Direct Federal Support of Individuals Pursuing Training and Education in Non-degree Programs
Congressional research reportApr 3, 2020
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Direct Federal Support of Individuals
Pursuing Training and Education in Nondegree Programs
Cassandria Dortch
Specialist in Education Policy
David H. Bradley
Specialist in Labor Economics
Alexandra Hegji
Analyst in Social Policy
April 3, 2020
Congressional Research Service
7-....
www.crs.gov
R46306
SUMMARY
Direct Federal Support of Individuals Pursuing
Training and Education in Non-degree
Programs
Recent Administrations and Congress have demonstrated bipartisan support for increasing
federal assistance to individuals pursuing training and education in postsecondary non-degree
programs, sometimes referred to as short-term programs. Non-degree programs are
postsecondary training and education programs that are most often shorter in duration than a
bachelor’s or associate’s degree program. They generally provide work-based learning or
educational instruction to individuals who are beyond the typical age for secondary education to
prepare them for a particular occupation. Examples of support have included proposals to expand
existing federal programs, create new programs, and improve coordination between existing
programs. This report provides an overview of existing federal programs and benefits that
support individuals pursuing training and education in non-degree programs.
R46306
April 3, 2020
Cassandria Dortch
Specialist in Education
Policy
-redacted-@crs.loc.gov
David H. Bradley
Specialist in Labor
Economics
-redacted-@crs.loc.gov
Alexandra Hegji
Analyst in Social Policy
-redacted-@crs.loc.gov
For a copy of the full report,
please call 7-.... or visit
www.crs.gov.
A prominent argument for supporting individuals pursuing training and education in non-degree
programs is that there is a substantial employer need for individuals with some postsecondary
credentials but no degree. In 2018, approximately 72% of jobs in the national economy were in occupations for which the
typical entry-level education is less than an associate’s degree. Just over 6% explicitly required a non-degree credential, but
these credentials could prepare individuals for many jobs that do not require a bachelor’s or higher level degree. Mean annual
wages for individuals whose highest educational attainment is high school completion are similar to those for individuals
with a non-degree credential. Earnings for individuals with only non-degree credentials vary based on differences in
occupational field, program duration, and type of educational institution attended.
Several federal programs provide direct financial support to or on behalf of students to enable them to pursue training and
postsecondary education in non-degree instructional and work-based learning programs. None of these federal programs or
benefits that provide such support focus exclusively on promoting non-degree program pursuits. The federal programs
include the following:
Title I of the Workforce Innovation and Opportunity Act (WIOA; P.L. 113-128) is the primary federal
workforce development statute. The program relies on state and local workforce development boards to
enter into contracts with training and education program providers and oversee the quality of the providers.
Title IV of the Higher Education Act of 1965 (HEA; P.L. 89-329), as amended, authorizes grant and loan
programs that provide financial assistance to higher education students. Non-degree program quality
assessment is handled by state authorizers, accrediting agencies, and in some instances through Department
of Education certification.
Education tax benefits, administered by the Internal Revenue Service (IRS), partially offset some of the
costs of higher education for eligible taxpayers. Many education tax benefits are only available to
individuals enrolled in a degree program, but three education tax benefits can also be claimed for
postsecondary non-degree programs: the Lifetime Learning Credit, the Exclusion for Employer Provided
Educational Assistance, and tax-advantaged 529 plan education savings accounts.
The Post-9/11 GI Bill and Veteran Employment Through Technology Education Courses (VET TEC) were
originally intended to help veterans enter the civilian workforce. Post-9/11 GI Bill program quality is
primarily overseen by state agencies under contract with the Department of Veterans Affairs. VET TEC
program quality is assured by withholding 50% of tuition and fees from providers until participants are
employed.
Supplemental Nutrition Assistance Program (SNAP) Employment & Training (E&T) provides eligible lowincome households with employment and education services. E&T funding is administered by state
agencies through contracted providers, which receive funds to cover education and other program costs.
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Direct Federal Support of Individuals Pursuing Training & Education
The Temporary Assistance for Needy Families (TANF) block grant is best known for providing monthly
cash assistance to needy families with children but may be used to support subsidized employment, on-thejob training, and training and education programs.
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Contents
Introduction ..................................................................................................................................... 1
Labor Market for Non-degree Programs ......................................................................................... 3
Non-degree Programs ...................................................................................................................... 4
Non-degree Instructional Programs .......................................................................................... 5
Non-degree Instructional Program Providers ..................................................................... 6
Duration, Structure, and Cost of Programs ......................................................................... 6
Credit and Noncredit Programs .......................................................................................... 7
Participation Data ............................................................................................................... 8
Work-Based Learning Programs ............................................................................................... 8
Registered Apprenticeship (RA) ......................................................................................... 9
Providers ........................................................................................................................... 10
Structure, Duration, and Cost of Programs ....................................................................... 10
Participation Data ............................................................................................................. 10
Federal Programs and Benefits .......................................................................................................11
WIOA Contracts and Individual Training Accounts (ITAs) (DOL) ........................................ 15
Eligibility of Non-degree Programs .................................................................................. 15
Participant Eligibility for Training .................................................................................... 16
Basic Benefit Payment Structure ...................................................................................... 17
Basic Administrative Structure ......................................................................................... 18
Quality Assurance Mechanisms ........................................................................................ 18
Measures of Program Performance ................................................................................... 18
Program Participation ....................................................................................................... 19
Program Limitations ......................................................................................................... 20
HEA Title IV Federal Student Aid (ED) ................................................................................. 20
Eligibility of Non-degree Programs .................................................................................. 21
Participant Eligibility ........................................................................................................ 23
Basic Benefit Payment Structure ...................................................................................... 24
Basic Administrative Structure ......................................................................................... 25
Quality Assurance Mechanisms ........................................................................................ 25
Measures of Program Performance ................................................................................... 28
Program Participation ....................................................................................................... 28
Program Limitations ......................................................................................................... 29
Tax Benefits (IRS)................................................................................................................... 31
Eligibility of Non-degree Programs .................................................................................. 32
Participant Eligibility for Training .................................................................................... 33
Basic Benefit Payment Structure ...................................................................................... 33
Basic Administration ......................................................................................................... 34
Quality Assurance Mechanisms ........................................................................................ 35
Measures of Program Performance ................................................................................... 35
Program Participation ....................................................................................................... 35
Program Limitations ......................................................................................................... 36
Veterans Education Programs (Post-9/11 GI Bill® and VET TEC) (VA) ............................... 36
Eligibility of Non-degree Programs .................................................................................. 37
Participant Eligibility for Training .................................................................................... 38
Basic Benefit Payment Structure ...................................................................................... 38
Basic Administrative Structure ......................................................................................... 39
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Quality Assurance Mechanisms ........................................................................................ 39
Measures of Program Performance ................................................................................... 40
Program Participation ....................................................................................................... 41
Program Limitations ......................................................................................................... 44
Supplemental Nutrition Assistance Program (SNAP) Employment & Training (E&T)
(USDA) ................................................................................................................................ 44
Eligibility of Non-degree Programs .................................................................................. 46
Participant Eligibility for Training .................................................................................... 46
Basic Benefit Payment Structure ...................................................................................... 47
Basic Administrative Structure ......................................................................................... 48
Quality Assurance Mechanisms ........................................................................................ 48
Measures of Program Performance ................................................................................... 48
Program Participation ....................................................................................................... 49
Program Limitations ......................................................................................................... 49
Temporary Assistance for Needy Families (TANF) (HHS) .................................................... 49
Eligibility of Non-degree Programs .................................................................................. 50
Participant Eligibility for Training .................................................................................... 50
Basic Benefit Payment Structure ...................................................................................... 50
Basic Administrative Structure ......................................................................................... 51
Quality Assurance Mechanisms ........................................................................................ 51
Measures of Program Performance ................................................................................... 51
Program Participation and Outcomes ............................................................................... 51
Program Limitations ......................................................................................................... 51
Tables
Table 1. Occupational Employment and Wages, by Typical Entry-Level
Education Required: May 2018.................................................................................................... 4
Table 2. Examples of Work-Based Learning ................................................................................... 8
Table 3. Selected Characteristics of Federal Programs Supporting Students who Pursue
Training or Education Through Non-degree Programs .............................................................. 13
Table 4. Percentage of WIOA Title I Program Exiters, by Training Type ..................................... 20
Table 5. Number and Percentage of Non-degree Instructional Credit Programs and
Awards by Institutional Control: AY2017-2018 ......................................................................... 28
Table 6. Examples of Non-degree Programs Approved for GI Bill Purposes ............................... 37
Contacts
Author Contact Information .......................................................................................................... 52
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Introduction
In recent years, policymakers, industry stakeholders, and educational institutions have shown an
interest in the federal government increasing financial support to individuals who pursue training
and postsecondary education in non-degree instructional and work-based learning programs.
These are instructional or work-based programs designed primarily for individuals beyond high
school age and for which a degree is not conferred upon completion. Such programs include, but
are not limited to, apprenticeships (e.g., masonry), college certificate programs (e.g., medical
billing), and courses that lead to professional certificates or licensure (e.g., Microsoft
certifications). By some accounts, there already is, and will continue to be, demand for workers to
fill jobs that do not require a college degree but do require training or postsecondary education
(e.g., skilled electrical work, health care support services). In addition, there is some evidence that
the percentage of jobs requiring more than a high school diploma but not a degree is increasing.1
Although the federal government annually makes available over $100 billion in direct financial
aid to individuals pursuing postsecondary education, the overwhelming majority of those funds
are not available to a significant proportion of the individuals pursuing training and education
through postsecondary non-degree programs. As some traditional colleges experience declining
enrollment, some schools have shown an interest in creative approaches to increasing enrollment
and maintaining revenues, including reaching out to adults who want to pursue completion of
short programs that allow quick reentry into the workforce and/or increase earnings.2 Given the
purported demand for workers with certain postsecondary non-degree credentials, Congress may
consider viable options for providing direct federal support to students pursuing the completion of
non-degree programs.
Several proposals have surfaced recently that would increase direct federal support to students
pursuing training and education in non-degree (short-term) programs. From 2011 to 2017, the
Department of Education (ED) experimented with allowing Pell Grants to be received for shortterm non-degree postsecondary education programs.3 In October 2019, the House Committee on
Education and Labor ordered reported the College Affordability Act (H.R. 4674), which would
comprehensively reauthorize the Higher Education Act (HEA) and would expand the types of
non-degree programs eligible for Pell Grants.4 In 2018, the President’s Council of Economic
Advisers presented options for bringing 25- to 64-year-olds back into the workforce with the
skills required in the changing economy in an effort to increase the rate of economic growth.
These included providing unemployment insurance benefits for individuals while training,
providing Pell Grants for some short-term training programs, and developing a new
1 William C. Symonds, Robert Schwartz, and Ronald F. Ferguson, Pathways to prosperity: Meeting the challenge of
preparing young Americans for the 21st century (Cambridge, MA: Pathways to Prosperity Project, Harvard University
Graduate School of Education, 2011), p. 3, https://www.gse.harvard.edu/sites/default/files/documents/
Pathways_to_Prosperity_Feb2011-1.pdf.
2 Eric Kelderman, “Enrollment Shortfalls Spread to More Colleges,” The Chronicle of Higher Education, May 20,
2019; Jon Marcus, “New Research Questions the Value of Certificates Pushed by Colleges, Policymakers,” The
Hechinger Report, October 24, 2017, https://hechingerreport.org/new-research-questions-value-certificates-pushedcolleges-policymakers/; and Clifford Adelman, Ph.D., Searching for Our Lost Associate’s Degrees: Project Win-Win at
the Finish Line, Institute for Higher Education Policy, Washington, DC, October 2013, http://www.ihep.org/sites/
default/files/uploads/docs/pubs/pww_at_the_finish_line-long_final_october_2013.pdf.
3 U.S. Department of Education, Experimental Sites Initiative, Experiments, https://experimentalsites.ed.gov/exp/
approved.html on February 18, 2020.
4 For more detail on the provisions, see the “Job Training Pell Grants” section of CRS Report R46176, H.R. 4674, the
College Affordability Act: Proposed Reauthorization of the Higher Education Act, Summary of Major Provisions.
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comprehensive program for retraining displaced workers.5 The President’s FY2021 budget
request for ED proposed expanding Pell Grants to short-term programs that are not currently Pelleligible.6 Several education and business organizations have supported extending Pell Grants, and
occasionally Direct Loans, to programs that are shorter in duration than those that are currently
eligible.7
Some stakeholders, however, express concerns about promoting non-degree programs and
increasing financial support for students pursuing them. There is concern that some non-degree
programs do not increase the employment or earnings of completers compared to individuals
whose highest level of education is high school completion. Some concerns focus on how the
federal government would ensure the quality of the programs.8 Other concerns focus on
potentially high federal costs associated with supporting the programs, the potential need for
student supports and business coordination, and the possibility of perpetuating income
inequalities by fostering lower income students to pursue non-degree programs that lead to lower
income professions.9 Some have raised questions about the demonstrated diminishing labor
market returns over time for some technical non-degree programs, including apprenticeships.10
Additionally, some non-degree educational programs intended to prepare individuals for a
specific occupation are neither required by nor necessarily preferred by employers, although the
programs may be of a high quality.11
In light of evidence of employers increasingly relying on degrees when establishing hiring
requirements,12 non-degree credential holders may have more difficulties in securing employment
over the long term. In addition, adults with degrees currently employed in positions that do not
require a degree may be crowding non-degree holders out of some occupations. In 2018, for
5 Executive Office of the President, Council of Economic Advisers, Addressing America’s Reskilling Challenge, July
2018, https://www.whitehouse.gov/wp-content/uploads/2018/07/Addressing-Americas-Reskilling-Challenge.pdf.
6 Office of Management and Budget, A Budget for America’s Future – President’s Budget FY 2021.
7 Andrew Kreighbaum, “Brewing Battle Over Pell Grants,” Inside Higher ED, July 8, 2019; and Opportunity America,
the American Enterprise Institute for Public Policy Research, and the Brookings Institution, Work, Skills, Community:
Restoring Opportunity for the Working Class, 2018, p. 15, http://www.aei.org/spotlight/work-skills-community-report/
(Hereinafter referred to as “Restoring Opportunity for the Working Class, 2018”).
8 Michelle Van Noy, Heather McKay, and Suzanne Michael, Non-Degree Credential Quality: A Conceptual
Framework to Guide Measurement, Rutgers Education and Employment Research Center, July 2019,
https://smlr.rutgers.edu/sites/default/files/rutgerseerc_ndcquality_framework_full_paper_final.pdf.
9 Paul Fain, “Support Grows for Major Shift in Pell,” Inside Higher Ed, July 10, 2017,
https://www.insidehighered.com/news/2017/07/10/support-builds-expanding-pell-eligibility-short-term-certificates;
Restoring Opportunity for the Working Class, 2018, p. 15.
10 Clive Belfield and Thomas Bailey, The Labor Market Returns to Sub-Baccalaureate College: A Review, Center for
Analysis of Postsecondary Education and Employment, A CAPSEE Working Paper, March 2017,
https://capseecenter.org/labor-market-returns-sub-baccalaureate-college-review/; and Eric A. Hanushek, Ludger
Woessmann, and Lei Zhang, General Education, Vocational Education, and Labor-Market Outcomes Over the LifeCycle, National Bureau of Economic Research, Working Paper 17504, Cambridge, MA, October 2011,
https://www.nber.org/papers/w17504.pdf (which found that the change in labor market returns with age did not exist in
the United States and other countries with a small non-degree education system).
11 Jon Marcus, “New Research Questions the Value of Certificates Pushed by Colleges, Policymakers,” The Hechinger
Report, October 24, 2017, https://hechingerreport.org/new-research-questions-value-certificates-pushed-collegespolicymakers/.
12 Opportunity America, the American Enterprise Institute for Public Policy Research, and “Restoring Opportunity for
the Working Class, 2018, p. 66.
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instance, 28% of employment was in occupations that typically require a degree for entry-level
positions, while 42% of the population aged 18 and over had a degree.13
This report provides an overview of existing federal programs and benefits that support
individuals engaged in the pursuit of training and education in non-degree instructional and workbased learning programs. It informs consideration of additional or revised policy approaches
aiming to support pursuit of training and education through non-degree programs. The report
begins with a brief description of employer demand for individuals who have completed nondegree programs. This is followed by a discussion of the landscape and key characteristics of
non-degree programs, from those offered through work-based learning to those offered through
more formal instructional means. The report concludes with a detailed description of six federal
programs and three tax benefits that currently provide direct financial support to students
pursuing training and postsecondary education in non-degree instructional and work-based
learning programs.14 Each program and benefit description highlights potential gaps and
limitations in the scope and extent to which the program or benefit supports individuals pursuing
non-degree programs, as well as student eligibility requirements and federal administration and
oversight.
Labor Market for Non-degree Programs
Key stimuli for promoting financial support for individuals pursuing training and postsecondary
education in non-degree programs include that the unfulfilled employer/business need for
individuals with non-degree credentials is impeding, and/or will impede, economic growth; and
that an individual’s attainment of a non-degree postsecondary credential provides a worthwhile
payoff. This section of the report provides data on the proportion of total employment and mean
wages earned in occupations by typical entry-level education requirements. This discussion
provides a sense of the market for non-degree credentials. It does not offer a comprehensive
exposition of labor market returns and social impacts of increased non-degree program
completion.
In May 2018, approximately 6.2% of jobs in the national economy were in occupations for which
the typical entry-level education requirement was a non-degree postsecondary credential (Table
1). The Department of Labor’s (DOL’s) Bureau of Labor Statistics (BLS) assigns a typical entrylevel education requirement—the typical education level most workers need to enter an
occupation—for occupations that it tracks.15
Table 1 also presents the mean annual wages for occupations by typical entry-level education
required. Mean annual wages for occupations that, at entry, require a high school diploma or its
equivalent, some college but no degree, or a non-degree credential are all similar. While Table 1
13 Bureau of Labor Statistics, U.S. Department of Labor, Occupational Employment Statistics, Overview of May 2018
occupational employment and wages, https://www.bls.gov/oes/current/overview_2018.htm (last modified date: March
29, 2019); and Census Bureau, Table 1. Educational Attainment of the Population 18 Years and Over, by Age, Sex,
Race, and Hispanic Origin: 2018, February 21, 2019, https://www.census.gov/data/tables/2018/demo/educationattainment/cps-detailed-tables.html.
14 Noneducation related benefits for families with dependents aged 19 to 23 who are students are not included.
Programs that provide income support (e.g., unemployment insurance), subsistence (e.g., Section 8 Project-Based
Rental Assistance), or other resources (e.g., Child Care and Development Fund) to eligible individuals, including
students, are not included.
15 For a discussion of BLS data limitations regarding the entry-level education requirements, see U.S. Department of
Labor, Bureau of Labor Statistics, “Employment Projections: Measures of education and training,” press release,
October 24, 2017, https://www.bls.gov/emp/documentation/education/tech.htm.
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shows differences in mean annual wages across education categories, these wages do not capture
differences within the categories, which in many cases may include sizeable earnings
differentials. For example, some research has found earnings premiums for individuals attaining
long-term certificates, certificates in technical (e.g., electronics) and health fields, certificates in
the field in which the individual works, and certificates from community colleges.16
Table 1. Occupational Employment and Wages, by Typical Entry-Level
Education Required: May 2018
Typical Entry-Level Education
Requirement for Occupationa
Share of Total
Employment (%)
Mean Annual Wageb
Doctoral or professional degree
2.5
$130,090
Master’s degree
1.9
$77,430
Bachelor’s degree
21.7
$87,130
Associate’s degree
2.3
$56,970
Non-degree credential
6.2
$42,530
Some college, no degree
2.5
$39,470
High school diploma or equivalent
38.7
$43,060
No formal educational credential
24.2
$27,890
All occupations
100.0
$51,960
Source: U.S. Department of Labor, Bureau of Labor Statistics, Occupational Employment Statistics, Overview of
May 2018 occupational employment and wages, https://www.bls.gov/oes/current/overview_2018.htm (last
modified date: March 29, 2019).
a. The typical education needed for entry represents the typical education level most workers need to enter
an occupation.
b. The mean annual wage is calculated by summing the wages of all the employees in a given occupation and
then dividing the total wages by the number of employees.
Non-degree Programs
Postsecondary non-degree programs provide training and education primarily to individuals who
are beyond the typical age for secondary education. Most, but not all, non-degree programs are
intended to prepare individuals for a particular occupation. Non-degree programs may be
described by various classifications. One commonly used classification scheme delineates
programs primarily provided by educational institutions (non-degree instructional) and by
employers (work-based learning), although some programs include both instructional training and
work-based learning.
16 Mark Schneider, Higher Education Pays: Measuring the Economic Security of Florida’s Postsecondary Graduates,
College Measures, p. 70; Research for Action, Research Brief: Measuring the Effects of Outcomes-Based Funding on
Certificate Production: Challenges, Inconsistencies and Recommendations for Future Research, February 2019, pp. 4-5;
and Mina Dadgar and Madeline Joy Trimble, “Labor Market Returns to Sub-Baccalaureate Credentials: How Much
Does a Community College Degree or Certificate Pay?,” Educational Evaluation and Policy Analysis, vol. 37, no. 4
(December 2015), p. 399–418, overview at https://ccrc.tc.columbia.edu/publications/labor-market-returns-subbaccalaureate.html.
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Non-degree Instructional Programs
In general, postsecondary non-degree instructional programs are a combination of postsecondary
courses or a postsecondary curriculum that fulfills an educational or professional objective, but
for which a student does not earn a degree upon completion.
What Characterizes a Postsecondary
Non-degree Instructional Program?
What Characterizes a Postsecondary
Degree Program?
For purposes of this report, a postsecondary nondegree instructional program is any curriculum or any
combination of courses or subjects that generally
fulfills one or more identified educational,
professional, avocational, or vocational objectives;
does not lead to a degree; is primarily offered
through instruction; primarily enrolls individuals
beyond the compulsory age of education; and does
not require being enrolled in or having completed a
bachelor’s or higher degree program. Non-degree
instructional programs may be required to meet
accreditation standards if offered for credit; meet
state board, licensure, or certification standards if
required for state board approval, licensure, or
certification; or meet state education law standards if
offered by an educational institution, as required by
state law. This definition is adapted from 38 U.S.C.
§3452(b) and U.S. Department of Education, National
Center for Education Statistics, Data Point: Degree and
Non-degree Credentials Held by Labor Force Participants,
NCES 2018-057, March 2018.
A degree program at postsecondary educational
institutions confers a degree—an associate’s degree,
bachelor’s degree, or higher level academic degree
(e.g., doctoral degree)—on students who successfully
complete the program. The postsecondary
educational institution must either be empowered by
the appropriate state education authority under state
law to offer the degree program, or in some instances
be approved by a recognized accrediting agency to
offer a degree program (38 U.S.C. §3452(f)). Laws,
regulations, and practices pertaining to degree
program requirements vary across the states. State
requirements may be administered by a state higher
education entity, state nursing board, state
professional licensing and certification board, state
workforce development board, or other entity. States
establish degree program requirements that vary, but
often are related to credit hours, curriculum, and
employment prospects of program completers (See,
for example, Pennsylvania Code §31.21, Washington
Administrative Code 250-61-100, or 23 Illinois
Administrative Code 1030).
Non-degree instructional programs prepare individuals for a wide variety of specialized jobs and
more general employment. Upon completion of a non-degree instructional program, individuals
receive a postsecondary educational certificate, which is a credential awarded by an educational
institution based on the completion of a postsecondary instructional program, including
coursework, assessment, or other performance evaluations.17 Individuals pursue non-degree
programs for various reasons, including to expand knowledge and skills, to prepare for further
education, to prepare for employment, to sustain employment, and when seeking promotion.
For purposes of this report, non-degree instructional programs exclude those that lead to
postbaccalaureate certificates and exclude transfer programs. Typically, transfer programs do not
award a certificate or degree, but provide education for at least two academic years and are
acceptable for full credit toward a bachelor’s degree.
Non-degree instructional programs should not be confused with certifications and licenses, which
are occupational credentials awarded by entities that assess whether individuals have met
established occupational standards or requirements.18 Licenses are required to practice in some
17 S. Cronen, M. McQuiggan, and E. Isenberg, Adult Training and Education: Results from the National Household
Education Surveys Program of 2016 (NCES 2017-103rev), National Center for Education Statistics, Institute of
Education Sciences, U.S. Department of Education. Washington, DC, 2017, p. 1, https://nces.ed.gov/pubs2017/
2017103rev.pdf (Hereinafter referred to as “NCES 2017-103rev”).
18 A certification is an occupational credential awarded by a certification body, such as a professional association or
certifying board, based on an individual demonstrating through an examination process that he or she has acquired the
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occupations. Certifications show that an individual has attained competency in an occupation.
Some certifications and licenses require the completion of a non-degree instructional (or degree)
program.
Non-degree Instructional Program Providers
A diverse set of entities offer non-degree instructional programs. Traditional postsecondary
educational institutions—colleges and universities—offer non-degree instructional programs, as
do trade, vocational, and technical schools. In fall 2018, almost 3,000 institutions of higher
education enrolled nearly1.9 million non-degree seeking undergraduate students.19 Other entities
also offer such programs, including businesses; professional organizations; trade unions;
nonprofit organizations; federal, state, and local governments; museums; bootcamps; hospitals;
and the military. One study estimated that there were over 4,500 for-profit non-traditional
postsecondary educational institutions enrolling almost 670,000 students in academic year (AY)
2009-2010.20
Duration, Structure, and Cost of Programs
Stackable Units
Non-degree instructional programs vary
considerably in length and duration. Programs
A stackable unit is a sequence of independent programs
that are aligned to a career path and that progress to
may require a few days or more than two
higher-level certificates or credentials. Each stackable
years to complete. Generally, the length is
credential qualifies an individual for related
related to curriculum requirements, industry
employment. An individual may supplement a degree or
expectations, and the breadth and complexity
other credential with one or more stackable
of skills that the program is intended to instill.
credentials.21 Stackable credentials may also be
designed to help individuals adapt to a changing labor
The length of the program may also be
market while advancing their careers.22
affected by federal, state, and private entities
that require a minimum number of educational
hours to be eligible for employment, or for certification or licensing. The overall program
duration may be broken up if it is designed in stackable units. A single educational program
aligned to a career path may be redesigned into a sequence of independent programs (stackable
units).
Programs are offered in classrooms, online, by correspondence, with cooperative elements, or
through a combination of methods.
designated knowledge, skills, and abilities to perform a specific job; examples include Cisco certified network associate
(CCNA) certification and medical technician certification. A license is an occupational credential awarded by a
government agency that constitutes legal authority to do a specific job; examples include a medical license and an
electrician’s license. NCES 2017-103rev, p. 1.
19 CRS calculations based on ED’s Integrated Postsecondary Education Data System (IPEDS) using the total of
undergraduate non-degree/certificate-seeking students at Title IV-participating institutions in fall 2018.
20 The estimate was primarily based on state authorized postsecondary institutions that are not accredited. C. Goldin,
S.R. Cellini, “Does Federal Student Aid Raise Tuition? New Evidence on For-Profit Colleges,” American Economic
Journal: Economic Policy, 2014;6 (November):174-206, p. 16.
21 Research for Action, Research Brief: Measuring the Effects of Outcomes-Based Funding on Certificate Production:
Challenges, Inconsistencies and Recommendations for Future Research, February 2019, pp. 4-5.
22 Evelyn Ganzglass, Scaling “Stackable Credentials”: Implications for Implementation and Policy, Center for
Postsecondary and Economic Success, March 2014.
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Generally, students must fund or find funding for the cost of a program, and, if applicable, for
related living expenses and lost wages for foregone employment. Program cost varies by length,
program resource requirements, and provider. For example, for the most heavily enrolled
programs in AY2018-2019, the average published cost for tuition and fees was over $9,000 at
public less-than-two-year colleges and approximately $15,000 at private less-than-two-year
colleges.23
Credit and Noncredit Programs
In non-degree instructional programs, a dichotomy exists between programs made up of credit
course(s) and those structured as a series of noncredit courses. However, courses in the same field
of study with the same vocational objective and industry recognition may be offered for credit at
one institution and noncredit at another, or even within the same institution.24
Generally speaking, individuals who successfully complete credit courses and programs earn
credits that may be transferred or used as currency toward the completion of other credit
programs (either at the conferring school or at another school). All degree programs are credit
programs. Credit programs are most often approved by an accrediting entity and may have more
stringent student entrance or prerequisite requirements. Credit programs may lead to a variety of
vocations.25
Although noncredit programs may offer continuing education units (CEUs) or vocational
certificates to program completers, the programs do not proffer these students currency toward
the pursuit of credit programs or noncredit programs in other fields. The advantage of noncredit
programs is that they often are less expensive for students and educational institutions, cover a
broader range of topics, and can be modified more quickly to be attentive to industry and student
needs.26 Noncredit programs may satisfy career entry requirements;27 may include adult basic
education (ABE) and English as a second language (ESL) instruction; may provide personal
enrichment; and may be customized training.28 Based on 2007-2013 enrollment information from
23 CRS calculations based on the published tuition and fees in AY2018-2019 for the largest program for full-time, first-
time undergraduate students, averaged across the number of reporting institutions, from the Department of Education,
Integrated Postsecondary Education Data System. A less-than-two-year college is a postsecondary institution that
offers instructional programs of less than two years duration.
24 John Milam, “The Role of Noncredit Courses in Serving Nontraditional Learners,” New Directions for Higher
Education, no. 129 (Spring 2005), p. 61.
25 Mark Schneider, Higher Education Pays: Measuring the Economic Security of Florida’s Postsecondary Graduates,
College Measures, p. 31; and Di Xu and Xiaotao Ran, Noncredit Education in Community College: Students, Course
Enrollments, and Academic Outcomes, Community College Research Center, Teachers College, Columbia University,
CCRC Working Paper No. 84, September 2015, p. 12.
26 Di Xu and Xiaotao Ran, Noncredit Education in Community College: Students, Course Enrollments, and Academic
Outcomes, Community College Research Center, Teachers College, Columbia University, CCRC Working Paper No.
84, September 2015, p. 1; and U.S. Government Accountability Office, Public Community Colleges and Technical
Schools: Most Schools Use Both Credit and Noncredit Programs for Workforce Development, GAO-05-4, October 18,
2004, p.11.
27 Mark Schneider, Higher Education Pays: Measuring the Economic Security of Florida’s Postsecondary Graduates,
College Measures, p. 24; and Di Xu and Xiaotao Ran, Noncredit Education in Community College: Students, Course
Enrollments, and Academic Outcomes, Community College Research Center, Teachers College, Columbia University,
CCRC Working Paper No. 84, September 2015, p. 12.
28 Di Xu and Xiaotao Ran, Noncredit Education in Community College: Students, Course Enrollments, and Academic
Outcomes, Community College Research Center, Teachers College, Columbia University, CCRC Working Paper No.
84, September 2015, p. 8; and U.S. Government Accountability Office, Public Community Colleges and Technical
Schools: Most Schools Use Both Credit and Noncredit Programs for Workforce Development, GAO-05-4, October 18,
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nine colleges in one state community college system, approximately 38% of enrollments were in
noncredit courses: vocational (18%), ABE (9%), ESL (7%), and general educational development
(GED) (4%).29
Participation Data
National level data on the universe of non-degree instructional programs, enrollment, and
completions are incomplete.30 Some states and the federal government do not collect data on
noncredit programs.31 A 2016 nationwide survey found that 8% of adults aged 16-65 and not
enrolled in high school had a postsecondary certificate, although some of these certificates may
be postgraduate.32 The subset of educational institutions participating in the HEA Title IV federal
student aid programs (see the “HEA Title IV Federal Student Aid” section below) awarded almost
1 million for-credit non-degree undergraduate credentials and approximately 3 million
undergraduate degrees in AY2017-2018.33
Work-Based Learning Programs
The term work-based learning refers to a range of training and educational activities that are
intended to impart general or specific workplace skills to individuals through time spent at an
employer’s worksite or a simulated work location. The terms defined in Table 2 are examples of
common types of work-based learning in the federal context. Work-based learning is a broad term
and may occur at multiple points in a career path and in multiple forms, ranging from career
exploration for youth to highly specialized technical training for incumbent workers.34 Activities
considered to be work-based learning include, but are not limited to, on-the-job training (OJT),
apprenticeships, summer job experiences, internships, externships, residencies, cooperative
programs (co-ops), and paid or unpaid work experiences. Programs that provide wages or
remuneration are often referred to as earn and learn programs.35
Table 2. Examples of Work-Based Learning
Type of Work-Based Learning
Apprenticeship
Description
An arrangement that includes a paid-work component and an educational
or instructional component, wherein an individual obtains workplace
relevant knowledge and skills.a
2004.
29 Data on noncredit programs are not collected at a national level in part because the programs are not eligible for Title
IV aid. Di Xu and Xiaotao Ran, Noncredit Education in Community College: Students, Course Enrollments, and
Academic Outcomes, Community College Research Center, Teachers College, Columbia University, CCRC Working
Paper No. 84, September 2015, p. 2, 8-9; and John Milam, “The Role of Noncredit Courses in Serving Nontraditional
Learners,” New Directions for Higher Education, no. 129 (Spring 2005), p. 57.
30 Michelle Van Noy, Heather McKay, and Suzanne Michael, Non-Degree Credential Quality: A Conceptual
Framework to Guide Measurement, Rutgers Education and Employment Research Center, July 2019,
https://smlr.rutgers.edu/sites/default/files/rutgerseerc_ndcquality_framework_full_paper_final.pdf.
31 Jenna Leventoff, Measuring Non-Degree Credential Attainment, National Skills Coalition, May 2018, p. 2.
32 NCES 2017-103rev, p. 3. In the context of the Adult Training and Education Survey (ATES) of the National
Household Education Surveys Program, 2016, “Adults are persons aged 16 to 65 and not enrolled in high school.”
33 CRS compiled data from the U.S. Department of Education, Integrated Postsecondary Education Data System
(IPEDS).
34 Generally speaking, an incumbent worker is an existing employee with an employment history (20 C.F.R. §680.780).
35 38 C.F.R. §21.4233(a).
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Type of Work-Based Learning
Description
Cooperative program (co-op)
A full-time program of education consisting of phases of school instruction
alternated with training in a business or industrial establishment, with such
training being strictly supplemental to the school instruction that may be
approved.b
Customized training
Training that is designed to meet the specific requirements of an employer
or group of employers; that is based on a commitment of an employer to
employ, or continue to employ, an individual who successfully completes
the training; and for which the employer pays a “significant” amount of its
cost.c
Incumbent worker training
Training that is designed to meet the specific requirements of an employer
or group of employers in order to retain employees or avert layoffs and is
based on a commitment by the employer to retain the incumbent workers
who successfully complete training.d
Internship
A planned, structured learning experience that takes place in a workplace
for a limited period of time. Internships may be paid or unpaid.e
On-the-job training (OJT)
Paid, productive work experience offered by an employer or other
industry-relevant entity intended to provide knowledge or skills essential to
the full and adequate performance of the job for which training is provided.
OJT may include theoretical and technical instruction.f
Registered apprenticeship (RA)
Apprenticeships that have been approved by the Department of Labor
(DOL) or a DOL-approved state agency as meeting specified standards.g
Sources:
a. Department of Labor Task Force on Apprenticeship Expansion, Final Report of the Task Force on
Apprenticeship Expansion, May 10, 2018, p. 40.
b. 38 C.F.R. §21.4233(a).
c. 20 C.F.R. §680.760.
d. 20 C.F.R. §680.790.
e. 20 C.F.R. §680.180.
f.
29 U.S.C. §3102(44).
g. For more information on RA, see CRS Report R44174, Apprenticeship in the United States: Frequently Asked
Questions.
Registered Apprenticeship (RA)
RA programs are a distinctive form of work-based learning because of their DOL oversight.36 RA
programs are registered with DOL or a DOL-approved state agency if they meet standards
delineated in federal regulations. Among the requirements, a registration application must include
a work process schedule, which outlines the major competencies of the occupation and how a
combination of OJT and/or related instruction will lead to the worker demonstrating proficiency
in those competencies. Once a program is registered, the registration agency must review the
program no less than once every five years to ensure that it remains in compliance with the
required standards. If the program demonstrates a “persistent and significant failure to perform
successfully,” the program may be deregistered.37
36 For more information on RA programs, see CRS Report R45171, Registered Apprenticeship: Federal Role and
Recent Federal Efforts.
37 See 29 C.F.R., Chapter 29 for more information on standards and deregistration.
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Providers
Because work-based learning encompasses such a broad range of training activities, it is possible
for multiple types of entities or individuals to offer such learning experiences. Work-based
learning experiences may be provided by employers (either formally or informally), labor unions,
external training providers, educational institutions providing work-relevant instruction, or
partnerships of these entities.
Structure, Duration, and Cost of Programs
Work-based learning is generally structured to meet the needs of the employer, potential
employer, or trainee. For example, summer internships may offer three to four months of informal
training opportunities. Conversely, a summer internship may offer a formal curriculum covering
specified procedures or tasks through iterative task-based coaching/instruction.
RA programs require at least 2,000 hours of supervised OJT and range in duration from one to six
years, but most RA programs are four years in duration.38 Some RA programs take a time-based
approach through which an apprentice learns and obtains skills by completing a specified number
of hours of OJT. Other programs take a competency-based approach in which skill attainment is
verified by the apprentice demonstrating proficiency in the skill learned. Programs may also be
constructed as hybrid programs that combine aspects of the time-based and competency-based
approaches. All RA program designs must include related instruction to supplement OJT.
The costs of work-based learning programs are primarily borne by the provider, but the trainee
may be required to cover his/her living costs. Program costs may include the lost work time of
experienced employees, fees for contracted trainers, and trainee wages. As the work-based
learning progresses, some portion of the program costs may be offset by the trainee’s increased
productivity. In some cases, trainees may be required to pay for related instruction or other costs.
Work-based learners who do not receive remuneration or receive nominal remuneration must
provide for their own transportation, room, and board while also potentially forgoing the
opportunity to earn wages from other paid employment.
Participation Data
The data on work-based or employer provided training are not extensive. The data sets that do
exist often differ in methodology, timeframe, and purpose. For example, some surveys look only
at firms with 50 or more employees, while others are part of larger household surveys not
designed around employer provided training questions. A summary of four different government
surveys related to employer provided training in the 1990s concluded that while most
establishments offer some training (formal or informal), the percentage of workers receiving
training ranged from 16% to 70%.39
A 2016 nationwide survey found that 21% of adults aged 16-65 had completed a work-based
learning program, although not all of these programs were intended to prepare individuals for a
38 See https://doleta.gov/OA/apprenticeship.cfm.
39 Robert I. Lerman, Signe-Mary McKernan, and Stephanie Riegg, “The Scope of Employer-Provided Training in the
United States: Who, What, Where, and How Much?,” Job Training Policy in the United States, ed. Christopher J.
O'Leary, Robert A. Straits, and Stephen A. Wandner (Kalamazoo, MI: W.E. Upjohn Institute for Employment
Research, 2004), p. 222.
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particular occupation or field of work.40 Among adults aged 16-65, the most common work-based
learning programs completed were in healthcare and teaching. 41
With respect to RA, DOL reported approximately 633,000 active apprentices in about 25,000
active programs in FY2019.42 In the same year, about 81,000 apprentices completed a program.43
The construction industry currently accounts for the largest share of apprenticeships, though they
are available in other industries such as manufacturing and transportation.44
Federal Programs and Benefits
The federal government provides direct financial support to individuals pursuing training and
education that might better prepare them for entry into the workforce and that might help them
realize their potential. None of the federal programs or benefits that provide such support focus
exclusively on promoting training or education through the pursuit of non-degree programs. With
that caveat in mind, federal programs are described below in an order that generally attempts to
correspond to their relevance to supporting the pursuit of training or education through nondegree programs. The design and implementation of the federal programs and benefits are notably
different in several aspects including, but not limited to, the choice and monitoring of non-degree
programs.
The primary benefit programs are the Workforce Innovation and Opportunity Act (WIOA) Title I
program, the federal student aid programs, federal tax benefits, and veterans educational
assistance. WIOA Title I, administered by the Department of Labor (DOL), is intended to
encourage general workforce development and may be used to directly subsidize training costs of
individuals who pursue training and education. The federal student aid programs, authorized
under Title IV of the Higher Education Act (HEA) and administered by the Department of
Education, provide grants and loans to students to aid them in accessing and completing
postsecondary education programs. The Internal Revenue Service (IRS) administers the Internal
Revenue Code, which, among other things, provides certain tax benefits as a strategy for posteducation financial support. Educational assistance administered by the Department of Veterans
Affairs (VA), specifically the Post-9/11 GI Bill and Veteran Employment Through Technology
Education Courses (VET TEC), are programs designed to provide direct financial support to
students that allows them to pursue a wide variety of educational and training programs.
Two programs that augment the basic living supports for needy families with some training and
education assistance are also discussed in this report. Supplemental Nutrition Assistance Program
(SNAP) Employment & Training (E&T), administered by the Department of Agriculture
(USDA), provides training and education opportunities to individuals with a high risk for
educational failure. Temporary Assistance for Needy Families (TANF), administered by the
Department of Health and Human Services (HHS), provides flexibility to states to use TANF
funds for activities that would develop a more highly skilled workforce through training and
education.
40 NCES 2017-103rev, p. 3.
41 NCES 2017-103rev, p. 4.
42 U.S. Department of Labor, “Registered Apprenticeship National Results Fiscal Year (FY) 2019 (10/01/2018 to
9/30/2019),” https://doleta.gov/oa/data_statistics.cfm, downloaded on February 18, 2020.
43 Ibid
44 Ibid.
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The subsequent sections of this report describe these prominent federal programs that can be used
to support students in non-degree programs. The sections are organized to focus on key program
design elements and highlight differences among the programs. Table 3 highlights a few program
characteristics that help to delineate key differences.
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Table 3. Selected Characteristics of Federal Programs Supporting Students
who Pursue Training or Education Through Non-degree Programs
Federal program listed in order of report description
Federal Program
(Administering
Agency)
Payment or Tax
Benefit Structure
General Purpose
Non-degree Programs
Eligible Participantsa
Workforce
development.
Primarily supports
career services, but also
training and training
support services.
Non-degree instruction.
Adults over age 18 who
need training to obtain or
retain employment that
leads to economic selfsufficiency.
Funds disbursed to
training providers.
Only in-demand or potentially
in-demand occupations.
State and local workforce
development boards establish
criteria and procedures that
meet WIOA minimums.
Access to and
affordability of the
benefits of
postsecondary
education. Primarily
support students
pursuing degrees.
For-credit instructional
programs of at least 600
clock hours over 15
weeks offered by HEA
Title IV-eligible IHEs.b
Undergraduate students
with financial need and no
bachelor’s degree.
State agency approval.
Accrediting agency approval
using HEA minimum criteria.
ED certification.
For-credit instructional
programs of at least 300
clock hours over 10
weeks offered by HEA
Title IV-eligible IHEs.b
Undergraduate and
graduate students, and
parents of undergraduates.
Funds disbursed to
schools. Funds remaining
after payment of
institutional charges are
remitted to student or
parent.
Lifetime Learning
Credit (IRS)
Offsets higher education
costs, including those
incurred to acquire or
improve job skills.
Non-degree instruction
and work-based learning
offered by HEA Title IVeligible IHEs.
Eligible taxpayers (or their
dependents) if income is
below specified limits.
Credit that reduces
federal income tax
liability.
HEA Title IV institutional
eligibility criteria.
Employer Provided
Assistance (IRS)
Increased employee
productivity.c
Non-degree instruction
and work-based learning.
Employees of participating
employers.
Assistance not subject to
federal payroll or income
taxes.
Employer judgment (to be
eligible to be excluded from
wages for tax purposes,
employer provided
educational assistance must
be provided under a written
educational assistance plan
that must meet several
requirements).
WIOA Individual
Training Accounts
(DOL)
WIOA Contracts
(DOL)
Pell Grants (ED)
Direct Loans (ED)
CRS-13
Work-based learning.
Quality Assurance
Federal Program
(Administering
Agency)
General Purpose
Non-degree Programs
Eligible Participantsa
Payment or Tax
Benefit Structure
Quality Assurance
529 Accounts (IRS)
Encourages saving for
educational expenses.
Non-degree instruction
and work-based learning
offered by HEA Title IVeligible IHEs.
Beneficiaries of established
savings accounts.
Tax-advantaged savings
account.
HEA Title IV institutional
eligibility criteria.
Post-9/11 GI Bill
(VA)
Adjustment to civilian
life and civilian
employment.
Facilitating recruitment
and retention in the
uniformed services.
Non-degree instructional
programs, OJT, and RA.
Veterans and
servicemembers and their
family members.
Tuition and fees paid to
educational providers.
Housing allowances paid
to participants.
State agency approval, and
state agency and VA reviews.
Only non-degree high
technology programs that
are not offered by
degree-granting colleges.
GI Bill-eligible veterans.
Supplemental
Nutrition Assistance
Program (SNAP)
Employment &
Training (E&T)
(USDA)
Providing employment
and training
opportunities for SNAP
participants, particularly
those subject to the
work-related eligibility
requirements.
Non-degree instruction
and work-based learning.
SNAP participants (financial
and other eligibility rules
apply); E&T participants are
typically those subject to
work-related requirements.
State agencies typically
fund direct services or
fund contracted partners
to provide services.
State agency monitoring with
federal oversight.
Temporary
Assistance for
Needy Families
(TANF) (HHS)
End government
dependency of needy
families and promote
families living together.
Primarily assistance for
basic needs.
Non-degree instruction
and work-based learning.
Parents or caretakers of
TANF households.
States may pay
participants or service
providers.
State agency monitoring.
VET TEC (VA)
Incentive of 50% tuition and
fees reimbursement upon
participant employment, and
VA-developed criteria.
Source: Table prepared by CRS based on statutory provisions, regulations, and other published guidance.
a. Additional eligibility rules apply.
b. HEA Title IV-eligible IHEs are institutions of higher education that meet the eligibility requirements to participate in the HEA Title IV federal student aid programs.
c. U.S. Congress, House Committee on Agriculture, Two-Year Extension of Exclusion with respect to Educational Assistance Plans, To accompany H.R. 2568, 98th Cong., 2nd
sess., September 24, 1984, H.Rept. 98-1049, p. 7.
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WIOA Contracts and Individual Training Accounts (ITAs) (DOL)
Title I of the Workforce Innovation and Opportunity Act (WIOA; P.L. 113-128) is the primary
federal workforce development legislation and is intended to bring about increased coordination
among federal workforce development and related programs.45 WIOA Title I is administered by
DOL and funded through discretionary appropriations. Services authorized under WIOA are
intended to:
increase the employment, retention, and earnings of participants, and increase attainment
of recognized postsecondary credentials by participants, and as a result, improve the quality
of the workforce, reduce welfare dependency, increase economic self-sufficiency, meet the
skill requirements of employers, and enhance the productivity and competitiveness of the
Nation.46
The Adult and Dislocated Worker Employment and Training Activities program under WIOA
Title I provides formula grants to states, which in turn allocate the majority of those funds to local
Workforce Development Boards (WDBs). At the local level, funds are required to be used for five
main purposes: establishing a One-Stop delivery system, providing career services, providing
training services, establishing relationships with employers, and developing industry or sector
partnerships.47
As part of its service delivery model, WIOA
Recognized Postsecondary Credential
provides consumer choice to participants. The
A recognized postsecondary credential is an
program for adult and dislocated worker
industry-recognized certificate, certification,
participants in WIOA is structured around two
certificate of completion of an apprenticeship, license
main levels of services: career services and
recognized by the state or federal government, or
associate’s or baccalaureate degree.48
training. On an operational level, career services
are categorized as basic and individualized.
Basic services include assistance such as labor market information and job postings, while
individualized services include assistance such as skills assessment and case management.
Eligibility of Non-degree Programs
Eligible WIOA participants may pursue training and education at the eligible training provider
(ETP) of their choice. A state Eligible Training Provider List (ETPL) identifies choices to
customers who are accessing WIOA services. Generally, ETPs include the following:
institutions of higher education that are eligible to participate in the HEA Title IV
federal student aid programs and offer programs leading to a recognized
postsecondary credential,
entities that provide RA, or
other public or private training providers.49
45 29 U.S.C., Chapter 32; and 20 C.F.R., Parts 678 and 680.
46 29 U.S.C. §3101(6).
47 34 C.F.R. §668.32.
48 29 U.S.C. §3102(52).
49 The term training provider is not defined in WIOA. However, 20 C.F.R. §680.410 notes that in addition to
institutions of higher education and apprenticeship programs, other providers of training services may include
community-based organizations and joint labor-management organizations.
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Allowable training activities that may be supported with WIOA Title I funds are non-degree and
degree instructional programs and certain types of work-based learning, including OJT, RA,
customized training, and incumbent worker training. Training must be for occupations that are in
demand in the local area or region, are in demand in an area to which the trainee is willing to
relocate, or are deemed (by the local WDB) to have “high potential for sustained demand or
growth in the local area.”50 In addition, the implementing regulations for WIOA specify that a
program of training services provided by an ETP is one or more courses or classes or a structured
regimen that leads to the following:
an industry-recognized certificate or a certificate of completion of an RA,
a license recognized by the state or federal government,
an associate or baccalaureate degree,
a secondary school diploma or equivalent,
employment, or
measurable skill gains toward a credential.
Local areas under WIOA may reserve up to 20% of combined adult and dislocated worker funds
for incumbent worker training.
Participant Eligibility for Training
The workforce development system designed by WIOA is premised on universal access, such that
an adult age 18 or older who is a citizen or noncitizen authorized to work in the United States
does not need to meet any qualifying characteristics in order to receive career services.51 While
basic career services are available to all adults, individualized career services are to be provided
as appropriate to help individuals obtain and retain employment. Under WIOA, service at one
level is not a prerequisite for service at the next level.
To be eligible to receive training, an individual must
be unlikely or unable to obtain or retain employment that leads to economic selfsufficiency,52
be in need of training services to obtain or retain employment that leads to
economic self-sufficiency,
have the skills and qualifications to participate successfully in training,
select a training service linked to an occupation in the local area (or be willing to
relocate to another area where the occupation is in demand), and
be unable to obtain other grant assistance (e.g., Pell Grants) for the training
services.
These determinations are made by a One-Stop operator through an interview, evaluation, or
assessment, which can include a recent evaluation or assessment conducted pursuant to another
education or training program. Local WDBs designate colleges and universities, private
50 29 U.S.C. §3174(c)(3)(G)(iii).
51 To participate in WIOA services, an individual must not be in violation of Section 3 of the Military Selective Service
Act (i.e., must be registered for military service). 29 U.S.C. §3249(h).
52 Economic self-sufficiency is not defined in WIOA. However, 29 U.S.C. §3174(d)(1)(A)(x) allows local funds to be
used to adjust the economic self-sufficiency standards for local factors or to calculate and adopt local self-sufficiency
standards.
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organizations, and government agencies as One-Stop operators that assess and evaluate
individuals and decide which individuals to provide with access to training services.
Of funds allocated to a local area for adult employment and training activities, priority for career
and training services is to be given to recipients of public assistance, other low-income
individuals, and individuals who are basic skills deficient. It is left to the discretion of the local
WDB, in consultation with the state’s governor, to determine how to allocate funds among these
priority groups.
Basic Benefit Payment Structure
Under WIOA, training is allowed through ITAs or through contracts for services. While ITAs are
the primary vehicle, contracts may be used in certain circumstances.53 WIOA also permits funds
to be used for supportive services (e.g., child care and transportation) and “needs-related
payments” necessary to enable an individual to participate in training.
When an individual is determined by a One-Stop operator to be eligible to receive training
services, that individual, in consultation with the One-Stop operator, may choose training services
from the ETPL. At that point, an ITA is established, from which payment is made to the ETP, not
to the individual, for training services. Local WDBs have the authority to set limits on the type
and duration of training and may choose to set limits on the amount of an ITA, based on
individual circumstances or on an across-the-board level. WIOA participants who are in receipt of
an ITA may use ITA funds to support non-degree instructional and degree programs and the
related instruction portion of an RA. In addition, local WDBs are also authorized to provide
supportive services, including transportation, child care, dependent care, housing, and needsrelated payments necessary to enable an individual to participate in training.
While training is typically carried out through the ITA model, local WDBs may provide training
through a contract for services, which may include various forms of work-based learning.54 The
contract is an agreement between a local WDB and an employer or RA sponsor for occupational
training for a WIOA participant in exchange for reimbursement from the WDB. A contract for
services may be used if
the consumer choice requirements of WIOA are met;
the services are OJT, RA, customized training, incumbent worker training, or
transitional employment;
the local WDB determines there is an insufficient number of training providers in
a local area to meet the ITA requirements;
the local WDB determines there is a local training program of demonstrated
effectiveness to serve individuals with barriers to employment;
the local WDB determines that it is most appropriate to contract training services
to train multiple individuals in in-demand occupations or industry sectors; or
the training service is a pay-for-performance contract.
For example, through a contract, a local WDB may reimburse an OJT provider (employer) for up
to 50% of the wage rate of a participant (reimbursement rates may be 75% in limited
circumstances). State and local WDBs may also enter into contracts with RA sponsors to
53 Byron Zuidema, Deputy Assistant Secretary, Advisory: Training And Employment Guidance Letter WIOA No. 19-16
Operating Guidance for the Workforce Innovation and Opportunity Act, Department of Labor, Employment and
Training Administration, March 1, 2017, p. 7.
54 WIOA allows for alternative mechanisms authorized under 29 U.S.C. §3174(c)(3)(G)(ii).
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reimburse the sponsors for up to 75% of an apprentice’s wages. Notably, reimbursement for
wages is supported by a contract, not an ITA.
Basic Administrative Structure
As noted, states are responsible for developing the ETPL. Local WDBs and One-Stop operators
administer the training programs and payments to training providers. Thus, administrative
structures and procedures vary by state.
Quality Assurance Mechanisms
Quality assurance of training providers is established through both initial and continued provider
eligibility processes. The governor and the state WDB in each state are responsible for
establishing criteria and procedures for eligible providers of training services to receive funding
in the local workforce investment areas. RA programs are automatically eligible to be included on
the state ETPL.55 Non-RA training providers not previously eligible under WIOA or its
predecessor law must apply to the governor and the local WDB (according to a procedure
established by the governor) for initial eligibility of one fiscal year.
To maintain continued eligibility, existing training providers must follow procedures established
by the governor and implemented by the local WDB and submit WIOA-specified information.
WIOA provides general requirements while allowing local WDBs discretion on specific factors.
For example, while WIOA indicates that OJT contracts should be limited in duration, as
appropriate to the occupation, the training content, and the participant’s prior work experience
and service strategy, the exact length of the OJT contract is determined by the local WDB.
Similarly, WIOA requires that in determining employer eligibility to receive WIOA incumbent
worker training funding, a local WDB must consider the characteristics of individuals in the
program and the relationship of the training to the competitiveness of the individual and the
employer without establishing quantifiable targets.
Measures of Program Performance
WIOA requires ETPs and states to report measures of program participation and outcomes.
Notably, RA programs are not required to submit ETP performance report information.56
To be considered for continued eligibility, providers must submit to the governor every two years
the following performance and cost information for participants receiving training under WIOA
Title I:57
the percentage of program participants in unsubsidized employment in the second
and fourth quarters after program exit;
55 The governor must inform all RA programs in the state of this automatic eligibility and must provide an opportunity
to RA programs to consent to inclusion on the state ETPL. See 20 C.F.R. §680.470.
56 20 C.F.R. §677.230(b). The regulations note that although RA programs are not required to submit ETP performance
report information, these programs may voluntarily submit performance information, and that states are required to
include such information (if submitted) in ETP reports. As DOL notes, this exemption for RA programs from ETP
performance reporting exists because “all apprenticeship programs registered with a recognized State Apprenticeship
Agency or the USDOL Office of Apprenticeship undergo a rigorous application and vetting process in order to become
registered by the apprenticeship system.” See U.S. Department of Labor, Registered Apprenticeships and the Eligible
Training Provider (ETP) List - FAQs, Washington, DC, May 2016, p. 5, https://www.dol.gov/apprenticeship/docs/
ETPL_FAQ_Workforce_System.pdf.
57 WIOA §122(b)(2). The required information from training providers is for WIOA-funded participants only, not for
individuals otherwise participating in the training provider’s program.
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median earnings of program participants who are in unsubsidized employment
during the second quarter after program exit;
the percentage of program participants who obtain a recognized postsecondary
credential, or secondary school diploma or equivalent, during participation or
within one year of program exit;
information on the type of recognized postsecondary credentials received by
program participants;
information on the cost of attendance, including tuition and fees, for program
participants; and
information on program completion rates for program participants.
In addition, the governor may require additional, specific performance information deemed
necessary to determine continued eligibility.
States are required to publish and disseminate annual ETP performance reports. The reports must
include the following information with respect to each program of study eligible to receive WIOA
funds, disaggregated by the type of entity that provided the training, during the most recent
program year and the three preceding program years:
the total number of participants who received training services through a WIOA
Title I program,
the total number of participants who exited from training services, and
the average cost per participant for the participants who received training
services.
In addition, the ETP performance reports must include the number of participants with barriers to
employment served by the WIOA Title I programs, disaggregated by each program of study
eligible to receive WIOA funds and each subpopulation of such individuals, and by race,
ethnicity, sex, and age.58
Program Participation
The first WIOA ETP performance report is not yet available, but some participation data are
available.59 Within the WIOA-authorized forms of work-based learning, the most recent data
available (2017) indicate 955,094 adult participants and 469,572 dislocated worker participants.
The majority of participants are age 30 and over (67% of adults and 82% of dislocated workers)
and unemployed or have received a layoff notice (82% of adults and 92% of dislocated workers).
While many participants had no postsecondary education experience (59% of adults and 47% of
dislocated workers), a notable 22% of adults and 34% of dislocated workers had a degree.60
58 20 C.F.R. §677.230; Rosemary Lahasky, Eligible Training Provider (ETP) Reporting Guidance under the Workforce
Innovation and Opportunity Act (WIOA), U.S. Department of Labor, Employment and Training Administration,
Training and Employment Guidance Letter No. 3-18, Washington, DC, August 31, 2018, http://wdr.doleta.gov/
directives/attach/TEGL/TEGL_3-18.pdf.
59 Rosemary Lahasky, Eligible Training Provider (ETP) Reporting Guidance under the Workforce Innovation and
Opportunity Act (WIOA), U.S. Department of Labor, Employment and Training Administration, Training and
Employment Guidance Letter No. 3-18, Washington, DC, August 31, 2018, http://wdr.doleta.gov/directives/attach/
TEGL/TEGL_3-18.pdf, p. 7.
60 U.S. Department of Labor, Employment and Training Administration, Office of Policy Development and Research,
PY2017 Quarter 3 Report for WIOA and Wagner-Peyser, Washington, DC, July 2018, https://www.doleta.gov/
performance/results/docs/WIOA_Performance/PY2017/Q3/WIOA_and_Wagner-Peyser_PY2017Q3.pdf.
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Table 4 shows usage of training services among program exiters in program year 2018. Fewer
than 20% of WIOA Title I participants engage in work-based learning provided under contract.
The majority, over 66%, of trainees pursue skills training or upgrading through non-degree
instructional and degree programs with ITAs. The most popular occupations pursued by adults
through training were healthcare, transportation and material moving, and production. The most
popular occupations pursued by dislocated workers were transportation and material moving,
computer and mathematical, office and administrative support, and management.
Table 4. Percentage of WIOA Title I Program Exiters, by Training Type
PY2018 (July 1, 2018–June 30, 2019)
Services
Number of trainees
Adults
Dislocated Workers
85,705
38,216
Occupational skills traininga
66%
72%
Skill upgradinga
14%
16%
OJT, excluding RA
14%
9%
Customized training
3%
1%
RA
2%
1%
Source: U.S. Department of Labor, Employment and Training Administration, Office of Policy Development and
Research, PY2018 Data Book, Washington, DC, February 2020, Tables II-13 and III-14, https://www.doleta.gov/
performance/results/WIASRD/PY2018/PY_2018_WIOA_and_Wagner-Peyser_Data_Book.pdf .
Notes: Percentages do not add to 100%, as participants may receive training of more than one type listed
and/or other types not listed.
a. There is no clear distinction between skill upgrading and other occupational skills training.
Program Limitations
WIOA Title I currently supports adult entry or reentry into the workforce primarily by providing
career services, but short-term training and education are also provided. The program assumes
that many participants only need career services. Support for non-degree training and education
pursuits could be bolstered by the following:
increasing focus of One-Stop operators to increase access to non-degree training;
additional funding could be dedicated to wage reimbursement and/or ITAs to
ensure the availability of career services;
the 20% limit on incumbent training could be relaxed to ensure current workers
remain employed despite changing skill requirements, and
the restriction on recipients of training services being able to obtain other grant
assistance (e.g., Pell Grants) could be eliminated to allow programs to
supplement one another.
Non-degree program quality may vary given state and local flexibility in developing the
ETPL.
HEA Title IV Federal Student Aid (ED)
Title IV of the Higher Education Act (HEA; P.L. 89-329, as amended), authorizes programs that
provide financial assistance to students to promote access to, affordability, and completion of
higher education at certain institutions of higher education (IHEs). The programs are
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administered by the Department of Education. Grants are available to qualified, financially needy
students, and loans are available to qualified borrowers (both students and parents of dependent
students). The primary types of Title IV aid are Federal Pell Grants61 and federal student loans
made through the William D. Ford Federal Direct Loan (Direct Loan) program.62 The Pell Grant
and Direct Loan programs are designed to provide portable aid (i.e., the availability of aid
follows students to the eligible postsecondary education institutions in which they choose to
enroll). Title IV also authorizes other aid programs that are relatively smaller in scale and thus are
not discussed in this report.63
Pell Grants and Direct Loan program loans are available to all eligible individuals regardless of
congressional appropriations. The Direct Loan program is a mandatory entitlement program for
budgetary purposes. As a mandatory entitlement, all eligible individuals have access to borrow in
accordance with program rules, and the requisite budget authority is available. The Pell Grant
program is often referred to as a quasi-entitlement because eligible students receive the Pell Grant
award to which they are entitled regardless of discretionary appropriations levels.64
Eligibility of Non-degree Programs
Pell Grants and Direct Loans may be used to pursue Title IV-eligible programs of study, which
include non-degree instructional and degree programs and some work-based learning. Title IVeligible programs must be offered by Title IV-participating IHEs. To be eligible, programs and
Title IV-participating IHEs must meet a variety of criteria, including quality assurance (see the
“Quality Assurance Mechanisms” section). Title IV-participating IHEs are classified as public
IHEs, private nonprofit IHEs, proprietary (private for-profit) IHEs, and public and private
nonprofit postsecondary vocational institutions.65
Non-degree programs must meet several eligibility requirements.66 For example, in general, the
Title IV-eligible non-degree instructional program and the Title IV-eligible portion of work-based
learning must lead to a certificate or other recognized non-degree credential (e.g., diploma or
license). Also, Title IV aid is generally not available for noncredit programs or portions of
programs for which a defined number of credit or clock hours is not associated.67 For
instructional and work-based learning programs measured in clock hours, the OJT portion of
work-based learning must be offered under the supervision of an IHE. If a portion of the OJT is
61 For additional information, see CRS Report R45418, Federal Pell Grant Program of the Higher Education Act:
Primer.
62 For additional information, see CRS Report R45931, Federal Student Loans Made Through the William D. Ford
Federal Direct Loan Program: Terms and Conditions for Borrowers.
63 For information on these programs, see CRS Report RL31618, Campus-Based Student Financial Aid Programs
Under the Higher Education Act; and CRS Report R46117, TEACH Grants: A Primer.
64 The Pell Grant program is funded through a mix of discretionary and mandatory appropriations.
65 Any public or private nonprofit institution, including those that award degrees, may act as postsecondary vocational
institutions.
66 For additional information, see 2019-2020 Federal Student Aid Handbook (hereinafter, FSA Handbook), vol. 1, pp.
4-5 and vol. 2, pp. 27-33.
67 Students enrolled in a Title IV-eligible program may be eligible for up to one academic year of noncredit remedial
courses; English as a Second Language courses without time limitations; and, for Direct Loan purposes, up to one year
of coursework necessary for enrollment in a Title IV-eligible program. 34 C.F.R. §§668.32, 600.2; FSA Handbook, vol.
1, pp. 19-20, 25.
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offered by an entity under contract with an IHE, such portion must be less than 50% of the
program.68
In general, non-degree programs are subject to specific durational requirements,69 including
weeks of instructional time70 and number of credit or clock hours. For Pell Grants, the non-degree
programs offered by public and private nonprofit postsecondary vocational institutions and
proprietary institutions must either be
at least 15 weeks of instructional time and at least one of the following: 600
clock hours, 16 semester hours, or 24 quarter hours;71 or
at least 10 weeks of instructional time and at least one of the following: 300
clock hours, 8 semester hours, or 12 quarter hours.72
For the Direct Loan program, non-degree programs offered by public and private nonprofit
postsecondary vocational institutions and proprietary institutions must be at least 10 weeks of
instructional time and 300-599 clock hours.73 In addition, students must be enrolled in an eligible
program of study on at least a half-time basis to borrow through the Direct Loan program. See the
text box below for information on an ED experiment with shorter duration programs.
Pell Grant Experiment for Shorter Duration Programs
HEA Section 487A authorizes ED to waive certain HEA Title IV requirements for selected IHEs to evaluate the
impact or effectiveness of policy proposals; this is known as the Experimental Sites Initiative (ESI).
From approximately 2012 to 2017, ED implemented an experiment allowing select IHEs to offer Pell Grants to
otherwise-eligible students enrolled in a vocational program of at least eight weeks in length and 150-599 clock
hours of instructional time.74 The 150-599 clock-hour programs had to meet the hiring requirement of multiple
employers; meet local or regional workforce needs, as determined through consultations with employers or state
and local workforce agencies; and allow students to obtain required licensure or certification. ED ended the
experiment on June 30, 2017, because participation and data collection was insufficient to rigorously evaluate the
value of the expansion in increasing employment or wages.75 Nevertheless, an evaluation report is expected in
early fall 2020.76
68 For additional information on work-based learning, see FSA Handbook, vol. 2, p. 31; and Department of Education,
Apprenticeship and the Federal Student Aid Programs, GEN-14-22, December 18, 2014.
69 Additional or alternative program eligibility requirements also apply to a variety of specific programs (e.g., those that
consist solely of English as a second language or teacher certification programs). For additional information, see FSA
Handbook, vol. 1, pp. 4-5 and vol. 2, pp. 27-33.
70 For additional information on the definition of academic year and weeks of instructional time, see FSA Handbook,
vol. 3, pp. 3-7.
71 These programs may admit as regular students those who have not completed the equivalent of an associate’s degree.
72 These programs must admit as regular students only those who have completed the equivalent of an associate’s
degree.
73 This type of program is known as a short-term program and is only eligible to participate in the Direct Loan program.
The program must (1) admit as regular students some individuals who have not completed the equivalent of an
associate’s degree, (2) have been in existence for at least one year, (3) have verifiable completion and placement rates
of at least 70%, and (4) not be more than 50% longer than the minimum training period required by the state or federal
agency (if any) for the occupation for which the program is intended.
74 U.S. Department of Education, Office of Postsecondary Education, “Postsecondary Educational Institutions Invited
To Participate in Experiments Under the Experimental Sites Initiative,” 76 Federal Register 66698-66707, October 27,
2011.
75 National Association of Student Financial Aid Administrators, “Experimental Sites Initiative Closing Four
Experiments,” press release, March 30, 2017, https://www.nasfaa.org/news-item/11682/
Experimental_Sites_Initiative_Closing_Four_Experiments.
76 U.S. Department of Education, Institute of Education Sciences, “Evaluation of the Pell Grant Experiments Under the
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Non-degree programs at public and private nonprofit IHEs that are at least one academic year in
length and lead to a certificate or other recognized non-degree credential are eligible for both the
Pell Grant and Direct Loan programs, without regard to any of the above-specified durational
requirements.
Participant Eligibility
For a student to be eligible to receive Title IV funds for his or her higher education, he or she
must be enrolled (or accepted for enrollment) in a Title IV-eligible program. In addition, among
other criteria, a student must
be a U.S. citizen, national, legal permanent resident, or other specified eligible
noncitizen;77 and
have a high school diploma (or equivalent, such as a general educational
development [GED] certificate) or meet other relevant criteria.78
Individuals must also meet program-specific eligibility criteria to receive Pell Grants or Direct
Loan program loans.
Pell Grant Program-Specific Eligibility Criteria
To receive Pell Grants, students must meet program-specific criteria that include the following:
being enrolled in an undergraduate program,
not having completed the curriculum requirements of a bachelor’s degree, and79
demonstrating financial need (primarily individuals from families in the two
lowest income quintiles as determined under the program’s award rules).80
All recipients are subject to a cumulative lifetime eligibility cap on Pell Grant aid of 12 full-time
semesters (or the equivalent).
Direct Loan Program-Specific Eligibility Criteria
To receive Direct Loan program loans, students must meet program-specific criteria81 that include
being enrolled on at least a half-time basis.82 Students (or their parents in the case of PLUS Loans
Experimental Sites Initiative,” https://ies.ed.gov/ncee/projects/evaluation/pathways_pell.asp, as available on March 20,
2020, https://ies.ed.gov/ncee/projects/evaluation/pathways_pell.asp.
77 Those noncitizens eligible to receive federal student financial aid are listed in U.S. Department of Education, Federal
Student Aid, “Many non-U.S. citizens qualify for federal student aid,” http://studentaid.ed.gov/eligibility/non-uscitizens.
78 Such other criteria may include, but is not limited to, completing an eligible homeschool program or enrolling in a
program that leads to both a high school diploma (or equivalent) and a recognized postsecondary credential. For more
information and other generally applicable Title IV eligibility requirements for students, see FSA Handbook, vol. 1.
79 Students enrolled on at least a half-time basis in a post-baccalaureate program required by a state for K-12 teacher
certification or licensure are also eligible, as long as the program does not lead to a graduate degree and the enrolling
institution does not offer a baccalaureate degree in education.
80 Congressional Budget Office (CBO), Distribution of Federal Support for Students Pursuing Higher Education in
2016, 53732, June 2018, https://www.cbo.gov/system/files/2018-06/53732-taxexpenditureshighereducation.pdf.
81 See HEA §§427-428B, 455. For additional information, see CRS Report R45931, Federal Student Loans Made
Through the William D. Ford Federal Direct Loan Program: Terms and Conditions for Borrowers.
82 Half-time enrollment is defined as taking at least half of the academic workload of a full-time student, as defined by
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to parents borrowing on behalf of a dependent child) may need to meet additional eligibility
criteria to qualify for specific Direct Loan program loan types. The primary loans are the
following:
Direct Subsidized83 Loans for undergraduate students with demonstrated
financial need,84
Direct Unsubsidized Loans for any student regardless of financial need, and
PLUS Loans for parents of dependent undergraduate students and graduate and
professional students regardless of financial need.
Individuals who are new borrowers on or after July 1, 2013, may only borrow Direct Subsidized
Loans for a period of time not to exceed 150% of the published length of their academic program.
Basic Benefit Payment Structure
In general, the amount of Title IV aid for which a student is eligible is guided by statutory award
rules. Aggregate Title IV aid and other aid (e.g., institutional aid) typically cannot exceed a
student’s cost of attendance (COA). The COA is an institutionally determined measure of a
student’s educational expenses for the period of enrollment and generally includes items such as
tuition and fees; an allowance for books and supplies; and, as applicable, an allowance for room
and board. The COA may also include transportation costs and dependent care expenses.
An important feature of the Pell Grant award rules is that the grant is determined without
consideration of any other financial assistance a student may be eligible to receive or may be
receiving. Annual appropriations acts and the HEA establish the total maximum Pell Grant award
amount that a student may receive in an academic year. For award year (AY) 2020-2021, the
maximum Pell Grant award that an eligible individual enrolled full-time for a 26-30 week
academic year may receive will be $6,345.85 The amount may be reduced based on the student’s
COA, financial need, enrollment rate, or program duration. Pell Grant awards used to pursue nondegree programs are generally subject to income taxation; whereas Pell Grant awards used to
pursue degree programs are only subject to income taxation if used for purposes other than tuition
and fees.86
Direct Loan program award rules vary by type of loan borrowed. In addition, numerous other
factors could affect the type and amount of aid awarded. However, some generally applicable
rules apply to the Direct Loan program. Other types of financial assistance awarded to the student
must be taken into account when awarding Direct Loan program loans. Also, an individual cannot
be awarded a Direct Subsidized Loan or Direct Unsubsidized Loan in an amount that exceeds
statutory annual and aggregate award limits, which are determined based on an individual’s
the IHE and pursuant to minimum statutory and regulatory requirements. For example, for a student enrolled at an IHE
that measures progress in credit hours and uses standard terms (e.g., semesters, trimesters, or quarters), he or she must
be enrolled in six credit hours to be considered half-time. 34 C.F.R. §668.2(b).
83 With certain exceptions, the federal government subsidizes these loans by paying the interest that accrues on them
while the borrower is enrolled in an eligible program on at least a half-time basis and during grace periods and periods
of authorized deferment.
84 Individuals who are new borrowers on or after July 1, 2013, may only borrow Direct Subsidized Loans for a period
of time not to exceed 150% of the published length of their academic program.
85 U.S. Department of Education, Department of Education Budget Tables, FY 2020 Congressional Action, last updated
February 10, 2020, available at https://www2.ed.gov/about/overview/budget/budget20/20action.pdf.
86 26 U.S.C. §117.
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dependency status and class level.87 For example, a dependent undergraduate student may borrow
up to $5,500 in Direct Subsidized Loans and Direct Unsubsidized Loans for his or her first year,
while an independent undergraduate student may borrow up to $9,500 in such loans in his or her
first year.88 The annual maximum loan amount an undergraduate student may receive is prorated
when the borrower is enrolled in a program that is shorter than a full academic year.
Basic Administrative Structure
ED’s Office of Federal Student Aid (FSA) is the primary entity responsible for administering the
Title IV aid programs. The administrative tasks associated with the programs are completed by a
number of actors (e.g., FSA, IHEs), depending on the function.89
FSA undertakes many high-level functions in Title IV program administration.90 These include,
but are not limited to, contracting for the operation and maintenance of systems to process aid;
providing customer service, training, and user support for the administration of the programs; and
ensuring integrity of the programs.
IHEs complete many of the day-to-day functions associated with awarding and disbursing Title
IV aid to students. ED makes funds available to IHEs so that they can disburse awards to
students. IHE functions include verifying a student’s eligibility to receive the aid, calculating aid
amounts,91 disbursing aid funds, and managing program funds at the institutional level.92 In
addition, under the Pell Grant program ED pays participating IHEs an administrative cost
allowance.93
Quality Assurance Mechanisms
Several HEA provisions intended to ensure the quality of Title IV-eligible programs and Title IVparticipating IHEs have been enacted to protect students and taxpayers. The program integrity
triad—state authorization, accreditation, and ED certification—is the foundation of these
provisions and is intended to provide a balance in the Title IV eligibility requirements. State
authorization is intended to provide consumer protection, accreditation is intended to provide
quality assurance, and ED certification is intended to provide direct oversight of compliance in
the Title IV programs.94 In addition to the requirements of the program integrity triad, non-degree
programs may be required to meet gainful employment requirements. The following subsections
87 For additional information, see CRS Report R45931, Federal Student Loans Made Through the William D. Ford
Federal Direct Loan Program: Terms and Conditions for Borrowers.
88 In either case, a first-year student may borrow no more than $3,500 in Direct Subsidized Loans.
89 For additional information on administration of the Direct Loan program, see CRS Report R44845, Administration of
the William D. Ford Federal Direct Loan Program.
90 HEA §141; see also CRS Report R46143, The Office of Federal Student Aid as a Performance-Based Organization.
91 The process of calculating and determining the amounts and types of aid that will be offered to a student, in
accordance with federal student aid need analysis procedures and individual programs rules, is called packaging. The
packaging of aid may affect the types and amounts of aid that are made available to students.
92 Within the DL program, additional administrative tasks, such as collecting loan payments, are undertaken by
contracted loan servicers. Within many of the other Title IV programs, additional tasks, such as attempting to collect on
past-due Title IV balances owed to ED, are undertaken by other parties such as contracted entities and other federal
agencies.
93 See 34 C.F.R. §690.10.
94 For additional information on institutional Title IV eligibility requirements, see CRS Report R43159, Institutional
Eligibility for Participation in Title IV Student Financial Aid Programs.
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briefly describe each piece of the triad and the gainful employment requirements as they relate to
Title IV-eligible programs.
State Authorization
An IHE must be authorized to provide a postsecondary education within the state in which it is
located to participate in the Title IV programs, which includes complying with any applicable
state approval or licensure requirements.95 State approval and licensure requirements vary
appreciably among the states.96 For instance, some states approve IHEs and their individual
educational programs, while other states only require approval of an IHE as a whole.97 The degree
to which a state evaluates an individual educational program may also vary by state. For example,
states variously evaluate program curricula, program objectives, projected enrollment, student
outcome measurements (e.g., completion and placement rates), and justification of program need
(e.g., industry demand or consumer interest).98 In addition, some states require programmatic
accreditation (discussed below) or separate approval by another state agency (e.g., a professional
licensing agency).99
Accreditation100
To participate in Title IV programs, an IHE must be accredited by an accrediting agency
recognized by ED as a reliable authority of the quality of the education being offered.101
Accrediting agencies are private associations of member educational institutions or industry
associations that undertake quality review of educational institutions and/or programs.
In general, an IHE need only be accredited by a regional or national accreditor to participate in
Title IV programs. The regional or national accreditor must evaluate whether the IHE meets
accrediting agency-prescribed criteria. Although these criteria vary among the agencies, EDrecognized accrediting agencies must regularly102 evaluate statutorily specified areas, including
95 34 C.F.R. §600.9.
96 For an overview of the various state authorization requirements for IHEs, see Andrew P. Kelly and Rooney
Columbus, Inputs, Outcomes, Quality Assurance: A Closer Look at State Oversight of Higher Education, American
Enterprise Institute, August 2015, https://www.aei.org/research-products/report/inputs-outcomes-quality-assurance-acloser-look-at-state-oversight-of-higher-education/ (Hereinafter referred to as “Inputs, Outcomes, Quality Assurance”).
97 See, for example, State Higher Education Executive Officers Association, “SHEEO State Authorization Survey,
Analysis of selected data elements for 50 U.S. States and D.C.,” October 2012, p. 4.
98 See, for example, Arkansas Higher Education Coordinating Board, Policy 5.11, “Approval of New Degree Programs
and Units,” https://static.ark.org/eeuploads/adhe/New_Academic_Programs.pdf; Wisc. Stat. §440.52(7); State of
Wisconsin, Educational Approval Program, “Program Application,” EAP Form 1.03, rev. January 2018,
https://dsps.wi.gov/Documents/EAProgramApplication1.03.doc; 5 CCR §74112; Arkansas Higher Education
Coordinating Board, Policy 5.11, “Approval of New Degree Programs and Units,” https://static.ark.org/eeuploads/adhe/
New_Academic_Programs.pdf; Kansas Board of Regents, Board Policy Manual, Chapter III: Coordination of
Institutions, §5, https://www.kansasregents.org/about/policies-by-laws-missions/board_policy_manual_2/
chapter_iii_coordination_of_institutions_2/chapter_iii_full_text#programs; and W.Va. CSR §135-11-1 et seq; and
Wisc. Stat. §440.52.
99 See, for example, State Higher Education Executive Officers Association, “SHEEO State Authorization Survey,
Analysis of selected data elements for 50 U.S. States and D.C.,” October 2012, pp. 7-9; and 18 VAC 90-30-80, 18
VAC 90-30-10.
100 Large portions of this section are derived from CRS Report R43826, An Overview of Accreditation of Higher
Education in the United States.
101 Public and private nonprofit IHEs and postsecondary vocational institutions may also be preaccredited.
102 Institutional accreditation may be renewed every few years to every 10 years, but IHEs are often required to submit
periodic reports to accrediting agencies for continual evaluation. For more information, see Middle States Commission
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an IHE’s faculty, curricula, facilities, student support services, and success with respect to student
achievement in relation to the institution’s mission. Within these broadly outlined criteria,
accrediting agencies have discretion as to the precise evaluation measures. Regional and national
accreditors evaluate an IHE’s performance on the whole, but may choose to evaluate a sample of
programs.
An educational program does not need to be accredited by a programmatic accrediting agency for
Title IV purposes.103 However, an IHE may seek programmatic accreditation to satisfy employer
and some occupational licensure requirements. To gain programmatic accreditation, an
educational program offered by an IHE is evaluated on established standards for the particular
field of study, such as whether the curriculum meets professional guidelines.
ED Certification
When an IHE seeks to participate in Title IV programs, it must apply for certification from ED.
During this process, ED evaluates whether the IHE meets Title IV participation requirements. ED
reviews each educational program to determine whether it satisfies eligibility requirements.104 For
example, the eligibility requirements include the aforementioned durational requirements; and
300-599 clock-hour programs that may be eligible to participate in the Direct Loan program must,
among other requirements, have verifiable completion and placement rates of at least 70%.
If an IHE wants to add a new educational program to its Title IV eligibility, it generally may selfcertify to ED that the new program is Title IV eligible or, for new 300-599 clock-hour programs,
submit an application to ED for approval.105
Gainful Employment (GE)106
The HEA specifies that most non-degree programs must prepare students for “gainful
employment in a recognized occupation.”107 Regulations promulgated in 2014 (2014 GE
regulations)108 defined the term gainful employment in a recognized occupation, but they were
rescinded in 2019.109 The 2014 GE regulations were intended to serve as a proxy measure for
programmatic quality by establishing debt-to-earnings (D/E) rates that programs were required to
meet.110 The rationale behind the rule was that if an educational program is of sufficient quality,
on Higher Education, “Accreditation review Cycle and Monitoring,” June 3, 2017, https://msche.my.salesforce.com/
sfc/p/#46000000ZDJj/a/46000000Xpre/m1fjdSZ3mx5.4hLsSR55yhFFkj5BSa6sMCGNYdgG27w.
103 In the case of single-purpose institutions (e.g., freestanding medical schools), an IHE may meet Title IV
accreditation requirements if it is accredited by an ED-recognized programmatic accrediting agency.
104 34 C.F.R. §600.10.
105 34 C.F.R. §600.20; FSA Handbook, vol. 2, pp. 130-131, 134.
106 Non-degree programs offered by public, private nonprofit, and proprietary IHEs that meet the following criteria are
excepted from meeting the GE requirements: preparatory coursework necessary for enrollment in a Title IV-eligible
program and approved comprehensive transition and postsecondary programs for students with intellectual disabilities.
In addition, teacher certification programs at public or nonprofit institutions for which the school does not award a
credential are excepted from meeting the GE requirements. FSA Handbook, vol. 2, p. 25.
107 HEA §§101(b)(1), 102(b)(1), & 102(c).
108 Department of Education, “Program Integrity: Gainful Employment,” 79 Federal Register 64890, October 31, 2014.
109 The rescission is effective July 1, 2020; however, IHEs may choose to implement the rescission on or after July 1,
2019. U.S. Department of Education, “Program Integrity: Gainful Employment,” 84 Federal Register 31392, July 1,
2019.
110 U.S. Department of Education, “Program Integrity: Gainful Employment,” 79 Federal Register 64890, October 31,
2014.
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then it will lead to earnings that will enable students to repay the student loans they borrowed for
enrollment in the program.
Under the GE framework, each program subject to the GE rules must meet two D/E rates.
Programs that fail to meet minimum standards in multiple years will be ineligible for Title IV
participation for three years. No program has yet been subject to loss of Title IV eligibility under
the requirements.111 In addition, the education programs subject to GE rules must meet third-party
standards such as being approved by an ED-recognized accrediting agency, being recognized by
the relevant state agency, being programmatically accredited (if required by a federal entity or
state agency in the state in which the IHE is located or otherwise seeks state approval), and
meeting any applicable educational prerequisites for professional licensure or certification in the
state in which the IHE is located.112
Measures of Program Performance
The HEA does not define measures of performance for the Title IV programs. The HEA does
require that Title IV participating IHEs and ED report information on enrollment, certificates and
degrees conferred, student charges, and other information that may be of interest to prospective
and current students and policymakers.113
Program Participation
ED collects data annually on Title IV non-degree instructional for-credit programs. Table 5 shows
the total number of non-degree instructional for-credit programs and credentials and the
percentage of non-degree instructional for-credit programs and awards by institutional sector in
AY2017-2018. Of the 6,418 Title IV-participating IHEs, 4,618 offered non-degree for-credit
programs. Approximately half of Title IV-eligible non-degree for-credit programs are offered by
private for-profit IHEs, while more than two-thirds of non-degree for-credit credentials from Title
IV-eligible programs are awarded by public IHEs.114
Table 5. Number and Percentage of Non-degree Instructional Credit Programs and
Awards by Institutional Control: AY2017-2018
Grand Total
Public
IHEs Offering Nondegree For-Credit
Programs
Non-degree For-Credit
Credentials Awarded
4,618
971,158
36%
69%
111 To enable ED to calculate whether an IHE’s programs meet the D/E rates, regulations specify that ED obtain data
from the Social Security Administration (SSA). 34 C.F.R. §668.40(c)(1). However, a memorandum of understanding
related to data sharing between ED and SSA lapsed in 2018. Thus, although programs were expected to be subject to
loss of Title IV eligibility in early 2019, ED was unable to calculate D/E measures and was unable to enforce the GE
rules. U.S. Department of Education, Office of Federal Student Aid, “Distribution of Final GE Completers List and
Draft GE Completers Lists Correction Results,” Gainful Employment Electronic Announcement #118, April 5, 2019,
https://ifap.ed.gov/eannouncements/040519GEEA118FinalCompleterListDraftCompleterListCorrectionResults.html.
112 IHEs must also disclose a variety of information regarding each of their GE programs to prospective students in
their promotional materials. Information to be disclosed includes, for example, program length, program completion
rates, and the total cost of each program.
113 See, for example, HEA §132.
114 CRS compiled data from the U.S. Department of Education, Integrated Postsecondary Education Data System
(IPEDS), Statistical Table sum using 2017 Title IV participating institutions and 2015-2016 data.
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Private not-for-profit
14%
3%
Private for-profit
50%
28%
100%
100%
Percentage total
Source: CRS-compiled data from the Department of Education, Integrated Postsecondary Education Data
System (IPEDS), using 2018 Title IV-participating institutions and AY2017-2018 data.
Notes: Non-degree credit awards are formal awards that require completion of an organized program of study
at the postsecondary level (below the baccalaureate degree) involving instructional activity measured in credit
hours, contact hours, clock hours, or some other unit of measurement. The program’s purpose is academic,
vocational, or continuing professional education, and excludes avocational and adult basic education programs.
One fairly recent report indicated that many IHEs also report non-Title IV eligible program completions to
IPEDS despite IPEDS instructing IHEs to report only Title IV eligible program completions (Source: Complete
College America, Certificates Count: An Analysis of Sub-baccalaureate Certificates, December 2010, p. 3,
https://files.eric.ed.gov/fulltext/ED536837.pdf). Another report indicates that IHEs are not required to report
certificates that require fewer than 12 credits and that are approved at the institution or regional level, but many
IHEs report these data (Source: Research for Action, Research Brief: Measuring the Effects of Outcomes-Based
Funding on Certificate Production: Challenges, Inconsistencies and Recommendations for Future Research, February 2019,
p. 14).
In AY2015-2016, approximately 765,000 Pell Grant recipients pursued non-degree credit
programs and received about $2.7 billion in Pell Grant awards—roughly 10% of the total number
of recipients and dollar amount of awards. Also in AY2015-2016, approximately 10% of
undergraduates who borrowed a Direct Loan were pursuing certificate programs.115
Program Limitations
Support for non-degree programs is limited in several ways:
Title IV aid is only available to support individuals pursuing credit programs of a
statutorily specified duration at Title IV-participating IHEs.
Support for work-based learning is limited to programs or portions of programs
that lead to a certificate or degree and that are offered by Title IV-participating
IHEs.
Some students who may choose to pursue training or education via non-degree programs will not
be eligible. These include
students who do not have a high school diploma (or equivalent) or who are not
enrolled in a career pathway program;
with respect to Pell Grants, students who have a bachelor’s degree;116 and
with respect to the Direct Loan program, students enrolled less than half-time.
115 CRS analysis of U.S. Department of Education, National Center for Education Statistics, 2015-16 National
Postsecondary Student Aid Study (NPSAS:16) variables UGDEG, PELLAMT, SECTOR1, and STAFFAMT; and U.S.
Department of Education, Federal Pell Grant Program 2015-2016 End of Year Report, Table 18.
116 Approximately 21% of undergraduates seeking an undergraduate credit certificate in AY2015-2016 had previously
earned a degree. Within two years of degree receipt, 5.8% of AY2013-2014 bachelor’s degree recipients pursued
further education in a two-year institution. National Student Clearinghouse, Snapshot Report: Two-Year Enrollment
after Bachelor’s Degree, Summer 2016, https://nscresearchcenter.org/snapshotreporttwoyearenrollmentafterbachelors24/.
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Non-degree program quality may vary. It is primarily assessed through the program integrity
triad, since the 2014 GE rules have been rescinded. State authorizers and accreditors have some
flexibility in determining and applying criteria to assess quality.
Few reports have examined state authorization requirements in general, or as they relate to
program quality in particular. However, those that have done so identify the variation among state
authorization requirements as an impediment and a complicating factor in assessing institutional
experiences with state authorization.117 They note that an individual state’s history, resources, and
priorities may affect the extent to which the state chooses to take a more active or passive role in
some areas, such as evaluating non-degree programs.118 Despite difficulties in assessing state
authorization requirements, researchers have pointed to the following as potential weaknesses in
at least some states’ authorization requirements:
concerns that the oversight of some state boards may be impaired by potential
conflicts of interest, overrepresentation of special interests, or a sense of being
beholden to IHEs;
input requirements (e.g., faculty members’ qualifications, facilities and
equipment used in the instructional process) may impede innovative education
models;
elongated timeframes to receive state authorization, which may be a result of a
complex regulatory state process or a lack of state resources;
conflicts across state laws in instances where an institution offers educational
programming in multiple states; and
despite the fact that many states require institutions to report on student
outcomes, few states may actually make authorization renewal decisions based
on those outcomes.119
A 2014 GAO report identified some of the strengths and weaknesses of the accreditation system
as it relates to program quality.120 One strength is that institutional accreditors tailor their expert
peer reviews depending on the school type and mission. In addition, programmatic accreditation
is specifically aligned to the particular field or type of program. Potential weaknesses identified
by GAO include conflicting interests between IHEs and the IHE-funded accreditors, the
insufficiency of accreditor capacity and resources, the inability of experts to assess innovative
modes of education (e.g., competency-based education), and the difficulty in defining and
measuring academic quality.121
117 Inputs, Outcomes, Quality Assurance, p. 2.
118 Teresa E. Taylor, Arthur L. Coleman, and Bethany M. Little, et al., Getting Our House in Order: Clarifying the Role
of the States in Higher Education Quality Assurance, Education Counsel, September 2016, p. 9,
https://ib5uamau5i20f0e91hn3ue14-wpengine.netdna-ssl.com/wp-content/uploads/2016/09/EducationCounsel-role-ofthe-state-in-the-triad-Final-pre-publication-copy-2016.pdf.
119 Inputs, Outcomes, Quality Assurance.
120 U.S. Government Accountability Office (GAO), Higher Education: Expert Views of U.S. Accreditation, GAO-18-5,
December 2017, pp. 11-29, https://www.gao.gov/products/GAO-18-5.
121 Ibid.
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Tax Benefits (IRS)122
Education tax benefits, administered by the Internal Revenue Service, partially offset some of the
costs of higher education for eligible taxpayers.123 They differ from other benefits in several
ways. First, unlike many benefits programs, education tax benefits tend to provide the greatest
advantage to upper middle income taxpayers.124 Second, unlike traditional financial aid, which is
used to pay for education expenses around the time the education is received, taxpayers claim
education tax benefits when they file their federal income tax return. Hence, taxpayers receive a
tax benefit only after they have already paid for their education expenses, sometimes many
months after the expense is incurred.125
Many education tax benefits are only available to individuals enrolled in a degree program.
However, some education tax benefits do have eligibility rules that are broad enough to include
individuals enrolled in non-degree programs.126
In contrast to most other federal education programs, the education tax benefits discussed in this
report reduce federal revenues rather than increase outlays. Hence, education tax benefits are
considered a type of “spending through the tax code” that is not subject to annual appropriations.
Any persons that meet the requirements for these benefits can receive them (generally when they
file their federal income tax return). Education tax benefits may encourage overconsumption of
education or subsidize education that would have taken place without these tax incentives.127
Taxpayers in non-degree programs may currently128 be eligible for the following:
The Lifetime Learning Credit, which reduces a taxpayer’s income tax liability
and provides financial assistance to taxpayers (or their family members) who are
122 Margot L. Crandall-Hollick, CRS Specialist in Public Finance, contributed this section and can address related
questions from congressional clients. For a summary of all education tax benefits, see CRS Report R41967, Higher
Education Tax Benefits: Brief Overview and Budgetary Effects, by Margot L. Crandall-Hollick.
123 The term taxpayer in this report is used to describe all the individuals listed on a federal income tax return. A
married couple with two children would be discussed as one taxpayer.
124 Elaine Maag, David Mundel, and Lois Rice et al., Subsidizing Higher Education through Tax and Spending
Programs, Urban-Brookings Tax Policy Center, Tax Policy Issues and Options No. 18, May 2007,
https://www.brookings.edu/research/subsidizing-higher-education-through-tax-and-spending-programs/.
125 Taxpayers generally prepare and file their income tax return for a given calendar year in the first few months of the
following calendar year. For example, most taxpayers filed their 2018 income tax returns in spring 2019, with most
returns due by mid-April 2019. Hence, tax benefits for education expenses paid in early 2018 would be claimed on tax
returns filed nearly a year after payment. Some taxpayers with a positive tax liability may be able to adjust their income
tax withholding to bring forward some of the tax benefit, as opposed to waiting until the time tax returns are filed.
126 Many tax benefits are limited to individuals who are pursuing a program leading to a degree or other recognized
educational credential, as well as often being limited to students enrolled at an accredited educational institutions that is
eligible to participate in the HEA Title IV federal student aid programs. These requirements may limit the types of nondegree programs for which a taxpayer could claim a tax benefit. For example, for the American Opportunity Tax Credit
(AOTC), qualifying expenses “do not include expenses that relate to any course of instruction or other education that
involves sports, games, or hobbies, or any noncredit course, unless the course or other education is part of the students’
degree program.” See 26 C.F.R. §1.25A-2(d)(5). In addition, scholarships are generally tax-free if, among a variety of
eligibility criteria, they are “received by an individual who is a candidate for a degree at an educational organization.”
See Internal Revenue Code (IRC) §117(a).
127 Congressional Budget Office (CBO), “Tax Expenditures Have a Major Impact on the Federal Budget,” blog,
February 3, 2012, https://www.cbo.gov/publication/42919.
128 P.L. 115-97 repealed (through the end of 2025) two education-related tax benefits: the business deduction for workrelated education expenses and the parental personal exemption for dependent students 19-25 years old. An additional
tax benefit, the tuition and fees above-the-line deduction, expired at the end of 2017 and to date has not been reinstated.
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pursuing education. The Lifetime Learning Credit is a nonrefundable tax credit
for 20% of the first $10,000 in qualifying expenses. The credit phases out for
taxpayers above certain income thresholds.129
Employer Provided Educational Assistance, which excludes eligible employer
provided educational costs from the taxpayer’s taxable income.130
529 accounts, which are intended to help families save for future educational
expenses.131
Eligibility of Non-degree Programs
The Lifetime Learning Credit and 529 accounts may be used for eligible education expenses
associated with pursuing non-degree programs at Title IV-eligible IHEs. A broader range of nondegree programs may be eligible for employer provided educational assistance.
The Lifetime Learning Credit (LLC)
Qualified education expenses used to calculate the amount of the credit are defined as tuition and
related expenses required for enrollment in a course at a Title IV-eligible IHE. Related expenses
are amounts that are required for enrollment, including books, supplies, and equipment, but do
not include living expenses or other expenses that are not required for enrollment.132 These
expenses must be reduced by any amount of tax-free educational assistance used to pay for
qualified educational assistance (including employer provided educational assistance and tax-free
distributions from 529 accounts). For the purposes of the LLC, a course can either be part of a
post-secondary degree program or be a course to help the student acquire or improve job skills
(e.g., part of a non-degree program).
Employer Provided Educational Assistance
Employer provided educational assistance can be used for tuition, fees, books, supplies, and
equipment associated with any form of instruction or training that improves or develops the
recipient’s skills.133 According to IRS Publication 970, “the payments don’t have to be for workrelated courses or courses that are part of a degree program.”134 For example, an employer could
pay up to $5,250 of the tuition costs of an employee’s course to improve his or her skills. This
129 Some taxpayers in non-degree programs may be eligible for the AOTC, such as individuals receiving a recognized
postsecondary credential in a work-based learning program (see Table 4). However, in addition to the requirement that
the student must be pursuing a program leading to a degree or other recognized educational credential, the student for
whom the credit is claimed must also be in the first four years of postsecondary education, and must be enrolled at least
half-time. These requirements may limit eligibility for the credit to more traditional students.
130 Internal Revenue Service, Tax Benefits for Education 2019, IRS Publication 970, January 17, 2020, p. 65,
https://www.irs.gov/forms-pubs/about-publication-970.
131 A qualified tuition program is a type of tax-advantaged savings account, also known as a 529 plan.
132 Qualified tuition and related expenses do not include the costs of room and board; insurance; medical expenses
(including student health fees); transportation; and similar personal, living, or family expenses; regardless of whether
the fee must be paid to the eligible educational institution for the enrollment or attendance of the student (26 C.F.R.
§§1.25A-2(d)(3)).
133 The employer’s educational assistance program must be a written plan and must meet certain other requirements to
qualify for this tax benefit. IRC §127(b)(1).
134 Internal Revenue Service, Tax Benefits for Education 2019, IRS Publication 970, January 17, 2020, p. 65.
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amount would not be included in the employee’s wage income.135 In addition, the statute does not
state that the institution providing the program must be a Title IV-eligible IHE.
529 Accounts
Tax-free withdrawals from 529 accounts are allowed for qualified expenses, which include tuition
and required fees, room and board, books, supplies, equipment, and, for special needs
beneficiaries, additional expenses at a Title IV-eligible IHE.136 Those expenses do not need to be
associated with a degree program.
Participant Eligibility for Training
Eligibility for training depends on factors outside of the tax code. Whether the training qualifies
for tax incentives is a different question. To qualify for tax benefits, participants must either file a
federal income tax return or be claimed as a dependent or spouse on one.
The Lifetime Learning Credit (LLC)
Taxpayers can claim the credit for qualified education expenses paid for themselves, their
spouses, or their dependent children. Taxpayers cannot claim the credit if they file as married
filing separately, if they (or their spouses if filing jointly) are nonresident aliens, or if their income
is $68,000 or more ($136,000 or more if married filing jointly).
Employer Provided Educational Assistance
Participants can only use this tax benefit if their employer offers an educational assistance
program.
529 Accounts
Beneficiaries of a 529 account are designated at the time of its establishment. Amounts in a 529
account may also be transferred to another 529 account established for certain relatives of
designated beneficiaries.
Basic Benefit Payment Structure
Individuals apply for the LLC when they file their federal income tax return after incurring
qualified educational expenses. Qualified educational expenses paid from a 529 account or
through an employer are tax-free.
The Lifetime Learning Credit (LLC)
The LLC is calculated as 20% of the first $10,000 of qualified education expenses, yielding a
maximum credit of $2,000 per taxpayer.137 The maximum credit amount phases out for taxpayers
with income between $58,000 and $68,000 ($116,000 and $136,000 for married joint filers) in
135 Any amounts paid in excess of $5,250 for an employee are included in wages, and hence taxable.
136 As a result of a legislative change made by P.L. 115-97, up to $10,000 may be withdrawn from a 529 account tax-
free per beneficiary, per year and used for qualifying elementary and secondary school tuition. While 529 accounts can
be used to pay for elementary and secondary education, this aspect of these plans is generally not relevant to students in
non-degree programs as discussed in this report.
137 A taxpayer may include more than one individual with qualifying expenses for the LLC.
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2019. Because the credit is nonrefundable, the amount of the credit that the taxpayer receives
cannot by definition exceed the taxpayer’s federal income tax liability. Hence, if a taxpayer has
little to no federal income tax liability (e.g., they are low-income), they will generally receive
little if any benefit from a non-refundable tax credit like the LLC.
Employer Provided Educational Assistance
Employers may choose to provide their employees with up to $5,250 in tax-free tuition assistance
per year under an employer sponsored educational assistance program. The assistance is not
included in the employees’ wages and is not subject to federal income taxes, nor is it subject to
payroll taxes.
529 Accounts
Taxpayers can withdraw funds from their 529 accounts tax-free and use the distribution to pay for
qualifying education expenses associated with non-degree programs, subject to restrictions of the
individual plans.138 (In practice, many taxpayers establish 529 plans for children. However, these
taxpayers are allowed under the statute to transfer some or all of the child’s 529 account balance
into the 529 account of certain relatives of the child tax-free.139)
Basic Administration
The IRS primarily relies on taxpayers, employers, and states to ensure proper administration of
the benefits, although the IRS may audit taxpayers to ensure compliance.
The Lifetime Learning Credit (LLC)
Taxpayers effectively apply for the LLC by filing their federal income tax return (Form 1040) and
IRS Form 8863 (related to claiming education tax credits). These forms, and their associated
instructions, describe eligibility rules and help taxpayers calculate the amount of the credit.
Taxpayers do not explicitly need to list the course or program of study they are enrolled in when
applying for the LLC on their federal income tax return, although they are asked to provide
information about the educational institution on Form 8863.
Employer Provided Educational Assistance
To qualify as an educational assistance program, an employer’s plan must be in written form and
must meet certain other requirements. According to regulation, “it is not required that a program
be funded or that the employer apply to the IRS for a determination that the plan is a qualified
program. However, under IRC Section 601.201 (relating to rulings and determination letters), an
employer may request that the IRS determine whether a plan is a qualified program.”140 In
addition, a program cannot discriminate in favor of employees who are officers, shareholders,
self-employed, or highly compensated (although such employees can be eligible for these benefits
138 For more information on 529 plans, see CRS Report R42807, Tax-Preferred College Savings Plans: An Introduction
to 529 Plans. Taxpayers may be eligible to withdraw amount from their Coverdell education savings accounts (ESAs)
tax-free to pay for non-degree programs. However, there are a variety of restrictions that may make these accounts less
desirable to nontraditional students.
139 IRC §529(c).
140 See C.F.R. §1.127-2, qualified educational assistance program.
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along with other employees). Employees eligible to participate in the program must be given
reasonable notice of its terms and availability.
529 Accounts
Generally, states sponsor 529 plans, and individuals can establish accounts in a given plan for a
designated beneficiary. When a taxpayer withdraws an amount from a 529 plan, the 529 program
is to provide the taxpayer with a Form 1099-Q, which will show the total amount withdrawn and
the breakdown between investment growth (“earnings”) and the original investment (“basis”). If
taxpayers apply any of this withdrawal to a non-eligible expense, they are required to include a
portion of the withdrawal on their federal income tax returns, and hence, it may be subject to
taxation. Unless audited, a taxpayer does not have to document how they have spent their
withdrawals (e.g., the kind of program). In 2018, approximately 0.5% of taxpayers were
audited.141
Quality Assurance Mechanisms
Outside of the eligibility rules discussed above, the Internal Revenue Code (IRC) does not have
rules regarding the quality of training and education programs for which a tax benefit is claimed.
Measures of Program Performance
The IRS does not publish, nor is it required to collect or publish, any measures of a non-degree
program’s performance.
Program Participation
IRS data on these education tax benefits are limited.
The Lifetime Learning Credit (LLC)
IRS data indicate that in 2015, approximately 2.5 million taxpayers claimed approximately $2.1
billion of the LLC, for an average credit of $830 per taxpayer.142 These data indicate that
approximately half of all LLC dollars were claimed by taxpayers with adjusted gross income
(AGI) between $50,000 and $200,000. Taxpayers with AGI below $15,000 or more than
$200,000 generally did not claim the LLC, due to its nonrefundability and phase-out,
respectively. To date, no studies have evaluated the impact of the LLC on enrollment in nondegree programs or its effectiveness in helping non-degree candidates improve their job skills.
Employer Provided Educational Assistance
Administrative data from the IRS on the exclusion of employer provided educational assistance
are unavailable. To date, no studies have evaluated the impact of employer provided educational
assistance on enrollment in non-degree programs or its effectiveness in helping non-degree
candidates improve their job skills.
141 Internal Revenue Service, IRS Data Book Examinations, https://www.irs.gov/statistics/enforcement-examinations.
142 Data provided by the IRS Statistics of Income (SOI) to the author and available to congressional clients upon
request.
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529 Accounts
Administrative data from the IRS on 529 plans are unavailable. Survey data analyzed by GAO
indicate that relatively few families have established these accounts, and that those who do tend
to have greater assets and income than those who do not establish the accounts.143 CRS has not
identified any studies that have evaluated the impact of 529 plans on enrollment in non-degree
programs or their effectiveness in helping non-degree candidates improve their job skills.
Program Limitations
Most research regarding education tax benefits broadly have found little effect on increasing
enrollment.144 This research highlights some limitations with education tax benefits that may be
applicable to non-degree programs. First, education tax benefits, when received many months
after expenses are incurred, may provide limited assistance to students who cannot afford upfront
education costs.145 Second, as GAO has highlighted, there are a variety of different education
benefits and it may be confusing for taxpayers to determine what benefit they are eligible for, and
which benefits provide the largest tax savings.146 Finally, the education tax benefits discussed in
this report only benefit taxpayers with income tax liabilities, which excludes many low-income
taxpayers who have little to no income tax liabilities.
Veterans Education Programs (Post-9/11 GI Bill® and VET TEC)
(VA)
Veterans education programs (GI Bills) were originally intended to help former servicemembers
adjust to civilian life by providing for the “reintegration of the discharged soldier, sailor, and
marine into the civilian economy in the most prompt and adequate manner.”147 Over the years, the
benefits have been renewed and revised to also compensate for compulsory service, encourage
voluntary service, avoid veteran unemployment, provide equitable benefits to all who served, and
143 For more information, see U.S. Government Accountability Office (GAO), Higher Education: A Small Percentage
of Families Save in 529 Plans, GAO-13-64, December 12, 2012, https://www.gao.gov/products/GAO-13-64.
144 See for example, Nicholas Turner, “The Effect of Tax-Based Federal Student Aid on College Enrollment,” National
Tax Journal, vol. 64, no. 3 (September 2011), pp. 839-862. This study found that three tax benefits (the Hope Tax
Credit, the Lifetime Learning Credit, and the Tuition and Fees Above-the-Line Deduction) “increased full-time
enrollment in the first two years of college by about … 6.7 percent.” This “7 percent enrollment increase implied that
93% of tax-based aid recipients would have enrolled without the tax-based subsidy” (pp. 840 and 852). For another
example, see George B. Bulman and Caroline M. Hoxby, “The Returns to the Federal Tax Credits for Higher
Education,” NBER Working Paper No. 20833, January 2015.
145 For more information, see Nicholas Turner, “The Effect of Tax-Based Federal Student Aid on College Enrollment,”
National Tax Journal, vol. 64, no. 3 (September 2011), p. 845; Bridget T. Long, “The Impact of Federal Tax Credits
for Higher Education Expenses,” 2004. College choices: The economics of where to go, when to go, and how to pay for
it, University of Chicago Press, p.101-168; and Government Accountability Office, Student Aid and Postsecondary Tax
Preferences: Limited Research Exists on Effectiveness of Tools to Assist Students and Families through Title IV Student
Aid and Tax Preferences, GAO-05-684, July 2005, p. 30.
146 GAO notes “Some tax filers do not appear to make optimal education-related tax decisions … One explanation for
these taxpayers’ choices may be the complexity of postsecondary tax provisions, which experts have commonly
identified as difficult for tax filers to use.” Government Accountability Office, Student Aid and Postsecondary Tax
Preferences: Limited Research Exists on Effectiveness of Tools to Assist Students and Families through Title IV Student
Aid and Tax Preferences, GAO-05-684, July 2005.
147 U.S. Congress, House Committee on World War Veterans’ Legislation, Providing Federal Government Aid for the
Readjustment in Civilian Life of Returning World War II Veterans, To accompany S. 1767, 78th Cong., 2nd sess., May 5,
1944, Rept. 1418, p. 2.
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promote military retention. The pilot Veteran Employment Through Technology Education
Courses (VET TEC) and its predecessor are an alternative approach that incentivizes training
providers for program completion and employment.148 VET TEC is not a GI Bill. The GI Bills
and VET TEC provide financial assistance to students whose eligibility is based on a qualifying
individual’s service in the uniformed services while such students are enrolled in approved
programs of education, which include training programs.
The GI Bills and VET TEC are administered primarily by the Department of Veterans Affairs.149
The GI Bills are appropriated entitlements funded with mandatory spending. Appropriated
entitlement spending is funded, but not controlled, in annual appropriations acts.150 VET TEC is
funded by a limited allocation from GI Bill appropriations.
The remainder of this section describes the Post-9/11 GI Bill and VET TEC.151 The Post-9/11 GI
Bill has represented approximately 80% or more of total GI Bill participation and spending in
each year since FY2013.152
Eligibility of Non-degree Programs
While the majority of Post-9/11 GI Bill benefits are used to support education through degree
pursuit, they are also used to support students pursuing training and education through approved
work-based learning and non-degree instructional programs at a variety of training establishments
and educational institutions. Non-degree programs include credit and noncredit instructional
programs, courses that prepare individuals for assessments to further their education or career
(e.g., Advanced Placement [AP] exams or real estate licensing exams), OJT, apprenticeships, and
courses that lead to a predetermined educational, vocational, or professional objective (Table 6).
The variety of eligible programs was intended to provide eligible individuals with the maximum
choice in training and education options.153
Table 6. Examples of Non-degree Programs Approved for GI Bill Purposes
Work-Based Learning
On-the-job training
Cooperative programs
Registered apprenticeship
Training required for ownership and operation
of a franchise
Non-degree Instructional
Correspondence
Credit courses offered by accredited institutions
Entrepreneurship courses
Noncredit courses offered by unaccredited institutions
148 Although the VET TEC pilot was enacted by the Harry W. Colmery Veterans Educational Assistance Act of 2017
(Colmery Act; P.L. 115-48), the Department of Veterans Affairs (VA) initiated a similar pilot program known as the
accelerated learning programs (ALPs) in 2015.
149 The Department of Defense, Department of Health and Human Services, Department of Homeland Security, and
Department of Commerce also play an administrative role and transfer some funds to the VA for benefit payments.
150 The level of spending for appropriated entitlements, like other entitlements, is based on the benefit and eligibility
criteria established in law, and the amount provided in appropriations acts is based on meeting this projected level.
151 The Post-9/11 GI Bill is authorized by 38 U.S.C., Chapter 33. VET TEC is authorized under 38 U.S.C. § 3001 note.
152 For more information about the Post-9/11 GI Bill, see CRS Report R42755, The Post-9/11 GI Bill: A Primer. For a
description of the other GI Bills, see CRS Report R42785, GI Bills Enacted Prior to 2008 and Related Veterans’
Educational Assistance Programs: A Primer.
153 For example, see Veterans of Foreign Wars, “The Independent Budget for the Department of Veterans Affairs,
Fiscal Year 2011,” pp. 34-35.
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Source: CRS compilation of examples from Title 38 U.S.C., Chapters 30-36.
Notes: Additional requirements and exclusions apply.
VET TEC benefits are only available for the pursuit of non-degree high-technology programs of
education at contracted training providers that enter into a Program Participation Agreement
(PPA) with the VA. A high-technology program of education provides instruction in computer
programming, computer software, media application, data processing, or information science.
The training providers must meet several criteria including, but not limited to, not offering
degrees and not charging tuition and fees that exceed annual VA caps.154
Participant Eligibility for Training
Post-9/11 GI Bill benefits are available to eligible servicemembers and veterans and their family
members. The program is not open to the general public and is not based on family income levels.
A servicemember or veteran must meet qualifying active duty service requirements in the
uniformed services and either continue on active duty or meet specified discharge/release
requirements. An eligible servicemember may transfer benefits to family members. The spouse
and children of a servicemember who dies in the line of duty while serving on active duty as a
member of the Armed Forces are also eligible.
To be eligible for VET TEC, an individual must be a GI Bill-eligible veteran enrolled full-time in
a VET TEC-eligible program.155 VET TEC participants may or may not be recipients of GI Bill
benefits.
Basic Benefit Payment Structure
Both the Post-9/11 GI Bill and VET TEC provide living stipend payments directly to participants
and payments to providers for direct program costs. Program costs are paid by the Post-9/11 GI
Bill concurrent with program pursuit, while VET TEC pays costs during and after pursuit. In
addition to payments, eligible individuals may apply for personalized counseling to help guide
their career paths, ensure the most effective use of their VA benefits, and help them achieve their
goals.156
Post-9/11 GI Bill
The Post-9/11 GI Bill provides eligible persons an entitlement to educational assistance payments
over a period of 36 months (or its equivalent in part-time educational assistance). In cases where
a veteran transfers all or a portion of the benefits, transferors and transferees must share the 36
months of entitlement.
Under the Post-9/11 GI Bill, several types of benefit payments are available. The amount of each
payment and eligibility for the payments depends on an individual’s benefit level; the type of
training or education program pursued; the rate of enrollment or pursuit; actual charges, and when
relevant, in-state tuition charges; the location of the training or education; and the mode of
education delivery. An individual’s benefit level is based on their aggregate length of qualifying
active duty service or other eligibility characteristics. While an individual is enrolled in a program
of education or pursuing training, an educational institution may receive payments for tuition and
154 Department of Veterans Affairs, VET TEC Pilot Program Participation Agreement, downloaded February 19, 2019,
https://www.benefits.va.gov/GIBILL/FGIB/VetTecParticipationAgreement.pdf.
155 There are no statutory provisions restricting the combination of GI Bills and VET TEC or prohibiting receipt of
concurrent benefits.
156 38 U.S.C. §§3697 and 3697A.
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fee charges, and the individual may receive a monthly housing allowance, a books and supplies
stipend, tutorial assistance, and additional monthly payments. Individuals are reimbursed for fees
charged for taking approved tests.
As an illustration in AY2019-2020, a veteran enrolled in an educational program at a hypothetical
private educational institution may receive up to $24,476.79 in tuition and fees, but no more than
the actual tuition and fee charges; between approximately $800 and $4,300 monthly for housing,
depending on location; and up to $1,000 for books and supplies. Veterans pursuing OJT or
apprenticeship receive a progressively decreasing housing allowance that is intended to partially
offset scheduled wage increases associated with the OJT or apprenticeship, and may not receive a
tuition benefit if no tuition is charged by the sponsoring employer or instructional provider.
VET TEC
Under VET TEC, payments are provided to veterans and training providers. While enrolled fulltime, veterans receive a monthly housing allowance that is similar to the Post-9/11 GI Bill
housing allowance. The VA reimburses the qualified training provider for the cost of tuition and
other fees for the program. The VA pays 25% of the cost upon initial enrollment of an eligible
veteran, 25% upon program completion, and 50% upon employment of the completer in a
suitable field. Training providers cannot charge tuition and fees to the VET TEC participant
directly.
Basic Administrative Structure
Potential participants apply to the VA to ensure eligibility for either the Post-9/11 GI Bill or VET
TEC. Eligible individuals may then enroll in or enter into a training agreement for approved
programs. Educational institutions and training establishments certify the expected and actual
enrollment and pursuit of eligible individuals to the VA. Certifications of individual enrollment
and pursuit are made at regular intervals and when there are changes to what was previously
certified. The VA verifies eligibility, calculates payment amounts, and distributes payments to
eligible individuals and educational institutions.
Quality Assurance Mechanisms
Program quality for GI Bill-approved programs is primarily determined by semi-independent
state approving agencies (SAAs), but the VA also has oversight obligations. Program quality for
VET TEC programs relies heavily on participant employment outcomes.
Post-9/11 GI Bill157
While the VA primarily relies on SAAs for initial approval of programs of education, the VA and
SAAs share responsibility for ongoing oversight. The VA contracts (or enters into agreement)
with each SAA to provide approval, oversight, and other related activities to ensure the quality of
programs of education and proper administration of GI Bill benefits. Statutory and regulatory
provisions and policy have established standards for the programs of education, educational
institutions, and training establishments.
The quality standards apply to each program of education. Many standards were established in
response to reports of poor quality or incidences of abuse. Four prominent standards apply to the
157 For more information on the GI Bill quality assurance mechanisms, see CRS Report R44728, The Role of State
Approving Agencies in the Administration of GI Bill Benefits.
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quality of most programs: program objective, independent study (e.g., online) restrictions, the 8515 rule, and contractual arrangement restrictions. The program objective may not be avocational,
recreational, or personal development. Independent study programs must be accredited by an EDrecognized accrediting agency and must lead to a degree or certificate that meets additional
statutorily specified criteria. Under the 85-15 rule, no more than 85% of students enrolled in a
program of education may have tuition, fees, or other charges covered by institutional aid or by a
GI Bill. For programs offered in part or exclusively through contractual agreements, the
contracted courses must be independently approved for GI Bill purposes.
Besides the standards that apply to most programs of education, there are additional requirements
depending on the type of program. For example, non-degree programs must be offered in
facilities with adequate space and equipment, taught by instructors with adequate education and
qualifications, and follow curricula with recognized accepted standards. Programs designed to
prepare individuals for state licensure or certification or for an occupation requiring state board
approval must meet the relevant instructional requirements.
Programs of education that have not been approved or certified as meeting quality educational
criteria by another government agency are required to meet various standards and criteria in
addition to the aforementioned standards. Non-degree programs that have been approved by other
government agencies are Federal Aviation Administration (FAA) approved flight training
programs, DOL Registered Apprenticeships, and state-approved apprenticeships. The standards
include, but are not limited to, having faculty with adequate qualifications and having a
curriculum that is similar to other institutions, or meeting licensure, certification, or board
standards.
VET TEC158
The VA is the sole arbiter in determining if a facility is eligible for VET TEC. The payment
structure and several key elements of the PPA are designed to ensure program quality and value.
The payment structure, as described earlier, reimburses training providers when veterans
complete the program and when they find meaningful employment. Meaningful employment
means employment occurring within 180 days of program completion and using the skills of the
completed program for self-employment, promotion, or new employment.
Key quality-related requirements within the VET TEC PPA require that training providers be
licensed or approved by the required federal, state, or municipal agencies and meet the 85-15 rule.
The PPA further requires that the VET TEC-eligible programs not be self-paced.
Measures of Program Performance
As of 2013, the VA is required to report annually on the number of credit hours, certificates,
degrees, and other qualifications earned by Post-9/11 GI Bill participants. The requirement was
initiated to determine whether the program effectively prepares eligible individuals for the
future.159
The VET TEC program performance measures are the program admittance rate, job placement
and retention rates for program completers, the percentage of program completers employed less
158 Department of Veterans Affairs, VET TEC Pilot Program Participation Agreement, downloaded February 19, 2019,
https://www.benefits.va.gov/GIBILL/FGIB/VetTecParticipationAgreement.pdf.
159 Representative Jeff Miller, “Honoring America’s Veterans and Caring for Camp Lejeune Families Act of 2012,”
Congressional Record, vol. 158 (July 31, 2012), p. H5428, https://www.govinfo.gov/content/pkg/CREC-2012-07-31/
pdf/CREC-2012-07-31-house.pdf.
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than six months in the field of study, the percentage of program completers employed at least six
months in the field of study, median annual salary for employed program completers, and transfer
rates to other academic or vocational programs.
Program Participation
Although GI Bill participant pursuit of training and education through non-degree programs is
low, many educational institutions and training providers that do not offer degrees are approved
for GI Bill purposes. Approximately 9% of GI Bill participants pursued an educational certificate
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in 2013, compared to 81% who pursued a degree.160 In FY2018, approximately 0.4% of Post-9/11
GI Bill participants were pursuing OJT or an apprenticeship.161 Of the educational institution and
training establishment locations that offered programs approved for GI Bill purposes, almost 500
flight school locations, over 18,000 school locations, and over 9,000 OJT/apprenticeship
160 Department of Veterans Affairs, 2015 Veteran Economic Opportunity Report, p. 10, https://www.benefits.va.gov/
benefits/docs/VeteranEconomicOpportunityReport2015.PDF.
161 Department of Veterans Affairs, Veterans Benefits Administration, Annual Benefits Report FY2018: Education,
https://www.benefits.va.gov/REPORTS/abr/docs/2018-education.pdf.
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locations did not award any degrees, based on data from December 2019.162 Of the over 18,000
school locations, 37% were private for-profit, 37% were public, and 27% were private nonprofit
schools.163 The most popular certificates completed by Post-9/11 GI Bill participants in AY2018-
162 An additional almost 19,000 schools offer non-degree and degree programs. CRS calculations based on the
Department of Veterans Affairs, GI Bill Comparison Tool, December 17, 2019, https://www.va.gov/gi-billcomparison-tool/.
163 Ibid.
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2019 were in welding; information technology; heating, ventilation, and air conditioning; health
care; and gunsmithing.164
Based on July 1, 2019, data following the February 2019 VET TEC launch, there were five
approved training providers and eight participants.165
Program Limitations
Program eligibility is limited to individuals who have served in the uniformed services and their
family members.
Some recent examinations of the program have found that program quality oversight may be
compromised by the oversight process described above. A 2018 GAO report indicated that SAA
funding, the scope and focus of oversight actions, and the process for choosing institutions to
audit may limit the ability to adequately conduct thorough oversight.166 A 2018 VA OIG report
found that SAAs lacked adequate controls to review all statutory approval standards, includi
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