Let The Rule Making Begin

Career College Central summary:

  • A 15-person panel appointed by the U.S. Department of Education this week began a months-long negotiating process aimed at developing a package of regulations relating to student aid programs. Negotiators began to tackle an ambitious regulatory agenda, first announced by the Obama administration last year, that includes new rules for distance education, Parent PLUS loans and campus debit cards.
  • Meeting for the first time Monday, members of the panel and department officials began to explore those issues in broad discussions, which will continue for the rest of this week. Lawyers from the department said they would then draft proposed rules before the panel reconvenes for three more days in March. Another three-day session of negotiations is scheduled for May.
  • Several consumer advocates on the panel also sought to add two more issues to the agenda. Suzanne Martindale, a staff attorney at Consumers Union, proposed adding a discussion of regulations to prevent colleges’ manipulation of their loan default rates, and of banning mandatory arbitration clauses in contracts between students and institutions. Department of Education officials rebuffed that request, saying that while they viewed those issues as “important,” they had neither solicited public feedback on those topics nor provided any notice to constituencies who would be affected by those issues.
  • Negotiators are likely to face an uphill battle in reaching consensus. The panel will have to come to unanimous agreement on all six of the wide-ranging topics in order to satisfy the definition of consensus under the rule making process. If that consensus is reached, the department would be bound to the panel’s final proposal. The department would otherwise have the freedom to draft regulations as it wishes.

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