ED Reaches Consensus on Proposed Regulations for Higher Education Accountability

Last week, I tuned into the U.S. Department of Education’s (ED) session of negotiated rulemaking focused on accountability in higher education. This process, required for making regulatory changes to Title IV programs, convenes stakeholders to discuss and seek consensus on proposed regulations. In its second meeting, the Accountability in Higher Education and Access through Demand-driven Workforce Pell (AHEAD) Committee discussed regulatory changes to implement the “Do No Harm” earnings standard from the One Big Beautiful Bill Act (OBBBA). 

After extensive discussion with negotiators representing constituencies including students, taxpayers, institutions, and employers, ED reached consensus on proposed regulations that will hold all higher education programs accountable to a new earnings metric and provide program-level transparency for students and the public.  

Student protections and transparency were central to the negotiations. The proposed regulations apply an earnings premium test to all programs, including undergraduate certificate programs, which would ensure that all students receive real economic value from their education. That earnings standard assesses whether students are, on average, better or worse off after having attended a given program.  

The proposed regulations align the existing Gainful Employment (GE) and Financial Value Transparency (FVT) regulations with the earnings standard in OBBBA in ways that include removing the debt-to-earnings rates. Much of the FVT framework was retained and renamed the Student Tuition and Transparency System (STATS), with some changes to the metrics and reporting requirements.  

Providing new program-level information about costs, financial aid, and outcomes through STATS will empower students to make more informed decisions about which program to pursue. 

Under its proposed timeline, ED would first calculate the earnings test and notify colleges of their programs’ results in early 2027. When that calculation occurs, the most recent tax data available would cover the 2025 calendar year, which is four years after graduates from the 2021 award year completed their programs. ED will then conduct the second earnings test calculation and notification in early 2028 using data for completers in the 2022 award year. Programs that fail the calculation in both 2027 and 2028 would be designated as “low-earning outcome programs” and could lose access to federal student loans beginning July 1, 2028. 

For more details about the AHEAD Committee discussions and proposed regulatory changes, read this comprehensive summary I coauthored with Lydia Franz from The Institute for College Access & Success (TICAS). That summary includes technical information about the specific earnings benchmarks, modifications to GE and FVT, and the student, program, and institutional disclosures.  

The regulations are not yet final but will be in the coming months. ED will soon issue a proposed rule for public comment that matches the language negotiators agreed upon. After reviewing public comments, ED will publish a final rule that will take effect on July 1, 2026.  

We’ll continue following this rulemaking process as the Department seeks public input. Stay tuned for more insights on what the accountability and transparency provisions mean for students and institutions.