Aaron LacyGuest
Laura PuryearGuestMaggie StaszcukHostOkay, for those of us that haven't been following along, tell us about the new framework that's been introduced and what's going on with Title IV funding.

So there have been a lot of changes in the Department of Ed, especially in Trump's second term.

So in his administration, he has made it very clear that his intent is to dismantle the Department of Ed.

It's been around since nineteen seventy-nine, so that's not something that you can just snap your fingers and do.

So one of the most recent changes they've made, um, is to financial transparency and earning metrics.

So that's going to impact Title IV funding for schools and students, specifically direct loans and Pell funds.

The, the new rules are, uh, switching from the financial value transparency and switching to a different measurement tool.

So, uh, essentially what they wanna do now is determine if you go into a higher ed program, if you come out of that financially better off than you would have if you had not gone to it, if you just had a high school diploma or a GED.

The math around it is complicated, and there are different metrics for different types of programs, but the initial rule came out, and there was a lot of blowback.

And I'll just take a little step back and say that, you know, this is sort of the culmination of a fifteen-year effort.

The second administration or second term Obama administration was the first to introduce, uh, a concept like this, uh, that involved measuring in some way the, uh, debt that was being taken on by graduates and their earnings following graduation.

The first Trump administration did away with that rule, then the Biden administration put it back in place, and they added not only were they doing what we call a debt-to-earnings metric, where they were sort of comparing the debt or cost that a student took on to what they were making after they graduated, but notably, the Biden administration also introduced a straight earnings test.

We're gonna do this debt-to-earnings ratio, but also on the other side, we're just gonna look at how much people are making about three years after they graduate from these programs.

What we're talking about is the median earnings of a group of folks who graduated during a particular period of time, so about three years ago.

We'll get that data from the IRS, and then we're gonna compare it to some sort of benchmark that we're, we're all gonna agree is an appropriate benchmark.

The idea is that the benchmark represents what folks are making out there who don't have any post-secondary education.

And so philosophically, the notion is if you go and get a post-secondary education, then on average, folks should be making more than those who have no post-secondary education at all.

But the Trump administration came along, and, and Congress, to be really clear, as part of the one big Beautiful Bill Act in statute for the first time in history, included an earnings accountability framework as well.

And they said, "Yeah, we like this idea of a straight earnings test." So that's the Republicans in Congress.
Okay, for those of us that haven't been following along, tell us about the new framework that's been introduced and what's going on with Title IV funding.

So there have been a lot of changes in the Department of Ed, especially in Trump's second term.

So in his administration, he has made it very clear that his intent is to dismantle the Department of Ed.

It's been around since nineteen seventy-nine, so that's not something that you can just snap your fingers and do.

So one of the most recent changes they've made, um, is to financial transparency and earning metrics.

So that's going to impact Title IV funding for schools and students, specifically direct loans and Pell funds.

The, the new rules are, uh, switching from the financial value transparency and switching to a different measurement tool.

So, uh, essentially what they wanna do now is determine if you go into a higher ed program, if you come out of that financially better off than you would have if you had not gone to it, if you just had a high school diploma or a GED.

The math around it is complicated, and there are different metrics for different types of programs, but the initial rule came out, and there was a lot of blowback.

And I'll just take a little step back and say that, you know, this is sort of the culmination of a fifteen-year effort.

The second administration or second term Obama administration was the first to introduce, uh, a concept like this, uh, that involved measuring in some way the, uh, debt that was being taken on by graduates and their earnings following graduation.

The first Trump administration did away with that rule, then the Biden administration put it back in place, and they added not only were they doing what we call a debt-to-earnings metric, where they were sort of comparing the debt or cost that a student took on to what they were making after they graduated, but notably, the Biden administration also introduced a straight earnings test.

We're gonna do this debt-to-earnings ratio, but also on the other side, we're just gonna look at how much people are making about three years after they graduate from these programs.

What we're talking about is the median earnings of a group of folks who graduated during a particular period of time, so about three years ago.

We'll get that data from the IRS, and then we're gonna compare it to some sort of benchmark that we're, we're all gonna agree is an appropriate benchmark.

The idea is that the benchmark represents what folks are making out there who don't have any post-secondary education.

And so philosophically, the notion is if you go and get a post-secondary education, then on average, folks should be making more than those who have no post-secondary education at all.

But the Trump administration came along, and, and Congress, to be really clear, as part of the one big Beautiful Bill Act in statute for the first time in history, included an earnings accountability framework as well.

And they said, "Yeah, we like this idea of a straight earnings test." So that's the Republicans in Congress.
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