Controversial For-Profit Schools Attack Community Colleges

After months of criticism, they're not going down without a fight.

By Julianne Hing Oct 13, 2010

For-profit schools are facing a slew of [new regulations]( from the Department of Education that would rein in their marketing practices, but they’re not going to go down without a fight. Last week Florida for-profit school Keiser Univeristy sued the president of Florida State College at Jacksonville for what the for-profit school felt was a "destructive media campaign." The lawsuit, the [Miami Herald]( reports, claims that administrators at state schools have put together a smear campaign against the for-profit schools that’s hurt their enrollment. The Senate has been discussing for-profit school reform all summer, digging into every aspect of the shady for-profit industry in a series of three hearings that covered marketing practices, students’ extreme debt, and for-profit schools accreditation practices. Meanwhile, the Department of Education has been mulling new regulations that would make for-profit schools ineligible to win their students’ Pell grants if they sent too many of their students into the world with debt they could not repay. Currently, 90 percent of for-profit school students rely on loans and aid to pay for their classes, and [40 percent]( of for-profit students who rely on federal student loans default on them after leaving those schools. Some for-profit schools rely on federal student loans and Pell grants, which are intended for the neediest students from low-income backgrounds, for as much as 80 percent of their revenue. Regulation of some kind appears imminent. But for-profit schools are not going down without a fight. The new strategy? Throw attention on community colleges. The Keiser University lawsuit is just one part of a larger concerted effort to give local community and state colleges the same heat for-profit schools are feeling. Earlier this year, for-profit school Corinthian Colleges commissioned a report that found that for-profit schools were [a better deal]( than community colleges. For-profit schools argue that they are helping advance President Obama’s goal of increasing college graduation rates because they pursue a customer base of academically "high-risk" students, many who could not get into nonprofit schools, are from low-income backgrounds or are the first in their families to enroll in higher education. The [Cato@Liberty]( blog has adopted the for-profit schools’ talking points: >Community colleges might be a good option for some people, but they are hardly paragons of educational success. Quite the opposite: According to the U.S. Department of Education, they have the worst graduation rates of any two-year sector of higher education. Only around 22 percent of public, two-year college students graduate within three years, versus roughly 49 percent of private, not-for-profit attendees and about 59 percent of private, for-profit students. Ben Miller from [Education Sector]( says that that’s like comparing apples and oranges, though: >The difference looks gigantic, but that’s because the for-profit figure is primarily composed of certificates, while the community college number is mainly associate degrees and does not include large numbers of transfer students. >Community colleges produced the vast majority of their graduates in programs of at least two years and less than four years-most likely associate degrees. They also had a substantial number of students who transferred out. Unfortunately, we don’t know where they ended up, but it’s a safe bet that a relatively large number went to a four-year school and just did not earn a degree from the community college. Miller argues that it’s not enough to grade schools based on graduation rates alone, that people should break completion rates down by types of degrees, too. And while community colleges don’t have stellar graduation rates, that’s not why the Department of Education is going after for-profit schools anyway. The DOE is scheduled to decide on the new regulations by November 1.