§ 668.410 - Consequences of the D/E rates measure.

§ 668.410 Consequences of the D/E rates measure.

(a) Student warning -

(1) Events requiring a warning to students and prospective students. The institution must provide a warning with respect to a GE program to students and to prospective students for any year for which the Secretary notifies an institution that the program could become ineligible based on its final D/E rates measure for the next award year.

(2) Content of warning. Unless otherwise specified by the Secretary in a notice published in the Federal Register, the warning must -

(i) State that: “This program has not passed standards established by the U.S. Department of Education. The Department based these standards on the amounts students borrow for enrollment in this program and their reported earnings. If in the future the program does not pass the standards, students who are then enrolled may not be able to use federal student grants or loans to pay for the program, and may have to find other ways, such as private loans, to pay for the program.”; and

(ii) Refer students and prospective students to (and include a link for) College Navigator, its successor site, or another similar Federal resource, for information about other similar programs.

(iii) For warnings provided to enrolled students -

(A) Describe the academic and financial options available to students to continue their education in another program at the institution, including whether the students could transfer credits earned in the program to another program at the institution and which course credits would transfer, in the event that the program loses eligibility for title IV, HEA program funds;

(B) Indicate whether or not the institution will -

(1) Continue to provide instruction in the program to allow students to complete the program; and

(2) Refund the tuition, fees, and other required charges paid to the institution by, or on behalf of, students for enrollment in the program; and

(C) Explain whether the students could transfer credits earned in the program to another institution.

(3) Consumer testing. The Secretary will conduct consumer testing to determine how to make the student warning as meaningful as possible.

(4) Alternative languages. To the extent practicable, the institution must provide alternatives to the English-language student warning for those students and prospective students for whom English is not their first language.

(5) Delivery to students.

(i) An institution must provide the warning required under this section in writing to each student enrolled in the program no later than 30 days after the date of the Secretary's notice of determination under § 668.409 by -

(A) Hand-delivering the warning as a separate document to the student individually or as part of a group presentation; or

(B) Sending the warning to the primary email address used by the institution for communicating with the student about the program.

(ii) If the institution sends the warning by email, the institution must -

(A) Ensure that the warning is the only substantive content in the email;

(B) Receive electronic or other written acknowledgement from the student that the student has received the email;

(C) Send the warning using a different address or method of delivery if the institution receives a response that the email could not be delivered; and

(D) Maintain records of its efforts to provide the warnings required by this section.

(6) Delivery to prospective students -

(i) General. An institution must provide any warning required under this section to each prospective student or to each third party acting on behalf of the prospective student at the first contact about the program between the institution and the student or the third party acting on behalf of the student by -

(A) Hand-delivering the warning as a separate document to the prospective student or third party individually, or as part of a group presentation;

(B) Sending the warning to the primary email address used by the institution for communicating with the prospective student or third party about the program;

(C) Providing the prospective student or third party a copy of the disclosure template as required by § 668.412(e) that includes the student warning required by this section; or

(D) Providing the warning orally to the student or third party if the contact is by telephone.

(ii) Special warning requirements before enrolling a prospective student.

(A) Before an institution enrolls, registers, or enters into a financial commitment with a prospective student with respect to the program, the institution must provide any warning required under this section to the prospective student in the manner prescribed in paragraph (a)(6)(i)(A) through (C) of this section.

(B) An institution may not enroll, register, or enter into a financial commitment with the prospective student with respect to the program earlier than -

(1) Three business days after the institution first provides the student warning to the prospective student; or

(2) If more than 30 days have passed from the date the institution first provided the student warning to the prospective student, three business days after the institution provides another warning as required by this paragraph.

(iii) Email delivery and acknowledgement. If the institution sends the warning to the prospective student or the third party by email, including by providing the prospective student or third party an electronic copy of the disclosure template, the institution must -

(A) Ensure that the warning is the only substantive content in the email;

(B) Receive electronic or other written acknowledgement from the prospective student or third party that the student or third party has received the email;

(C) Send the warning using a different address or method of delivery if the institution receives a response that the email could not be delivered; and

(D) Maintain records of its efforts to provide the warning required under this section.

(7) Disclosure template. Within 30 days of receiving notice from the Secretary that the institution must provide a student warning for the program, the institution must update the disclosure template described in § 668.412 to include the warning in paragraph (a)(2) of this section or such other warning specified by the Secretary in a notice published in the Federal Register.

(b) Restrictions -

(1) Ineligible program. Except as provided in § 668.26(d), an institution may not disburse title IV, HEA program funds to students enrolled in an ineligible program.

(2) Period of ineligibility.

(i) An institution may not seek to reestablish the eligibility of a failing or zone program that it discontinued voluntarily, reestablish the eligibility of a program that is ineligible under the D/E rates measure, or establish the eligibility of a program that is substantially similar to the discontinued or ineligible program, until three years following the date specified in the notice of determination informing the institution of the program's ineligibility or the date the institution discontinued the failing or zone program.

(ii) An institution may not seek to reestablish the eligibility of a program that it discontinued voluntarily after receiving draft D/E rates that are failing or in the zone, or establish the eligibility of a program that is substantially similar to the discontinued program, until -

(A) Final D/E rates that are passing are issued for the program for that award year; or

(B) If the final D/E rates for the program for that award year are failing or in the zone, three years following the date the institution discontinued the program.

(iii) For the purposes of this section, an institution voluntarily discontinues a program on the date the institution provides written notice to the Secretary that it relinquishes the title IV, HEA program eligibility of that program.

(iv) For the purposes of this subpart, a program is substantially similar to another program if the two programs share the same four-digit CIP code. The Secretary presumes a program is not substantially similar to another program if the two programs have different four-digit CIP codes but the institution must provide an explanation of how the new program is not substantially similar to the ineligible or voluntarily discontinued program with its certification under § 668.414.

(3) Restoring eligibility. An ineligible program, or a failing or zone program that an institution voluntarily discontinues, remains ineligible until the institution establishes the eligibility of that program under § 668.414(c).

(Authority: 20 U.S.C. 1001, 1002, 1088, 1094, 1099c)