Failure To Disclose

November 3, 2011

Three years after the reauthorization of the Higher Education Act, which included new disclosure requirements for institutions, the majority of colleges are failing to provide public information on graduation rates for low-income students, and many do not adequately disclose other required information, according to a study published today by Education Sector and the American Enterprise Institute.

The study, "The Truth Behind Higher Education Disclosure Laws," examined the rates at which 152 four-year colleges and universities comply with five new disclosure requirements created when the Higher Education Act was renewed in 2008. As well as graduation rates for students receiving Pell Grants, which the majority of colleges failed to provide even when asked, the disclosure requirements examined included credit transfer policies, employment and graduate school placement rates, textbook prices, and disclosures related to private student loans.

In some cases, including credit transfer policies, the information is required to be posted online. In others, it must simply be provided when asked. But many colleges failed on both counts: only 25 percent of all respondents could provide Pell Grant recipients’ graduation rates. A majority posted or could provide placement data: 67 percent for employment placement and 60 percent for graduate school placement. Eighty-six percent of institutions were making the appropriate disclosures about private student loans, including information about federal student loan options. Of the institutions surveyed, 97 percent disclosed textbook prices, and 99 percent made public their credit transfer requirements.

Still, the information was often hard to find -- buried deep on college websites or requiring multiple phone calls or e-mails to verify. “The law itself allows so much variation in compliance as to render much of the information all but useless for students and parents choosing colleges,” the researchers, Kevin Carey of Education Sector and Andrew Kelly of the American Enterprise Institute, wrote. “As our analysis demonstrates, many colleges are providing less information than meets the eye.”

In many cases, colleges are simply confused about the requirements. Institutions are required to disclose or submit to the federal government a host of data, including information on fire safety, campus safety and security, file-sharing, graduation rates and others. Several disclosure requirements were among regulations singled out as “potentially burdensome” by institutions surveyed earlier this year, although the requirements in the Education Sector and American Enterprise Institute report were not specifically named among them.

When asked by Carey and Kelly, some colleges denied that the disclosure requirement for Pell Grant graduation rates exists at all. Others said that collecting it was too complicated because some students do not receive grants every year.

“It wasn’t, ‘Oh, we don’t have it available,’ ” Kelly said. “There also seemed to be some genuine confusion as to what the requirement was. We had people say, ‘Oh, we’re not required to report that.’ ”

But even on the regulations where colleges were largely in compliance, the disclosures were often unhelpful, the authors wrote. Credit transfer requirements were posted on the websites of almost all colleges surveyed, as required by law. But many didn’t state the specific criteria for accepting credit, which can depend on specific departments or major requirements.

There are reasons why colleges might not comply, including fear that they will look bad by comparison with other institutions, as well as the investment of time and money needing to gather the information, the researchers wrote. But many nonselective public institutions, which might struggle with both factors, manage to comply -- and some prestigious colleges, which are more likely to have good metrics and additional staff, do not.

Although the Education Department is responsible for enforcing the disclosure requirements, its officials have done little to do so publicly. “We are aware of no instances in which colleges have even been publicly identified by the Department of Education as being in non-compliance with the disclosure provisions examined in this report, much less been fined or had their eligibility to receive student aid ... revoked,” Carey and Kelly wrote.

Improved enforcement would improve compliance, they wrote. So would changing requirements that colleges “disclose” or “make available” information to a requirement that they report it to the National Center for Education Statistics, which would create standard formats and gather the data in a central location.

But the requirements and resulting disclosures should also be made clearer to students and families, who should be given more guidance on what information is important, the authors wrote. “The compliance stuff doesn't get to a lot of the accessibility questions that we tried to tackle,” Kelly said. “Even when you have it there, can anybody find it? Can average high school students find it?”

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