March 9, 2018

For-Profit College’s Bizarre Explanation for Shutting Out Students

For-Profit College's Bizarre Explanation for Shutting Out Students

Despite the ongoing project by Trump Secretary of Education Betsy DeVos and her revolving door lieutenants to abandon all accountability measures for predatory colleges and student loan collectors, for-profit schools around the country keep failing. The latest announcement comes from Lake Charles, Louisiana’s Delta Tech (Delta School of Business and Technology), which abruptly declared it would stop looking for a new Department of Education-approved accreditor, and thus its students would no longer be eligible for federal grants and loans. That means that going forward students who would need federal aid to cover Delta’s tuition and fees will be shut out. Delta Tech also announced that it had cancelled its spring commencement.

KSLA TV in Shreveport spoke with Delta Tech students like Kayla Dargin, a straight-A general studies program student “who never missed class despite working and taking care of her children.” Regarding Delta Tech’s cancellation of her graduation, she said, “It just makes me feel like we’ve wasted our time for nothing.”

As with many for-profit college closings in the past few years, Delta Tech’s operators essentially did what President Trump does constantly: blame their problems on Barack Obama. But Delta Tech’s explanation was particularly bizarre under the circumstances.

Delta Tech, which has an enrollment of less than 200 students and offers certificate and associate degree programs in fields including medical assisting, information technology, accounting, and paralegal studies, issued a press release on February 28 that focuses on the Department of Education’s decision, in the final weeks of the Obama administration, to cancel federal recognition of Delta’s accrediting agency, ACICS, which the Department had concluded had been asleep at the switch while predatory abuses occurred at numerous for-profit colleges it was supposed to monitor. Ending federal recognition means that ACICS accreditation no longer entitles schools to federal aid.

Delta Tech’s press release states that the Department’s “action taken against ACICS was not based on any wrong doing of Delta Tech,” says the school has “put forth a tremendous effort to secure accreditation with a new recognized agency,” and expresses “confidence” that the school could gain such new accreditation by the June 12, 2018, deadline for doing so. (In a lengthy separate statement to KSLA, Delta Tech explained that it applied to another accreditor, ACCET, and “in May of 2017 Delta Tech’s application was accepted by ACCET.”)

But Delta Tech says it’s not going to bother getting a new accreditor because: “our Institution’s good standing in the community and respected reputation has been severely damaged as a result of the action taken by the United States Secretary of Education….  we no longer have reason to believe this new accreditation would undo the irreparable harm done to our Institution.”

So, Delta Tech is saying it could have found a new accreditor to get back to receiving federal aid for its students, but it won’t do so solely because the Obama administration’s rejection of its old accreditor, which accredited hundreds of schools, has ruined Delta Tech’s reputation forever? Really?

Also, here’s why Delta Tech says it won’t be holding a graduation ceremony: “As a results of the significant hardship Delta Tech has endured, our Institution will not hold the commencement ceremony scheduled for April 13, 2018 and we must cancel that event.” That’s just being a drama queen. Current Delta Tech students remain eligible for federal aid and eligible to graduate, as the school acknowledges. The students have earned their degrees. Give them their ceremony.

The school’s explanation for giving up on federal aid seems even odder given that Delta Tech’s current accreditor, ACICS, is applying to be reinstated, and despite the overwhelming case against such a result, and lack of support from many interested parties, it appears that the DeVos Department is leaning in favor.

Adding to the confusing story here is that Delta Tech’s dean, Michelle Edwards, left the school last summer to become the new CEO of ACICS, after the agency had lost Department recognition.

Some of Delta Tech’s programs — associate degrees in medical office assisting, administrative assistant science, and other fields — flunked the first round of measures under the Obama administration’s gainful employment rule, which tests whether graduates are earning enough money to pay down typical student loan burdens at a school. Data shows graduates in those programs earn less than minimum wage earnings for a full-time worker. The 72-week medical assisting associates degree costs nearly $24,000 for tuition, fees, books, and supplies; typical graduates leave with $15,000 in debt and earn only $14,651 per year. Required disclosures on Delta Tech’s website show high tuition costs and low graduate earnings across a number of programs.

Many other for-profit schools have blamed the gainful employment rule for their problems. But the rule’s financial penalties have not yet kicked in, and now the DeVos Department is on the verge of almost entirely gutting the entire regulation, so Delta Tech didn’t have to worry anymore about losing federal aid under that measure.

Delta Tech says it “has not made any decision to close,” but its future seems uncertain. While some expensive for-profit schools are finding ways to survive without Department of Education aid, it’s not at all clear Delta Tech can do the same. According to the most recent published data, for the 2015-16 school year, Delta Tech is getting 78 percent of its $2.2 million annual revenue from federal student grants and loans

In reality, for-profit colleges keep failing because the students they have been enrolling — low-income, single parents, veterans — have gotten the message that many of these institutions have been engaged in deceptive, predatory practices and that students generally can get a better education at a lower price somewhere else, such as a community college. I see no evidence of wrongdoing at Delta Tech, but the data suggests they aren’t offering the best value for the money.

Maybe what’s really going on here is a calculation by Delta Tech that it’s best to lay low, and hope DeVos brings ACICS back promptly.

Honest, effective, and affordable for-profit schools have the opportunity right now to restore their reputations by convincing the Trump administration to keep the Obama accountability rules, and dropping bad accreditors. That would help separate the good schools from the bad ones, and drive some of the worst actors out of business. But instead they’re following the lead of the predatory schools and opposing any meaningful safeguards. They won’t be able to blame Obama for their troubles forever.