Nearly 200 for-profit colleges almost 100% federally funded
- New research from the Brookings Institute reveals the number of for-profit institutions drawing more than 80% of revenues from U.S. Department of Education student loans has decreased, falling from 38% of schools in 2011-12 to 29% in 2014-15. But when including veterans benefits from the Department of Defense, almost 200 of these colleges are 100% federally funded.
- Data reveals four of the 11 largest for-profit educational companies exceed the 90% threshold when various federal funding sources are accounted for, but only two proprietary institutions in recent years have lost student loan access due to consecutive years of being in violation of the 90/10 revenue rule.
- Researchers suggest that the lack of private funding in schools specifically offering career training suggests a significant disconnect between employers and the value they place on degree programs at for-profit institutions.
This information may not disrupt potential plans for deregulation of the for-profit sector but does pose an interesting question for all college leaders. How can schools more efficiently disconnect teaching and learning from public resources, since federal and state governments are expediting the effort to privatize higher education anyway?
The answer may lie in creating revenue-bearing partnerships with established industries to finance workforce pipelines and industrial innovation. Can colleges have more laboratories sponsored by for-profit companies instead of nonprofit groups receiving money from these companies? Can large tech industries begin endowing faculty positions designed for their top employees and executives to deliver expertise to future employees? These are the industrial disruptions higher education must create to limit innovation disruptions in other fields.
- Brookings Institute How much do for-profit colleges rely on federal funds?