How for-profit colleges operate is at the heart of a bitter fight between the colleges’ trade association and the federal government.
Last fall, the U.S. Department of Education announced that it will apply 13 new rules to regulate for-profit schools. Those regulations affect Bryant and Stratton College and ITT Technical Institute, the two local for-profits here in Syracuse.
In response, the Association of Private Sector Colleges and Universities filed a federal lawsuit over three of the regulations. The group is the trade association representing over 1,500 for-profit schools, including ITT Technical Institute. The group’s lawsuit argues the regulations were rushed, unfair, arbitrary and even unconstitutional.
The group’s members “believe in fair regulatory oversight to protect students, institutions and taxpayers. But these regulations as written are not fair, lawful or workable,” Harris Miller, the group’s president and CEO said in a press release. Bob Cohen, senior vice-president of communications for the trade group, declined to comment beyond the press release.
Officials at the federal education department declined to comment on specific aspects of the lawsuit. “We’re confident that the published regulations will do the best job of protecting students and taxpayers,” said spokesman Justin Hamilton at the education department in Washington, D.C.
Officials at ITT Technical Institute’s Liverpool campus did not return multiple phone calls for comment.
Bryant and Stratton isn’t a part of the trade group that’s suing the federal government. But officials at Bryant and Stratton College’s James Street campus said that they’re following the lawsuit closely.
“At this point, the college really does not see the regulations affecting our campus” said Melissa Moore, an academic advisor at Bryant and Stratton. Bryant and Stratton enrolls 1,420 between its downtown campus on James Street and a secondary campus in Liverpool.
The regulations, according to the federal government, are meant to ensure that for-profit schools meet minimum federal standards for accreditation, to prevent deceptive marketing practices by schools and third-party advertisers and to prevent them from paying their recruiters based on how many students they enroll.
For its part, Bryant and Stratton defended its practices that those regulations would affect. For example, Bryant and Stratton stresses re-paying the federal education loans, said Tami Eiklor, the financial aid manager at the James Street campus.
“Financial aid advisors spend a great deal of time explaining to students throughout their time here what the ramifications are if they fail to pay back their loans,” said Eiklor.
Under the new federal rules, schools can lose eligibility for federal student aid if a school’s default rate on student loans reaches 30 percent over three years. The federal aid is a major source of money to for-profit schools. If students default on the federal loans, the schools do not have to repay the loans.
At Bryant and Stratton, 85 percent of students get federal grants and 89 percent receive federal student loans, Eiklor said. Nationally, at its 18 campuses across the country, Bryant and Stratton averages a 13-percent default rate, Eiklor said.
The other local for-profit school, ITT Technical Institute, has slightly better statistics, according to the National Center for Educational Statistics. From 2006-2008, the most recent years the center has available, 12.3 percent of ITT’s students defaulted on their student loans.
(Stephen Hughes is a graduate student in magazine, newspaper and online journalism.)
-30-
