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Weekly News Roundup: For-Profit Education Battle Rages Undiminished

Weekly News Roundup: For-Profit Education Battle Rages Undiminished

By: Louis Conrad on March 4, 2011
 

There's still much ado about the practices of for-profit universities grabbing higher-ed news headlines.

Congress.org reports that a "group of Republican senators introduced a bill to block the Obama administration from tightening rules on federal loans to students attending for-profit colleges, even as Senate Democrats announced plan [to] continue their probe of the industry."

These five Republican senators, led by Jim Risch of Idaho, introduced Senate Bill 460, which "would prevent the Department of Education from implementing what's known as the 'gainful employment' regulation, which would eliminate federal financial aid for programs with high proportions of students who are not repaying the principle on their student loans, or who end up with excessive debt loads compared with the salaries they can earn."

In other higher-ed news, some states are developing their own bills to rectify what they believe represent abuses by the for-profit university system. Reuters reports that California is headed for cuts for for-profit students: "California's student aid commission said on Friday that aid funds going to students at for-profit schools should be slashed first when the state cuts its education budget." Specifically, the Reuters article continues, "California Student Aid Commission, which administers financial aid programs, voted unanimously on Friday to put Cal Grant aid to for-profit schools' students at the bottom of it priority list when the state is forced to make budget cuts relating to education financing."

This new approach owes to the fact that California took some of the worst hits during the housing crisis and subsequent economic recession. In a press statement Commissioner Lawrence Hershman observed that "[t]he public universities have taken on drastic cuts. It's time for the for-profit colleges to share in some of the pain."

Maryland likewise seeks to tighten its grip on for-profits. The Baltimore Business Journal reports that for-profit and career colleges "operating in Maryland could be barred from state financial aid and required to reimburse their students' tuition if they go out of business if a new bill is passed in the General Assembly."

This bill (Senate Bill 695 / House Bill 995) would give "the Maryland Higher Education Commission more power to regulate for-profit colleges and universities like the University of Phoenix, Strayer University, DeVry University and Baltimore International College."

The next few months will be critical to the future of for-profit institutions, which need to prove their case that they educate millions who don't otherwise enjoy access to traditional postsecondary institutions. The clock is ticking, and for-profits must prove their mettle, lest they go the way of the dodo bird.

 
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