David Aladdin Mollenkamp, Farnaz Farkish Thompson, John S. Moran, Maricris Prendingue
July 7, 2026
Key Takeaways
- The Department of Education’s final earnings accountability rule replaces FVT/GE regulations and becomes effective July 1, 2027, with delayed implementation until 2028 for programs in tipped-income industries.
- Programs failing the earnings accountability metric for two of three consecutive years lose Direct Loan eligibility and potentially all Title IV funds.
- Institutions that do not report FVT/GE-required data will be deemed to have elected early implementation of the new rule.
- The final rule offers new exclusions and alternative pathways to help institutions avoid losing Pell Grant eligibility.
On July 1, 2026, the Department of Education published the final earnings accountability rule in the Federal Register. The earnings accountability rule replaces the Financial Value Transparency and Gainful Employment (FVT/GE) regulation, applying a single metric to most undergraduate and graduate certificate and degree programs at institutions of higher education across the country. The metric aims to evaluate whether programs of higher education provide value to their graduates by assessing whether program graduates earn more than individuals who did not enroll in such programs. Programs that fail the metric will have limited access to the Direct Loan program and potentially all Title IV funds.