Showing posts with label Pine Manor College. Show all posts
Showing posts with label Pine Manor College. Show all posts

Thursday, January 12, 2017

The Department of Education's "Heightened Cash Monitoring" list and its list of programs that failed DOE's Gainful Employment Rule: Big Trouble Ahead for American Higher Education

As the Obama administration limps to a close, the U.S. Department of Education issued two lists that should scare the heck out of anyone working in the field of higher education.

First, a few days ago, DOE issued its most recent list of colleges that it flagged for "Heightened Cash Monitoring." More than 500 colleges are on that list.

At about the same time, DOE also released its list  of post-secondary programs that failed DOE's "gainful employment" rule.  More than 800 programs are on that list.

DOE's Heightened Cash Monitoring List: 539 institutions

Let's look first a DOE's Heightened Cash Monitoring List. Most of the schools on this list are for-profit institutions, which shouldn't surprise anyone. Is anyone shocked to discover that Lubbock Hair Academy in Lubbock, Texas and the Institute for Therapeutic Massage in Haskell, New Jersey are on that list?

A lot of the colleges on DOE's Heightened Cash Monitoring List are nonprofit liberal arts schools, and that isn't surprising either. The small liberal arts colleges are finding it more and more difficult to attract students, and a number are on shaky financial ground.  Colleges on the list include secular institutions like Pine Manor College and Mount Ida College in Massachusetts and religious institutions like St. Gregory's University in Shawnee, Oklahoma and St. Mary of the Woods College in Indiana.

But I was surprised that DOE put 38 foreign colleges on its Heightened Cash Monitoring List. Who would have thought the federal government would issue student loans to Americans studying abroad? But it does, and some of those foreign schools have financial concerns that got them on DOE's Heightened Cash Monitoring List.

Here are just a few of the foreign schools that made the list: Medical University of Gdnask in Poland; Tyndale University College and Seminary in Toronto, Canada; and the University of Gloucestershire in Cheltenham, England.

But what surprised me most was the number of public institutions that were flagged by DOE for Heightened Cash Monitoring--84! In Minnesota, more than 30 public colleges and universities made the list, including regional universities like Bemidji State University and Minnesota State University in Mankato. Nine public institutions in Alabama are also on the list, including the University of North Alabama and the University of West Alabama.

In short, DOE's latest Heightened Cash Monitoring list shows us that a lot of for-profit colleges, non-flagship public colleges, and small liberal arts colleges are under financial strain. Not all of the 539 schools on that list will fail in coming years; but certainly some of them will.

More Than 800 Programs Failed DOE's Gainful -Employment Rule

The Department of Education adopted a Gainful-Employment Rule in 2014, which was designed to protect students from enrolling in expensive for-profit colleges that did not prepare them for good jobs. Under this rule, programs risk losing federal student aid money if their graduates do not make enough money on average to justify the expense of getting their education. Specifically, programs fail the Gainful-Employment Rule if their graduates have student-loan payments that exceed 12 percent of their total earnings or 30 percent of their discretionary income.

Over 800 higher-education programs failed DOE's gainful-employment test, which it released this week. As reported by the Chronicle of Higher Education, 98 percent of the failing programs were offered by for-profit institutions. But even the mighty Harvard University made the list for one of its programs--a certificate program in theater arts.

Here is what surprised me about the list of programs that failed the gainful-employment test: Only two law schools were on it. Florida Coastal School of Law and Charleston School of Law, both for-profit law schools failed to meet the debt-to-earning ratio that the Gainful Employment rules requires.

Given the damning evidence compiled by Law School Transparency, I was puzzled by the small number of law schools that failed DOE's gainful employment rules.  After all, LSAT scores for students at 7 law schools are so low that Law School Transparency estimates that 50 percent of their graduates are at "extreme risk" of failing their bar exams. And LSAT scores at 26 schools are so low that a quarter of their graduates run an extreme risk of failing their licensing exams.

Conclusion: Big Trouble Ahead For Higher Education

DOE's Heightened Cash Monitoring List and its list of programs that failed the Gainful-Employment Rule are warning signs that a number of higher education institutions are in trouble. For-profit institutions, non-prestigious public college, and small liberal arts schools are all surviving on federal student-aid money. If DOE turns off the spigot to any of the schools on these two lists, those schools will certainly close within a few months.

If higher education leaders are not concerned about the financial health of their industry, they certainly should be.

Gee, I'm scared!



References

Andrew Kreighbaum. Latest Heightened Cash Monitoring List. Inside Higher Ed, January 12, 2017.

Law School Transparency. 2015 State of Legal Education.

Karen Sloan. Two Law Schools Get an 'F' for High Debt From Education Dept. Law.com, January 11, 2017.

U.S. Department of Education press release. Obama Administration Announces Final Rules to Protect Students from Poor-Performing Career College Programs, October 30, 2014.

U.S. Department of Education press release. Education Department Releases Final Debt-to-Earnings Rates for Gainful Employment Programs. January 9, 2017.

Fernanda Zamudio-Suarez. Over 800 Programs Fail Education Dept.'s Gainful-Employment Rule. Chronicle of Higher Education, January 9, 2017.

Fernanda Fernanda Zamudio-Suarez. Here Are the Programs That Failed the Gainful-Employment RuleChronicle of Higher Education, January 9, 2017.





Friday, November 11, 2016

Tiny liberal arts colleges are dead. They just don't know it. 15 small-college presidents meet in New York City.

My father was a fighter pilot in the Army Air Corps in December, 1941, stationed at Clark Field in the Philippines. He often told this story about his introduction to World War II.

About two weeks before the Japanese attacked Pearl Harbor, my father told me, his commander called all the young airmen together for a meeting.

"Make out your wills and get your affairs in order," the commander told the pilots. You are not dead yet, but most of you will be soon."

And the commander was right. My father's P-40 fighter plane was bombed on the ground when the Japanese attacked Clark Field a few hours after the Pearl Harbor attack. Six months later, my father  was captured on the Bataan Peninsula, along with the entire American  army. He experienced the Bataan Death March and spent the rest of the war in a Japanese concentration camp. Two thirds of his fellow prisoners died while in captivity.

I thought of my father's story as I read an article about a recent meeting of 15 presidents of the nation's smallest liberal arts colleges, which took place in New York City last June. All  15 presidents represented institutions with 800 students or fewer.

Rick Seltzer of Inside Higher Ed reported on the meeting, from which I gathered the presidents concluded that their colleges are doing a great job educating young people. The problem, from the presidents' perspective, is poor public relations; the public simply does not realize just how neat and special these colleges are.

Thomas O'Reilly, president of Pine Manor College (about 450 students), said this about his institution: "We're small enough that we can work with a handful of students, and if it works for them, it can be quickly spread across the rest of the programs we're offering.. If it doesn't we can quickly stop--just as importantly--without having made a major investment."

OK, I got it. Small liberal arts colleges are nimble, and that's why they're special.

Mariko Silver, president of Bennington College, another micro institution, said the nation was  focused overmuch on scaling up higher education without appreciating the small colleges. "One of the things that I feel makes American higher education the envy of the world is a real diversification of institution types--an ecosystem."

Nice talking points, Mariko! Everyone in higher education likes to be reassured that American colleges are the envy of the world.

But in fact, the tiny liberal arts colleges are on the verge of extinction. A few small liberal arts colleges will survive and even thrive: those with large endowments or sterling reputations like many of the small liberal arts colleges in New England. And small colleges that excel in nursing or health care will probably be fine.

But tiny colleges with 800 students are fewer cannot long survive, in my opinion. As my father's commander might have put; they are dead and just don't know it.

 I don't say this with any pleasure. The microbrew college presidents are probably right to say there is a distinct value to receiving a liberal arts education at a small college. But the economics of higher education today simply won't allow the small liberal arts colleges to survive. In 2015, Moody's Investor Service predicted that college closings would triple by 2017.

And Moody's prediction is too conservative. Of the 15 colleges represented at the New York City meeting last June, I predict half will close within five years. Shimer College, for example, has fewer than 100 students. Who thinks it will still be open in 2022? Shimer is in Chicago. I'm surprised Shimer's president could afford to travel to New York City.

Apart from all the other challenges small liberal arts college face, they simply can't survive in a world of ever increasing state and federal regulations. And here's an example.

In a case decided by the Second Circuit Court of Appeals last May, Michele Dziedzic sued SUNY Oswego for sexual discrimination under the Civil Rights Act of 1964 because she was transferred from the paint department to the plumbing department. The plumbing department, in her view, was "less prestigious" than the paint department, which she maintained was an elite unit. Dziedzic also said she had suffered from a hostile working environment due to sexual jokes and racy pictures that she was forced to endure when she collected her mail from a mailbox in the men's locker room.

I am not belittling Ms. Dziedzic's grievances. She may very well have been transferred to the plumbing department for nefarious reasons, and being forced to visit the men's locker room to collect her mail may have been humiliating.

But is this a federal case that must travel to the Second Circuit Court of Appeals? The suit may not have cost Ms. Dziedzic much; she represented herself. But SUNY Oswego was represented by four lawyers!

How many suits like that could an institution like Shimer College or Pine Manor College endure? Not many.

At my own institution, I signed a form awhile back certifying that I had read a safety memo informing me that it is dangerous for university students or employees to text on their cell phones while walking on campus. I imagine this memo was spawned by some state or federal safety regulation. How much did my university spend warning students and employees not to walk while texting?

In recent years, the U.S. Department of Education has issued "Dear Colleague" letters that dictate how colleges manage their restrooms and their student grievance procedures.  Each of these "Dear Colleague" letters imposes a financial burden on coleges and uniersities.

And the colleges don't push back on the ever tightening noose of federal regulation because they are all addicted to federal student aid money.

I will be sorry to see the small liberal arts fade away like old soldiers. But I feel sorrier still for students who take out student loans to attend these dying institutions--institutions that may well be closed before their graduates pay off their student loans.


References

Dziedzic v. State University of New York at Oswego, 648 Fed.Appx. 125 (2d Cir. 2016).

Rick Seltzer. Leaders consider future of tiny liberal arts colleges. Inside Higher ED, November 11, 2016.

Kellie Woodhouse. Moody's predicts college closures to triple by 2017. Insider Higher ED, September 28, 2015.





Tuesday, August 2, 2016

St. Catharine College of Kentucky is in receivership: More small colleges will close as federal oversight squeezes small liberal arts colleges out of business

Last month, St. Catharine College closed its doors for the final time. More than 100 faculty members and staff were laid off, and a federal court placed the college in receivership, which means a court-appointed overseer will manage the institution's assets on behalf of creditors.

St. Catharine's leaders blamed its closure on the U.S. Department of Education. DOE put the college on its "Heightened Cash Scrutiny" list, subjecting it to more onerous regulation of its federal financial aid money.  College administrators said DOE's move was unjust and forced the college to close.

St. Catharine is one of 517 colleges and universities on DOE's latest "Heightened Cash Scrutiny" list, which includes proprietary schools, a few public universities,  about 40 foreign institutions, and quite a few small liberal arts colleges like St. Catharine.  Not all these schools will  close in coming years, but some of them will.

For example, Shimer College is on the list; Shimer only has about 100 undergraduates. How long do you think Shimer will last? Pine Manor College, a small school in Brookline, Massachusetts, is also on the list. Pine Manor had about 500 students in the fall of 2015; and the total cost of attendance (tuition, room and board, etc.) is $43,000. How healthy do you think Pine Manor is?

Small liberal arts colleges all over the United States will be closing at an accelerating rate in the coming years.  The cost of attendance is simply too high at these little schools. Of course, most small private colleges are now discounting their tuition rates for entering freshmen--on average, first-year students are only paying about 50 percent of the sticker price.  But slashing tuition fees has not lured enough customers for many small colleges to keep their enrollments up.

I don't know enough about St. Catharine's situation to determine whether DOE treated the college unfairly. DOE may have had good reasons for putting St. Catharine on its "Heightened Cash Scrutiny" list. But it is fair to say that DOE's intensive meddling in college affairs has increased administrative costs for American colleges and universities.  Small institutions--colleges with less than a thousand students--simply can't afford the mounting costs of complying with federal mandates.

For a major public university, new  DOE mandates are manageable.  The University of Texas, for example, can hire additional administrators to comply with federal regulations; and it has a battalion of lawyers who can draft updated university policies to comply with new federal regulations that are spewed out of Washington.

But the little colleges simply can't afford the cost of complying with ever more intrusive federal regulations--FERPA, the Clery Act, Title IX, Section 504, etc.  And one by one, small liberal arts colleges will begin closing.

I foresee the day when American higher education will consist of three sectors: 1) secular public institutions, for-profit colleges, and elite private colleges and universities that have large endowments. Small liberal arts colleges, once a respected and important segment of American higher education, will soon be a thing of the past.

St. Cathrine Chapel.jpg
St. Catharine College is in receivership



References

Paul Fain. St. Catharine College Placed in Receivership. Inside Higher Ed, July 28, 2016. Accessible at https://www.insidehighered.com/quicktakes/2016/07/28/former-st-catharine-college-placed-receivership

Rick Howlett. St. Catharine College Closes Its Doors For the Final Time. WFPL, August 1, 2016. Accessible at http://wfpl.org/st-catharine-college-shutters-doors/

Kelly Woodhouse. (2015, November 25). Discount Much? Inside Higher Ed. Accessible at: https://www.insidehighered.com/news/2015/11/25/what-it-might-mean-when-colleges-discount-rate-tops-60-percent?utm_source=Inside+Higher+Ed&utm_campaign=389f6fe14e-DNU20151125&utm_medium=email&utm_term=0_1fcbc04421-389f6fe14e-198565653