For-profit colleges take fire from students, government

By Frank Bi

Minnesota Daily, U. Minnesota via UWIRE

“It was the first college that came to our school,” Austin said.

The rep made her pitch to the students and caught the 19-year-old’s attention right away.

Austin knew school was going to be expensive — 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 won’t transfer and that their time in school won’t 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 schools’ 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 — 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 — 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.

“We believe it has no merit,” said Mike Buttry, spokesman for Capella University. “We are going to fight very vigorously.”

A study by the U.S. Senate’s Health, Education, Labor and Pensions Committee indicated that for-profit colleges are also becoming increasingly profitable — the average profit in 2005 for a for-profit was $127 million. That number has increased 80 percent to almost $230 million today.

“To satisfy shareholders, publicly traded schools must generate higher revenues, while keeping down costs, including teaching costs,” the HELP study reported.

U. Minnesota is the largest school by enrollment in the state. But right behind it are two for-profit colleges — Walden University and Capella University — both of which are under investigation by the Senate.

“They were spamming me bad.”

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.

“They were spamming me; they were spamming me bad,” said McIntyre, a film student. “They will telemarket your phone, text it, call it.”

McIntyre started receiving multiple calls from local for-profit colleges Brown College and AI at all times during the day.

“They are on your back,” said AI dropout Pat DeRose. “They’re really trying to get you to go, when really they’re trying to get your money — that’s what it felt like.”

AI responded only with a statement that “any individual who has concerns about their education at the Arts Institute International Minnesota may address them directly with Dean [Susan] Tarnowski.”

From early September to mid-October, an adviser from the art school called DeRose every day.

“It was so annoying,” said DeRose, who began screening calls.

Still undecided about school this fall, DeRose gave in and agreed to meet with a counselor.

“I let the [counselor] convince me to go into digital effects when I was trying to study film,” he said.

The counselor told DeRose to try out a semester at the school before making up a decision to stay, he said.

“He’s pretty much saying, ‘Pay for a whole semester and try it out first,’” DeRose said. “The minute he said that, I thought it was sketchy.”

“Sketchy” practices

McIntyre and Austin agree that there have been “sketchy” situations at the school.

The two are roommates in apartments the school provided in Stadium View apartments.

“The first paper we turned in, everybody got a 99 [out of a 100,] said Austin. He questions whether his professor had actually read anyone’s paper.

“My computer applications class is right before [McIntyre’s] class, and his teacher would sit in on our class to learn the curriculum for the day and then teach his class,” 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.

“I think they accept everyone, to be honest,” 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.

“I thought we were supposed to get it right away,” 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 hadn’t gone through yet.

Breiland finally got the money mid-way through the school quarter.

“The school is so expensive,” he said. “Yet there are not enough resources or equipment in the classrooms.”

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 won’t transfer.

“Over the years, I’ve definitely heard from students who have went to some place like Rasmussen or Brown College,” said Renye Branchaud-Linsk, who worked at a homeless shelter next to Rasmussen for more than 20 years. “The outcome of their education wasn’t what they had thought they were getting … it had them feeling like they hadn’t spent their money wisely.

“I felt badly that you’ve invested this money into your education thinking that the outcome will be there but it’s not,” she said.

Read more here: http://www.mndaily.com/2010/12/13/profit-colleges-take-fire-students-gov’t
Copyright 2014 Minnesota Daily

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