A Degree, and Thousands of Dollars Later; For-Profit Schools Leave Many Students Feeling Cheated

By Elizabeth Green and Grant Lancaster
The Razorback Reporter

Graduates of for-profit schools in Arkansas have more student-loan debt compared to those who attend public nonprofits, according to 2016 data from the U.S. Department of Education College Scorecard.

“For-profit” colleges are operated by private, profit-seeking businesses; many are vocational schools.

The average loan debt for graduates of for-profit schools in Arkansas is $13,233, and the average for graduates of public nonprofits, such as the University of Arkansas, is $11,790, according to College Scorecard.

Of the 92 colleges and universities in Arkansas, 40 are for-profit, according to the Department of Education.

From 2010-12 Kaylyn Vanconant attended Bryan University, a for-profit school with a campus in Rogers. She graduated with an associate degree in medical assisting. The school emphasized getting a job after graduation, Vanconant said, though not necessarily in the career field she had studied.

“Their idea of helping students obtain a job was a McDonald’s,” Vanconant said, or a franchise healthcare call center.

Vanconant took out just over $30,000 in subsidized and unsubsidized student loans while at Bryan, she said, and as the interest has added up over the years, she now owes about $47,000.

“I can’t pay it back,” Vanconant said.

Bryan University’s median graduate debt is $23,519, according to 2016 College Scorecard data. The school ranks fourth highest in graduate debt among Arkansas for-profits.

Paula Carollo is the financial aid coordinator at Bryan University.

Costs at Bryan are higher because students take what she described as “accelerated courses,” and the school offers  more one-on-one attention compared to a standard university such as the U of A. That is likely why students take on additional student loans, she said.

“It’s like going to a convenience store and spending $3 on a soda when you could’ve gotten it at Walmart for two bucks,” Carollo said.

Vanconant mostly has deferred payments on her loans for 10 years, she said. She described the amount of debt as overwhelming and said if she is able to put something toward the $47,000 balance, it might be “a dollar or two” each month.

Vanconant is now finishing her first year as a business management student at Western Governor’s University, a nonprofit online university founded in 1997 by a group of governors. A Pell Grant covers most of the cost, she said, and she pays the rest out of pocket.

Vanconant works at the Walmart home office, making less than $12 an hour.

“I am certainly going to sit there and try to pay it back,” Vanconant said, “but as far as how long it’s going to take me, I don’t know.”

Strayer University in Little Rock has the highest rate of graduate debt out of all for-profit schools in the state, with a median of $34,242, according to College Scorecard.

Akeia Torres graduated from Strayer in 2018 with a bachelor’s degree in business administration and a minor in healthcare administration. She has about $65,000 in student loan debt, she said.

The mixture of night classes and online courses allowed Torres, a working mother, to attend college at her own pace. After submitting more than 350 applications, however, she was not able to find a human resources job that would offer her any more money than her current position as human resource coordinator at Arkansas Pathology Associates.

“I have all this debt and I can’t even get a good job,” Torres said.

After completing a bachelor’s degree, Torres said she chose to continue in Strayer’s graduate program with the hopes that a master’s degree would attract better job offers. She also got incentives to continue at Strayer through a program that allows students to take one free course each quarter as long as the student scores A’s and B’s. Torres had enough credit to finish a one-year masters program without taking any extra loans, she said.

Torres completed a mix of online and on-campus classes to finish her undergraduate degree, but has found that most of the graduate courses in her field are only offered online, she said.

“They make you think you can get most of your classes on campus,” Torres said, “and that’s not true.”

Torres did not think very much about how much Strayer cost her, she said.

“Then, when reality hits, and you see how much debt you’re in,” Torres said, “you ask ‘why wasn’t I paying attention?’”

Torres knew about the risks associated with for-profit colleges when she chose to enroll at Strayer, she said.

Tressa Shavers, the Little Rock-based regional vice provost at Strayer University, could not comment on information published about the university or its student debt, she said.

For-profit institutions across the country recently have faced increased scrutiny.

In one example – August 2016 – the Department of Education prohibited ITT Educational Services, the parent company of ITT Technical Institutes, from enrolling new students who used federal financial aid, according to a report by Inside Higher Ed. The department also placed ITT on heightened cash monitoring, which required the institution to use its own money to cover federal aid disbursements for current students.

The ban and increased oversight was because the Accrediting Council for Independent Colleges and Schools determined the school was non-compliant, failing standards such as financial stability, management, record keeping, retention and institutional integrity.

The following month, in September, all ITT Tech campuses nationwide were shut down and the company filed for bankruptcy, leaving 40,015 students nationwide unsure of where to turn next, according to ITT’s 2016 second quarter report.

The ITT Little Rock campus was across the street from Strayer’s campus, so Torres was very aware of the closing, she said. Some of the ITT students transferred to Strayer, she said.

Wesley Hill graduated from ITT Tech in Little Rock in December 2015 with a bachelor’s degree in information systems and cyber security, as well as an associate degree in network system administration.

He is paying back around $84,000 in student loans, including an $18,000 parent-student loan that his mother took out for him.

“The interest is so high,” Hill said, “I’m barely making a dent.”

Hill went to ITT in 2010 after briefly attending the University of Central Arkansas to major in business. ITT stopped offering the information systems program, so Hill pursued his associate degree until the program was brought back a year later.

“As a young adult going to college I thought, you know, I have to get a degree, so I’ve already got my associate, I’ll just push through and get this bachelor’s,” Hill said, “but it was really hard because for what you’re paying, you weren’t getting the education.”

Hill said when he came back to continue his bachelor’s education, the school had let many of the full-time faculty go. In their place, people who worked during the day were hired to teach at night. Many did not have background for the subjects they taught, Hill said.

“It was, ‘Google this, watch YouTube videos.’ The teachers were reading off of prompts that were outdated,” Hill said. “They couldn’t pronounce what they were teaching. I mean it was a joke.”

Hill is making monthly payments of about $500 to Nelnet, a Wall Street firm that manages student loans, but has a pending defense to repayment against his bachelor’s loans. In addition to feeling as though the bachelor’s education was unfulfilling, Hill said the Department of Education website shows that he never graduated from ITT, though the school tells him his December 2015 degree is legitimate.

“I feel cheated a little bit,” Hill said.

Hill now works as a manager for Windstream’s network operations center in Little Rock. He said that ITT did not help him obtain the job.

“What I learned,” Hill said, “I do not apply at all.”

Hill also said that ITT attempted to take credit for his “success story” by putting up a picture of his face on campus with a statement claiming the career services department got him the job.

“They were taking credit for something they didn’t do,” Hill said.

Department of Education sanctions against ITT came during the Obama administration’s crackdown on for-profit higher education.

After President Trump was elected, for-profit college companies, such as Strayer, Apollo Education and Grand Canyon Education, saw their stock jump substantially, according to Business Insider. Strayer’s alone increased by 35 percent.

Education Secretary Betsy DeVos supports privately run schools and invests in for-profit educational ventures, including Laureate Education, a private for-profit college operator, according to the Office of Government Ethics.

President Trump even agreed to a $25 million settlement within days of the election regarding a series of lawsuits against his own for-profit education venture, Trump University, which operated from 2004 to 2010.

The Trump administration has reversed many Obama-era rules meant to protect the integrity of federal financial aid programs.

In July the Department of Education announced it was eliminating the “gainful employment” rule, which required for-profit and vocational programs to qualify for federal funds by proving that they were preparing graduates for gainful employment.

Weeks before Trump took office, the department identified about 800 programs in violation of this rule. Ninety-eight percent were for-profit colleges, according to The New York Times.

Most students attending for-profit institutions are nontraditional. Many have families to support and strive to receive a decent education while also working full time.

The trends at for-profit institutions show that a majority of these students are not getting the most out of the education they paid to receive. Instead, they are left thousands of dollars in debt, a potentially useless degree, and high interest rates that make the debt seem unrelenting.

“It was like a used car salesman tactic where they’re going to sit there and sell you the great features of the car,” Vanconant said, “but then you start driving it and the fender falls off, and then the muffler falls off.”