New House education chair opposes for-profit regulations

The incoming Republican chairman of the House of Representatives education committee said that he would oppose any bill tightening rules on for-profit schools, and hoped the Education Department would ease a planned rule that could cost some schools critical federal funding.

The schools have been in a battle with the department and Democratic Senator Tom Harkin, who had reiterated on Thursday that legislation might be needed next year to rein in the schools, under fire for high student loan default rates and low graduation percentages.

"I would push back really hard against a bill that might come out of Chairman Harkin's committee," said Representative John Kline, a Minnesota Republican who takes over the Education and Labor Committee next month.

Asked if such a bill could succeed, Kline told Reuters: "I don't think so."

The industry is fighting the Education Department's plan for a rule that would bar federal loans to students in programs where fewer than 35 percent of former students are paying back loans or are capable of doing so. A final rule on repayment rates is due out early next year.

Asked if the final version of the rule would be eased, Kline said, "I certainly hope so."

For-profit education stocks include Corinthian Colleges, Strayer Education and ITT Education.