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"Damning" report on for-profit colleges

The Senate Health, Education, Labor and Pensions Committee has just released the report from its two-year investigation of the for-profit college industry. As expected, it paints a disturbing picture – "four damning volumes," as described by Amy Wilkins of Education Trust.

I wrote in December about the suspect tactics at Brown Mackie College, one of the for-profit schools with a high profile in Indiana. Indiana Attorney General Greg Zoeller is among five state attorneys general who have intervened in a U.S. Justice Department lawsuit targeting recruitment practices at EDMC, Brown Mackie's parent company. A judge dismissed part of the case in May, but allowed the suit to proceed on the question of whether the company followed stated recruitment policies.

"Largely based on the high numbers of students leaving the programs without completing a certificate or degree, it is not clear that the $1.8 billion taxpayers made in the company in 2010 is a worthwhile investment," concludes the Senate report on EDMC.

The congressional panel also investigated ITT Educational Services, based in Carmel, Ind.

"ITT is one of the most expensive companies examined by the committee, and it is not clear that the value of the education justifies the cost," according to the report. "The cost of attending ITT is so high that the company has created its own loan program to enable students to borrow money in excess of federal lending limits."

The report charges that ITT has "some of the most disturbing recruiting tactics among the companies examined."

"(ITT) devotes the largest share of revenue to profit of any (for-profit education) company analyzed at 37 percent," according to the report, "Taken together, these issues cast serious doubt on the notion that ITT's students are receiving an education that affords them adequate value relative to cost, and calls into question the $1.1 billion investment American taxpayers made in the company in 2010."

A former recruiter for ITT was among the speakers at an afternoon news conference held by Sen. Tom Harkin, D-Iowa, and other HELP committee members. She told of a culture in which company employees routinely referred to getting "asses in classes" and the need to "kiss 'em and sit 'em" to boost recruitment numbers.

Legislation already is being prepared in response to the investigation, but Harkin suggested that consumer education and media scrutiny would help rein in abuses before any new laws go into effect.

Karen Francisco, editorial page editor for The Journal Gazette, has been an Indiana journalist since 1981. She writes frequently about education for The Journal Gazette opinion pages and here, where she looks at the business, politics and science of learning as it relates to northeast Indiana, the state and the nation. She can be reached at 260-461-8206 or by e-mail at kfrancisco@jg.net.

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