Last week, for the first time in the gainful employment regulatory process, the U.S. Department of Education revealed its true motivation and bias against private-sector education and the students who attend our institutions.
While defending a regulation that limits access to higher education and obstructs a pathway to the middle class for new traditional students, Education Secretary Arne Duncan and Deputy Director of the Domestic Policy Council James Kvaal hid behind the assertion that the gainful employment policy is designed to grow the middle class and protect students.
Nothing could be further from the truth.
The regulation does not apply to all of higher education, therefore it cannot protect all students, and it will limit access to the very postsecondary institutions that serve lower-income students trying to join the middle class through new career skills.
What this boils down to is the unfortunate reality that the Education Department engaged in a sham negotiated rulemaking process with the sole goal of reaching a predetermined conclusion that will severely limit access to higher education and opportunity for millions of students based on the type of institution they attend.
In addition to the students denied access to critical career training programs, the economic reality is that others will be harmed when reduced numbers of students enrolled make the programs or possibly the entire institution no longer viable.
The department’s regulation will result in the new traditional student -- working adults, minorities and people with scarce financial resources -- seeing their access to higher education and prospects for better employment dramatically reduced.
Individuals interested in careers with lower starting salaries, such as communications, psychology, visual and performing arts, and social work will be barred from receiving the same federal aid as their classmates choosing more lucrative fields.
All of this because of an institutional bias by the current Education Department against the private sector’s involvement in the delivery of postsecondary education -- something that has been a key element of America for generations.
At the heart of this sits the department overreaching its statutory authority to interpret the “gainful employment” language in the Higher Education Act, the federal law that governs financial aid, as authorizing it to evaluate program eligibility on the basis of complicated debt calculations.
As Senator Lamar Alexander noted last week, the fact that it took the Department 841 pages to define two words in the Higher Education Act – longer than the law itself – “shows exactly what is wrong with Washington and its desire to overregulate institutions of higher education.”
Even with all those pages, the department uses an arbitrary one-size-fits-all approach by not taking into consideration the level of preparation and the characteristics of entering students.. As a result the department has created the perverse incentive for institutions to avoid enrolling low-income and minority students.
America’s private sector institutions strongly support accountability that applies to all programs recognizing the diversity of students and institutions, as President Obama has promised in creating a rating system. We would support measuring outcomes and performance for all programs across higher education based on quantitative indicators like: retention and progression rates, completion, employment of graduates, earnings and graduate satisfaction.
What we object to is a regulation imposing an arbitrary debt-to-earnings metric as the definition of what is or is not academic quality.
We cannot stand silently by as a regulation is promulgated that would fail programs (if it were applied to them) like a bachelor’s degree in journalism from Northwestern University, a law degree from George Washington University Law School and a bachelor’s degree in social work from Virginia Commonwealth University. These programs get a pass since the department has chosen to focus on a narrow band of programs that serve the new traditional student.
The purpose of the federal financial aid programs has always been to help provide disadvantaged students access to higher education. It is incredible that this administration is on the verge of promulgating a regulation that limits access to education for disadvantaged students based on the very factors that caused them to be disadvantaged in the first place.
Steve Gunderson is president and CEO of the Association of Private Sector Colleges and Universities.
Victory University, a for-profit institution in Memphis, is shutting down, Memphis News Channel 3 reported. Rumors have circulated about financial problems at the institution, which has 1,600 students.
The University of Northern Virginia doesn't sound like an institution to find in South Dakota. But the for-profit institution has relocated there, the Associated Press reported. Virginia authorities shut it down, citing a lack of accreditation, but now it has an address in South Dakota, seen by many as lax in regulating for-profit higher education. Northern Virginia officials could not be reached for comment.
On the heels of the Consumer Financial Protection Bureau’s announcement last week that it was suing for-profit education giant ITT Educational Services for engaging in predatory lending practices, one Democratic senator is calling on the Department of Education to also investigate the company. Senator Richard Durbin of Illinois, a Democrat and longtime critic of for-profit colleges, on Friday sent a letter urging Education Secretary Arne Duncan “to investigate these troubling accusations and scrutinize ITT’s participation” in federal student aid programs.
Durbin also sent a letter to ITT’s accreditor, the Accrediting Council for Independent Colleges and Schools, calling for the agency to “hold ITT accountable.”
Durbin previously sent similar letters to the Education Department in December asking for an investigation of Corinthian Colleges after a Huffington Postarticle said the company had hired graduates temporarily to artificially boost Corinthian's job placement rates.
An article in The New York Times explores the charges in a lawsuit against Premier Education Group, which operates for-profit colleges in 10 states. Officials of the colleges maintain that they are being sued unfairly by "misguided" or disgruntled former employees. The suit charges that the colleges admit students in part by misleading them about their chances of getting jobs. An example: One of the ex-employees who sued said she became concerned when she noticed an electronic ankle monitor on a student in a pharmacy program for which certification would likely exclude those with felony convictions. The ex-employee said she was told to find an internship for the student, even if she had to deceive the employer.
DeVry Inc. shut all 13 of its Chicago-area DeVry University and Chamberlain College of Nursing campuses Monday, citing an emailed threat that was deemed a "potential security issue," The Chicago Tribune reported. Little information was provided about the nature of the threat, but DeVry officials said in a statement that local authorities had declared it safe to reopen the campuses today.
Corinthian Colleges, Inc., a chain of for-profit colleges, said in a federal filing Wednesday that the U.S. Education Department had rejected "many" of the company's requests for new programs because of concerns about its reporting of job placement and other information. Company officials disputed an assertion made in a January letter from the Education Department that Corinthian had "admitted falsifying" placement or grade information, saying instead that the company had detected and reported to federal authorities "isolated instances" of misreporting.