It’s Time to Stop the ‘Bad Actors’ Among California’s For-Profit Colleges

There are certain for-profit colleges in California — some but not all, it’s important to add — that provide an education so ineffectual it can hinder, rather than help, students seeking a better life.

Everyone needs for-profit schools to deliver quality. More students all the time count on them to boost careers and opportunity. Employers need the skilled workforce these programs should help generate. And taxpayers footing the CalGrant bill expect graduates who will contribute to our economy.

Why are there bad actors profiting without delivering quality? And what can be done to stop them?

Speaking Up for Low-Income College Students

On Valentine’s Day I testified on California’s oversight of private postsecondary education before a joint hearing of the Assembly Higher Education Committee and the Senate Business, Professions & Economic Development Committee. Good thing I love a righteous fight.

My testimony was grounded in Public Advocates’ work on the oversight of private postsecondary schools, as well as in my experience as president of Skidmore College and general counsel of the U.S Department of Education. I currently chair the National Advisory Committee on Institutional Quality and Integrity (NACIQI), which advises the U.S. Secretary of Education on accreditation and higher education accountability.

Giving Californians access to college and career preparation opportunities is important, but not enough. As I asked the committee members, “Access to what?” Here’s the analogy I like to use: If our goal were to provide low-income neighborhoods and individuals with access to good banking services, we would not count opening more payday lenders as success.

I am especially troubled by data showing that low-income students and students of color are more likely to be negatively affected. When we look at who enrolls low-income students and students of color we are brought to the entrances of for-profit schools. And when we go to the exit doors, we learn that on average students at these schools are less likely to graduate, more likely to have borrowed heavily and much more likely to default on their loans.

What Next?

How should the legislature respond, ensuring that California’s private postsecondary programs offer access and quality? It won’t be easy. Asssemblymember Julia Brownley mentioned during the question and answer session that this is an extremely complex issue. Assemblymember Anthony Portantino added that the private postsecondary space includes a broad spectrum of schools — everything from “barber schools to graduate programs.” That will make it a tough industry to regulate in a single bill.

But the legislature needs to act. Overall, we and other consumer and student advocates, including The Institute for College Access and Success (TICAS) and California Competes, believe that a much stronger oversight system is in order. As I said in my testimony, it’s not enough to underwrite with precious state dollars any program that hangs up a shingle or offers a computer link to California.

Here are specific steps the legislature could take:

• Close the Oversight Gap: Regionally-accredited schools, including many of the largest nonprofit and for-profit institutions in the state, are exempt from all but one or two narrow provisions of the state requirements. That means hundreds of thousands of California students in private higher education institutions aren’t adequately protected.
• Strengthen Initial Reviews: To keep out poor quality unaccredited institutions in the first place, the Bureau for Private Postsecondary Education, created by the Private Postsecondary Education Act of 2009 (A.B. 48), should verify institutions’ application information and strategically use visiting committees to review high-risk applicants.
• Require Verified, Comparable Disclosures: Students lack publicly available, comparable information to make informed decisions when they choose a school. We have extensive comparative information for lots of smaller consumer choices like a restaurant or hotel — shouldn’t students have a similar framework to help decide whether to invest years, significant amounts of money and their opportunities for the future in schooling?
• Improve Investigation and Enforcement: The legislature should increase the bureau’s investigative capacity and support training so it can identify and pursue statutory and regulatory violations.
• Assure Effective Complaint Procedures: The complaint process should be more accessible, transparent and accountable to students and consumers.

We hope to work with the legislature as it grapples to improve a system that has the power to do tremendous good, and with business to see that their needs are met. We were heartened to see lawmakers at the hearing welcome our input and agree that something needs to be done. But will they take action? We’ll be watching.

Read Jamie’s complete testimony and the testimony of TICAS Program Manager Debbie Cochrane, or view the entire hearing (Jamie’s testimony starts at 1:22). You can also read our one-page fact sheet on private postsecondary oversight for a quick overview.

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