In response to sweeping statutory changes enacted through the One Big Beautiful Bill Act (OBBBA), the U.S. Department of Education (ED or the Department)convened the Accountability in Higher Education and Access through Demand-driven Workforce Pell (AHEAD) negotiated rulemaking committee. The committee was charged with translating new legislative mandates into federal regulations that will govern institutional accountability, program eligibility, and student access to federal financial aid. Because negotiated rulemaking directly shapes the final regulatory requirements institutions must follow, tracking the AHEAD committee’s discussions is critical for colleges and universities seeking to anticipate compliance risks, evaluate program viability, and plan strategically for the future of Title IV participation.

The AHEAD Committee, after completing its second negotiated rulemaking session, shifted its focus to the new federal accountability framework established under OBBBA. The session built on the committee’s initial December meeting, which concentrated on the creation of a Workforce Pell Grant program, and reflected the department’s broader effort to reshape how postsecondary program outcomes are measured across all sectors of higher education.

Emphasis on Alignment Across Programs and Sectors

The Department of Education framed the second session around the concept of “harmonization,” emphasizing its intent to align the new accountability framework with existing Gainful Employment (GE) principles while significantly expanding its scope. Unlike prior accountability regulations, the proposed framework would apply uniformly to all institutional sectors and program types, including both GE and non-GE programs.

While the ED indicated it would consider limited differentiation where appropriate, the Department made clear that its preference was for consistent application of performance metrics across all Title IV–eligible programs. This approach marks a notable expansion of federal accountability beyond its historical focus on proprietary and certificate programs.

Expanded Program Reporting Requirements

Before turning to accountability metrics, the ED outlined new reporting expectations related to program eligibility. Under the proposal, institutions would be required to report all newly offered academic programs—both GE and non-GE—to ED through Partner Connect within 10 days of implementation.

Although institutions that currently self-certify Title IV eligibility would retain that authority, negotiators raised concerns about the ED’s capacity to manage an increased reporting volume, particularly in light of recent staffing reductions. The ED responded that improvements to Partner Connect are underway and clarified that expanded reporting does not alter which programs must receive formal departmental approval before becoming Title IV eligible.

Transition From GE/FVT to a New Accountability Model

The centerpiece of the rulemaking discussion was the ED’s proposal to replace the current Gainful Employment and Financial Value Transparency (GE/FVT) framework with two interconnected systems:

  • The Student Tuition and Transparency System (STATS), which would govern public reporting and earnings premium calculations.
  • A new earnings accountability framework, which would determine program-level consequences tied to graduate earnings outcomes.

While certain elements of the existing GE/FVT regulations would be retained, the proposal introduced several major changes:

  • Elimination of the debt-to-earnings test
  • Application of earnings-based accountability measures to all programs, including non-GE programs
  • Limitation of sanctions to Federal Direct Loan eligibility rather than full Title IV eligibility

Under this structure, programs that fail the earnings metric in two out of three consecutive award years would lose access to Direct Loans, though other forms of federal student aid would remain available.

How Earnings Would Be Measured

Earnings performance would be assessed using four-year median earnings of working graduates, replacing the current three-year methodology that includes both working and non-working individuals. Programs would be evaluated against one of six ED-defined earnings benchmarks, with benchmark selection dependent on credential level, program type, and student enrollment patterns.

Undergraduate programs would generally be measured against state-level median earnings for high school-educated workers ages 25 to 34, unless the program serves a predominantly out-of-state population, in which case national data would apply. Graduate programs would be assessed against bachelor’s degree earnings benchmarks using a conservative comparison approach intended to ensure rigor.

The resulting earnings premium metric would determine whether a program’s graduates earn above, at, or below the applicable benchmark.

Cohort Construction and Data Reliability

Recognizing that many programs graduate relatively small numbers of Title IV recipients, ED outlined a multi-step cohort aggregation process designed to ensure statistical reliability. This process would aggregate completers across multiple award years and, if necessary, across related programs using CIP code groupings.

Programs that cannot achieve a minimum cohort size after full aggregation would be exempt from the earnings test. The ED estimates that the vast majority of Title IV recipients would ultimately be included in a statistically reliable cohort under this approach.

Projected Impact and Areas of Concern

Using preliminary data, the ED estimates that a modest percentage of programs would fail the proposed earnings test. However, the impact on students could be more pronounced in certain credential types and institutional sectors. Undergraduate certificate programs appear particularly vulnerable, with early projections showing disproportionate effects on for-profit institutions.

Higher projected failure rates in fields such as cosmetology, culinary arts, fine arts, religious studies, and complementary medicine prompted negotiators to question whether the earnings metric adequately accounts for labor market variation and the broader value of certain educational pathways. Geographic disparities were also noted, with some states expected to experience higher concentrations of programs that fall below the earnings threshold.

The ED emphasized that these projections are estimates only, with final data not expected until 2027.

What Comes Next

The AHEAD Committee completed its negotiations, also focusing discussions around cohort definitions, earnings calculations, exemptions, and the potential unintended consequences of the proposed accountability framework. Institutions will need to work closely across campus on the proposed requirements that could affect program eligibility, student borrowing options, and long-term compliance obligations.

Naturally, HEAG is tracking these changes closely and analyzing potential implications for institutions across all sectors. Colleges and universities seeking guidance on these developments, or support in evaluating institutional risk and developing strategic responses, are encouraged to contact info@heag.us for assistance.

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