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Huffington Post Article about Kaplans “Bad Practices”

December 22, 2010 By Leave a Comment

 

The Huffington post recently posted a strikingly negative article about Kaplan.  Link to article is below.  The industry is clearly headline material for tv, print and online articles all unfortunately negative, why cant the industry get some positive press?  Any of us who have actually been to a graduation at a forprofit school can attest to the lives that have been changed as well as the appreciation from the families and friends.   

At Kaplan University, ‘Guerilla Registration’ Leaves Students Deep In Debt

http://www.huffingtonpost.com/2010/12/22/kaplan-university-guerilla-registration_n_799741.html?page=1

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Tom Harkin will hold a news conference today regarding military & forprofit!

December 9, 2010 By Leave a Comment

  We wanted to remind everyone that Tom Harkin will hold a news conference today where he will “plan to release the latest in a string of reports on the sector”.  Including a growing concern over military funding into forprofit education firms.  Here is a  Link to article: http://www.insidehighered.com/news/2010/12/09/qt#245392

 Conference will be held at noon.

 The NYTimes this morning had an article on for-profit schools and the military.  Link is here: http://www.nytimes.com/2010/12/09/education/09colleges.html?ref=education.  Public companies mentioned or referenced include Bridgepoint Education, Career Education (Colorado Technical University), and American Public Education.

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Discount for ForprofitEDU members

December 6, 2010 By Leave a Comment

Here’s some good news!

ForProfitEDU is partnering with The Capital Roundtable for their conference on Private Equity Investing in Education Companies.

The conference is being chaired by Bruce Eatroff, partner at Halyard Capital.  It’s being held at the University Club in New York City on Thursday, January 13, and features 20 experts.

We’ve negotiated a special rate for friends of ForProfitEDU.  Your registration rate is only $995.  That’s a $400 discount off The Capital Roundtable’s standard rate.

 For registration or inquiries, just call Shaina Mardinly at 212-832-7333 ext. 0, or email her at smardinly@capitalroundtable.com.  Please be sure to use my ForProfitEDU.com as the name to get the discount.

 The full title of the conference is – “Private Equity Investing in Education Companies — Seizing Success in an Industry Undergoing Transformation.” For more details click here — http://www.capitalroundtable.com/masterclass/Capital-Roundtable-private-equity-education-conference.html
We hope to see you on January 13 for what promises to be a great day.

P.S. Since we expect this conference to attract a strong attendance, please register as soon as possible to reserve your seat.

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Layoff mounting at many of the schools

December 2, 2010 By 1 Comment

Tiss the season, well unfortunately for many EDU staffers this holiday season has begun with an ax.  Many of the schools have begun laying off employees and according to sources many others have them in the works. 

The University of Phoenix has laid off roughly 700 employees as it grapples with declining enrollment and changes in the way it compensates admissions counselors.  The layoffs, mainly affecting admissions personnel, were announced in meetings with affected employees across the nation, said Ryan Rauzon, a spokesperson for parent Apollo Group.

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Edu Stocks continue to fluctuate

November 16, 2010 By Leave a Comment

Good news is the Republicans took the House, bad news Dems held the Senate.  EDU stocks continue to fluctuate due to uncertainty and fear.   Many arguments on both sides of the fence as to what will happen in 2011…  Happy to hear a lot more discussion and understanding about the positives the for profits bring to education.  About the outreach they provide to those ignored most by traditional academia.

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Could the DOE finally be realizing the negative impacts of their proposed rule changes?

October 29, 2010 By 1 Comment

The Department of Education, seemed to respond to the heavy pressure from for-profit colleges and intelligent politicians (isn’t that an oxymoron), is softening the plan to require the colleges to seek federal approval of new programs.

This change is one of many concessions the DOE has made to colleges and financial-aid administrators in their package of final regulations that will be made public.

Under the newly revised rules, for-profit colleges would simply be required to notify the department when they create new programs, however a small percentage of those programs may be subject to formal approval.

On the call, Mr. Davis also rattled off the names of more than a dozen Democratic lawmakers who oppose the gainful-employment rule and said there was “deep concern” in the Democratic party about the effect the changes could have on low-income and minority students.  Duh…  How obvious is it that the for-profits are the only significant form of Educational out reach to the under served in this country.

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ESM Promotes Dave Martelon to CIO

October 29, 2010 By Leave a Comment

ESM Promotes Dave Martelon to Chief Information Officer

Highlands Ranch, CO – October 25, 2010 – ESM, a provider of student lifecycle solutions to help schools enroll, graduate and place students, has promoted Dave Martelon to Chief Information Officer (CIO), where he will lead the strategic direction of the company’s scalable, performance-driven technology services, as well as oversee the entire IT organization.

“Dave has been instrumental in advancing our technology platform – his vision for the future, keen knowledge of evolving technologies and leadership skills make him the ideal fit for our CIO,” said Doug Kelsall, CEO of ESM. “Technology plays a critical role in helping us reach and engage students, and under Dave’s guidance, we will be able to continue to provide the highest level of student support, as well as find new ways to deliver an exceptional student experience.”

As CIO, Martelon will lead the continued innovation of ESM’s student lifecycle technology suite, which seamlessly integrates with clients’ existing systems in order to support students throughout their entire educational path. Coupled with the company’s knowledgeable people and proven processes, ESM’s technology makes it possible to immediately connect with interested and qualified prospective students, work with those students throughout the enrollment process, retain students through successful program completion, and help place graduates into jobs.

Martelon has more than 15 years of technology leadership experience. His core areas of IT executive expertise include strategic planning and execution, business intelligence and analytics, call center technology, process improvement, IT service management, and software and system development. Additionally, he has successfully led the development and launch of multiple Software as a Service (SaaS) platforms.

Prior to joining ESM, Martelon served as vice president of engineering at InfoNow Corporation, president & CTO at Solaquillo, and director of development for TrueLogic Financial. He holds a Bachelor’s of Science degree in Computer Science from Purdue University.

About ESM

ESM provides student lifecycle solutions to help institutions enroll, graduate and place students. Leveraging its highly trained people, performance-driven processes and advanced technology, the company complements an institution’s in-house teams. As a premier Business Process Outsourcer, ESM operates the largest education-only call center in the country with more than 700 employees, delivering rapid, cost-effective lead processing, high contact rates and strong conversion rates. Additionally, ESM provides student retention solutions to improve graduation rates, as well as career placement services to help students succeed professionally.

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Public forprofits take a big hit on apollo report

October 15, 2010 By Leave a Comment

Shares of most public forprofit education companies took a big haircut yesterday after apollo removed its guidance and indicated that its enrollment growth would decline for the next few quarters.  Not a surprising announcement from apollo in my opinion as clearly the management of most public forprofit colleges have begun to take steps to both focus on quality not just quantity.  With many schools now offering orientations, trials or raising entrance standards it’s clear schools have begun focusing on improving the quality of intake.  Question is, who will go after those who miss the cutoff, are we going to stop helping those who need the most help?

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Debate on Gainful employment from the linkedin group on forprofit education

October 7, 2010 By 1 Comment

 The following are some snipets from the linkedin group on forprofit education:

 Here is one company that in my opinion has put their money where their mouth is. Congrats to Corinthian Colleges, Inc. (CCi) for putting on the armor and marching onto the battlefield!

We can only impact this with hard work. Thank you for the letter (I heard it was 80k, 68k of which argued against).

  I admire Corinthian for taking a stand on this discriminatory DOE Gainful Employment ruling. The rhetorical question is why is this not being applied to non-profit colleges and universities also?

The full page ad and quarter page ads that Corinthian placed in last Sunday’s New York Times (September 19, 2010) should have been paid for by a coalition of for-profit schools. But, my hat is off to Corinthian to have the courage to do what others have not done. Recommend the web-site www.mycareercounts.org to everyone, please.

 • I agree — the Corinthian ad appeared in the Seattle Times as well. The fact that seems to get lost in the wash are the tens of thousands of grads who have started successful careers outside the ‘traditional’ public and ‘not for profit’ systems. Many who could not have been or would not have been successful anywhere else.
 • Next will be the campaign from CCA…
 I certainly think that these policies would have more legs if also applied to the traditionals or “not-for-profit”. The reality is that “not-for-profit” still profits in many ways that are overlooked. Take a look at the compensation of College Presidents and coaches. Take a look at the money they get both privately and publicly and how it is spent. In times when public universities are cutting classes at the expense of their students, they still continue to raise tuition and give the Regents and presidents large pension packages.
 • I had also heard that Kaplan University had placed a similar ad. I have not found a good source to view the text of the Corinthian ad or the Kaplan ad. I would appreciate it if one of you would be able to provide a link pointing me to site providing this.
• Good point,  They also do not contribute tax dollars, something America is quite short on…

 • You need to look at trends on a global basis -and over a long term.
After 40 years in industry, I’ve noticed that a lot of people worry about where thengs are heading; but inevitably, they end up going somewhere unpredicted….and as the decades roll past, this all happens faster & faster.
I decided 10 years ago to cut loose from “government accredited education” and make our business of education much simpler…. provide the best learning experience, charge a reasonable price, take on board students and staff who are like minded, and don’t worry about the things that keep complicating the rest of the industry. This formula works. Politicians are never light on their feet….but small businesses are. Politicians are never going to kill “for profit education” ….they can try, but it is not in their nature to have any capacity to do so.


 • If you want to review nearly everything that’s appeared on this topic, go to:

http://www.intered.com/for-profit-regulation 

  •  • – some really smart people said the same thing about the student loan industry as well. Politicians are professional manipulators (starting with the campaign/election process) and socializing sectors like education IS in their nature…and companies like Sallie Mae would certainly disagree with your assessment of their “capacity”. 

    I appreciate your point of the publics and not-for-profits not being tax paying entities. So true that the for-profits “re-invest” into the country’s tax pool.

• I think the politicians are influenced heavily by the kings of the non-profit world. For-profits are starting to eat their lunch and they are afraid. They might have to tap their endowments (profits).

 •  CCA should have expresed outrage over this months ago. I have no confidence in their ability to speak forcefully for the for-profit industry.
 • I am new to this thread but I find the discussion fascinating.  to your point: how is it feasible that the non-profits are not to be held to similar standards? The criteria for inclusion, as far as I can see, is not whether you are a for-profit educational institution, but whether your students are recipients of financial aid from the Federal Government. Obviously, if I am correct in this, then the “non-profits” are clearly to be held accountable to a similar standard. So, if my kid wants to study Latin at the University of Wisconsin, is the DOE going to force the college to explain the potential gainful employment my kid is likely (NOT) to receive as a result of such an education? Are there any public educators out there reviewing this discussion? I would love to see your comments to this along with the group’s active participants.
 •  – Public educators are not overly concerned. This is a one-sided attack…always has been. The attack is designed to help the public educators by eliminating the private sector competition. Public educators know they could never survive were they held to the standards for-profit schools are held to. So they stay out of the battle as they are secure being out of the line of fire. I have YET TO HERE the DOE make a cogent argument as to why these standards only apply to the for-profit sector. Please…ask them. Maybe they will provide you with an answer.

 • I have posted the question to the Linked In White House group as well as sending an email directly to: AskArne@ed.gov. I will keep this group posted when a response is received.

• Hi, this attack is geared specifically to the for-profit sector. As far as not being held to the same standards…For-Profits have a minimum standard for their completion rates, placement rates, and student default rates to maintain our accreditation and ability for Title IV funding. They are also starting to ding us if the student waives placement because they are GAINFULLY EMPLOYED in a field other than what they studied at your institution. How is that fair? The students waives placement and the institution gets dinged on their placement rates. When was the last time you heard publics being held to these standards. BTW, how much placement assistance did your son with his Latin degree receive upon graduation??? And thank you for posting the question to Arne.
 • Have governments got so much money to spare that they have to focus on damaging for profit education; -which in turn will increase their own cost of providing education.

• They think they can redirect the Title IV money to build a community college system.

 • He is right; the administration figures it will take two years to take out the for-profits, so they’ll be “stimulating” the community colleges in the meantime to expand to accomodate the influx of students. Ahhh, more students fot THEM to abuse.

 • I will withhold further comment on the government’s capacity to do what we do…
 • Many politicians operate with the notion that the best defense is an offense – any offense, regardless of how offensive. In my opinion, this attack on for-profit education is not so much an attack on “for-profit” as it is a defense to prevent an informed constituency from asking deeper, more meaningful questions about political leadership and education. Those deeper questions might be:
1. Where is our national education agenda?
2. Why is education still considered a local issue when it is so clearly a national issue?
3. Why are we still burning billions of education dollars on local level administration in the non-profit (public) education system when that model is so clearly broken?

And on and on and on.

 • Diversity is very important.
I always found as an employer, that the best work team is one made up of people who each have a very different education.
It is wrong to assume that there is one, single, best way of educating people.
Different people learn in different ways.
Everyone has differentr priorities in their lives at different times
Diversity in education breeds innovation in graduates.
All too often though, we try to find a “single framework” and exclude everything on the fringes -that is a big mistake if you want your country to continue to develop.

Isn’t it interesting that big, diverse countries, with less “national strategies” like India and China, are growing faster than America and Europe.

 
• I have received a prompt response from the Department of Education (POSTED BELOW). It raises some of the same questions:

1. Are non-profit (besides community colleges) educational institutions held to the same standards as for-profit institutions?

2. It appears that community colleges will be evaluated on the same playing field according to the response below? Correct?

Department of Education
to me

show details Oct 1 (3 days ago)

Recently you requested personal assistance from our on-line support
center. Below is a summary of your request and our response.

If this issue is not resolved to your satisfaction, you may reopen it
within the next 14 days.

Thank you for allowing us to be of service to you.

Subject
—————————————————————
“Department on Track to Implement Gainful Employment Regulations”

Discussion Thread
—————————————————————
Response (Monica Bates) – 10/01/2010 03:44 PM
Dear Mr. XXX,

Thank you for contacting the United States Department of Education through AskArne@ed.gov.

The Department’s proposed regulations will hold programs accountable for preparing students for gainful employment and ensure program integrity in higher education.

As proposed, the graduation rate and job placement disclosure rule would require proprietary institutions of higher education and postsecondary vocational institutions to provide prospective students with each eligible program’s graduation and job placement rates, and that colleges provide the Department with information that will allow determination of student debt levels and incomes after program completion.

As proposed, the approval of additional programs rule would require institutions to provide: 5 year enrollment projections; documentation from employers not affiliated with the institution that the program’s curriculum aligns with recognized occupations at those employers’ businesses; and that there are projected job vacancies or expected demand for those occupations at those businesses before new programs can become eligible to participate in federal student aid.

Additional information on the Department’s planned public sessions will be released in the coming weeks.

Once again, thank you for contacting the United States Department of Education.

Sincerely,

Information Resource Center
Office of Communications and Outreach
United States Department of Education
400 Maryland Ave, SW, LBJ
Washington, DC 20202-0498

Customer – 09/29/2010 11:56 PM
——————————————-
From:]
Sent: Wednesday, September 29, 2010 10:45:48 PM
To: Ask Arne
Auto forwarded by a Rule

“Department on Track to Implement Gainful Employment Regulations” (attached): I posted the following question today on the Linked-In For-Profit Education Industry Group:

I am new to this thread but I find the discussion fascinating. Sally, to your point: how is it feasible that the non-profits are not to be held to similar standards? The criteria for inclusion, as far as I can see, is not whether you are a for-profit educational institution, but whether your students are recipients of financial aid from the Federal Government. Obviously, if I am correct in this, then the “non-profits” are clearly to be held accountable to a similar standard. So, if my kid wants to study Latin at the University of Wisconsin, is the DOE going to force the college to explain the potential gainful employment my kid is likely (NOT) to receive as a result of such an education? Are there any public educators out there reviewing this discussion? I would love to see your comments
to this along with the group’s active participants.

I was challenged by a member of the group to directly ask our government how such an inequity is possible. I look forward to a response which I will forward to the group. Thank you.

 • Well, I finally took the time to find an article on the latest default rates. If you want to know the source, you can find it at

http://money.cnn.com/2010/09/13/pf/college/student_loan_default_rate/index.htm

“Student loan default rate creeps higher”

The most important revelation in this article for me is found in this paragraph:

Graduates of public colleges defaulted at a rate of 6%, up from 5.9% a year earlier. Students coming from private schools had a 4% default rate, up from 3.7%. The default rate for borrowers at for-profit schools, however, rose to 11.6% from 11% a year earlier.

OK, people, what gives? Why is the rate of default so much higher for for-profit schools? A demographic group with fewer moms and dads able to help out in tough times?

 • – at the risk of sounding condescending, if you aren’t familiar with the different demographics served, you should do some homework. Working adults, unemployed adults, under-employed adults and a high percentage from economically-challenged families vs. 18-22 year old students predominately from middle to upper-middle class homes, and you ask what gives?
  •  –
When you preface a comment in such a way, then you can assume the reader understands your intent. I would recommend leaving your emotions and condescensions for the government and just try be a real and honest guy here. Just a thought.

Nonetheless, that is exactly what I assumed the rebuttal to be. As I sent you in an email, is there any rate of default that would shock anyone from this group (people in the for-profit space)? In other words, if the default rate were 50%, would that concern you? At what rate (or rate discrepancy) would we expect/want the DOE to step in?

When do we have another mortgage crisis developing versus when do we have an over-zealous government agency?

 • It has been required for many years that for-profit schools manage their default rates to maintain their eligibility to offer Title IV programs and understand that. I think the bigger issue is that often the demographic we serve is high risk. We provide accessibility to education which may not otherwise be available. We teach in a way that allows for our students to learn a practical skill in a short period of time to get an entry-level position in their chosen fields. Hopefully, this will in-turn decrease the dependency on some other public assistance programs while creating a stepping stone to continuing to further their education.

90/10 and gap, I won’t go any further on this topic but it is worthy of a mention in driving tuition rates. Again, not a standard that the traditionals are held to.

We have so many people who take advantage of social services offered by this country because it is easier and makes more sense for them to stay home and on these services then take the step to get off of them. We have generations of welfare families out there. For-profits are the ones that serve them. We get them in school, hold their hands, and strive very hard to get them not only to graduation but getting them employed.

Another trend that is not sitting well with me is that if a student is employed out of the field and waives placement, we are getting dinged for it; it doesn’t make any sense. Again, ask many who graduated from a traditional college with a liberal arts degree what they ended up doing with it…

•  – apologies for the comment if you feel I WAS being condescending, but I will not leave my “emotions” for the government. For people like myself (and various other) who have given upwards of 20 years of my life to this sector of higher education, this is an emotionally charged issue. MY government is unfairly and unduly attacking me and my friends, and threatening rules that would be devastating to this country, especially those financially less fortunate than most. Sorry, but you’d have to be a droid to not feel emotion on this one.
 • Having attended the APSCU Student Rally and immediately going to Senators Boxer’s and Feinstein’s office to discuss this rule, I can tell you it is extremely one-sided. Our initial talking point with staffers, most of which had already decided their recommendations, was to talk about equal treatment. Their response was that it indeed is equal since non-profits and publics have to have the same income-to-debt ratio for their certificate and diploma programs. When I countered with, equal would be for publics and non-profits to be held to the same standard for Associate, Bachelor, Masters and higher; the same as the for-profits are, I was met with silence. The party line was that Congress is held responsible to safeguard the taxpayer’s investment. I countered with the $220 billion in 2008 that was subsidizing publics and non-profits at both the state and federal levels that not a dime is returned or paid back to the government. Since non-profits make up 10% of higher education, let’s take 10% of the subsidies and split the $22 billion according to enrollment to bring down the tuition at the for-profits and I’m sure the debt-to-income ratios would be far greater than our counterparts. I also asked one staffer, why couldn’t subsidies be based on student need instead of flat across the board. They didn’t have the answers.
 • You are right
 • That’s the problem. Lack of knowledge results in reliance on “party line”. This is why I actually laughed out loud when Senators Harkin and Franken suggested that this was not a political issue.

Like so many issues in DC, this is partisan politics at its worst. Hardcore democrats are out to destroy for-profit schools and hardcore republicans are supportive of the for-profit schools. Our need is to influence the others, those who care enough to look at the facts…those that will consider what is at risk and who is at risk.

  • Having worked in career colleges, both FP and NP, and as a graduate of a public university, I continue to find these discussions interesting. I have opined in the past that the NP and FP operated basically the same – tuition driven, no direct assistance from government, student centric, outcomes of paramount importance to survival. One’s tax status doesn’t really matter.

The FPs will be able to meet these requirements and still survive, if only barely. They will eventually be forced to enroll fewer low socio-economic students, primarily minorities and single mothers. Yes, the repayment rates will rise, the default rates will drop, and we will create a permenant underclass that has very little chance to gain any semblence of the so called Amercian Dream. The DOE, media, President Obama, and Arne Duncan need to heed the old adage, “be careful for what you ask, you just might get it.”

 • Thank you,  – WELL SAID!!!!!

For more information and to see the complete debates join our linkedin group, link on top right of this site
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Keiser University files civil suit against Florida State College at Jacksonville

October 7, 2010 By Leave a Comment

In a clear sign of the heightened tensions over proposed new federal regulations on for-profit colleges, Keiser University, a for-profit education system based in Florida, has sued a public-college president there, accusing him and a top administrator of smearing Keiser by communicating derogatory comments about the for-profit education industry to investors and others via e-mail. Keiser itself is not publicly traded, but its founder and chancellor, Art Keiser, has been an outspoken criitic of the proposed regulations. The civil suit was filed in state court against two officials at Florida State College at Jacksonville—its president, Steven R. Wallace, and its vice president for government relations, Susan M. Lehr.

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