The American Federation of Teachers filed a lawsuit Wednesday against the Education Department and Education Secretary Betsy DeVos for her repeal of Obama-era regulations designed to hold for-profit colleges and universities accountable to their students.
The AFT accused DeVos of violating the law to repeal protections for students at for-profit colleges, and it argued that the regulations could save taxpayers over $5 billion on money going toward failing programs, according to the complaint.
"The reason that we filed this lawsuit, the reason that the attorneys general throughout the country are doing this, is to stop the rollback of oversight of these for-profits and others," AFT President Randi Weingarten said. "We're trying to stop unscrupulous behavior defrauding overpromising and underdelivering."
In 2014, the Education Department enacted the Gainful Employment Rule, which required colleges and universities to maintain a certain student debt-to-earning ratio and effectively barred for-profit colleges from receiving federal aid under the Higher Education Act Title IV student assistance programs. The rule also makes schools disclose information about their performances to students.
In June 2017, the Education Department announced it would negotiate the rules of Gainful Employment and began delaying enforcement of Gainful Employment regulations by extending the deadline by a year for universities to disclose their gainful employment data to students and in promotional materials. DeVos has been criticized for her sympathy toward for-profit colleges and student loan providers.
"Once fully implemented, the current rules would unfairly and arbitrarily limit students' ability to pursue certain types of higher education and career training programs," DeVos said in a 2017 statement. "We need to expand, not limit, paths to higher education for students, while also continuing to hold accountable those institutions that do not serve students well."
In June, DeVos announced a final repeal of the gainful employment rules.
The AFT, a union with over 1.7 million members, is asking the court to reverse the repeal, thereby re-establishing oversight of for-profit colleges and other institutions. Dan Zibel, chief counsel for the National Student Legal Defense Network, a nonprofit that advocates for students' rights to educational opportunities, is representing the AFT.
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Zibel said that without the Gainful Employment Rule, students wouldn't receive necessary information about career and for-profit programs and that these institutions aren't preparing students for gainful employment in a recognized occupation. Because of this, the repeal could lead to greater difficulties in paying loans and spending on other priorities.
"Students are going to be going to these programs, and the programs are not providing them any value," Zibel said.
In July, NBC News published an exposé in cooperation with The Hechinger Report that focused specifically on the now-closed Massachusetts-based for-profit Salter College and its parent company, Premier Education Group.
Most students who take on debt to attend certificate programs at schools like Salter end up earning less than the typical high school graduate, according to federal data posted by the Education Department. The joint investigation found that shortfalls in oversight enable companies with questionable track records to continue to recruit vulnerable students and profit from taxpayer money.
Weingarten said the union never thought the Gainful Employment Rule was sufficient, but it did change for-profit colleges' behavior and stopped deception.
"It's basically going to open the floodgates to for-profits, again, to do this baseless advertising, to charge whatever they want to charge, to take people's money and not have any accountability," Weingarten said.
Weingarten also said that DeVos seems to just want to undo the rule and that she did it in such a way that it's difficult to understand what she's trying to do other than repeal the Gainful Employment Rule.
In a statement to NBC News, the Education Department doubled down on the repeal.
"The Department will vigorously defend its final regulation rescinding this deeply flawed rule," press secretary Angela Morabito said in an email.
CORRECTION (Jan. 27 2020, 1:07 a.m. ET) A previous version of this article misspelled the last name of the chief counsel of the National Student Legal Defense Network. He is Dan Zibel, not Zilber.