Gainful Employment and Why it Should Apply to All Higher-Education Institutions

The U.S. Department of Education is trying to create a clear financial picture for students with a recently developed, not yet implemented regulation called “Gainful Employment.” The Gainful Employment regulation along with many other new regulations are set to be put into action sometime in 2011. These new regulations have been conceived in response to the growing pressure over for-profit education’s questionable recruitment practices.

What the U.S.D.E. hopes to accomplish with these new policies is to make students more informed about the financials of their degree programs. Simply defined, the regulation will “apply a formula to programs in career-oriented majors, like healthcare, business and education to decide which ones lead to ‘gainful employment.’ Those that do not would be eliminated. Students would also get concrete information about graduation rates, employment rates, potential salaries in their chosen field, loan debt info and the like before they choose their school. This information should help students analyze their risk/reward scenario.”

The U.S.D.E. has defined “gainful employment” as employment that provides students with the income they need to successfully re-pay their education debts.

Randy Proto, CEO of the American Institutes school group which operates healthcare-based career schools in a number of states, says that the disclosure agreement found in the “gainful employment” regulation is an “excellent idea.” But, for the regulation to be effective, Proto suggests that the formulas established to decipher the “gainful employment” statistics must “account for differences in: student populations served, programmatic goals, national economic conditions and many other factors.”

As it is envisioned now, the “gainful employment” regulations would only apply to for-profit education institutions and a minute percentage of students in non-degree programs at ground schools. So, Proto asks, what about the “7.5 million additional students enrolled in career-oriented degree majors at public and private universities? Why leave any students and programs out of its reach? If the proposed regulation is a good idea and provides the anticipated benefits and protections, it should be broadly applied.”

Proto, clearly a proponent of for-profit education, supports the “gainful employment” measure, but would also like to see regulations emplaced across the board to ensure equality, not just at for-profit online schools or career training institutions.

Proto seems to be on the right track. “Gainful employment” regulations are a good idea but shouldn’t be enforced only at for-profit schools. All students should be able to benefit from the information “gainful employment” statistics will provide. Says Proto, “this is a real opportunity for higher education. But only if it is ‘Gainful Employment’ for all students.”

 

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Article Source: http://education.ezinemark.com/gainful-employment-and-why-it-should-apply-to-all-higher-education-institutions-16ba0068c63.html

Keiser University Sues Florida State College Jacksonville: Why this may concern you

From: http://community.elearners.com/all_blogs/online_student_blogs/my_bellevue_university_experience/b/bellevue_university/archive/2010/10/19/keiser-university-sues-florida-state-college-jacksonville-how-this-may-concern-you.aspx

The “for profit vs. non-profit” fight has gotten a little bit uglier this month.  I’ve mentioned it on the forums but I’ve decided to do a little more digging before blogging on this particular news article.  In a nutshell, Keiser University (a for profit school) finds out about a collaborative effort between Florida State College Jacksonville (a non-profit school), the Institute for College Access and Success (a connected lobby group which is anti “for profit” schools), Gilchrist Bert (founder of the Water Street Capital hedge fund and famous for short selling) and of course Steve Eisman (a hedge fund analyst also famous for short selling) conspiring to drive Keiser University out of Jacksonville.

 

So who are all of these actors and how does this play out?  Why would they do this?  Is this a crusade to protect the interests of students?

 

Florida State College Jacksonville, generally a community college in Jacksonville who allegedly believes that Keiser University would steal enrollment dollars and decrease the demand for the college’s services.  The conspirators acting on behalf of FSCJ were Steven Wallace the president of the college and Susan Lehr, the vice president of government relations.

 

The Institute for College Access and Success (ICAS) is a lobby group who has a primary agenda of placing restrictions on for profit schools placing them at a competitive disadvantage to non-profits.  This organization is most famous recently for producing Robert Shireman who became the Deputy Undersecretary of Education at the U.S. Department of Education.  It was Shireman who started the ball rolling in changing the U.S. Department of Education’s official stance from neutral to hostile towards for profit education as a whole.  More on himhttp://www2.ed.gov/news/staff/bios/rshireman.html

 

Gilchrist Bert founded the billion dollar, Jacksonville based hedge fund Water Street Capital.  Gilchrist is famous for turning massive profits short selling.

 

Steve Eisman is a portfolio manager for FrontPoint Financial Services, a connected hedge fund, who is also very famous for making big bucks short selling, especially in this last mortgage crisis the nation underwent.

 

So the next logical question is, why do these hedge fund guys care about what happens to for profit schools and how exactly do they anticipate making money by short selling?  I’ll take a shot at giving an admittedly oversimplified explanation of short selling and how these guys make money doing it.  Basically a hedge fund manager borrows a stock at a given value on interest from a brokerage and then sells them.  To settle the account eventually the hedge fund manager will then have to buy back the same number of shares and return them to the broker.  If the shares can be devalued or drop in price, the hedge fund turns a profit because they are buying them back for a smaller amount of money than they borrowed them.  They keep the difference.  I’ll give an example, say you borrow a pen worth $1,000 from a friend and agree to pay him/her 10% for every month you keep the pen out of their possession.  You then turn around and sell the pen for $1,000 and during the following weeks the manufacturer of the pen drops the price to $500.  You buy the pen, return it to the owner plus the interest you owe on it and keep the difference.  Make sense?

 

So why are these guys so vested in seeing the education shares fall?  Simple, because they’ve borrowed shares and would like to return them by buying them back at a reduced price.  So other than the for profit schools who stands to lose?  The brokerage firm, that’s who.  And why should we care if the brokerage firm loses?  Take a look at your 401K, guess who is managing this account for you?  That’s right, a brokerage firm.  The brokerage is betting that the stock will remain stable or otherwise grow, meaning that the hedge fund will have to pay interest and return the stock that is now more valuable than before, thus the brokerage firm (and you) will see greater returns on your initial investment than you would otherwise.  This is a win/lose game, either the brokerage and your average investor win or the hedge fund wins.

 

So the basically the story is, these hedge fund managers smell blood in the water.  You have an administration in power that is almost openly hostile towards free market enterprise regardless of industry.  Add to that equation a U.S. Department of Education who has no problem imposing unprecedented policy upon schools based solely upon their tax status and who is also using their position to influence the decisions of non-governmental accrediting bodies.  Lastly you have Senators and Congressmen who receive large campaign donations from not only the hedge fund managers, but law firms who may represent them, non-profit schools and other organizations that may have a stake in the game.

The losers in this are the investors (me and you), the for profit schools, students and future students regardless of whether they will or already attend for profits schools or not.  Why?  Because the supply of readily available schools will drop, making it more difficult and expensive to earn a college degree (supply vs. demand).  Secondly the alumni of for profit schools stand to lose as their degree(s) will have an unfair shadow of doubt cast upon it regardless of the reality of the quality of education they received.

 

 

Is higher education leading to higher employment?

This summer, the U.S. Department of Education introduced a proposal to regulate for-profit universities. Referred to in education circles as the “gainful employment” regulations, the proposal seeks to protect students with the highest financial need who enroll at these institutions, to ensure the likelihood that they will be able to find employment and repay their loans after completing their certificate or degree programs.

The Department of Education is proposing a new sanction, namely that if the for-profit programs are not producing “gainful employment” opportunities for these students, those institutions will lose their student aid eligibility — a major source of income for these education companies. As usual, the issue has raised partisan rancor in several congressional hearings (the latest on Sept. 30) held by Iowa Democratic Sen. Tom Harkin, chairman of the Health, Education, Labor, and Pensions Committee.

As a not-for-profit, four-year and graduate residential university, my institution is not directly affected by these federal rules. But they do bring a critical issue to light for all of higher education, for-profit and not-for-profit alike: What are we doing to prepare and enable our students to secure jobs and succeed in an increasingly competitive and dynamic workforce, especially for those in the highest-need brackets? Are we doing enough? Are new models needed?

According to the Bureau of Labor Statistics, the youth unemployment rate reached 19.1 percent in July, and the United States is experiencing some of the worst youth joblessness of the post- World War Two era. These statistics should sound an alarm across the nation. While penalizing for-profit universities for programs that produce little results and high debt for their students might be an effective short-term solution to protect students and our student loan system, we need a broader national vision from Washington, from corporate America, and from higher education about how to ensure that our young people have a future in our nation’s workforce. Punitive measures from the government and “business as usual” from our nation’s colleges and universities just won’t cut it. Students need a new deal — a promise of access that can actually lead to job opportunity when they complete their degrees.

With the state of our economy, the question is even more urgent for students and their families: What will a degree get me after I graduate? In the salad days of job opportunity, we university administrators could afford to wax a bit more vague about this. For many traditional academicians, this question might even seem out of place. After all, college is about imparting knowledge, the collective inheritance of humanity — not about something as mundane as a job.

Of course that is the case, but our students also want and need to work. I see this mindset in the kind of students we attract to Stevenson University. Almost one-third are first-generation college students. Their parents did not attend college, but they nurtured that dream for their children. These students expect that attending college will lead to a good job, and they consciously chose an education with programs and experiences structured to help make their dreams a reality.

Several years ago, representatives of Maryland’s public and independent colleges and universities joined forces with the Governor’s Workforce Investment Board on a listening tour, dialoging with business leaders around the state about the kinds of programs and initiatives that prepare students to work successfully in their companies and economic sectors. This tour was extremely productive and helped to build the kind of collaboration that higher education, business and government need.

But this process needs to be national, continual and at the top of the president’s and Congress’ agendas.

President Barack Obama’s “Skills for America” initiative, announced Oct. 4, is a step in the right direction. By encouraging partnerships between community colleges and industry, students will be able to connect their educations to careers, many in new and emerging industries. This initiative should also move beyond community colleges to four-year institutions, public and private, that are serving many of the nation’s highest-need students.

What else can higher education do? Diverse employment internships should be a near mandate across college curricula; federal and state employer advisory boards for higher education can update academia on the changing and emerging workforce skills for industry; and we should promote career development standards and requirements that challenge our students and grow their skills as much as their academic coursework expands their knowledge.

Instead of punitive measures that might ultimately limit access and discourage students and working adults from achieving a degree, we need creative measures from leaders in education and the top policymakers that ensure degrees — and the college experiences that support them — remain relevant in an increasingly dynamic and global workforce. Career education should not be sidelined; it needs to be front and center in our strategic institutional plans and national economic policy.

Kevin J. Manning is the president of Stevenson University with campuses in Stevenson and Owings Mills. His e-mail is kmanning@stevenson.edu.
From: http://www.baltimoresun.com/news/opinion/oped/bs-ed-colleges-jobs-20101013,0,2442120.story

Impact of Gainful Employment on Public and For-Profit Colleges according to the Missouri Data Set

http://www.finaid.org/educators/20101011missouriimpactanalysis.pdf

 

Report from Mark Kantrowitz

A great video.

Assault on Career Colleges

By: Mark Hyman at http://www.thelandofthefree.net/conservativeopinion/2010/10/10/assault-on-career-colleges/

The U.S. Department of Education recently conducted a Notice of Proposed Rulemaking (NPRM) that suggests the Dept of Ed will severely restrict access to various federal loan and grant programs to students attending career colleges. Unlike state-owned public institutions and private, not-for-profit colleges, career colleges operate on a for-profit basis.

There are approximately 1,000 career colleges such as the University of Phoenix, Strayer University, DeVry Institute and Westwood College that offer Associate, Bachelor or Master’s degrees. About 1.2 million students were enrolled in these colleges in 2007-08, according to Dept of Ed statistics. Another 1,800 for-profit post-secondary schools offer certificate, continuing professional education or occupation-specific education such as golf academies and culinary, technical and cosmetology schools.
In contrast, there are more than 3,300 public institutions and private, not-for-profit colleges that offer Associate or higher degrees. In 2007-08, about 17 million students were enrolled in these schools.

Career colleges have grown dramatically in the past several years. They primarily market themselves as providing degree and certificate programs that meet local market employment shortfalls and cater to the hectic schedules of a student body that is already in the workforce. Career colleges also provide opportunities to students who are denied admission to public universities and private colleges.

The typical career college student is already employed, 25 years of age or older, minority, female, single and often with dependent children, has lower income, cannot rely on family resources to finance college, and comes from a family without a college degree.
Because of these demographics, career colleges tend to have a much higher percentage of students who rely on federal student financial aid that is doled out under Title IV of the Higher Education Act of 1965 (federally insured loans, Pell Grants, etc.) than do students at public universities and private colleges.

This federal funding totaled $105 billion during the 2008-09 school year. About $24 billion of that amount went to students who attended career colleges.

According to Senator Tom Harkin (D-IA), chairman of the Senate Committee on Health, Education, Labor and Pensions, which has jurisdiction, federal student aid will balloon over the next decade. The U.S. will spend as much as $350 billion just on Pell Grants over the next 10 years. In 2009, $24 billion was spent on Pell Grants; in 2011, the U.S. will hand-out $30.6 billion.
The Dept of Ed has several criticisms of career colleges. The department alleges students attending career colleges default on federally backed student loans at a significantly higher rate than do students at public universities and private colleges. Career colleges dispute this allegation and respond with two points.

First, the demographic of the typical career college student is more prone to defaulting on loans, in general, and this accounts for a slightly higher student loan default rate. This demographic claim is borne out by the high loan default rate of students attending historically black colleges and universities.

Second, career colleges accuse the Dept of Ed of using different accounting techniques when analyzing student loan repayments by career college students. Older students already in the workforce are more likely to consolidate student loans into consumer debt refinance plans. The Dept of Ed, career colleges assert, improperly identify student loans in such situations as “in default” when they are, in fact, being repaid on time or are in approved interest-only payment programs.

The Obama Administration’s first attack on higher education financing occurred when the government conducted a takeover of private student loans. Observers allege the proposed rule change underscores the anti-corporate bias of the Obama Administration.
The Dept of Ed also complains that career colleges create “labor oversupplies” by graduating too many qualified workers for a specific profession causing unemployment and depressing salaries. Of note, the Ed Dept is silent on the thousands of lawyers graduated each year by law schools.

Occupation-specific training programs, argues the Dept of Ed, “that lacked a general education component made graduates of for-profit institutions less versatile and limited their opportunities for employment outside their field.” Career colleges dispute this.
Speaking on background, one career college official stated that graduating students who cannot get employed will cause students to attend school elsewhere. “We are marketplace-driven. We have a strong incentive to ensure our graduates get jobs. And they do,” he said.

According to the NPRM, the Dept of Ed is “determining whether certain postsecondary educational programs lead to gainful employment in recognized occupations.” It further indicates an intent to cut off federal student aid to “educational programs of little or no value.”

One can easily draw the conclusion there is elitism at play. What exactly constitutes a program of “no value”?

Certificate programs leading to jobs in cosmetology, police forensics, and computer repair may not pass muster with the Education Department as having “value” unlike some of the following courses offered in the Fall 2010 at these elite colleges and universities:
• Oberlin College: “Queering the Reel” (RHET 104) – Examining sexual orientation and gender in film.
• Yale: “Gypsies, Tramps and Thieves” (PLSC 154) – Study of “groups who have shown to live outside, or on the margins of, society” including hoboes and 18th century pirates.
• Harvard: “Akkadian Language and Literature” (AKKAD 300) — Study of the extinct Akkadian language that died-out more than 2,100 years ago.
• Columbia: “Transnational Transgender Social Formation” (W3918) — Merely one course offering among the university’s vast human rights curricula.
• Occidental College: “Stupidity” (CTSJ 180) — A Critical Theory and Social Justice offering to prove “[s]tupidity is neither ignorance nor organicity [sic], but rather, a corollary of knowing and an element of normalcy, the double of intelligence rather than its opposite.” Huh?

If the Dept of Ed truly wants “to protect taxpayers against wasteful spending on educational programs of little or no value” then perhaps it ought to prohibit the recipient of any federally-backed student aid from taking classes similar to these or banning tax dollars altogether from going to any school that even offers such nonsense.

Public university officials have been especially critical of career colleges. Students enrolled in career colleges not only attend classes in typical bricks and mortar classrooms but, have also been taking classes online. Public universities have been losing financial aid dollars to students attending career college programs.

GIVEN OLD ACADEMIA’S heavy political support of Democrats, this may be the real motive behind the Obama Administration’s effort to cut-off federal aid to colleges that have profit motives. Adding insult to injury, enrollment at career colleges has steadily increased while enrollment has flat-lined at public institutions and private colleges.

Last year, California denied community college admission to about 140,000 students due to the state’s dire financial predicament. Career colleges have picked up the slack. Today, the University of Phoenix has more than 443,000 students. Only the State University of New York system has a larger enrollment (463,000).

A Government Accountability Office report released in August 2010 (GAO-10-948T) alleges deceptive marketing practices at 15 career colleges and accuses 4 of those schools of conducting fraudulent practices.

The Association of Private Sector Colleges and Universities (APSCU), the industry trade association, has condemned deceptive marketing practices and offers training seminars for financial aid administrators.

There are unconfirmed reports that more than 200 schools were surveyed for the report but, that the GAO cherry-picked only the 15 schools accused of deceptive or fraudulent marketing practices. They are also unconfirmed reports that the Dept of Ed was specifically targeting the University of Phoenix in response to complaints made by public universities. Both of these claims are plausible.

At a June 2010 Congressional hearing, criticism was leveled at career colleges for using “TV advertisements, billboards, phone solicitation, [and] web marketing” to promote their institutions. According to Senator Harkin, “[advertising] spending by a for-profit school system radically [sets it] apart from other [not-for-profit] colleges.”

Career colleges counter that they do not have the monopoly inherent in being a state university nor do they enjoy the free marketing available from the promotion of big-time athletic programs such as football and basketball that are resident in public universities and private colleges.

The NPRM focused on a two-part test to ascertain an institution’s future eligibility for federal student aid. These are student debt-to-income ratios and loan repayment rates. Schools not meeting the minimum thresholds of the two tests would be deemed as not having adequately prepared students for “gainful employment” and would be cut-off from receiving federal student aid dollars.
This proposed rule to determine federal aid eligibility would apply only to career colleges. Career colleges utilizing federal student aid “benefit from billions of dollars in subsidies from taxpayers,” argues Education Secretary Arne Duncan and therefore ought to meet additional burdens not borne by public universities and private colleges.

The APSCU observes that if the same rule were applied to public universities and private colleges then it would severely restrict aid to medical school students. Students attending dental and law schools and other schools with high enrollment costs would also be affected.

According to the APSCU, 9% of nurses and 54% of allied health workers who graduated in 2009 attended career colleges. The trade association argues that drastically cutting back federal aid opportunities to these schools could exacerbate acute health care worker shortages.

There is a related matter that dramatically differentiates for-profit and not-for-profit colleges. Each state pours hundreds of millions of dollars into its public institutions. Additionally, public institutions and private, not-for-profit schools operate on a tax-exempt basis. In contrast, career colleges do not receive direct government subsidies and instead, pay millions of dollars of taxes into federal, state and local governments.

An analysis prepared by Professor Bradford Cornell of the California Institute of Technology on behalf of an advocacy group representing career colleges compared the costs borne by taxpayers by students attending for-profit and not-for-profit colleges.
According to Cornell’s report, “where only direct costs to taxpayers are considered, for-profit 2-year institutions produce graduates at a cost to taxpayers that is $25,546 lower on a per student basis than the public 2-year institutions [emphasis added].” The difference is more dramatic when one factors in tax revenues paid by for-profit schools and the absence of tax revenue from not-for-profit schools.

This assault on career colleges has pit influential groups and 80 members of Congress of both political parties against the Obama Administration. They note that career college students are heavily female and minority and changes to financial aid rules would disproportionately disadvantage them.

According to the Imagine America Foundation, 43% of students at career colleges are minority and 65% are female. Also, thirty-nine percent of degrees awarded at career colleges went to minorities, which is twice the rate at public institutions (20%) and more than double the rate at private colleges (17%).

Reducing access to federal student aid to those who enroll in career colleges would harm an important political Democrat constituency. In a letter addressed to Harkin, one liberal group of politicians urged the Iowa Senator to abandon his “imbalanced” approach to restricting federal aid to career colleges.

The Department of Education is expected to issue new federal student aid rules on November 1 that would take effect next year.

APSCU Comments on White House Community College Initiative

The following letter was sent earlier this week from APSCU President Harris Miller to Dr. Jill Biden regarding the White House Summit on Community Colleges.  While APSCU believes this is a step in the right direction, it is important that Washington not overlook private sector colleges and universities if we are to fulfill President Obama’s goal of the highest percentage of college graduates by 2020:

Dear Dr. Biden:

Congratulations on convening the first Community College Summit.  Your deep commitment to higher education is clear, and your leadership gives those of us who work in higher education confidence that our future workforce is in caring hands.  From business leaders, to lawmakers, to community college administrators and students, your Summit will bring together a diverse and impressive array of stakeholders – all of whom are committed to improving and enhancing higher education.

But one group is missing: the 3.2 million students and the more than 250,000 employees who populate private sector universities and colleges.  We are sorry about this missed opportunity, but we stand ready to support you, President Obama and Vice President Biden and to help attain the goal of the highest percentage of college graduates in the world by 2020.

Our institutions provide paths forward for students who, in many cases, have no other options.  Most students at our schools do not conform to the profile of a traditional student.  For example, 76% are financially independent of their parents; 47% have dependent children; 28% work full time; and 63% are age 24 or older.  Before the discussion turns overly abstract, we should remember the faces and stories of aspiring students.  There are countless examples of people, unable to find success within the traditional educational system, who have turned to private sector colleges and universities — and flourished as a

As you know, our schools work closely with the employer community to ensure that their faculty, curricula and facilities are preparing students for meaningful careers.  Last year, 54% of all new allied health workers and 10% of nurses received their degrees, diplomas, or certificates from private sector colleges and universities.  Though in 2008 our sector represented only 8% of higher education students (we have now climbed to 12%), 15% of all degrees and certificates were awarded by our institutions.  This positive outcome is because our schools focus so intently on outcomes for their students—getting the degree and getting the job.

On September 29, 2010, over 2,000 students rallied on Capitol Hill with lawmakers from both parties to tell their inspiring stories of their time at private sector colleges and universities.  Progressive Democrats and Conservative Republicans—at a time of election-year partisanship—joined hands and stood with these students.  We must follow these students’ lead and together find a way forward.

The millions of students in private sector schools deserve the same attention and encouragement as those students in other postsecondary institutions.  Please don’t forget to include our students in future White House discussions of how best to prepare our future workforce for the 21^st Century.  Only by joining forces will we help our country regain its global leadership in higher education and allow many more Americans to achieve their dreams.

APSCU contact: Bob Cohen.

 

From: http://www.career.org/iMISPublic/AM/Template.cfm?Section=Newsletters1&CONTENTID=21401&TEMPLATE=/CM/ContentDisplay.cfm

Letter from Steve Wallace to the Editor

A recently filed lawsuit alleges that officials of Florida State College at Jacksonville conspired to compete with a for-profit college with a campus in Jacksonville. This is not true.

With an enrollment of 85,000, our college has plenty of students.

What is true is that Keiser University is retaliating against our efforts to raise awareness about excessive student loan debt.

In collaboration with the U.S. Department of Education, Florida State College at Jacksonville has been significantly involved in efforts to improve student loan consumer protection.

In our view, strong measures are urgently needed at state and federal levels to ensure consumer protection against the abusive practices of some for-profit colleges that can saddle vulnerable students and their families with a lifelong burden of debt without any realistic prospect for repayment.

Such excessive debt often precludes further education and may severely impair the student’s ability to secure future employment and housing. Ultimately, American taxpayers pay for loan defaults, which currently total an estimated $47.4 billion.

Federal studies and investigations have found the for-profit college industry to be at the center of this student debt crisis and have raised serious concerns about some of their business practices.

The leaders of Florida State College at Jacksonville are concerned primarily about the exploitation of students in Northeast Florida by profit-focused colleges as these (typically young) citizens pursue their dream of a higher education.

As one of the largest and most comprehensive public colleges in America, Florida State College at Jacksonville offers nearly every program of interest at tuition rates among the lowest in the nation.

The college’s commitment to student loan minimization led to the establishment of the Star Opportunity Fund – one of the largest local need-based financial aid programs in the country.

The number of scholarships awarded by the fund to low-income students has increased by 176 percent over the past two years, and the college’s foundation has launched a massive campaign to make far more resources available to students.

Florida State College at Jacksonville officials will continue to combat excessive student debt while working hard to protect the interests of our local college students.

We will not let this lawsuit deter us from our mission of providing high-quality, affordable education to our community, nor will it deter us from sounding the alarm about some of the business practices of the for-profit college industry.

STEVEN R. WALLACE,

president,

Florida State College at Jacksonville

 

From: http://jacksonville.com/opinion/letters-readers/2010-10-08/story/non-profit-collegesconsumers-need-protection?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+JacksonvillecomOpinion+%28Jacksonville.com%3A+Opinion%29

Keiser University sues Jacksonville college

by Grant Explorer on Thursday, October 7th, 2010

For-profit colleges are beginning to launch an all-out war to fight what they see as unfair attacks from such critics as community colleges and the federal government.

Fort Lauderdale-based Keiser University sued a Jacksonville community college on Monday, claiming administrators there maligned its school. At the same time, a group representing 19 other for-profit schools released a study slamming recruiting practices and student achievement at community colleges, which compete for many of the same students and government dollars.

And last week, more than 2,000 career college students and supporters attended a rally in Washington, D.C., to protest proposed regulations that could strip the for-profit colleges of much of their federal aid.

“The misinformation is just extraordinary, and we have been absolutely miserable at defending ourselves,” said Keiser chancellor Arthur Keiser, who also leads the Association of Private Sector Colleges and Universities, the industry lobbying group. “Finally, I think that’s beginning to change.”

The sector has come under fire in the past year, as Senate hearings and federal government reports have raised questions about recruiting practices, student debt and the large amounts of federal dollars the schools receive. For-profits say they are being unfairly singled out.

Keiser claims in its lawsuit that the president and another administrator at Florida State College at Jacksonville launched a smear campaign against Keiser and the entire for-profit sector. The university based many of its claims on documents obtained through a public records request to the community college.

According to the suit, college president Steven Wallace sullied the reputation of Keiser and other for-profit schools in an April 2009 e-mail to a short seller, who would profit if the price of publicly-traded education stocks declined in value, the suit alleges. The community college was launching a new technical school at the time and saw Keiser as competition, according to the suit.

“The new technical college we will launch … is designed, in part, to drive the sleazebags out of our region,” according to Wallace’s e-mail.

The suit also alleges that school officials fed the media stories that for-profit schools “ripped off” their students and provided them with “worthless degrees.” Keiser’s business suffered, with lower than expected enrollments and restricted access to recruit at area high schools.

“They were out to harm our business, and it got to a point where this was intolerable,” said James Waldman, Keiser’s general counsel.

Wallace called the suit “absurd,” adding, “we are not concerned in the slightest because we have done nothing improper.”

Florida State College officials say they suspect Keiser is upset because community colleges have supported tighter controls of the for-profit industry. The U.S. Department of Education has proposed new rules that would limit colleges’ access to student aid if too many students default on their loans or fail to find “gainful employment.”

For-profit colleges received $4 billion in federal Pell Grants and $20 billion in federal loans in 2009, making up the bulk of their revenues, federal data show. And while only 12 percent of college students attend for-profit schools, they account for 43 percent of student loan defaults. Most students in community colleges don’t take out student loans, since tuition is state-subsidized and considerably cheaper.

“We are simply trying to protect our local college students from excessive debt,” Wallace said. “We will continue to do so on behalf of our community and will defend the college vigorously in court. ”

Keiser’s fight is not limited to Florida State College. Last week, it sent 28 students and supporters to Washington, D.C., to join a national rally against proposed federal regulations. Keiser nursing program graduate Greg Shaw, 44, of Tallahassee, was one of them.

“I worked very hard for a program where we lost 60 percent of the students who didn’t make the grade,” he said. “Now I’m hearing people sneering, saying, ‘I understand the government is cracking down on programs like yours.’ It has the effect of devaluing the degree I worked hard for, and it’s offensive.”

Career colleges and their supporters say the industry is being unfairly attacked. For example, a recent Government Accountability Report did an undercover investigation of recruiting practices at 15 for-profit colleges, but didn’t look at other education sectors. Problems were found in all the campuses, with potentially fraudulent behavior at four schools. Keiser was not among those visited.

Several for-profits, including Kaplan Higher Education and the University of Phoenix, have issued a long list of changes to address the problems, including restructuring their pay system so advisers aren’t working on commission, thus discouraging the use of high-pressure sales tactics.

Immediately after the government report, Kaplan suspended enrollment at Kaplan College locations in Pembroke Pines and Riverside, Calif., and that’s still in effect. A company statement said Kaplan is conducting a thorough investigation to make sure students and applicants “are treated in the most responsible and ethical manner possible,” and that employees are following all laws and company policies.

But industry officials say community colleges are also guilty of questionable practices. The Coalition for Education Success, made up of such schools as the Art Institutes and Argosy University, commissioned an undercover operation of practices at community colleges. The report states admission officials wouldn’t release graduation data and gave misleading or evasive data about job placement rates and earnings potential of graduates.

The survey also quotes federal data that shows community colleges have graduation rates of 21 percent, compared to 58 percent for career colleges.

“At a time when community colleges are being touted as the answer for educational achievement and job placement in this country, we found troubling evidence to the contrary,” said Jean Norris, lead researcher on the study.

If all the findings are true, it still doesn’t negate the need for reforms in the for-profit industry, said critic David Hawkins, director of public policy for the National Association for College Admission Counseling.

“The stakes must be extraordinarily high for the for-profits to be responding with such aggressive tactics,” he said. “The regulations proposed would fundamentally alter their business model, which is something they’re not interested in doing right now.”

From: http://www.exploringgrants.com/keiser-university-sues-jacksonville-college/

Dr. Chigos and the ‘gainful-employment’ rule

By Larry Stirling

From: http://www.sddt.com/Commentary/article.cfm?Commentary_ID=141&SourceCode=20101006tza

When Navy Lt. Cmdr. David Chigos retired, he tried to enroll at San Diego State University. Since he was working full-time during the day, he sought night classes.

Silly him … thinking that publically-employed academics might teach at night to accommodate working adults.

It is hard enough to get them to teach during the day.

Mr. Chigos must have been fuming as they laughed him out of the registrar’s office.

The experience helped Dave Chigos recognize that the public schools were failing to serve employed adults who worked all day and could only go to school at night.

The result of his frustration and then foresight and energy is the now widely recognized “National University” an institution that he started “out of the trunk of my car.”

Chigos and his team identified several impediments to reasonably-priced degrees.

Public university students are inured to the inveterate unresponsiveness of tenured, unionized and prickly faculties that require certain classes be taken while at the same time not providing enough of such classes to allow a perspicacious student to graduate timely.

Gone is the notion of a four-year degree because the faculty is just too durned busy to be bothered teaching the necessary hours to allow the enrollees to acquire 15 units a semester.

Chigos and his National University team instead arranged to have student registrations drive faculty decisions, not the other way around. When enough students needed a class in freshman English, an instructor was hired and the class provided.

To keep costs down and maintain maximum flexibility, there were no tenured faculty members. Instructors, who were working adults themselves, were hired based on the fact that they were qualified to teach the class.

Since they had other jobs, they did not need expensive benefits.

Quality control was maintained by having the students evaluate the instructors at the end of each teaching period. Lousy teachers were simply not hired back.

National University was decades ahead in applying computers to their administration further reducing overhead and pioneering “distance learning” throughout the world.

The N.U. template became a nearly overnight success spawning dozens of copy cats like Phoenix University, but meanwhile sending shock waves through the traditional schools.

About the same time, a group of investors realized that the existing law schools suffered from the same insular laziness as the big public universities.

So they started the Western States College of Law to serve working adults, such as myself, at night.

They kept costs affordable by hiring actual lawyers to teach instead of full-time faculty. Western States quickly became the largest law school in California.

Were these two innovative institutions lauded for democratizing education and cutting costs? Nope.

Instead, National University was set upon by the educational establishment led by USD President Author Hughes.

The henchman for the educational establishment is the Western Association of Schools and Colleges (WASC) and their hatchet of choice is to withhold accreditation and thereby cut off student access to federal school loans.

In the case of Western States School of Law, the apex man was the American Bar Association.

How dare the school use lawyers to teach law? How dare they rely on the public law library and the internet for access to legal resources?

To gain accreditation, WSU had to hire a full-time faculty of mostly liberals and establish a large, expensive library thus raising costs while making them less competitive, the real agenda for the accrediting agencies.

Done and done. Student costs rose substantially: a cost initially borne by the taxpayers via student loans and later by the students being burdened with larger debts.

However, the harassment of National University and WSU did not stop the creation of the manifestly superior private post-secondary educational market.

Students and parents came to recognize that public universities specialized in providing little more at the end of six year’s education than young, liberal unemployable social workers, oh, and a huge debt hangover.

As a result students flocked to the private-schools knowing that upon graduation they would likely be employable.

From 2000 to 2008, enrollment in private post-secondary schools ballooned to 1.8 million.

So many students have abandoned the public higher education system that a full panic has overtaken the traditional schools.

So they have called on the federal government to simply crush the competition with a proposed “gainful-employment” rule, a rule which no public higher education institution, especially SDSU, could ever meet. (See: http://www.mycareercounts.org for more information).

If the graduates of the private schools don’t pay back their loans within a stipulated period of time (something the school itself has no control over), the school whence they graduated will be cut off from federal loan eligibility.

The Secretary of Education claims that private students, obtaining employable skills are “less versatile” and the success of the schools may result in an “oversupply” of certain classifications of employees such as nurses.

I happen to know that the Department of Labor does not keep track of vacant jobs of which there are many millions in this nation. I also find it ludicrous that the Secretary of Education would attack the schools for their success and claim “oversupply.”

The “gainful employment” rule is nothing more than the public entities trying to suppress successful competition.

Dr. Chigos and the WSU founders would understand.

---

Stirling, a former U.S. Army officer, has been elected to the San Diego City Council, state Assembly and state Senate. He also served as a municipal and superior court judge in San Diego. Send comments to larry.stirling@sddt.com. Comments may be published as Letters to the Editor.

Norris Report: Student Satisfaction on Aspects of Importance in the College Experience

http://www.nortonnorris.com/pdfs/spotlight-on-community-college-recruitment_10_04_10.pdf

Here is another http://www.nortonnorris.com/pdfs/spotlight-on-community-college-recruitment_10_04_10.pdf

Interesting Side by Side Comparison of Advertising Tactics

Eisman claims he’s never heard of Keiser University; named in lawsuit

Following on this morning’s post about privately held for-profit school The Keiser School suing Florida State College at Jacksonville, Keiser’s senior counsel, James Waldman, was kind enough to take a few minutes this afternoon to talk with me by phone.

Most interesting to investors following the travails of publicly listed for-profits such as Grand Canyon Education (LOPE) and Apollo Group (APOL), and others, is that Waldman contends the suit is a first of its kind in terms of alleging defamation against for-profit ed, but he also says Keiser has not joined forces with any other for-profits, public or private, in bringing suit. The action is strictly related to what the company sees as a particular smear campaign by Florida State.

Waldman says the company can show that misleading statements by executives of Florida State, featured in the media, harmed the company’s business by reducing enrollment and even getting Keiser barred from recruiting at some high schools.

The issues in the suit, however, go to the heart of the criticisms against for-profit ed.

“Florida State has said that we [Keiser] are ripping off our students, and has said our degree is worthless,” said Waldman.

“There is no evidence that our degree is worthless. It is the same degree that can be obtained at the University of Florida,” contends Waldman. ”

“We have higher graduation rates than the community colleges do, and we create more jobs [for graduates] than they do,” said Waldman.

As for the connection to short sellers, such as Steve Eisman of FrontPoint Financial Services, who are named in the suit as co-conspirators, Waldman says Eisman and others “have been in direct communication with the named defendants,” exchanging information about for-profit ed.

As for Eisman, he also spoke with me this afternoon by phone. Eisman tells me he had never heard of Keiser before hearing of the suit last night. Eisman is not a party to the suit.

“I laughed,” Eisman tells me. “It’s very hard to be a co-conspirator about an institution I’ve never heard of.”

Eisman said he may have had some contact with Florida State’s government liaison, Susan Lehr, who is named as a defendant. However, it was only in the context of a general discussion of for-profit ed. “I speak to a lot of people about this stuff,” says Eisman. “We never spoke about any particular schools, and I’d never heard of Keiser before.”

The suit is ultimately “not at all important to the for-profit eds,” contends Eisman. “What I have said publicly,” adds Eisman, “is that the graduation rates are exceptionally low [in for-profit ed], the default rates are astronomical, and that the federal government should do something to change the industry. Those first two are facts, the latter is my opinion.”

From: http://blogs.barrons.com/stockstowatchtoday/2010/10/05/keiser-details-smear-campaign-against-it-eisman-never-heard-of-em/

Thumbs up to Glenn “GT” Thompson!

Washington, D.C.—U.S. Representative Glenn ‘GT’ Thompson, R-Howard, today told a rally of a thousand students that, “You have every right to determine your own educational needs; you have every right to determine your future career path; and, you have every right to make your own destiny.”

Thompson joined his colleagues Reps. Rob Andrews (D-NJ); Alcee Hastings (D-FL); and Brett Guthrie (R-KY) at the foot of the U.S. Capitol in a bipartisan show of support for the students’ concerns about U.S. Department of Education proposed regulations on “gainful employment”.

If the “gainful employment” rules go into effect, they will eliminate access to higher education for as many as 400,000 students per year. These rules apply almost exclusively to the for-profit sector of higher education, while ignoring the same issues concerning student debt found at public and private non-profit institutions.

One of the requirements for for-profit institutions to participate in the federal student aid program is that they offer a course of study that leads to “gainful employment” in a recognized occupation. Despite over forty years of existing precedent, the Education Department is considering regulations to define “gainful employment” by establishing an arbitrary 12 percent debt-to-earnings threshold based on student debt for recent graduates of each program offered by the institution. One way of explaining that is a question posed by the Department: Are graduates with typical student debt able to repay their loans in ten years without taking 12 percent of the expected earnings in the occupation?

Once again, these new regulations do not affect public and private not-for-profit universities and colleges.

“The President has promoted a policy to have 5 million new college graduates by 2020,” said Thompson. “I commend the President for that goal, however, I have to stop and wonder how we’re going to achieve the mission if the Department of Education is going to put up road blocks—or—decide that you can only attend one type of school over another.”

“I represent a very rural district in Pennsylvania,” Thompson told the rally. “Many of my constituents don’t have access to a community college and live a significant distance from universities. Many proprietary schools have sprung up out of necessity.”

The effect of these regulations will be that student choice will be limited, because for-profit institutions may not be able to continue offering certain programs, to ensure the proposed debt-earnings-ratio.

“Many students in Pennsylvania choose these schools because of their convenience. They realize that career colleges offer course work of all types and work to accommodate the busy schedules that we all have. They realize that life does not just stop for four years—so you can go to school. And they realize these institutions will give them the skills they need to enter the work force and earn a decent living,” added Thompson.

In May, Thompson joined 9 members of the Pennsylvania Congressional Delegation in sending a letter in opposition to Education Secretary Arne Duncan on this issue, requesting that the Department vacate the proposed changes. In August, the Department of Education released a formal proposal. Since, Thompson has joined with several of his colleagues on the House Education & Labor Committee in submitting formal comments in opposition to the rules as proposed.

This week, the Department of Education, due to extensive public comment, has decided to move the scheduled publication date of the rules from November 1, 2010, to July 1, 2011.

From : http://friendsofglennthompson.blogspot.com/2010/10/thompson-rallies-with-students-for.html

Keiser University Lawsuit Document

Click here to read the Keiser Lawsuit against Florida State College Jacksonville.

A For-Profit College Sues

A for-profit college is suing Florida State College at Jacksonville, its president, and its chief lobbyist for “tortious interference with a business relationship” and “injurious falsehood” in connection with what it says was “a false and misleading campaign in the Florida press and the national media designed to disparage Keiser University and to drive Keiser and other proprietary schools out of business.”

The complaint, filed yesterday in Broward County, Florida, names two money managers, Steven Eisman of Frontpoint Financial Services Fund, LP, Greenwich, Conn., and Gilchrist Berg of Water Street Capital, Jacksonville, Fla., as “co-conspirators.”

The involvement of short-sellers in the push for increased regulation of for-profit colleges and universities has been the subject of extensive coverage here, but the court complaint lays out new details about the way that the government-backed colleges — the complaint terms Florida State College at Jacksonville “a state-funded direct competitor of Keiser University” — worked hand in hand with short-sellers.

“Keiser suffered special damages as a result of Defendants’ negative media campaign in the form of, among other things, decreases in expected enrollment, increased costs of doing business, and decreased business valuation,” the complaint claims.

The complaint says the president of Florida State College at Jacksonville, Steven Wallace, sent Mr. Berg, described as “a prominent Jacksonville short-seller” an e-mail “with information to use against the proprietary schools.”

The complaint also cites an email from the top lobbyist for Florida State College at Jacksonville, Susan Lehr, that “personally insulted Dr. and Mrs. Keiser, Keiser University officials. Ms. Lehr called Mrs. Keiser “very arrogant like him. I guess that is what happens to you when you ‘earn’ $20 million a year and own 5 jets.”

The suit says that Ms. Lehr was “trading information with Eisman” who “stood to profit if the value of proprietary schools declined.”

And it says that Ms. Lehr promoted an Eisman speech critical of for-profit colleges in advance and “tailored a Florida State College press release to Eisman’s message.”

Says the complaint: “In May 2010, short seller Steve Eisman gave a speech called ‘subprime goes to college’ that predicted for-profit stocks would continue to fall. The speech also helped ensure that they would.”

A PDF of the complaint in the lawsuit is here.

The suit was first reported yesterday by the Florida Times-Union.

We have calls in to Florida State College for their response and will post it when we receive it; they had no comment to the Times-Union, saying that they had not yet had a chance to review the complaint.

From: http://www.futureofcapitalism.com/2010/10/co-conspirator-eisman

Keiser University sues FSCJ president

By Matt Coleman

Keiser University, a regional for-profit college, has filed suit against Florida State College at Jacksonville President Steven Wallace and one of his top administrators, saying they tried to sully the school’s image by colluding with detractors of for-profit colleges.

The crux of Keiser’s civil suit, filed Monday in Broward County, hinges on e-mails from Wallace and Susan Lehr, FSCJ’s vice president of government relations. The e-mail exchanges included representatives from The Institute for College Access and Success, a national group that has lobbied for tighter restrictions on for-profit schools.

The lawsuit claims the community college leaders tried to launch a clandestine smear campaign designed to build negative publicity for the proprietary college, which has one campus in Jacksonville.

An FSCJ spokesman said Wallace hadn’t received the lawsuit by Monday evening and declined to comment.

In the e-mails, an account linked to Wallace disparages the for-profit sector in a note to Gilchrist Berg, a prominent Wall Street short seller who founded a multibillion-dollar Jacksonville-based hedge-fund firm.

“All right, my friend. Here is a bunch of good stuff to get you started in your exploration of greed, corruption and predatory schemes among Florida’s proprietary and for-profit career ‘colleges,’” the e-mail said. “The new technical college we will launch on 8/1/09 is designed, in part, to drive the sleazebags out of our region.”

The same e-mail identifies Lehr as the “designated antagonizer of the privates.”

Other e-mails include correspondence between Lehr and Steve Eisman, a hedge-fund manager who gave a vitriolic speech against for-profit education during a Senate hearing in May.

“I cannot thank you enough for speaking out on the for-profit higher ed industry,” the e-mail said. “I read your speech and could just leap with joy!”

The lawsuit alleges Lehr “tailored a Florida State College press release” to the speech’s message, which alluded to the “subpriming of students.” The release was distributed to multiple news outlets, according to the lawsuit.

Keiser officials said the negative publicity has hindered student enrollment and financially harmed the company. The suit seeks damages, but a total amount wasn’t listed.

James Waldman, Keiser’s general counsel, said this is the first lawsuit ever filed by Keiser.

It’s unclear if this is the first time a for-profit school has sued a state-funded institution.

“My hope is other proprietary schools take action if this is going on elsewhere,” Waldman said. “There is no place in this country for the government schools to operate in such a manner to harm private businesses.”

matt.coleman@jacksonville.com, (904) 359-4654

From: http://jacksonville.com/news/florida/2010-10-04/story/profit-college-sues-fscj-president

E-Mails Spice Up Lawsuit Over Private Colleges

Hedge-fund manager Steven Eisman made a fortune shorting subprime debt, and at last May’s Ira Sohn Conference in New York he announced his next target: For-profit colleges. Now Eisman’s efforts have inspired a nasty lawsuit by a Florida school that accuses him of conspiring with administrators at two competing public colleges to drive down the value of for-profit schools.

I’d file this under “sour grapes” along with any number of similar suits against short-sellers, or the United States Football League’s hail-Mary antitrust suit against the NFL. Except for two things: Plaintiff  Keiser University in Fort Lauderdale used the Freedom of Information Act to get all sorts of nasty e-mails from public school administrators to the short-sellers. And the law firm at the bottom of the complaint, Bartlit Beck , has a well-deserved reputation for top-gun litigation.

The suit is curious because it doesn’t name Eisman or the other short-sellers as defendants and the plaintiff, Keiser, isn’t one of Eisman’s publicly traded targets. Instead it names Steven Wallace and Susan Lehr, chief executive and head of government relations, respectively, at Florida State College at Jacksonville. But more litigation may be coming soon. Keiser got 15,000 documents in its FOIA request including some that might give ammunition to public companies should they decide to sue.

“There are other documents out there that were not necessarily relevant to our lawsuit that certainly implicate claims by others,” said James Waldman, in-house counsel at Keiser. Since they’re all public documents, Waldman said, he’s in a sharing mood.

The suit accuses Florida State College of disparaging Keiser and other private schools of feeding “false stories to the media” that the private schools ripped off students and provided worthless degrees. That was Eisman’s investment thesis, of course, as well as a frequent complaint by critics of for-profit career schools that often operate on a stream of federal loan money.

Named as “co-conspirators” are Eisman of Frontpoint Partners in Greenwich, Conn.; Gilchrest Berg of Water Street Capital in Jacksonville; Antal Desai with CMCG in Dallas and officials with several groups opposed to the private student loan industry as well as U.S. Public Interest Group.

“Here’s a bunch of good stuff to get you started in your exploration of greed, corruption and predatory schemes among Florida’s proprietary and for-profit career `colleges,’” Wallace says in one e-mail to Berg the plaintiffs say they obtained under a FOIA request. In another e-mail, Wallace boasts to Berg that a planned new public technical colleege “is designed, in part, to drive the sleazebags out of our region.”

Wallace and Lehr were at a meeting and unavailable for comment Tuesday.

The lawsuit details correspondence between various public-education advocates and reporters at USA Today, Bloomberg, the Miami Herald and others. The suit says such efforts tortiously interfered with the relationship between Keiser and its students and constituted “injurious falsehood.”

In his May speech entitled “Subprime Goes to College,” Eisman ripped the entire sector as providing subpar educations financed with subsidized federal loans. He was particularly critical of Washington Post Co., which has long since moved on from its newspaper roots and now derives most of its earnings from for-profit education including its Kaplan testing unit.

So far, Eisman’s bet has paid off, with for-profit schools falling up to 50% amid rumblings the government will impose new rules tying access to federal loans with the schools’ success in finding graduates jobs.

Meanwhile in August, the General Accountability Office released a report showing that undercover tests of 15 for-profit colleges found that all 15 had engaged in deceptive practices including overstating “undercover applicants’ potential salary after graduation” and failing to disclose all costs. Perhaps mindful of future litigation, the report was careful to state that “results of the undercover tests and tuition comparisons cannot be projected to all for-profit colleges.”

From: http://blogs.forbes.com/danielfisher/2010/10/05/e-mails-spice-up-lawsuit-over-private-colleges/



Keiser University files civil suit against Florida State College at Jacksonville

For-Profit Institution Sues a Public-College President, Alleging a Smear Campaign

In a clear sign of the heightened tensions over proposed new federal regulations on for-profit colleges, Keiser University, a for-profit education system based in Florida, has sued a public-college president there, accusing him and a top administrator of smearing Keiser by communicating derogatory comments about the for-profit education industry to investors and others via e-mail. Keiser itself is not publicly traded, but its founder and chancellor, Art Keiser, has been an outspoken criitic of the proposed regulations. The civil suit was filed in state court against two officials at Florida State College at Jacksonville—its president, Steven R. Wallace, and its vice president for government relations, Susan M. Lehr.

From: http://www.forprofitedu.com/2010/10/keiser-university-files-civil-suit-against-florida-state-college-at-jacksonville/

Democrats, Progressives Escalate Concern Over Criticism on Private Sector Higher Education

Student Success Stories Ignored

WASHINGTON, DC (September 29, 2010) – In advance of a new round of expected criticisms of career colleges by Iowa Democratic Senator Tom Harkin at a planned Thursday hearing, more prominent Democrats and progressive advocates are asking for fairness for students of private sector colleges and universities.

In a letter sent today to Harkin, Coalition for Educational Success spokesperson and former Clinton Administration Special Counsel Lanny J. Davis said that the Senator’s overly broad criticisms of career colleges along with proposed U.S. Department of Education rules, would likely have a disproportionate negative effect on disadvantaged students’ access to higher education, especially the lower income and minority students who predominantly attend these colleges.

Davis, a long-time supporter of Senator Harkin’s, asked the Senator to try for more balance and fairness in the planned presentations at Thursday’s hearings.  “I hope that you will not, in fairness, ignore the millions of private sector college student and graduate success stories and not allow one witness with unproven allegations to testify without permitting another witness at the same table at the same time to provide a contemporaneous factual rebuttal.  I respectfully suggest that to do otherwise would be unfair–and inconsistent with all I have observed in your public service over the years,” said Davis in the letter to Senator Harkin.

Davis joins more than 80 members of Congress, including dozens of prominent Democrats, who have voiced their concern over proposed Education Department rules heavily promoted by Harkin, which would limit college access and choice for minority and poor students.  Just this week, progressive Democratic Senators Roland Burris, Herb Kohl and Bill Nelson asked for reconsideration of the proposal.  Leading groups in the African-American and Latino community have also added to the growing chorus of opposition.

More than 2 million students will enroll in career colleges this year, seeking a direct path into the job market by expanding their skills and knowledge.  The overwhelming majority are non-traditional students – full time workers, working parents, minorities, workforce returners and veterans.

Forty-three percent of students at career colleges are minorities and sixty-five percent are women.  The schools graduate nearly double the proportion of minority students when compared to other institutions.

“In the worst economy in a generation, we need more minority and underprivileged kids in college, yet some in Congress and the Obama Administration are considering new regulations that will create obstacles instead of opportunities,” said Davis.  “Underserved students, more than any others, depend on private-sector colleges.  Proposals being discussed will have dramatic consequences by denying choice and access to students, impeding skills training to fill open jobs in the workforce and choking innovation in higher education.”

From http://ed-success.org/press-release-concern-over-criticism-on-private-sector-higher-education.php