Jun 23, 2010

For-Profit Universities Face Increased Congressional Scrutiny

This week, higher education lawmakers called for a Government Accountability Office (GAO) review of for-profit universities.  The scrutiny comes after a House Education and Labor Committee hearing in which the Education Department Inspector General raised concerns about accrediting agencies’ oversight of the credit hour policies at institutions of higher education.  This greatly impacts for-profit universities because, although they comprise only ten percent of total education enrollment, they account for about a quarter of all federal student aid disbursements, the amount of which is determined by credit hours.


Senators Tom Harkin (D-IA) and Richard Durbin (D-IL) joined Representatives George Miller (D-CA), Timothy Bishop (D-NY), and Ruben Hinojosa (D-TX) in asking the GAO to assess the quality of for-profit institutions, as well as how much of their revenue is comprised of federal student and other funding sources.  “With the average college student borrower graduating nearly $25,000 in debt into one of the worst job markets on record, it is critical that the federal government ensures integrity and efficiency in the management of financial aid at for-profit universities,” said United States Student Association President Gregory Cendana.


The hearing comes soon after former students filed a class-action lawsuit against the Illinois School of Health Careers, a for-profit provider, after they completed a nursing assistant program with federal financial aid, only to find the program was not approved for them to receive state certification.  Incorrect information like this is one example of why Congress is continuing its scrutinizing of the industry.  

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