State Collaboration on For-Profit Higher Ed

Those charged with quality assurance see need to work together, given changes in the industry.
June 27, 2008

Discussion of public policy and for-profit higher education frequently focuses on the duties of the federal government and accreditors, both of which play a role in permitting institutions' students to become eligible for federal student aid. But there is of course another key player -- the state. It is state agencies that typically authorize any educational institution to operate at all (with or without eligibility for federal funds).

An association of state officials responsible for this oversight has been around for years, but hasn't been the most active of groups. The organization's leaders are trying to get more attention for their role and to work together to tackle some of the issues they face. In many ways, organization leaders say, changes in for-profit higher education -- the growing role of national chains as opposed to locally owned campuses, and the proliferation of distance education -- make it essential for the state role to evolve and become more collaborative across state lines.

Leaders of the state group -- the National Association of State Administrators and Supervisors of Private Schools -- are in Las Vegas this week for the annual meeting of the Career College Association, whose members these state officials regulate, and they discussed their vision for their role.

“The question is where do these for-profit fit in the continuum, in the mix of delivery and providers of higher education," said David C. Dies, president of the association and executive secretary of the Educational Approval Board of Wisconsin. Dies stressed that the need for more state collaboration was not a matter of thinking that for-profit players are inferior or unimportant, but recognizing changes in the field.

By most measures, Dies said, it is healthy. He has seen the number of institutions over which his agency has some responsibility go to 150 from 100 in the last 10 years. And he said this growth could be very positive -- given the large numbers of Americans who need a higher education and aren't necessarily finding one at traditional, nonprofit institutions.

John P. Ware, executive director of Ohio's State Board for Career Colleges and Schools, said that the most notable shift he's seen in the past 10 years is one of ownership. A decade ago, he said, about 80 percent of the career colleges in his states were locally owned and only 20 percent were owned by larger national groups. Now the percentages are reversed. Similarly, Dies noted that his agency in theory has jurisdiction whenever any distance education provider is used by a state resident -- and so as a result needs to examine institutions that are based elsewhere and that have little presence in Wisconsin.

These trends raise a variety of issues, Ware said. Generally outside purchases are followed by an infusion of funds and he has seen significant improvements in facilities. When a national chain opens a new campus in Ohio, he said, he also has the benefit of being able to examine the chain's track record elsewhere, which may provide much more information about likely success than promises on forms to be filled out. At the same time, he said, it is frustrating to officials of national colleges that they must comply with differing standards in different states, and Ware said that he understands the annoyance this creates for legitimate operators.

Among the ideas Dies, Ware and others would like to consider as the state group expands its activities:

  • The development of common standards for evaluating for-profit higher education, or for some of the requirements for initial approval of authority to operate.
  • If common standards are developed, reciprocity agreements could be arranged so that states might not need to duplicate everything they do now when evaluating a new college -- and new colleges could prepare the same materials for multiple states.
  • Jointly creating databases with information about diploma mills and databases of legitimate institutions (and those that aren't). Some state agencies already provide such services -- here's one from Oregon -- but Dies said that this is something on which states could work together, and the end product would be of value to people who would never think to look to an Oregon state agency for the information.
  • Encouraging states without strong procedures in place to oversee for-profit institutions to create them. One problem for state regulators is that the less honest for-profit institutions register in states with relatively lax (or no) enforcement operations. There are periodic efforts by states that have become havens for these operators to adopt tougher rules, but other states appear to then become targets -- and need to be urged not to let themselves become new havens, Dies said.

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