The academic publisher Cengage Learning on Monday announced it had struck a deal with its creditors that will enable the company to complete its restructuring process. The company filed for bankruptcy protection last July. The agreement would eliminate $4 billion of Cengage's remaining debt -- which totals about $5.8 billion -- and the company would receive financing for an additional $1.75 billion to $2 billion. The plan has yet to be approved by the bankruptcy court, but it has attracted support from "all of Cengage Learning’s most significant creditors," CEO Michael Hansen said in a statement.
Higher Education Quick Takes
Gov. Bill Haslam of Tennessee burnished his credentials as a higher education governor Monday night by promising in his State of the State speech to make two years of a community or technical college education free to graduating high school seniors in the state.
Haslam, whose state has aggressively overhauled its postsecondary system under both him and his predecessor, Phil Bredesen, proposed using lottery reserve funds to create an endowment to cover the tuition and fees of high school graduates who attend a community college or one of the state's colleges of applied technology. He called it the "Tennessee Promise."
"It is a promise that we have an ability to make," he said in a prepared text of his remarks. "Net cost to the state, zero. Net impact on our future, priceless."
The governor's 2014-15 budget proposal also calls for expanding the Degree Compass program developed at Austin Peay State University to help students navigate academic paths and creating a data system to help colleges identify adults who are likely to return to college and earn a degree.
Continuing its focus on problems with the servicing of private student loans, the U.S. Consumer Financial Protection Bureau on Monday released an analysis of its voluntary request for information from the private student loan industry. The bureau was especially interested in information about how loan servicers process the payments of borrowers seeking to pay down their debt ahead of schedule. The CFPB has said it’s concerned that some loan servicers apply prepayments in a way that maximizes their profits but makes the cost of the loan more expensive for borrowers.
In its report, the CFPB found that servicers varied in how they apply prepayments to student loans. Some were able to accept a borrower’s instructions through their online payment platform, while others were did not accept such instructions for certain types of loans. The bureau did not release the names of which entities responded to its request for information.
Rohit Chopra, the bureau's assistant director and student loan ombudsman, vaguely alluded to potential compliance issues in Monday’s report. He noted that it is illegal for companies to charge student loan borrowers a penalty for making early payments on their debt and said that one way for some servicers to ensure compliance with that requirement would be to automatically direct prepayments to a borrower’s loan with the highest interest rate first. In analyzing the servicers' prepayment policies--all of which were submitted voluntarily -- the CFPB did not check to see whether the policies were complying with the law. However, prepayment issues on private student loans could become a focus of the agency's efforts when it officially begins its supervision of large student loan servicers in March.
Long Beach City College is taking advantage of a new California law authorizing it to offer tiered tuition -- charging more in the winter and summer for some high demand courses. An article in The Los Angles Times finds that there are clearly students willing to pay more, in many cases because the regular, less expensive versions are full, semester after semester. At the same time, the article finds continued concerns about the idea of providing some access based on ability to pay more. "It creates two types of students: those who can pay and those who cannot. And it's unfair to the students who have to feed families and are unemployed," said Andrea Donado, student representative on the Long Beach Community College District board.
Full-time, non-tenure-track professors at Rutgers University are celebrating after winning key bargaining goals in their new contract. Career titles outlining paths for promotion have been established for teaching, professional practice and librarian faculty members, similar to those already in place for clinical and research non-tenure-track faculty members. Explicitly non-renewable contracts have been abolished, as has the title of “assistant instructor.” For non-grant-funded faculty members, appointments will be for one to five years, and advance notice of non-reappointment is now required.
Current assistant instructors also will be absorbed into the rank of instructor as of July and those assistant instructors making the minimum salary for their rank, about $34,000, will be paid the minimum salary for instructors – about $39,000. (No other raises for non-tenure-track faculty are included in the agreement). The union, which is affiliated with the American Association of University Professors and American Federation of Teachers, covers all tenure-line and about 1,000 full-time adjunct faculty at all three Rutgers campuses.
Ann Gordon, a recently retired, longtime, non-tenure-track research professor of history at Rutgers’s main campus at New Brunswick, said that the university previously had no strategy for managing the career paths of non-tenure-track faculty, but that the new agreement – reached after many months of negotiations -- puts it ahead of many peer universities on that issue. In a statement, a Rutgers spokesman said the contract recognizes the “important role” of non-tenure-track faculty there. Some 1,300 part-time adjuncts at Rutgers are unionized with the AAUP and AFT, but in a separate unit. The contract does not affect them.
A study published today in the journal mBio finds that an alternative version of an introductory laboratory course for undergraduates can significantly increase the odds that students will complete the course and take a second year of science. The alternative system -- in which students do actual science rather than replicating various experiments -- was designed with support from the Howard Hughes Medical Institute.
A survey by Fidelity of parents who are already saving for college for their children found that 60 percent have a goal of saving more in 2014 than they did in 2013. Including those parents, 88 percent said that they plan to save at least as much as they did in 2013. Of the majority of such parents who have a specific target for savings, the average is $405 per month.
Students and others at Memorial University, in Canada, are angry over one question on an assignment for computer science students, CBC News reported. They were asked to determine whether a rape victim, especially after being mocked online, would be likely to kill herself. Critics say that there was no need to use such an example for the computer science course. The professor did not respond to the network or Inside Higher Ed.
Women in Harvard University's business school have been treated inappropriately for decades, Dean Nitin Nohria told an alumni gathering last week, according to Business Insider. Nohria personally apologized for the mistreatment, saying that women at the business school were "disrespected, left out, and unloved by the school. I'm sorry on behalf of the business school." Among the pledges he made: to double (to 20 percent) the share of female protagonists in the case studies that are a key part of the M.B.A. curriculum. The apology came after an article in September in The New York Times detailed the negative experiences of many female students, and the business school's attempts (with mixed success) to promote a more hospitable environment.