well, given moves the department has made to roll back what it calls unnecessary or overreaching Obama-era regulations and to rule in favor of for-profits in some individual cases. The final and likely most difficult regulatory hurdle for the Purdue-Kaplan partnership, however, will come from the Higher Learning Commission, the regional accreditor for both universities.

The bid by the Dream Center, a nonprofit missionary organization, to purchase Education Management Corp. (EDMC) and its Argosy University, South University and Art Institutes campuses has drawn criticism. The offer is reportedly $60 million for institutions that collectively enroll about 60,000 students. Consumer, student and veterans' groups had urged the department to tightly scrutinize the deal, in part over concerns about a return to what critics said were predatory actions by some EDMC campuses.

One of several accrediting agencies that oversee EDMC already has rejected Dream Center's purchase of two Art Institute locations, citing insufficient information about the deal. Another accreditor, however, backed a portion of it.

BuzzFeed reported that the department "does not see any impediment to EDMC's request for approval of the change in ownership or its request for approval of nonprofit institution status."

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Dem Senators to CFPB: Keep Up Work on Loans

Senate Democrats Elizabeth Warren and Sherrod Brown in a letter Monday encouraged the Consumer Financial Protection Bureau to maintain active oversight of loan servicers and other participants in the student loan industry.

The Democrats wrote the letter to the CFPB's director, Richard Cordray, in the wake of a Department of Education decision to terminate two agreements with the agency involving oversight of student loan programs. That decision, the senators said, was another example of Education Secretary Betsy DeVos acting in favor of private student loan companies at the expense of borrowers.

The department, in ending the deals with CFPB, said the agency had used complaint data to inappropriately expand its jurisdiction. It also said the agency hadn't turned over complaints in a timely manner. Cordray, however, said the notice terminating the agreements was the first time he had heard any concerns about the agreements from the department.

The senators asked Cordray to provide copies of communication between CFPB and the Department of Education -- as well as the White House and other federal agencies -- about the termination of the agreements. They also asked Cordray to describe how CFPB used the information-sharing agreements to address problems in federal student loan programs, how the agreements helped federal student loan borrowers and how the termination of the deals would affect sharing of information between the agency and the department.

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CFPB Orders Student Loan Trust to Stop Collecting on Debt

The Consumer Financial Protection Bureau on Monday ordered a collection of trusts that hold billions in private student loans to stop collecting on debt and pay a settlement restoring harmed borrowers. 

The New York Times reported in July that judges in multiple states had tossed out debt collection lawsuits brought by National Collegiate Student Loan Trusts because ownership of the debts could not be verified. The CFPB's enforcement action found that the trusts had brought more than 2,000 such lawsuits without proper documentation in violation of consumer protection laws. And in many of those lawsuits, false or misleading affidavits were filed, the agency said. 

CFPB is seeking an independent audit of all 800,000 student loans held by the trusts. And it is ordering the trusts and their debt collector, Transworld Systems, Inc., to pay $21.6 million in payments to borrowers and civil penalties. 

A consent order against Transworld is effective immediately. A proposed judgment against the trusts will be effective if approved by the presiding judge in the U.S. District Court for the District of Delaware. 

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Session takes an early look at results from FAFSA filing changes

Students filed earlier and universities mailed awards earlier, but some ran into snags with setting tuition.

Support for State Free Tuition Programs Grows

A new poll from the Campaign for Free College Tuition shows support continues to increase for free college tuition programs that benefit academically qualified students.

Support for tuition-free state programs increased to 47 percent -- up 12 percent since CFCT started national polling in 2016. The poll also revealed that 78 percent of the public approve of the idea of free college tuition.

"CFCT's latest poll demonstrates the popularity of both federal and state programs that make college tuition-free," said Morley Winograd, president of CFCT, in a news release. "Both enjoy majority support from Democrats, Republicans and Independents alike, which contradicts recent commentary that the idea of free college is not popular among certain groups of voters."

Winograd said the poll highlights why tuition-free programs have taken off in red states like Arkansas, Kentucky and Tennessee, and in blue states like New York, Oregon and Rhode Island.

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