For-profit colleges try to block greater federal regulation

Local for-profit colleges such as DeVry University and The Art Institute of Philadelphia are part of a group that is suing to block new “gainful employment” regulations from Washington.

Amid nationwide claims of aggressive recruiting practices, false promises of employment and growing alumni debt, the federal Department of Education is regulating for-profit, career and certificate programs more carefully.

If those institutions fail to meet certain guidelines, such as a loan-repayment rate of 35 percent, they could lose their eligibility for federal aid.

Dr. Art Keiser, president of the Association of Private Sector Colleges and Universities, says that amounts to regulatory overreach.

“It is unfair to target the type of school or the specific program students choose, because it happens that institution pays taxes. I’m not sure I understand the logic of it,” Keiser said.

DeVry University says while it’s a member of the APSCU, it doesn’t support the lawsuit.

Saddled with $140,000 in debt and no job

Some for-profit institutions receive more than 80 percent of their revenue from taxpayer-guaranteed student loans.

James Brawner, who transferred from Temple to study visual communications at the Art Institute of Philadelphia, has accumulated $140,000 in debt. He said the institute advertised jobs at MTV and Dreamworks, but when he graduated in 1999, he wasn’t qualified to work at Kinko’s.

“I was told I was going to be trained according to what these employers wanted. I was told I was going to have the option of getting my bachelor’s degree after I graduated. That didn’t come true,” Brawner said. “I was told they had a list of schools I could transfer to to get my bachelor’s degree.

As it turned out, Brawner said there was not such a list until four years after he graduated. He was not able to transfer his credit.

A representative of the Art Institute of Philadelphia said privacy rules prevent any comment on Brawner’s situation and that the institute is complying with the new regulations.

Now back at Temple, Brawner would like to see repayment from the for-profit sector–or at least loan forgiveness for students in his situation.