The Hill: The administration's forced extinction of for-profit colleges

August 15, 2014
By Harry C. Alford, contributor

 Imagine if the federal government decided to regulate hospitals and medical clinics by judging them strictly by their ability to achieve specific outcomes for their patients — as opposed to measuring their quality of service — or else funding would be cut off, causing them to close their doors. Moreover, not all hospitals and clinics would be subject to these regulations — just the ones in neighborhoods with older populations, higher percentages of people living in poverty, and larger numbers of Latino and African-American residents.

The scenario above would lead to the closure of hundreds of hospitals which serve the vital role of providing health services to the underserved Americans who need them most. A proposal like this would be lambasted by Americans as outrageous and harmful. However, this is exactly what the U.S. Department of Education has proposed when it comes to college programs throughout the country with its proposed "gainful employment" regulations.

While the administration's conquest of Corinthian Colleges this summer left 72,000 students and 12,000 employees without a clear path forward, those numbers appear paltry when compared to the thousands of employees and millions of students who would be affected by the proposed gainful employment regulations. Various studies have shown that approximately 1 million students are enrolled in programs that will likely lose eligibility for Title IV federal student aid under the proposed regulations, and up to 7.5 million students could lose access by 2024.

As previously noted, the administration claimed ignorance of Corinthian's tenuous finances when it delayed access to the federal funding for students choosing to attend a Corinthian institution of higher education, but those dubious claims have since been exposed as a ploy to cover up the Department of Education's blind zeal for big government. As BuzzFeed revealed in documents provided to the outlet, the department was aware of many of the details of Corinthian's financial situation as recently as May 2014. This revelation — coupled with the department's and the administration's known hostility toward private-sector schools — confirms that the department's assertions are little more than a cover up for its hasty, poorly planned actions.

While the department may be patting itself on the back now, the repercussions of its hasty actions are being felt by the thousands of students who attend Corinthian's schools. These students now face uncertain futures as the department failed to consider a plan to absorb them, as well as the impact to Corinthian’s full-time employees, who will now be forced to seek new alternatives. The department's lack of consideration for this underserved population of the U.S. will be made even clearer if its proposed gainful employment regulations become law, as they are guaranteed to have exponentially more damaging effects.

The prospect of the impact of the gainful employment regulations is more appalling when the demographics of many private-sector institutions are taken into consideration. The majority of students who attend private-sector colleges come predominantly from challenged socioeconomic segments of our communities. Students at for-profits tend to be older than traditional students, are more likely to be minorities and slightly more likely to be female. Many students are already part of the workforce and are twice as likely to have families of their own.

Analysis from Charles River Associates suggest that between 25 and 40 percent of African-American students, between 21 and 39 percent of Hispanic students, and between 24 and 41 percent of female students are enrolled in impacted programs. These are the very individuals, in every corner of our country, who are working to break into the American middle class. They are also people for whom traditional public or non-profit colleges simply aren't an option — either due to costs, schedules, admissions requirements or simply due to choice, a freedom we enjoy in this country the last time I checked.

If the proposed regulations are put in place as currently drafted, there will be a snowball effect. First, students who are reliant on federal financial aid to afford college will be denied access. The resulting reduction in enrollment could shut down entire programs and colleges, thus negatively impacting potentially all students enrolled and studying at the institution of their choosing. Some programs, striving to meet unrealistic metrics to remain viable, will greatly restrict admission of the underserved students who need it most, and only enroll low-risk students. The schools left standing will be no more accessible to underserved students than traditional colleges and universities, public or non-profit.

It won't take long before the American public's outrage against these shortsighted regulations boils forth when millions of students are forced to abandon their dreams of higher education and are stripped of one of their most important options for life improvement.

Alford is the cofounder, president and CEO of the National Black Chamber of Commerce.

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Tallahassee Democrat: Tom Feeney: Proposal threatens opportunity for students

July 14, 2014

Tom C. Feeney, My View

Pro-growth policies in recent years have sparked an economic turnaround that makes Florida the envy of most states.

Our annual job growth rate of 3.3 percent is the fastest since 2006, and Florida’s month-over-month private sector job growth has been positive for the past 34 consecutive months. Florida businesses have created more than 600,000 jobs since 2010, while the state’s unemployment rate has remained below the national unemployment rate for the last nine consecutive months.

Career colleges advance these positive trends. Their programs are concentrated, streamlined and tightly focused on workforce demand and job availability, utilizing employer councils to ensure that classes and labs reflect current day marketplace needs and future directions. It is no coincidence that career college programs help prepare students for employment in at least 10 of the state’s 20 hottest job categories.

Unfortunately, the U.S. Department of Education has the career college sector squarely in its sights with the proposed “gainful employment” regulation. While the regulation ostensibly is focused on students and schools, its impact on Florida businesses could be substantial. That’s because career colleges supply employers with thousands of skilled, motivated and “job-ready” applicants every year. As such, these institutions help Florida businesses in health care, information technology, hospitality and other high-demand employment areas grow by fueling the talent pipeline.

The proposed gainful employment regulation will force schools to cut programs if their graduates are unable to meet a set of arbitrary salary and loan repayment thresholds. While the regulatory language includes all postsecondary institutions offering certificate and two-year career education programs, make no mistake about it: The higher, non-taxpayer subsidized tuition costs of career colleges make them squarely (and unfairly) the government’s target.

This is a federal regulation, but its effects will be felt at the state level. Consider the impact in Florida, where more than 1,000 career college campuses are educating more than 300,000 students — almost one in five of all 12-month enrollments. The government estimates that the proposed rule, due to take effect soon, will impact about 20 percent of programs immediately. Another 10 percent of programs would be relegated to the department’s putative penalty box, a gray zone of possible sanctions sure to cast a chill on new student enrollments.

The Association of Private Sector Colleges and Universities (APSCU) recently released a report finding that the regulation could impact up to 44 percent of career college students. In Florida, the new rule would have the potential to push 132,000 students out of higher education.

In tampering with talent availability, the Department of Education threatens slowdowns in key sectors of the Florida economy. Just consider the following:

• Health care will account for almost one in four jobs over the next 10 years. In the retirement-attractive Sunshine State, 17 percent of residents are 65 years old or older. More than 60 percent of health care graduates in Florida are educated at career schools.

• A study by TechAmerica ranks Florida No. 3 for high-tech establishments and No. 5 for high-tech employment. Florida career colleges produce over 60 percent of in-state information technology graduates.

• Florida hosts almost 95 million visitors a year. Career colleges educate 83 percent of Florida’s culinary arts graduates.

Career colleges also help ensure the availability of a workforce that is as diverse as it is well-skilled and job ready. Twenty-two percent of Florida’s career college graduates are African-Americans, compared with 17 percent for all institutions; for Latino students it’s 30 percent, compared with 22 percent for all institutions.

The constructive contribution of career colleges to a more diverse, better-prepared Florida workforce explains why more than 100 leaders across the state, including the Associated Industries of Florida, the Florida Hospital Association and the Florida Restaurant and Lodging Association, have joined together to oppose the U.S. Department of Education’s proposed gainful employment regulation. Many in Congress are likewise opposed, including Florida members of Congress U.S. Reps. Alcee Hastings, Ted Deutch, Lois Frankel and Joe Garcia.

Student loan debt is an important problem, and solving it is an important national priority. Lending issues are not, however, limited to career college students. To make real headway, we need less scapegoating and more systematic assessment. Meanwhile, widely available career college access means more skills for Florida workers, better opportunities to grow Florida businesses and a more vibrant economy overall.

Tom C. Feeney is president and chief executive officer of the Associated Industries of Florida (

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Miami Herald: Don’t hobble students at career colleges

July 08, 2014

By Curtis Austin

Education reform in South Florida deserves high marks, with struggling inner-city high schools, once so-called dropout factories, turning into innovation laboratories. According to a recent report in the Miami Herald, the number of graduating seniors has increased even as enrollment has gone down. High schools in Miami-Dade and Broward counties are taking progressive steps to turn more of their students into graduates. This should help the area sustain its impressive gains in payroll employment for years to come.

Unfortunately, misguided public policy may spoil this bright upside. The U.S. Department of Education is in the process of erecting barriers to the type of career education that helps many college students make the transition from classroom to job site. While everyone knows of University of Miami, Florida International University and Miami Dade College, few people realize that 108,000 students in South Florida attend career colleges. These are working men and women, often single parents, more often than not financially disadvantaged.

They choose career colleges because they are looking to master in-demand skills, a quick return to the workforce and the chance to build sustainable middle-class careers. South Florida’s immigrant population, in particular, has found career colleges a path to the middle class.

The Department of Education has other ideas. The Department’s proposed Gainful Employment regulation would close many career-college programs if graduates do not meet an arbitrary set of income and student-loan debt repayment thresholds. The regulation does not apply to degree programs at state universities or state colleges or at not-for-profit private schools, unfairly targeting programs in career colleges and the students they serve.

Career colleges are not taxpayer subsidized and, as a result, charge tuition that reflects the true cost of providing education. Many career-college students have previously tried community college. At career colleges, they succeed because they find the small classes, flexible schedules that let them keep working, hands-on learning, modern facilities and other educational supports they need to complete their academic programs.

The Gainful Employment regulation would harm many of these students by limiting their access to higher education. A report released by the Association of Private Sector Colleges and Universities (APSCU) finds that the regulation could affect up to 44 percent of career college students. In South Florida, that could close the door to post-secondary opportunity for more than 47,500 students every year.

Career colleges educate 60 percent of all healthcare graduates and 60 percent of all information technology graduates in Florida. Sideline almost 50,000 motivated, skilled and job-ready applicants and the impacts on the Miami area’s talent pipeline will be enormous.

Leaders across the state, including Associated Industries of Florida, the Florida Hospital Association and the Florida Restaurant and Lodging Association, have registered their opposition to the Department of Education rule. They are not alone. In Congress, lawmakers on both sides of the aisle, including Florida Reps. Alcee Hastings, Ted Deutch, Lois Frankel and Joe Garcia, also oppose the Department’s clear misstep.

Early in his first term, President Obama challenged the nation to recapture its position as a world leader in post-secondary education attainment. The president rightly foresaw that an educated workforce is critical to a globally competitive economy. The availability of such a workforce is especially important to South Florida’s trade-oriented employment marketplace. The Department of Education’s Gainful Employment regulation runs contrary to the president’s lofty goal.
There are, of course, positive steps that could help borrowers better manage student-loan debt. President Obama recently stated his intention to expand the use of income-based repayment programs. Other options include:

• Limiting student loans to educational needs — tuition, books and fees — rather than the total amount students may be eligible to borrow based on federal formulas.

• Improving the budgeting and student-loan repayment counseling provided to borrowers. Students need to clearly understand their obligations and alternatives for managing debt responsibly.

• Leveling the playing field by applying post-secondary reforms to all colleges and universities, not unfairly disadvantaging one sector over others. The Department of Education has turned a blind eye to the fact that in the 21st century, career preparation has become a major expectation of all post-secondary education institutions, not just career colleges.

• Reducing student-loan lending rates. Census data indicate the lifetime earnings of college graduates are over twice those earned with a high school diploma alone. Given the return on investment to the federal treasury, government should craft student-aid policies that encourage college attendance, not allow it to become a risk-laden financial burden.

The proposed Gainful Employment Regulation harms students and businesses. Let’s take an innovation lab approach to student-loan debt.

Curtis Austin is the executive director of the Florida Association of Postsecondary Schools and Colleges.

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Orlando Sentinel: Misguided proposal would harm students: Front Burner

June 20, 2014

By Curtis Austin

In Florida, more than 300,000 students obtain their post-high-school education at career colleges. Many are from Central Florida, where 73,000 students choose to attend private, for-profit schools to gain skills necessary to change their lives through education and employment.

One of the best-kept secrets of higher education is that career schools have topped public institutions as the main producers of frontline talent. In 2012-13, career schools accounted for approximately 60 percent of all health-care and 60 percent of all computer and information-technology graduates in Florida. They accounted for 93 percent of cosmetology and 83 percent of culinary graduates.

Unfortunately, the U.S. Department of Education is promulgating a regulation known as "gainful employment" that would reduce postsecondary educational opportunities. The proposal would require graduates of career-oriented programs to meet arbitrary future income and student-loan debt-repayment thresholds. Programs failing the test would lose eligibility to participate in federal student-aid programs.

The regulation would hit the Orlando economy right where it lives. Orlando-area career-college programming is diverse, from in-demand skills areas such as medical assisting and information technology to highly specialized, niche employment fields such as digital animation and theatrical make-up and costuming.

The Department of Education has proposed the regulation as a way to protect students from unmanageable debt. The focus is right, but the solution is wrong. If implemented, this regulation would force many programs to close, creating a long-lasting and detrimental effect on students and businesses.

First, the regulation fails to address all student debt. Nearly 70 percent of student debt and more than half of student-loan defaults are attributed to students in traditional institutions. The way the regulation is crafted, degree programs at state colleges and universities are exempted.

Second, the rule fails to acknowledge the long-term value of education. A student loan may "pay off" more quickly for a registered nurse than for a schoolteacher, but both benefit tremendously from their education.

Third, gainful employment fails to recognize that the federal government is part of the problem. A Government Accounting Office report noted that the government made $66 billion from student loans in the past five years. This evidence flies in the face of the government's protests about debt default rates. Overcharging students just adds to the problem.

Better approaches exist to help students manage debt, including:

•Counseling individuals to budget their spending based on realistic income projections.

•Expanding income-based repayment programs so that graduates entering lower-paying fields are not penalized for their career choices.

•Adapting reforms to include student borrowers at all institutions.

•Limiting student loans to educational needs rather than the total amount students may be eligible for based on federal formulas.

•Reducing federal student-loan interest rates, lowering the risks involved in seeking education.

More than 100 Florida leaders, including Associated Industries of Florida, the Florida Hospital Association and the Florida Restaurant and Lodging Association, recently asked the Department of Education to drop its proposal.

With more than 200 area schools serving thousands of students, career colleges are a critical part of Central Florida's postsecondary landscape and its work-force development infrastructure. With so much at stake, let's find better ways to address the debt issue.

Curtis Austin is executive director of the Florida Association of Postsecondary Schools and Colleges, the state's private career colleges.