For-profit colleges' methods questioned

When he enrolled at a for-profit college four years ago, Seth Grenier of Madison said he was young, naive and easily manipulated by aggressive recruiters.

Now, instead of beginning a lucrative career designing video games, Grenier is working at Walmart to repay roughly $30,000 in loans and an "early withdrawal fee" that Westwood College imposed.

Grenier, 23, said he left the college's online degree program in game software development two years ago because of mounting debt and the poor quality of instruction. The experience, he said, left him feeling "completely defeated."

A two-year U.S. Senate investigation released Monday found that Grenier's story is fairly common, with many for-profit colleges charging exorbitant tuition, using aggressive recruiting practices and failing to invest in the services that help students succeed in school and out in the workforce.

U.S. Sen. Tom Harkin, D-Iowa, who initiated the investigation as chairman of the Senate Health, Education, Labor and Pensions Committee, said these practices are "not the exception, they are the norm."

These schools, which are owned and operated by businesses, received $32 billion in federal funding in the 2009-10 school year - 25 percent of the total Department of Education student aid program funds - while 54 percent of students who enrolled in 2008 to 2009 left by the middle of 2010 without a degree or certificate, the report found.

Harkin, who discussed the report in a press conference that was webcast, said he became concerned after Congress made large, new investments in the Federal Pell Grant Program, enrollment in for-profit colleges skyrocketed and troubling reports surfaced about the schools.

The investigation focused on 30 colleges. Some have Connecticut campuses, including the University of Phoenix, owned by Apollo Group Inc., in Norwalk. Connecticut residents also take courses from for-profit colleges online.

The Denver-based Alta Colleges Inc., which operates its campuses under the Westwood College brand, was one of the most expensive schools examined. Westwood College agreed in March to pay $4.5 million to settle allegations of deceptive business practices. The number of students who drop out is not as high as at some of the other for-profit colleges, but the default rates for student loans are higher than most, the report said.

"Life is a complete struggle from here on out, every day, because of the constant weight of the debt on my back," Grenier said Monday.

U.S. Sen. Richard Blumenthal, D-Conn., said he has heard complaints from other residents too. These schools spend more on marketing and recruitment, about $4.1 billion, than they do on instruction, at $3.2 billion, Blumenthal, a member of the education committee, said in an interview.

Particularly troubling, Blumenthal said, is the fact that recruiters are targeting veterans and military personnel leaving the service "because they're vulnerable to promises about inflated incomes and jobs."

The report found that 37 percent of post-9/11 GI bill benefits and 50 percent of Department of Defense Tuition Assistance benefits went to for-profit colleges, the largest share of military educational benefit programs.

A state agency reviews the standards of educational institutions in Connecticut and works with the VA, State Veterans Affairs Commissioner Linda Schwartz said. Some of the programs examined by the Senate are national in scope and therefore perhaps not under the review of the agency, she added.

Both Harkin and Blumenthal see a place for for-profit colleges in the educational system because traditional college campuses can't accommodate everyone and don't meet the needs of all students.

Harkin thinks reforms could be incorporated into the Higher Education Act next year during the re-authorization process while Blumenthal said he plans to introduce a bill to end deceptive recruiting tactics and require for-profit colleges to disclose more information.

Congress may be slow to act, however, since there is still much work to be done on the budget, Harkin said.

"If nothing else, this report has put the nation on notice that there's a problem here," Blumenthal said. "… When someone walks into an office or a veteran is approached on a base, they're going to be a little bit more aware and wary."

Grenier said his advice to prospective students is to "do your research."

"I want an education. I want to further my life and make something of myself," he said. "It's not easy."


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