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Wis. Governor Kills For-Profit Oversight Agency

After years of attempts, Scott Walker, Wisconsin's Republican governor, has successfully eliminated the state's Education Approval Board as an independent agency tasked with overseeing for-profit colleges.

Walker's partial veto last week of a budget bill accelerated the timetable for folding the board into the state's safety and professional services department, the Wisconsin State Journal reported. With the veto, the EAB's independent governing board has been nixed, and the agency's six employees have been laid off. They may be able to reapply for their jobs.

Advocates for the for-profit sector have questioned whether an independent agency in Wisconsin was necessary, given that 29 for-profit institutions in the state have closed in recent years. But David Dies, the EAB's executive secretary, told Inside Higher Ed last month that the small agency still oversees 218 colleges.

Critics of Walker's veto include Michael Rosen, a retired economics instructor at a Wisconsin community college and a former faculty union leader.

"Thousands of economically disadvantaged young people, single mothers, veterans and students of color, will be hurt by this veto," Rosen said in a written statement. "Wisconsin is now open for business for the predatory businesses that are educational institutions in name only."

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Obama Alums Launch Coalition to Challenge DeVos

A group of former Obama administration officials is launching a legal aid effort to assist students who are defrauded or suffer from discrimination.

The organization, called the National Student Legal Defense Network, will work with state attorneys general and other advocacy groups to bring lawsuits on students' behalf, according to the Associated Press. The AP and The Washington Post reported the group's launch.

The network's co-founder Aaron Ament, a former chief of staff to the general counsel at the Department of Education under Obama, told those outlets that the deregulatory agenda of Education Secretary Betsy DeVos means there is a need for more groups to step up to protect students.

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Bipartisan Policy Ideas on Higher Education

The Urban Institute this week released 10 new papers from a bipartisan, high-profile group of scholars and experts on federal higher education policy.

"The federal role in higher education has grown over the past two decades, and now, a new administration has the opportunity to strengthen policies that support students and their colleges and universities," the institute said. "To help inform these decisions, we offer a series of memos written by a bipartisan group of scholars and policy analysts and rooted in an understanding of the importance and limits of the federal role in higher education."

The memos cover the following areas:

  • Data and transparency
  • Institutional accountability
  • Accreditation
  • Innovation
  • Workforce development
  • For-profit colleges
  • Understanding and modifying student behaviors and decisions
  • Pell grants and student aid simplification
  • Student loan repayment
  • Private loan financing mechanisms
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Education Dept. Confirms Initial Approval of Kaplan, EDMC Deals

The U.S. Department of Education on Wednesday confirmed that it has granted initial approval to acquisitions of Kaplan University and Education Management Corp., two large for-profits. The proposed transactions by Purdue University to acquire Kaplan and create a new online university, and by the Dream Center, a nonprofit missionary group, to buy EDMC and its for-profit campus chains, both have drawn controversy. Earlier this week Buzzfeed reported that the feds had signed off on the deals, citing emails the publication obtained.

The state of Indiana has backed Purdue's move. But the public university still must get approval from the Higher Learning Commission, the regional accreditor for both Purdue and Kaplan.

EDMC is overseen by several accreditors. One has rejected part of the deal, while another has backed it.

A department spokeswoman confirmed the feds' initial approval of both transactions. But she said those decisions are not final.

"The department has preliminarily concluded that, based on the information provided to the department, there are no current impediments to the requests for approval of change of ownership," she said via email. "But, keep in mind, a preacquistion determination is not a final approval. The department has laid out clear criteria each university must meet as well as conditions it would impose if it were to approve any change of ownership transaction and subsequently enable the acquiring parties to retain Title IV eligibility. We also notified the parties of additional documents and information that must be submitted for the department to conduct its final review of a formal change in ownership application."

Purdue described the approval process in a news release, noting that the department included conditions with its initial backing of the deal. Those conditions have not yet been publicly released.

 

 

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Democrats Grill Ed Dept. Nominee

Democrats used a Senate nomination hearing Tuesday to press the Department of Education's nominee for general counsel on questions involving federal Title IX policy and oversight of for-profit colleges.

Carlos Muniz, the nominee for general counsel and a former Florida deputy attorney general, is only the third Senate-confirmed education official to be nominated by the administration, after Secretary Betsy DeVos and Assistant Secretary Peter Oppenheim. While Muniz revealed little about how he would act on specific issues, the hearing highlighted areas where congressional Democrats will continue to clash with the department and DeVos.

Senator Patty Murray, the ranking Democrat on the Senate education committee, said the secretary's "lack of understanding of education issues and current law make it clear she needs an independent" counsel.

Muniz said he understood his "ultimate duty will be to the law, not to any individual or objective."

Democratic senators asked Muniz to commit to upholding the preponderance-of-evidence standard in campus-based Title IX proceedings (he didn't directly answer); asked him whether he would "stand in the way" of other federal agencies investigating for-profits colleges (he said he didn't have a view on the authority of other agencies); and asked him to explain why the Florida AG didn't investigate Trump University or for-profit colleges like Bridgepoint Education (he cited a low number of complaints from Floridians).

It was widely reported last year that Florida Attorney General Pam Bondi received a campaign donation from then candidate Donald Trump before declining to pursue an investigation of Trump University, a real estate training program. Her office insisted there was no connection between the donation and that decision. A federal judge this year approved a $25 million settlement between Trump and former students of the real estate seminar.

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Report: Education Dept. to Back Kaplan, EDMC Deals

The Trump administration's Education Department will sign off on controversial acquisitions of two large for-profit college chains, according to a report by BuzzFeed, which cited department emails the publication said it obtained.

Purdue University in April announced its plan to acquire Kaplan University in a complex deal to create a new nonprofit online university. The state of Indiana approved the acquisition, and experts predicted the Trump administration would as well, given moves the department has made to roll back what it calls unnecessary or overreaching Obama-era regulations and to rule in favor of for-profits in some individual cases. The final and likely most difficult regulatory hurdle for the Purdue-Kaplan partnership, however, will come from the Higher Learning Commission, the regional accreditor for both universities.

The bid by the Dream Center, a nonprofit missionary organization, to purchase Education Management Corp. (EDMC) and its Argosy University, South University and Art Institutes campuses has drawn criticism. The offer is reportedly $60 million for institutions that collectively enroll about 60,000 students. Consumer, student and veterans' groups had urged the department to tightly scrutinize the deal, in part over concerns about a return to what critics said were predatory actions by some EDMC campuses.

One of several accrediting agencies that oversee EDMC already has rejected Dream Center's purchase of two Art Institute locations, citing insufficient information about the deal. Another accreditor, however, backed a portion of it.

BuzzFeed reported that the department "does not see any impediment to EDMC's request for approval of the change in ownership or its request for approval of nonprofit institution status."

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VA Seeks Broad Waiver of Rule Barring Payments From For-Profit Colleges

The Department of Veterans Affairs intends to grant employees a waiver of a rule barring receipt of salary or other benefits from for-profit colleges.

The proposed regulation was published in the federal register Thursday and would take effect next month without "adverse comment."

A recent VA inspector general report found that two employees had violated the rule by working as adjunct instructors at for-profit colleges receiving VA benefits. The report recommended issuing waivers where no specific conflict of interest exists.

The proposal goes further, granting a waiver to all VA employees as long as they abide by certain other federal conflict-of-interest laws. Asked for comment, the VA's press office referred to language in the agency's notice of intent stating that the "statute has illogical and unintended consequences."

Carrie Wofford, president of Veterans Education Success, a group that focuses on fraud and abuse of student veterans, called the proposal "crazy." She argued it would allow employees at VA, which acts as a regulator of institutions receiving veterans' education benefits, to hold stock or receive gifts from those entities.

Will Hubbard, vice president of government affairs at Student Veterans of America, said he wasn't sure the proposal had a nefarious intent. But he said the timing was interesting considering recent changes the Department of Education has made to rules protecting students and certain personnel decisions at the department.

"We remain very committed to ensuring that student veterans continue to be the top priority of the Department of Veterans Affairs," he said.

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For-Profit Laureate Announces New Leader

Laureate Education Inc. announced Thursday that effective Jan. 1, 2018, Eilif Serck-Hanssen will become the for-profit company's new chief executive officer and Ricardo Berckemeyer will take over as the company's president. Serck-Hanssen is replacing current CEO Douglas Becker, who will become the nonexecutive chairman of Laureate's Board of Directors.

Serck-Hanssen is currently the company's president and chief administrative officer, and Berckemeyer is the current chief operating officer.

"Eilif has worked closely with me as a colleague and thought partner for many years," Becker said in a news release. "His demonstrated track record of success, experience and passion for education make him uniquely qualified to take on the leadership of the company."

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VA Backs Ashford on Arizona Move

The U.S. Department of Veterans Affairs this week backed Ashford University's attempt to shift its state-based eligibility for veterans' benefits from Iowa to Arizona, likely preserving the for-profit university's access to Post-9/11 GI Bill and active-duty military tuition benefits. 

Ashford enrolls roughly 5,000 student veterans. The online university decided to shut down its physical campus in Iowa two years ago. Last year Iowa's Department of Education ruled that Ashford would no longer be eligible to receive veteran benefits, citing reasons the university vigorously contested

Then, in July, the university's parent company, Bridgepoint Education, received approval from Arizona to receive veterans benefits. The federal VA on Wednesday backed that decision, sending a letter to Ashford saying that the university would receive a facility code for its Arizona campus.

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Inside Digital Learning: Keeping Discourse Civil Online

In today’s “Inside Digital Learning”:

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Inside Digital Learning: Keeping Discourse Civil Online

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