For-profit colleges take fire from students, gov’t

Enrollment in for-profit colleges has grown exponentially in the last several years. But as enrollment has increased, so has scrutiny of the schools’ practices.

For-profit colleges take fire from students, gov’t

Frank

Matt Austin first met a representative from the Arts Institute International Minnesota at an assembly when he was in high school.
The for-profit college representative spoke to an assembly of all 60 students at his alternative learning center in Faribault, Minn.
âÄúIt was the first college that came to our school,âÄù Austin said.
The rep made her pitch to the students and caught the 19-year-oldâÄôs attention right away.
Austin knew school was going to be expensive âÄî more than $30,000 a year at AI.
Now, after a semester at the college, Austin, along with other students from the school, are worried the credits they have paid for wonâÄôt transfer and that their time in school wonâÄôt lead to a job.
Enrollment in for-profit colleges has grown exponentially in the last several years, from 199,584 in 1998 to almost 1.8 million students nationwide, according to a study done by the U.S. Senate.
As enrollment has increased, so has scrutiny of the schoolsâÄô practices. Lawsuits have been filed and requests for information on business practices have been submitted.
Government inquiry
Both the U.S. Government Accountability Office and a Senate committee have looked into the for-profit schools.
The GAO conducted an undercover investigation of for-profit colleges in six states (though none in Minnesota), finding aggressive recruitment tactics at many.
The report showed schools bombarded potential students with numerous calls in recruiting attempts. Some of the undercover students began receiving calls within five minutes of submitting their contact information online âÄî with one receiving more than 180 calls in a month.
Upon the release of the GAO report, stocks of publicly traded for-profit colleges took a hit âÄî Minneapolis-based Capella University fell 13 percent.
In the last three years, the Better Business Bureau has lodged 82 complaints against Capella University. Forty of the complaints were for alleged billing errors, unauthorized charges or questionable collection practices. Eleven were for service issues, including failure to provide promised services or inferior quality of provided services. Sixty-two of the complaints were resolved, BBB spokesman Dan Hendrickson said.
Capella University is currently facing a class action lawsuit in Minnesota for irresponsible business practices and deceptive marketing.
âÄúWe believe it has no merit,âÄù said Mike Buttry, spokesman for Capella University. âÄúWe are going to fight very vigorously.âÄù
A study by the U.S. SenateâÄôs Health, Education, Labor and Pensions Committee indicated that for-profit colleges are also becoming increasingly profitable âÄî the average profit in 2005 for a for-profit was $127 million. That number has increased 80 percent to almost $230 million today.
âÄúTo satisfy shareholders, publicly traded schools must generate higher revenues, while keeping down costs, including teaching costs,âÄù the HELP study reported.
The University of Minnesota is the largest school by enrollment in the state. But right behind it are two for-profit colleges âÄî Walden University and Capella University âÄî both of which are under investigation by the Senate.
âÄúThey were spamming me bad.âÄù
The lowering of teaching costs is apparent to some AI students.
Dustin McIntyre first heard of AI from his older sister, who attended the school for a year. His curiosity led him online, where he shared his contact information with several local for-profit schools.
âÄúThey were spamming me; they were spamming me bad,âÄù said McIntyre, a film student. âÄúThey will telemarket your phone, text it, call it.âÄù
McIntyre started receiving multiple calls from local for-profit colleges Brown College and AI at all times during the day.
âÄúThey are on your back,âÄù said AI dropout Pat DeRose. âÄúTheyâÄôre really trying to get you to go, when really theyâÄôre trying to get your money âÄî thatâÄôs what it felt like.âÄù
AI responded only with a statement that âÄúany individual who has concerns about their education at the Arts Institute International Minnesota may address them directly with Dean [Susan] Tarnowski.âÄù
From early September to mid-October, an adviser from the art school called DeRose every day.
âÄúIt was so annoying,âÄù said DeRose, who began screening calls.
Still undecided about school this fall, DeRose gave in and agreed to meet with a counselor.
âÄúI let the [counselor] convince me to go into digital effects when I was trying to study film,âÄù he said.
The counselor told DeRose to try out a semester at the school before making up a decision to stay, he said.
âÄúHeâÄôs pretty much saying, âÄòPay for a whole semester and try it out first,âÄôâÄù DeRose said. âÄúThe minute he said that, I thought it was sketchy.âÄù
âÄúSketchyâÄù practices
McIntyre and Austin agree that there have been âÄúsketchyâÄù situations at the school.
The two are roommates in apartments the school provided in Stadium View apartments.
âÄúThe first paper we turned in, everybody got a 99 [out of a 100,] said Austin. He questions whether his professor had actually read anyoneâÄôs paper.
âÄúMy computer applications class is right before [McIntyreâÄôs] class, and his teacher would sit in on our class to learn the curriculum for the day and then teach his class,âÄù said Austin.
With more than 2,000 students, fall enrollment at the Arts Institutes International was the largest in its history, leaving the school to resort to temporary housing for a number of students.
âÄúI think they accept everyone, to be honest,âÄù DeRose said. He dropped out of the college in three weeks and hopes to go to a Division I school.
A return on investment
Justin Breiland was choosing between the Minneapolis College of Art and Design and the Arts Institute when an AI counselor convinced him to enroll in the for-profit.
Breiland, who is studying interactive media, also lives in Stadium View apartments.
The 19-year-old was offered a $2,700-a-quarter loan by the school to pay for rent and food.
âÄúI thought we were supposed to get it right away,âÄù he said.
For more than a month and a half, Breiland had very little money for food and was not able to pay his rent.
He met with the school a few times to voice his concerns about the stipend money, but was told his loan hadnâÄôt gone through yet.
Breiland finally got the money mid-way through the school quarter.
âÄúThe school is so expensive,âÄù he said. âÄúYet there are not enough resources or equipment in the classrooms.âÄù
Breiland is not looking to stay much longer and hopes to go to school in California in the near future but also has fears that his credits wonâÄôt transfer.
âÄúOver the years, IâÄôve definitely heard from students who have went to some place like Rasmussen or Brown College,âÄù said Renye Branchaud-Linsk, who worked at a homeless shelter next to Rasmussen for more than 20 years. âÄúThe outcome of their education wasnâÄôt what they had thought they were getting âĦ it had them feeling like they hadnâÄôt spent their money wisely.
âÄúI felt badly that youâÄôve invested this money into your education thinking that the outcome will be there but itâÄôs not,âÄù she said.