Corinthian Colleges Sale: New York Not Included

In its announcement last month that Zenith Education Group finalized its purchase of roughly half of the colleges previously part of for-profit educator Corinthian Colleges Inc., the Department of Education noted that 50 college campuses were part of the package and that they would all be transitioning to non-profit tax status as part of the deal. Corinthian Colleges Inc. had come under investigation for alleged unscrupulous marketing tactics and predatory lending and, eventually, forced into closure after the Department, according to its release, placed Corinthian on an increased level of financial oversight that delayed…Read more …

From The Hill: GE to Bring about “Unintended and Detrimental Consequences”

A recent commentary on The Hill ("Gainful Employment Rule Could Harm Law Schools") touches on a point that again highlights the unfair and unsound approach of the Gainful Employment regulation, which is that it should require all programs from all colleges to comply with the regulations – not just those in the proprietary sector. Protecting students from onerous student debt and poor program outcomes should be a universal mandate of all higher education providers. If the Department of Education was to apply this Rule evenhandedly to all schools, it would show how irrational…Read more …

GE and the Financial Interests of Students

One of the great untruths often spread by those critical of for-profit sector is the assumption that all proprietary colleges put their own financial interests above all else. And while such skewed misperceptions do not track with the work done every day on APC member college campuses that clearly demonstrate otherwise, let's put that conversation aside for now and talk instead about the financial interests of students, particularly with respect to GE. The topic of students' financial interests is certainly fair game in any debate about GE as they are the ones dependent…Read more …

The GE Paradox: Profiting from Turning Nonprofit

It’s an issue we have touched on time and again: the paradoxical nature of the Gainful Employment Rule, which, as a recent New York Times article (“Some Owners of Private Colleges Turn a Tidy Profit by Going Nonprofit") reminded us, ultimately comes down to tax status. After all, non-profit colleges are barley beholden to the GE Rule and virtually every GE program at community colleges avoids the rule even when there is clear objective evidence that program outcomes at many of these institutions are weak and their student borrowers are struggling. The Times'…Read more …

Answering to Investors: Not Just For Proprietary Colleges

A common accusation hurled by critics of proprietary colleges concerns allegations of "putting profits before students," the suggestion being that the administrators, faculty, and staff at these colleges and universities simply serve the financial motivations of the owners and investors. The idealistic suggestion seems to be that public and non-profit institutions are not revenue-minded and that they are somehow above having to concern themselves with the practical realities of finance. That is clearly not the case. A New York Magazine piece last year flippantly described Ivy League powerhouse Harvard University as “a real-estate…Read more …