U.S. Department of Education’s Oversight and Reporting of Proprietary Institutions’ 90/10 Revenue Information

Our objective was to determine the Department’s processes for (1) overseeing proprietary institutions’ compliance with 90/10 revenue requirements and (2) reporting of 90/10 revenue information to Congress and the public. We found that the Federal Student Aid office (FSA) had several processes for overseeing proprietary institutions’ compliance with 90/10 revenue requirements. Specifically, the FSA system used by institutions to submit their financial statements (eZ-Audit system) calculated 90/10 revenue percentages for proprietary institutions based on the audited financial statements submitted, acceptability reviews of financial statements, quality control reviews of financial statements, possible sanctions against proprietary institutions that do not meet 90/10 revenue requirements, and guidance issued on 90/10 revenue requirements. We also found that the Department was late to report proprietary institutions’ 90/10 revenue information to Congress for all 5 award years we reviewed (2016–2017 to 2020–2021). In addition, the Department’s 90/10 revenue report to Congress for award year 2019–2020 was incomplete. Finally, the Department did not publicly disclose the proprietary institutions that did not meet 90/10 revenue requirements on the College Navigator website as required by the Higher Education Act of 1965, as amended. Instead, the Department identified the proprietary institutions that did not meet 90/10 revenue requirements on the Department’s College Affordability and Transparency Center website.