The Catholic University of America


Summary of Federal Laws

Financial Aid Programs

Higher Education Act of 1965 as amended20 U.S.C. §§ 1070-1099; 34 C.F.R. § 668.1et seq; 

(click here for accounting and reporting requirements not specifically about the financial aid program)

General Information on the Higher Education Act

The Higher Education Act, as amended, requires  universities to give all students and prospective students information about the academic program and standards that must be met, as well as accreditation information. Costs and refund policies must be listed. Detailed information about financial aid must be provided, including information on how to contact the university's financial aid officer. Exit counseling must be made available to those who have incurred student loans. 
There has been a significant growth in regulations related to the HEA. This page will capture the highlights and latest issues.

Final Regulation, Borrower Defense Rule,   83 Fed. Reg. ___, Feb. 14, 2018

The Secretary delays, until July 1, 2019, the effective date of selected provisions of the final
regulations entitled Student Assistance General Provisions, Federal Perkins Loan Program, Federal Family Education Loan (FFEL) Program, William D. Ford Federal Direct Loan
Program, and Teacher Education Assistance for College and Higher Education Grant Program (the 2016 final regulations), published in the Federal Register on November 1, 2016. This includes the borrower defense rule. 


Dear Collegue Letter on Perkins Loan Extension Act of 2015, GEN-17-10, October 6, 2017. 

Federal Register Notice on Negotiated Rulemaking on Gainful Employment Rule, June 16, 2017  and Federal Register Final Rule, notification of Partial Delay of Effective Dates on Borrower Defense Rules, June 16, 2017. 

Reset of Rules Aimed at For-Profits Begins: June 15, 2017: Inside Higher Ed

The Trump administration will suspend borrower defense and renegotiate gainful employment.The July 1st deadline for Borrower Defense rules has been suspended. 

Borrower Defense Final Rules November 1, 2016


Department of Defense (DoD) and Tuition Assistance Policy and MOUs

Voluntary Education Programs, 79 Fed. Reg. 27732, Final Rule, May 15, 2014  Effective July 14, 2014

The new policies discussed in the rule include the following: All educational institutions providing education programs through the DoD Tuition Assistance (TA) Program will provide meaningful information to students about the financial cost and attendance at an institution so military students can make informed decisions on where to attend school; not use unfair, deceptive, and abusive recruiting practices; and provide academic and student support services to Service members and their families. MOUs for various brances of service are included in the Appendices.

Executive Order-Establishing Principles of Excellence for Educational Institutions Serving Service Members, Veterans, Spouses, and Other Family Members, April 27, 2012.

 State Authorization/Distance Education Rules

Program Integrity and Improvement, Final Rule, Dept. of Education, 81 Fed. Reg. 92232, Dec. 19, 2016

In this final rule, effective July 1, 2018, the Dept. of Education amends the State authorization sections of the Institutional Eligibility regulations issued under the Higher Education Act of 1965, as amended (HEA). In addition, the Secretary amends the Student Assistance General Provisions regulations issued under the HEA, including the addition of a new section on required institutional disclosures for distance education and correspondence coursesThe new rule would do the following: 


  • Require an institution offering distance education or correspondence courses to be authorized by each State in which the institution enrolls students, if such authorization is required by the State, in order to link State authorization of institutions offering distance education to institutional eligibility to participate in the title IV, HEA programs, including through a State authorization reciprocity agreement. 
  • Define the term “State authorization reciprocity agreement” to be an agreement between two or more States that authorizes an institution located and legally authorized in a State covered by the agreement to provide postsecondary education through distance education or correspondence courses to students residing in other States covered by the agreement and does not prohibit any State in the agreement from enforcing its own statutes and regulations, whether general or specifically directed at all or a subgroup of educational institutions. 
  • Require an institution to document the State process for resolving complaints from students enrolled in programs offered through distance education or correspondence courses. 
  • Require that an additional location or branch campus located in a foreign location be authorized by an appropriate government agency of the country where the additional location or branch campus is located and, if at least half of an educational program can be completed at the location or branch campus, be approved by the institution's accrediting agency and be reported to the State where the institution's main campus is located. 
  • Require that an institution provide public and individualized disclosures to enrolled and prospective students regarding its programs offered solely through distance education or correspondence courses.

The definition of *state authorization reciprocity agreement* was changed as follows:

Changes: We have revised the definition of State authorization reciprocity agreement by deleting the words “consumer protection laws” and adding in their place “statutes and regulations, whether general or specifically directed at all or a subgroup of educational institutions.” In addition, we have replaced the word “participating” with reference to a participating State with the word “any” so that a State authorization reciprocity agreement does not prohibit any State from enforcing its own statutes and regulations, whether general or specifically directed at all or a subgroup of educational institutions. We add the word “residing” after the word “students” to clarify that the agreement authorizing and institution to provide postsecondary education through distance education or correspondence courses is to students residing in other States covered by the agreement. We also add the words “in the agreement” after “any State” to clarify that the agreement does not prohibit any State in the agreement from enforcing its own statutes and regulations.

Failure to obtain authorization in a particular state results in denial of Title IV aid for that particular state.  Institutions should not market to, nor enroll students in, a program in a State unless the institution has met applicable State authorization requirements. An institution should be providing the student with information about its State authorization status and should be informing the student that, if the student relocates to a State where the institution is not authorized, the institution cannot disburse Federal student aid to the student as long as the student continues to reside in that State.

All Institutions must perform the due diligence of learning what additional requirements a foreign government may put on an institution to offer educational programs in their jurisdiction and comply with those requirements as a basic price of doing business in that foreign country.

While these regulations provide an exemption for branch campuses that is physically located on a military base, facility, or area that a foreign country has granted the U.S. military to use, the Department declines to publish a complete listing of these areas. These areas would be decided by a Status of Forces agreement between the U.S. and a foreign country.

Complaint process and other required disclosures

The Department added new § 668.50(b) and (c), which requires disclosures to enrolled and prospective students in the institution's distance education programs. Up to eight disclosures will be made publicly available, and up to three disclosures will require direct communication with enrolled and prospective students when certain conditions have been met. These disclosures will not change any other required disclosures of the Student Assistance General Provisions regulations.

Public Disclosures
§ 668.50(b)(1) Whether the program is authorized in the state in which the enrolled student resides; 

§ 668.50(b)(2)(i) Process for submitting complaints to the appropriate State agency in the State in which the main campus of the institution is located;

§ 668.50(b)(2)(ii) Any complaint process established by the reciprocity agreement;

§ 668.50(b)(3) Process for submitting complaints to the appropriate State agency in the State in which enrolled students reside, including contact information for those State agencies that handle consumer complaints;

§ 668.50(b)(4) Disclose any adverse actions a State entity has initiated related to the institution's distance education programs or correspondence courses for a five calendar year period prior to the year in which the institution makes the disclosure. 

§ 668.50(b)(5) Disclose any adverse actions an accrediting agency has initiated related to the institution's distance education programs or correspondence courses for a five calendar year period prior to the year in which the institution makes the disclosure;

§ 668.50(b)(6) Disclose any refund policies for the return of unearned tuition and fees with which the institution is required to comply by any State in which the institution enrolls students in a distance education program or correspondence courses. This disclosure requires publication of the State-specific requirements on the refund policies as well as any institutional refund policies that would be applicable to students enrolled in programs offered through distance education or correspondence courses with which the institution must comply.

§ 668.50(b)(7) Disclose the applicable educational prerequisites for professional licensure or certification which the program offered through distance education or correspondence course prepares the student to enter for each State in which students reside. The institution must also make this disclosure for any other State which the institution has made a determination regarding such prerequisites as well as if the institution's program meets those requirements. For any State for which an institution has not made a determination with respect to the licensure or certification requirement, an institution will be required to disclose a statement to that effect. 

Individual Disclosures

NB: These are federally required individual disclosures. Some states have their own unique disclosures. 

Under § 668.50(c)(1)(i), an institution will be required to provide an individualized disclosure to prospective students when it determines a program offered solely through distance education or correspondence courses does not meet licensure or certification prerequisites in the State of the student's residence.

Under § 668.50(c)(1)(ii), an institution will be required to provide an individualized disclosure to both enrolled and prospective students within 30 days of when it becomes aware of any adverse action initiated by a State or an accrediting agency related to the institution's programs offered through distance education or correspondence courses; or within seven days of the institution's determination that a program ceases to meet licensure or certification prerequisites of a State.

For prospective students who receive any individualized disclosure and subsequently enroll, § 668.50(c)(2) will require an institution to obtain an acknowledgment from the student that the communication was received prior to the student's enrollment in the program.

For summaries/comments of/on the new final rule, see the following: 

NC SARA response; 

WCET posts: 

December 21st post

December 16th post. 

See also the Dec. 21, 2016 Inside Higher Ed summary

Schools should not rely upon a repeal of the rules by a new administration. While this new rule is not in place until July 2018, much of what is in the rule mirrors or supplements current requirements in place by states that will continue to exist and apply regardless of federal action or inaction. 

 Final Regulations; Program Integrity Rules, 80 Fed. Reg. 73991, Nov. 27, 2015.

The Department of Education has now issued rules that clarify the incentive compensation ban. Recruiters may be compensated based upon graduation or completion of educational programs. However, no commissions are allowed tied to minority enrollments, and the rules continue to bar compensation of recruiters based upon the number of students they enroll, irrespective of the student's minority or other status, such as athletes. This clarification is published after litigation by the for profit colleges over the initially published regulations on October 29, 2010. The Department changed its mind as it had no evidence that graduation rate compensation was being used as a proxy for enrollment based compensation. 

 web page for SARA/State Authorization

WCET overview page on State Authorization

Dear Colleague Letter dated July 27, 2012 Guidance on Program Integrity Regulations Relating to Legal Authorization by a State (DCL: GEN-12-13) This guidance restates rules post APSCU case below.

Version 2.0 of the SHEEO Compendium of State Regulations

Association of Private Sector Colleges and Universities v. Arne Duncan,, Case No. 1:1-cv-00138,  (U.S. Ct. Appeals, D.C. Cir.) June 5th, 2012

In a sweet little decision, the Court of Appeals for the DC Cir. affirmed the viability of the Administrative Procedure Act, holding it had not been followed when promulgating the rules relating to distance education. While the victory may be short lived, and the damage may already be done, it was nice for schools to see the APA upheld.The state laws are still in place and must be followed.

The case was brought by APSCU in response to the Program Integrity Rule adopted by the U.S. Department of Education in 2010. These regulations became effective July 1, 2011, and addressed what colleges and universities must do to remain eligible for federal financial aid. The regulations affected a number of areas, including, schools’ accountability for the “gainful employment” of their graduates, incentive payments for recruiters, and federal oversight with respect to state regulation of distance education. A full summary of the rules can be found on the Department of Education web page.

The court overturned the rule[1] not based on its merits but because the rule was “not a logical outgrowth of the Department’s proposed rules.”  In other words, the notice-and-rulemaking process was flouted, in that colleges that might be affected  had no reason to believe that DOE was contemplating a set of regulations along the lines that they finally published – and therefore they had no reasonable opportunity to comment.

The incentive compensation provisions were upheld with the case sent back to the District Court so that the Department of Education can explain some technical matters, including how the regulation would affect recruitment of minority students.

The misrepresentation regulations were found to exceed the authority of the Secretary by covering students not subject to the Higher Education Act and by proscribing merely “confusing” statements. The court noted the law only applies to misrepresentations about the nature of a school’s educational program, financial charges or employability of graduates, and does not allow the promulgation of rules dealing with the institution’s relationship with the Department of Education or the broader category of “misrepresentation regarding the eligible institution”.

Other parts of the misrepresentation regulations were upheld,  so schools must still vigilantly monitor employees and contractors that could be  in the position of making false or misleading statements, especially to students or potential students.

[1] The text of the rule:  “If an institution is offering postsecondary education through distance or correspondence education to students in a State in which it is not physically located or in which it is otherwise subject to State jurisdiction as determined by the State, the institution must meet any State requirements for it to be legally offering postsecondary distance or correspondence education in that State.”

March 17, 2011 Dear Colleague Letter on Program Integrity

This letter addresses State authorization, incentive compensation, and misrepresentation. See question 15 and after for Distance Education information. 

Gainful Employment 

Federal Register Notice on Negotiated Rulemaking on Gainful Employment Rule, June 16, 2017

Although there will be negotiated rulemaking, for now, no later than July 1 2017,  institutions must comply with the gainful employment program disclosure requirements by updating the disclosures for each gainful employment program using the 2017 GE Disclosure Template provided by ED. Institutions also have until July 1 to submit an alternative earnings appeal to the GE Debt-to-Earnings rates that were released by ED on January 9, 2017.

 Reset of Rules Aimed at For-Profits Begins: June 15, 2017: Inside Higher Ed; The Trump administration will suspend borrower defense and renegotiate gainful employment.

NSLDS Gainful Employment User Guide issued June 2016

Gainful Employment Electronic Announcement #78: Providing Information on the process for calculation and release of GE Program Debt-to-Earnings (D/E) rates. May 31, 2016 

DCL ID: GEN-15-12 June 30, 2015 Regulatory Requirements Related to Gainful Employment Programs

Gainful employment rules generally apply to any educational program that leads to a certificate or other or other non-degree credential awarded by a public or private non-profit institution, regardless of the length of the program.

Gainful Employment, Final Rule, 79 Fed. Reg. 64889, October 31, 2014

The reporting requirements set forth in 34 CFR § 668.6 are current through Dec. 31, 2016. For this year, due July 31, 2015. Due October 1 for subsequent years. Disclosures required will change from year to year. See Gainful Employment Electronic Announcement # 52, dated Feb. 11, 2105 for online reporting and user guide.

Under the new rules, programs will no longer be held accountable for their cohort default rates, and instead will only be evaluated based on their graduates' debt-to-earnings ratios. The regulations take effect on July 1, 2015. There is also a longer transition period for institutions seeking to use current debt to earnings to comply with the metrics.

(1) Each eligible GE program it offers is included in the institution’s accreditation by its recognized accrediting agency, or, if the institution is a public postsecondary vocational institution, the program is approved by a recognized State agency for the approval of public postsecondary vocational education in lieu of accreditation;

(2) Each eligible GE program it offers is programmatically accredited, if required by a Federal governmental entity or required by a governmental entity in the State in which the institution is located or in which the institution is otherwise required to obtain State approval under 600.9;

(3) For the State in which the institution is located and in all other States within the institution’s MSA, each eligible program it offers satisfies the licensure or certification requirements of those states so that a student who completes the program and seeks employment in those states qualifies to take any licensure or certification exam that is needed for the student to practice or find employment in an occupation that the program prepares students to enter; and

(4) For a new program, the program is not substantially similar to a program offered by the institution that, in the prior three years, became ineligible for title IV, HEA program funds under the D/E rates measure or was failing, or in the zone with respect to, the D/E rates measure and was voluntarily discontinued by the institution.

The school must receive written or other electronic acknowledgement of the prospective student’s or third party’s receipt of the disclosure template. See Gainful Employment Disclosure Template that was releasted in the GE Electronic Announcement #50. The generated output document has to be used by Jan. 31, 2015.

Noted in the final rule at pp. 64950-1:

As reflected in changes to Sec. 668.404(e), we do not issue D/E rates for a program if the number of verified matches is fewer than 30. If the number of verified matches is  fewer than 30 but at least 10, we provide the mean and medium earnings data to the institution for disclosure purposes under Sec. 668.412. 


Credit Hour Rules

Final Regulations; Program Integrity Rules, 80 Fed. Reg. 67125, October 30, 2015

Effective July 1, 2016. These regulations are intended to ensure that students have convenient access to their title IV, HEA program funds, do not incur unreasonable and uncommon financial account fees on their title IV funds, and are not led to believe they must open a particular financial account to receive their Federal student aid. In addition, the final regulations update other provisions in the cash management regulations and 
otherwise amend the Student Assistance General Provisions. The final regulations also clarify how previously passed coursework is treated for title IV eligibility purposes and streamline the requirements for converting clock hours to credit hours. 



Adjustment of Civil Monetary Penalties for Inflation, 83 Fed. Reg. 2062, Jan. 16, 2018 

Federal Student Aid Program Review Guide for Institutions, 2017 

Checklist for Cash Management Compliance by NACUBO* 3-21-16

DCL ID : GEN-15-13 July 7, 2015 Undue Hardship Discharge of Title IV Loans in Student Bankruptcy Proceedings: Two step analysis by the holder of the note.

June 2, 2015 Letter from Department of Education on Enforcement of Statutory Prohibition on Incentive Compensation*

The Department may recover all Title IV funds received by an institution over a particular period if the funds were received through implementation of a policy through which an institution recruited students in violation of the incentive compensation prohibition. The Department may also impose fines or revoke an institution's eligibility to violate in Title IV programs.

Dear Colleague Letter on Third Party Servicer Institutional Requirements and Responsibilities, Jan. 9, 2015. GEN-15-01

IFAP Consumer Information
web page: Great compliance tool.

This assessment describes the requirements for the consumer information that a school must provide to students, the Department of Education, and others. Contains resources and checklists for the numerous required financial aid disclosures (at least A-Z by now)

Dept. of Education Q and A on Program Integrity Regulations

Navigating the Regulatory Highway: A Practical Guide to Interpreting, Implementing and Complying with DOE's Program Integrity Rules: June 2011, updated July 26, 2011 in light of recent DOE guidance on gainful employment. Clarifications on incentive compensation were also included.

This paper was presented at the NACUA Annual Conference by Terry Hartle, American Council on Education, Laurence Pendleton, Tennessee Board of Regents, Laura Warren, DePaul University, and Jay Urwitz, Wilmer Cutler Pickering Hale and Dorr LLP. Posted with permission of the authors.

NACUA Notes June 23, 2011 U.S. Department of Education Program Integrity Rules - Part I

NACUA Notes June 24, 2011 U.S. Department of Education Program Integrity Rules - Part II

NACUA Notes August 9, 2011 U.S. Department of Education Program Integrity Rules - Part III 

IFAP Library: Information for Financial Aid Professionals for Dear Colleague Letters and presentations from the annual NASFAA Conference.


 History on regulations studies

Higher Education Regulations Study: See the Press Release describing the Advisory Committee's plans to move beyond Title IV regulations and begin to examine the impact of all federal regulations within the Higher Education Act as a second phase of the congressionally mandated Higher Education Regulations Study. The Committee encourages the public to help identify regulations in higher education that are duplicative, no longer necessary, inconsistent with other federal regulations, and/or overly burdensome. Specifically, the Advisory Committee seeks to quantify the level of burden placed on institutions by such regulations. Comments will be taken by the Advisory Committee staff or through the Committee's public comment webpage or by telephone (202-219-2099).Section 1098 of the HEOA (2008) tasked the Department of Education with looking at the regulatory burden imposed on IHEs. Section 1106 of the HEOA mandated a study by the National Academy of Sciences to be entered into by the Secretary of Education.  To date this study remains unfunded.

Update 2/13/15 As of Feb. 2015, the National Academy of Sciences role had morphed into a focus on the regulatory burden for research universities. See the Committee on Federal Research Regulations and Reporting Requirements: A New Framework for Research Universities for the 21st Century.


At the same time, the overall regulatory burden was getting some attention by Congress.

The  Report of the Task Force on Federal Regulation of Higher Education was released on 2-13-15. This  report was a joint product funded by Lumina, hosted by ACE, and created by Senators Lamar Alexander and Barbara Mikulski.

See Congressional Report Blasts 'a Jungle of Red Tape' that Ensnares Colleges, by Kelly Field, in the Chronicle, posted 2-3-15.












updated  2-12-18 mlo