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Three Steps House Repubs May Take to Shield For-Profit Colleges

By any measure, last Tuesday was a great day for the for-profit higher education industry.

With the Republicans regaining control of the House of Representatives, some of the sector鈥檚 biggest champions will now be in powerful positions to protect the industry鈥檚 interests. (R-OH), who as chairman of the House education committee earlier this decade in federal law that aim to prevent for unscrupulous for-profit schools from taking advantage of financially-needy students.

The turnover in power in the House will make it extremely difficult, if not impossible, for the Obama administration and Senate Democrats to advance legislation designed to rein in the sector. It may also complicate the administration鈥檚 plans to finalize and enact , which would cut off federal student aid to for-profit college programs whose students take on the most unmanageable levels of debt (in relation to their expected future earnings) and have the poorest records of repayment.  

The victory, however, was not complete, as the Senate remains in Democratic hands. As a result, Sen. Tom Harkin, the Iowa Democrat in charge of the Health, Education, Labor and Pensions [HELP] Committee, is expected to continue his panel鈥檚 At the same time, Obama administration officials appear to remain committed to moving forward with the Gainful Employment regulation —  to prevent proprietary schools from leaving students buried in debt and without the training they need to get the types of jobs they were promised.

Still, Rep. John Kline (R-MN), the incoming chairman of the House education panel, will certainly in any efforts by the Obama administration and Democratic Senators to crack down on the sector. At Higher Ed Watch, we believe that House Republican leaders will consider:

  • Doing anything and everything in their power to pressure the Obama administration to abandon its plans to finalize and implement the Gainful Employment rule, or at least to soften it — from holding hearings 鈥渃hallenging the [Education] Department鈥檚 authority to issue the rules,鈥 as , to potentially refusing to work with the administration on reauthorizing the Elementary and Secondary Education Act, which is a key priority of the president鈥檚. They will also undoubtedly offer legislation to block the rule from being enforced. But with the balance of power in Washington still favoring the Democrats, there鈥檚 little chance that such a measure would ever make it out of Congress.
  • Attempting to withhold funding that the administration is seeking to ramp up the Education Department鈥檚 oversight of for-profit colleges. In , Education Secretary Arne Duncan wrote that the administration had requested 鈥渁dditional resources鈥 in the President鈥檚 fiscal year 2011 budget request 鈥渢o increase the capacity for and effectiveness of Departmental oversight,鈥 with the goal of having the Federal Student Aid office 鈥渃onduct 50 percent more program reviews of postsecondary institutions each year.鈥 Republican lawmakers could hamper these efforts by simply insisting that Congress keep the current — which is financing all programs and agencies subject to annual appropriations at fiscal year 2010 levels — in place for the entire year.
  • Seeking to roll back some of late last month that are set to go into effect in July. If House Republicans go down this path, they will most likely focus on rules that have drawn opposition from traditional and for-profit colleges alike. Among the regulations they would probably target is one that establishes for colleges to use when awarding federal student aid. The Department proposed this rule primarily to crack down on proprietary schools that have been inflating the course credits they provide to students in order from the federal financial aid programs. Lobbyists for non-profit colleges, however, 鈥渋nappropriate federal intrusion into areas of academic decision-making.鈥 While the Department tried to address their concerns in its final regulations, and might look to House Republicans to try to overturn the rule — just as they did back in 1995 when they appealed to the new House Speaker Newt Gingrich that Congress had created in 1992 .

Still, even for-profit college lobbyists acknowledge, that the House Republicans鈥 willingness and enthusiasm to go to bat for the industry may be tempered by any new revelations of wrong-doing that emerge in the coming months. The Government Accountability Office鈥檚 — which found (and secretly recorded) 鈥渇raudulent, deceptive, or otherwise questionable marketing practices鈥 at every single one of the 15 for-profit schools it visited — has clearly put Republican lawmakers on guard.

鈥淚 get told every time I鈥檓 around Boehner or Kline or whoever that 鈥榳e鈥檙e going to make certain all sectors get a fair treatment if we鈥檙e back in control, but we will not give you cover if you鈥檙e doing the wrong thing,鈥欌 Bruce Leftwich, a top lobbyist with the group formerly known as the Career College Association, said during the organization held last week with its members. “Let’s not take comfort because of the switch.”

In our opinion, that makes it all the more crucial for Senator Harkin to continue unearthing the truth about how some of the country’s largest for-profit higher education companies really operate.

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Stephen Burd
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Stephen Burd

Senior Writer & Editor, Higher Education

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Three Steps House Repubs May Take to Shield For-Profit Colleges