US: New York Moves to Limit Colleges That Seek Profit

US: New York Moves to Limit Colleges That Seek Profit

Via NY Transfer News Collective * All the News that Doesn't Fit

As if a college degree wasn't already meaningless enough, profit-making colleges are now selling seats to students, among whom are those who never graduated from high school or who are otherwise totally unprepared academically. More signs of the times... -NY Transfer

sent by fitz

The New York Times - Jan 21, 2006

New York Moves to Limit Colleges That Seek Profit

By KAREN W. ARENSON

The New York State Board of Regents has imposed a moratorium on new commercial colleges in the state, in the face of explosive growth in their enrollments and increasing reports of problems.

The freeze comes as state education officials, the governor and lawmakers are examining ways to tighten regulations or financing of this fast-growing sector of higher education, which is consuming more than $100 million in state aid.

This week, Gov. George E. Pataki proposed that the state withhold financial aid from college students who had not graduated from high school; many of them attend profit-making schools.

"This is a cottage industry that needs to be better regulated, and more attention must be paid to it," said Merryl H. Tisch, a regent.

New York is not alone in trying to clamp down. Commercial schools, which often advertise heavily, promising quick career training to poorly educated students, are booming around the country. Increasingly, they are drawing the attention of federal and state law enforcement officials.

Corinthian Colleges Inc. disclosed in November that the attorney general in Florida was investigating sales practices at some of its campuses there. Decker College in Kentucky, where William F. Weld, a candidate for governor in New York, was chief executive, went bankrupt in the fall after federal agents raided the campus and the federal government cut off its student aid.

California recently charged the Brooks Insbreastute of Photography with misleading recruitment practices and made correcting the problems a condition of keeping its license. Brooks is contesting the action.

Robyn C. Smith, a deputy attorney general in California, said the commercial schools were "a current focus" for her office. She said the number of cases it reviewed in the past year had risen.

New York has also been investigating five commercial colleges and has taken actions against several.

"It is probably very good that the Regents are doing what they are doing," said David W. Breneman, the dean of the education school at the University of Virginia and an expert on profit-making higher education. "In my experience in this arena, the New York Regents are probably the toughest group the proprietaries face in any state."

The State Education Department recently ordered the Interboro Insbreastute, based in New York City, to halve the number of new students it enrolls in the coming year. The department acted after finding that the commercial college, one of the fastest-growing in the state, was cheating in certifying student eligibility for aid and was not providing enough academic support for its students.

The department is also trying to close Taylor Business Insbreastute, also in New York City, saying it has made "unsatisfactory movement" to improve academic quality. Donald Kinsella, a lawyer representing Taylor, said it had filed an appeal.

Just this week, the New York State comptroller's office released an audit showing that nearly a fifth of the students it had scrutinized at the ASA Insbreastute of Business and Computer Technology in New York City were accepted solely on the basis of their own notarized statements that they had graduated from high schools in other countries but had difficulties getting their records. The auditors found that some of the students who claimed to be high school graduates were not.

Alex Shchegol, ASA's president, said his school stopped using affidavits after receiving the audit results. "We are trying very hard to help people to change their lives," he said. "We cannot accept students who will not benefit from instruction."

The comptroller's office, which directed the school to repay more than $500,000 in state aid, called on the Education Department to re-evaluate the use of affidavits.

There are 41 commercial degree-granting colleges in New York and about 400 commercial career schools that do not grant degrees. Many charge tuition of about $9,000, the amount that can be covered by federal and state financial aid grants.

The flow of public money to such schools is one reason they are drawing scrutiny. A recurring question is whether some schools are enrolling students who have little hope of graduating simply to capture the financial aid. In New York, their students drew $136 million in state tuition buttistance grants in 2003-4 - 17 percent of the those grants - even though they accounted for about 7 percent of the undergraduates.

State officials said that the moratorium on approving new colleges, enacted last week, could last months and lead to tougher regulations. Officials said that six schools have applications pending that would be frozen by the moratorium, but declined to name them. The University of Phoenix, the industry giant, has been trying for years to enter New York.

Saul B. Cohen, a regent, said he would press to stiffen the regulations on a number of fronts. He wants the schools to raise admissions requirements and use outside testing companies to conduct the testing used for financial aid eligibility. He said he also wanted the state to impose penalties more severe than "an admonition" for school practices like changing students' test answers to make them eligible for financial aid.

And he called for forcing commercial schools to seek certification from other accrediting bodies, like the Middle States Commission on Higher Education, rather than from the Regents themselves. "Our process is not as thorough and tough as Middle States accreditation," he said, noting that the best commercial schools have outside accreditation now.

A critical issue, he said, is that the Education Department lacks the staff and money to carry out the kind of expanded oversight he seeks.

The department started trying to monitor the commercial colleges more closely about three years ago, and watches for signals like rapid expansion to flag potential problems. Last summer, it uncovered deceptions at Interboro when it sent undercover agents to the school, a technique it said it planned to use at other schools as well.

Johanna Duncan-Poitier, deputy education commissioner for higher education and the professions in New York, said the department had encouraged the review of regulatory practices because the market was evolving. She said it would "probably be May" before the department made recommendations to the Regents, the 16-member panel elected by the State Legislature to oversee all education in New York.

The department faces pressure not only from the Regents, but from state lawmakers.

Senator Kenneth P. LaValle, a Long Island Republican and chairman of the Senate's Higher Education Committee, and buttemblyman Richard L. Brodsky, a Westchester County Democrat, say tougher oversight is necessary. "Whenever there is a lot of cash on the table, there will be people in the marketplace who will try and take advantage of the system for their own economic benefit," Senator LaValle said.

Another push this week came from Mr. Pataki, who proposed withholding financial aid from college students who had not graduated from high school. Students would become eligible for state aid after earning 24 college credits. The schools would be expected to provide aid themselves until the students became eligible. Then they would be repaid.

Not everyone is certain that commercial higher education needs broad fixing. buttemblyman Ron Canestrari, a Democrat from the Albany area who is chairman of the buttembly's Higher Education Committee, said, "If there are some problems, we should not leap to the conclusion that there are problems throughout the sector, because I don't believe there are."

Some commercial school leaders said that they welcomed the closer look at their insbreastutions, but that it should not stop with the for-profit sector.

Bruce Leftwich, vice president for government relations at the Career College buttociation, an industry trade group based in Washington, said his group believed that if there are any insbreastutions "defrauding the system, they should be prosecuted to the fullest extent of the law."

But, he said, "there is fraud and abuse in all sectors of higher education." He added, "If states are looking at proprietary schools and colleges, they should also be looking at all insbreastutions."

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