Minnesota Attorney General Lori Swanson has charged in legal filings that for-profit Globe University has violated state law by making unlicensed loans with "usurious interest rates” as high as 18 percent, The Star Tribune reported. Swanson asked that the loans to nearly 6,000 students be invalidated, so the students would not have to repay them and should be reimbursed for payments they have made. The filing said that the university wasn't registered to make the loans and the interest rates far exceeded what state law permits. University officials disputed the attorney general's statements, and accused her of trying to advance a political agenda.
Further developments in the collapse of Corinthian Colleges:
Canadian authorities have shut down the 14 Corinthian institutions in Canada, finding that they no longer had the right to be licensed in the country. Bloomberg reported that officials said the action was needed to protect current and prospective students.
Heald College campuses in California (which are part of Corinthian) on Friday received a partial reprieve from the California Student Aid Commission, which a week earlier had blocked their students from receiving state aid, The Sacramento Bee reported. Under the compromise, the ban will continue through at least April, but if students are able to finish the semester, their aid may be provided in a lump sum at that time.
A new university system focused on health care -- and financed in an unusual way -- was announced this morning, backed by the German publishing giant Bertelsmann. Arist Education System said it would create a system of graduate and professional health and human sciences institutions. The first institution to join the system is California's Alliant International University, which specializes in psychology, health sciences and law. Like the other institutions as part of Arist, Alliant -- which has been a private nonprofit university -- will become a public benefit corporation, a form of for-profit company that strives to pursue a social mission.
Last week, we learned on this site that Matt Reed’s son had recently sincerely asked this question: “Is the University of Phoenix a good school?” I have been gratified by the response from Inside Higher Ed readers -- and from Reed himself. But much is at stake in that question, especially for those we serve at the University of Phoenix -- those long underserved by traditional institutions. And I want to answer it publicly.
Is the University of Phoenix a good school? Yes. Yes, it is. And we’re working to make it an even greater school for nontraditional students everywhere. Our students expect quality, career-relevant degree and certificate programs. We’re providing instruction with dedicated faculty that bring real-world experience to the classroom. We are online and at local campuses in more than 30 states.
I came to the University of Phoenix last year from the University of Michigan. My peers in Ann Arbor came up to me and offered congratulations when they heard the news. I was told countless times, “University of Phoenix is an important institution. I’m glad you’re going there.” And a surprising number of colleagues within the UM community came to me and told me of their own positive experience, or a family member’s, at the University of Phoenix. For example, one UM student -- the first in her family to attend college -- was pursuing a graduate degree at Michigan (which she has since completed). She told me that she never would have progressed academically had it not been for the role the University of Phoenix played in her life (she completed her bachelor’s degree here).
To be sure, the institution has its complexities and challenges. But, like all schools, especially those that serve nontraditional students, we’re continuously in a mode of evaluating, assessing and working to improve student learning outcomes and the entire student experience. In 2014, the University of Phoenix awarded more than 73,000 degrees, and we’re strongly positioned to continue playing a vital role in American higher education for decades to come.
Our institution is large and well-known, yes, but it need not continue serving as shorthand for larger debates about for-profit higher education, which are often politically motivated. Our mission is to provide access to higher education opportunities that enable students to develop the knowledge and skills necessary to achieve their professional goals, improve the performance of their organizations and provide leadership and service to their communities. The University of Phoenix has played an important role in higher education in this country by successfully serving nontraditional adult students at scale.
Over the past seven months, I have been spending an enormous amount of time meeting with and listening to the stories of our students and our dedicated adjunct faculty. The passion our faculty have for teaching, innovation and student outcomes is palpable. Similarly, our students’ dedication is apparent. They have told me time and time again, “It is hard work, but it is not impossible.” The reason they came to this school is not just to prepare for an occupation and career advancement, but to change the perspectives of their children, and to change the trajectory of their families for future generations. It is the individual stories of our students that I wish were amplified in the media. That’s unrealistic, of course, but I am committed to telling as many stories of our students, graduates, faculty and staff as possible.
I wish most of all that Reed’s son could have been with me in Pasadena last Friday when I met the families of the University of Phoenix graduates featured in these videos here -- graduates like Evelyn “Vonn” Banks, the former Command Master Chief for Naval Sea Systems Command. I spent time with Vonn last week. Here is how she answers the question: Yes, University of Phoenix is a great school. Vonn has had a groundbreaking career as the most senior ranking non-commissioned female officer in the U.S. Navy. Her success was made possible, in part, by the three degrees earned from University of Phoenix. She is working on a fourth degree – truly epitomizing her personal motto: “I am a Phoenix, and I never quit."
I could fill this Web site with stories like that of Vonn Banks, and we are nearing 1 million graduates of the University of Phoenix.
Reed’s son asked a sincere question. He deserves an answer and I have invited Reed to visit with us in Arizona. He will find a rigorous, career-focused, innovative curriculum that is adapted to how adult students learn and a unified team committed to high-touch, high-tech student support, focused on students’ learning and career outcomes.
At some point, I hope readers of Inside Higher Ed will stop and visit a local University of Phoenix campus before making up their minds. Spend time on phoenix.edu and consider taking a course online before summarily passing judgment.
I spoke recently at a general session of the American Council on Education (ACE) and the University Professional and Continuing Education Association (UPCEA). They had convened in San Antonio to hear from national leaders. Before the general session began, the new president-elect of UPCEA, David Schejbal of the University of Wisconsin-Extension, stood to speak at the podium. He said, “We don’t typically talk to the for-profits,” which was met with good-natured laughter that I took as acceptance, agreement or, at least, understanding. Then he said, “We have a lot to learn from the University of Phoenix. I think that for-profits are not what we think they are. I’ve spent a lot of time with Tim Slottow, and his team’s focus on meeting the needs of adult students is really something we need to listen to.”
I am grateful for Schejbal. We have found similar leaders with open minds throughout the country. We are working closely together with a growing number of researchers at top-tier research universities and foundations who are eager to develop insights into how, together, we can measurably raise learning outcomes for all adult students. Our work with the Thurgood Marshall College Fund, the Gates Foundation (where Bill Gates himself paid us a visit) and researchers at Stanford University is just the beginning of what I hope will be a rich experimental learning environment for all devoted to the needs of nontraditional students. That is, I believe, among the best ways to honor the memory and resilience of our founder, John Sperling.
Whether friend or skeptic, our doors are open to all those working to serve nontraditional students, especially your readers at Inside Higher Ed.
Tim Slottow became president of the University of Phoenix in June 2014. Before joining the university, he served as the executive vice president and chief financial officer at the University of Michigan.
Of the 46,634 Wisconsin adults enrolled in private institutions (most of them for-profit) during 2012 and 2013, 36.5 percent dropped out within 2 years, according to a new report by the Wisconsin Educational Approval Board. The report says that the highest dropout rates were at online for-profit institutions. A press release accompanying the report noted the Wisconsin Governor Scott Walker, a Republican, has proposed eliminating the board, to “decrease the regulatory and fiscal burden on private, for-profit schools.” David C. Dies, director of the board, said in a statement that the new data show why it's important to have an oversight board for for-profit higher education. Governor Walker's proposal "eliminates the ability for anyone to collect and review student outcomes data from these institutions," Dies said.
The California Student Aid Commission has suspended state student aid for those enrolled at the 10 California campuses of the for-profit Heald College chain, The Sacramento Bee reported. The commission said that Heald had failed to submit documents required to show that it is financially stable. The move by the commission halted about $1 million in payments to Heald, a figure that could reach $14 million by June. Heald officials criticized the move and said that they had hired a new accountant. Heald officials also said the move could endanger the sale of Heald, which is part of the Corinthian Colleges group, which has faced severe financial and regulatory difficulties and has been selling off some parts of its operations. Heald has been considered one of the more attractive assets that Corinthian might sell off.
Submitted by Paul Fain on February 13, 2015 - 3:00am
Education Corporation of America (ECA), a privately held for-profit chain, will buy all 38 Kaplan College campuses. Kaplan Higher Education will continue to operate its Kaplan University and eight professional schools.
Terms of the deal were not released. But both sides said the all-stock transaction would give Kaplan a "preferred equity interest" in ECA. The 38 Kaplan College campuses currently enroll 12,500 students. The campuses lost $12.5 million last year, according to a corporate filing, and had a total revenue of $275 million. ECA operates Virginia College, Golf Academy of America, Ecotech Institute and New England College of Business. Virginia College is the largest, with 27 campuses and online programs, mostly in the Southeast.
"The combined ECA footprint, after the transaction closes, will include more than 70 career-oriented campuses and online programs across 20 states, serving approximately 30,000 students," the company said in a written statement.
Submitted by Paul Fain on February 13, 2015 - 3:00am
Scott W. Steffey will step down as president and chief executive officer of Career Education Corporation, the major for-profit chain announced. Steffey took over the top post of the publicly traded company in 2013. An industry analyst said his departure and brief tenure were surprising.
The regulations would impose penalties on vocational programs at for-profits and community colleges that do not meet standards the department has set for graduates' debt-to-earnings ratios. (The rules would only apply to non-degree programs at community colleges, however, while applying to degree and non-degree programs at for-profits.)
The for-profit association quickly sued after the rules were released, calling them arbitrary. A department official, however, said at the time that he was confident the regulations would withstand legal scrutiny.