177 colleges fall short on federal list measuring financial responsibility
- According to the most recent data available, for the 2014-15 school year, 112 private, nonprofit institutions and 65 for-profits failed the U.S. Dept. of Education's standards for financial solvency.
- The new data represents an increase of 18 schools overall — with greater increases in nonprofit failure, as for-profit institutions seemed to clean up their financial practices, according to the Chronicle of Higher Education.
- Institutions' debt:asset ratio, in addition to other factors, is a large consideration in the rankings formula, but many higher education supporters have criticized the U.S. Department of Education's methodology.
The Department of Education frequently misapplies its own guidance in interpreting the financial data collected on these schools, and offers facts with little context. The danger for institutions is two-fold in that public disclosure is difficult to put back into a bottle once released without full facts, leaving schools to then work to produce the right data with the appropriate contexts.
Considerations for institutions could include interactive dashboards to showcase progress towards debt and asset management and to make connections between philanthropic development, public appropriations and student tuition revenues. If stakeholders can see how money is spent and what debt looks like from higher education contexts, there could be a more substantive view of what schools need to operate.
- The Chronicle of Higher Education 177 private colleges fail Education Dept's financial responsibility test
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