Durbin, Hirono Call On Department Of Education To Strengthen Proposed Gainful Employment Rule

Durbin, Hirono Call On Department Of Education To Strengthen Proposed Gainful Employment Rule

While the Senators support the use of an earnings premium metric, they pushed for the reinstatement of the debt-to-earnings test

WASHINGTON - U.S. Senate Democratic Whip Dick Durbin (D-IL) and U.S. Senator Mazie Hirono (D-HI) submitted a public comment in response to the U.S. Department of Education's (ED) proposed rule to establish a postsecondary education accountability framework. In their letter, the Senators noted that while they support the new rule's "earnings premium" metric, they believe that the rule does not go far enough to weed out postsecondary programs, including those at for-profit colleges, that fail to provide students with positive outcomes.

"While the Department's proposed regulations represent a positive first step toward ensuring program integrity, proper oversight, and accountability for institutions of higher education that receive taxpayer-funded federal financial aid, we believe that additional measures are needed to ensure that students and taxpayers receive positive returns from their investments in higher education," the Senators wrote.

Durbin and Hirono first expressed their support for the rule's "earnings premium" metric, which requires the average graduate of an undergraduate program to exceed the median earnings of a typical high school graduate. Additionally, graduate degree programs must lead to earnings above those of a bachelor's degree holder. This metric, which was also included in the Biden-era rule, prevents for-profit colleges that leave students in mountains of debt with a flimsy degree from accessing federal funding. The Senators further pushed for certificate and career training programs to be judged by the same metrics as other postsecondary education programs.

"We strongly support the Department's application of the earnings metric for non-degree programs and urge the Department to maintain it in the final rule…Programs enrolling 31 percent of undergraduate certificate students are projected to fail the earnings premium test, compared with programs enrolling only four percent of associate degree students and fewer than one percent of bachelor's degree students…Weak earnings outcomes are particularly troubling among for-profit institutions that primarily award certificates. [A 2023] study found that nearly 75 percent of certificate-granting for-profit colleges leave most of their students earning less than the average high school graduate, even a decade after enrollment," the Senators wrote.

"These data make clear that certificate programs-which enroll large numbers of low-income students, older students, and students of color-carry the highest risk of leaving students financially worse off than if they had never enrolled. Excluding these programs from accountability requirements would not only squander taxpayer dollars but also deny these students the protections afforded to those pursuing degree programs… Including undergraduate certificate programs within the earnings accountability framework is therefore essential to ensuring consistent protections for both students and taxpayer investments," the Senators wrote.

Durbin and Hirono also urged ED to reinstate the Biden-era debt-to-earnings (DTE) metric, which measures loan debt against a student's earnings after they complete a postsecondary program. The Senators argue that education programs that fail the DTE metric should lose access to all Title IV funding, including Pell Grants, in addition to Direct Loan eligibility. This would encourage students to use their Pell Grant for programs that deliver meaningful economic value and ensure that ED resources are not drained by low-quality programs.

"We also strongly urge the Department to retain the debt-to-earnings (DTE) metric as a necessary complement to the earnings premium metric. While the earnings premium test serves an important purpose by identifying programs that fail to raise graduates' earnings, the DTE test addresses a separate and equally important concern: whether students are left with debt burdens they cannot reasonably repay, even when a program provides some earnings gain," the Senators wrote.

"If programs that fail the earnings premium metric remain eligible for Pell Grants, low-income students may exhaust their lifetime limit of Pell Grants at programs that fail to deliver meaningful economic value or provide the earnings gains students need to make the investment in their education worthwhile. At a time when the Pell Grant program faces a shortfall, it is imperative that the Department be a good steward of taxpayers' dollars by ensuring low-quality programs are not draining the Pell Grant resources," the Senators continued.

The Senators concluded their letter by urging ED to properly scrutinize postsecondary education programs to ensure that American students are receiving the best quality education possible.

"We appreciate that the Department's proposed rule and recognize that it is a positive step forward in supporting students and improving accountability for institutions of higher education. We look forward to working with the Department to strengthen protections for students from low-value programs, ensure responsible stewardship of taxpayer dollars, and maintain the integrity of the federal investment in higher education," the Senators wrote.

Durbin has long been a supporter of a robust Gainful Employment Rule. In 2014, the Obama Administration put the Gainful Employment rule into effect, but under the first Trump Administration, then-Secretary of Education Betsy DeVos rescinded the Gainful Employment Rule in 2019. Without the Gainful Employment rule in place, for-profit colleges have been able to prey on students, leaving them with debt and often a worthless degree. In 2023, the Biden Administration finalized a Gainful Employment Rule with the strongest accountability framework yet, which went into effect in 2024. However, the second Trump Administration eliminated the Biden-era DTE metric, removing an essential component in ensuring public transparency and preventing for-profit colleges from siphoning federal dollars while providing a near worthless degree to students.

Full text of the letter is available here and below:

May 20, 2026

Dear Secretary McMahon:

We write in response to the U.S. Department of Education's ("Department") proposed rules titled "Accountability in Higher Education and Access Through Demand-Driven Workforce Pell: Student Tuition and Transparency System (STATS) and Earnings Accountability." While the Department's proposed regulations represent a positive first step toward ensuring program integrity, proper oversight, and accountability for institutions of higher education that receive taxpayer-funded federal financial aid, we believe that additional measures are needed to ensure that students and taxpayers receive positive returns from their investments in higher education.

We strongly support the Department's application of the earnings metric for non-degree programs and urge the Department to maintain it in the final rule. The Department's preliminary findings underscore why this coverage is necessary. Programs enrolling 31 percent of undergraduate certificate students are projected to fail the earnings premium test, compared with programs enrolling only four percent of associate degree students and fewer than one percent of bachelor's degree students. These projections align with a 2023 study showing that at most certificate-granting institutions, more than half of students earn less than individuals whose highest credential is a high school diploma. ^[1] These weak earnings outcomes are particularly troubling among for-profit institutions that primarily award certificates. The same study found that nearly 75 percent of certificate-granting for-profit colleges leave most of their students earning less than the average high school graduate, even a decade after enrollment.

These data make clear that certificate programs-which enroll large numbers of low-income students, older students, and students of color-carry the highest risk of leaving students financially worse off than if they had never enrolled. Excluding these programs from accountability requirements would not only squander taxpayer dollars but also deny these students the protections afforded to those pursuing degree programs. Career training programs are meant to improve graduates' earnings and employment outcomes compared to a high school degree. Survey data shows that college affordability and future earning potential are the two most important factors guiding young people's decisions to apply and enroll in college. Students pursuing any undergraduate credential, whether a degree or certificate, should be able to trust that their program will lead to earnings above those of workers with only a high school diploma. Including undergraduate certificate programs within the earnings accountability framework is therefore essential to ensuring consistent protections for both students and taxpayer investments.

We also urge the Department to preserve the proposed framework for institutions to appeal their programs' earnings outcomes, which appropriately limits challenges to calculation errors and does not permit the use of alternative earnings surveys. Although some programs whose graduates commonly earn tips, particularly cosmetology programs, have argued that unreported tips would unfairly cause programs to fail the earnings metric, analysis of Internal Revenue Service data has shown that including unreported tipped income would not substantially change fail rates for most cosmetology programs. Allowing institutions to appeal based on alternative earnings measures or similar methodologies likely would lead to lengthy disputes, create incentives for manipulation that disadvantage students, and continue directing Title IV funds to programs that provide little or no meaningful earnings benefit to graduates.

We appreciate the Department's commitment to preserving robust transparency and consumer disclosure requirements through the Student Tuition and Transparency System (STATS). The Higher Education Act (HEA) gives the Department authority to collect and publish information on its programs, including Title IV, to inform the public and measure its programs' effectiveness. Providing students and families with reliable program-level information on costs, debt burdens, and post-enrollment outcomes-as well as proactive disclosures for programs that fail to meet minimum earnings thresholds-will better equip them to make informed choices about where to enroll. In addition to the reporting requirements proposed in the rule, the Department also should maintain existing regulatory requirements for institutions to report the total amount of institutional debt incurred by students who complete or withdraw from a program. This data would provide students and parents with a full picture of what a family could expect to pay and how much graduates can expect to earn.

We also strongly urge the Department to retain the debt-to-earnings (DTE) metric as a necessary complement to the earnings premium metric. While the earnings premium test serves an important purpose by identifying programs that fail to raise graduates' earnings, the DTE test addresses a separate and equally important concern: whether students are left with debt burdens they cannot reasonably repay, even when a program provides some earnings gain. According to the Department's data, career training programs account for only 15.2 percent of Title IV enrollments, but nearly 50 percent of all Title IV enrollments that fail the DTE standard and 65 percent of borrowers who default. There are approximately 40,000 students receiving Title IV funding from the programs that fail DTE but not the earnings premium, which is far too many for the Department to ignore.

Gainful employment programs that fail the earnings metric should lose access to all Title IV funding, including Pell Grants, rather than only Direct Loan eligibility. This safeguard is especially important for undergraduate certificate programs, but it should apply to all programs covered by the statutory gainful employment framework under the HEA, which requires that for-profit and vocational institutions and all non-degree programs must "prepare students for gainful employment in a recognized occupation" to receive federal financial aid under Title IV.^[2] If programs that fail the earnings premium metric remain eligible for Pell Grants, low-income students may exhaust their lifetime limit of Pell Grants at programs that fail to deliver meaningful economic value or provide the earnings gains students need to make the investment in their education worthwhile. At a time when the Pell Grant program faces a shortfall, it is imperative that the Department be a good steward of taxpayers' dollars by ensuring low-quality programs are not draining the Pell Grant resources.

We appreciate that the Department's proposed rule and recognize that it is a positive step forward in supporting students and improving accountability for institutions of higher education. We look forward to working with the Department to strengthen protections for students from low-value programs, ensure responsible stewardship of taxpayer dollars, and maintain the integrity of the federal investment in higher education.

Sincerely,

-30-