U.S. Department of Education publishes new regulations related to federal student financial aid

On 29 October 2010 the U.S. Department of Education (ED) published two sets of final regulations that address a number of important matters for institutions that participate in student financial aid programs under Title IV of the Higher Education Act, as amended (HEA). 75 Fed. Reg. 66832 (2010); 75 Fed. Reg. 66665 (2010). The new rules address program integrity in five areas: institutional eligibility, recruiting and admissions, program eligibility, student eligibility and aid determinations, and aid disbursements and refunds. One set of final rules was first announced in a Notice of Proposed Rulemaking (18 June NPRM) issued on 18 June and will become effective on 1 July 2011. The other set of final rules -- which addresses only new approval requirements for programs that lead to gainful employment in a recognized occupation -- was first announced in an NPRM issued on 26 July 2010 (26 July NPRM) and will also become effective on 1 July 2011. ED expects to issue a second round of gainful employment regulations in early 2011, to become effective 1 July 2012. This Education Investors Alert highlights selected aspects of the final regulations of interest to for-profit postsecondary education institutions and investors in that sector.

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