Betsy DeVos’s Department of Education Quietly Rolls Back Wide Array of Important Regulations

Betsy DeVos’s record at the U.S. Department of Education has been marked by passage of no major policy initiatives—no new programs to help public schools and not even any major federal initiatives to promote her pet cause, privatization of public education.  Her accomplishments have been behind the scenes as she has begun dismantling civil rights protections and taken a series of steps to undermine protection for college students, especially those who are paying for school with federal student loans.

At the end of February, U.S. Senator Elizabeth Warren and Congresswoman Katherine Clark of Massachusetts released DeVos Watch, Year One: Failing America’s Students. These two members of Congress sharply criticize Congress’s confirmation of a woman they believe was unqualified to serve as the U.S. Secretary of Education: “She became Education Secretary despite having absolutely no experience as a school teacher, school administrator, or public official, and despite her long record of bankrolling politicians and supporting policies that are damaging to public education. She had no record or experience related to the Education Department’s job of managing the $1 trillion federal student loan program.”

Warren and Clark condemn DeVos’s actions to reduce civil rights protections for students by “reversing, rescinding, overturning, or delaying” guidance and regulations that protect students from sexual harassment and sexual violence, and that protect transgender students. She threatens to delay the implementation of an Obama Department rule designed to prevent what has been widespread over-representation due to racial bias of students of color in special education programs. She has also weakened investigation of civil rights violations after the Department of Education’s Office for Civil Rights receives formal complaints.

Warren and Clark’s deepest worries about Betsy Devos, however, involve higher education and actions DeVos has taken to deregulate for-profit colleges and to weaken protections for students in the federal student loan program.Warren and Clark cite examples when DeVos hired insiders from the for-profit college sector to fill positions tasked with regulating for profit colleges. For two months after DeVos hired Robert Eitel as an assistant in the U.S. Department of Education, Eitel continued to serve as the Vice President for Regulatory Legal Services at for-profit Bridgepoint Education. Eventually Eitel recused himself from direct work with Bridgepoint, but, “he has been permitted to work on the Department’s delay and rewrite of Borrower Defense to Repayment regulations… which directly impact his former employer.”  Taylor Hansen, who served for several months under DeVos before he was forced to resign, had worked previously as lobbyist for the Association of Private Sector Colleges and Universities. Before DeVos hired him, Hansen had lobbied for years against the very rules he was expected to enforce as a member of DeVos’s staff.

Warren and Clark detail DeVos’s actions to weaken oversight of for-profit higher education and of the enormous college loan program:

  • While the Obama Department of Education had forbidden collection agencies from adding collection fees as long as borrowers in default had entered a repayment program, DeVos simply “withdrew this guidance.”
  • DeVos has delayed and denied relief under the Borrower Defense to Repayment rule. This rule, established in 1994, “provided relief from loan burdens in cases where colleges broke the law to get students to take out student loans and enroll.”  After Corinthian Colleges closed in 2015 and ITT Technical Institute closed in 2016, thousands of claims were filed.  The U.S. Department of Education settled 28,000 of these claims by January 20, 2017, but in the six months following DeVos’s confirmation as Education Secretary, the Department did not grant relief to any additional students who had filed complaints.  After a number of state attorneys general sued, the Department began processing claims, but “the Department denied an additional 8,600 applications from former Corinthian College students.” DeVos has delayed the implementation of Obama era Borrower Defense rules from July 2017 until July of 2019.
  •  DeVos has also delayed enforcement of the Gainful Employment rule by which Education Secretary Arne Duncan’s Department of Education tied eligibility for funding to students’ employment outcomes to protect students from predatory for-profits whose programs are so inferior their graduates are unemployable. In January of 2018, write Warren and Clark, “the Department of Education proposed removing all penalties for low-performing programs.”
  • DeVos’s Department of Education has also eased accreditation of for-profit colleges.  John King, President Obama’s second Education Secretary, stopped recognizing the Accrediting Council for Independent Colleges as an approved accrediting organization due to the failure of two for-profits it had accredited: Corinthian Colleges and ITT Technical Institute. “But on January 24, 2018, the Department accepted the Accrediting Council for Independent Colleges’ petition to be reconsidered as a national accreditor….”
  • Warren and Clark describe an additional way DeVos’s Department of Education is easing up on for-profit colleges: “In recent years, several for-profit colleges have sought nonprofit status in order to skirt regulations, such as gainful employment requirements and rules meant to prevent for-profit colleges from receiving all of their revenue from the federal government… But under Secretary DeVos, the Department has pre-approved the sale of the troubled Education Management Corporation’s for-profit portfolio (including the Argosy University, South University, and much of the Art Institute systems) to the Dream Center Foundation… and has allowed Kaplan University’s acquisition by Purdue University.”

Finally there is the massive student loan program. Last summer, DeVos ended a long agreement between the Department of Education and the Consumer Financial Protection Bureau to share information and oversight of federal student loans and to investigate complaints about problems with loans at predatory colleges as well as problems with the contractors hired by the Department of Education to service loans and collect debt. Warren and Clark report: “The Consumer Financial Protection Bureau currently has a pending lawsuit against Navient, the Department’s largest federal student loan servicing contractor, alleging that the company broke the law by creating obstacles for borrowers to repay loans, which harmed students and boosted the company’s profits.”

Warren and Clark report that DeVos is also working to block state-by-state oversight of student loan servicers. Michael Stratford explains in more detail at Politico: “Education Secretary Betsy DeVos is preparing to issue a declaration that companies collecting federal student loans are off limits for state lawmakers and regulators. The ‘notice of interpretation’ argues that only the federal government, not the states, has the authority to oversee federal student loan servicers…. That includes industry giants like Navient and Nelnet… The attempt by the Education and Justice departments to help the student loan industry pushes back against growing scrutiny from states—and even as the Trump administration has repeatedly called for giving states more control over education and other issues.  It also comes after the student loan industry has for months lobbied the federal government for protection from the state efforts to crack down on them… The department each year pays nearly $1 billion to a handful of student loan companies that collect the debt on behalf of the federal government. More than 42 million Americans owe roughly $1.4 trillion in outstanding federal student loans.”

Stratford reports that more than a dozen states have passed or are considering laws to regulate loan-processing companies. Many state attorneys general agree, “arguing that states have the right to oversee companies operating within their borders that collect loan payments from their residents.”  “Education Department officials late last year ordered the loan companies that work for the agency to avoid responding directly to information requests from third parties, which would include state regulators….”

While Warren and Clark’s report is wonkish, what is clear is that under the leadership of Betsy DeVos, the Department of Education has quietly been weakening oversight of two very profitable sectors—for-profit colleges and the huge companies that process student loans and make collections on these loans. And in the area of public education, DeVos’s department has been weakening civil rights enforcement.  While all this re-working of the rules is relatively invisible, it is likely to touch the lives of millions of citizens.

3 thoughts on “Betsy DeVos’s Department of Education Quietly Rolls Back Wide Array of Important Regulations

  1. I agree she is horrible & has done some pretty awful things, but I find it ironic that Duncan doesn’t merit similar sentiment from Warren after what he did to K-12. It seems as if higher ed has more importance.

  2. Practically every department and agency in this administration is engaged in removing regulations, safeguards, and enforcement. And they want ever more privatization, as well.
    They want to get rid of anything that stands in the way of businesses making more and more money.
    The Education Department is really no different than the Interior Department, plus the EPA, HHS, including the CDC and the FDA, and so on. The Education Department isn’t being spared from any of this. Appoint a dolt to head an agency or department, and make sure that dolt destroys the very reason for that department or agency in the first place.

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