WASHINGTON – For-profit colleges put revenues above education and charge students high tuition and loan rates that could leave them in debt for years, a Senate Democratic report said Monday.
While students are aggressively recruited, many drop out, the report said. It found that 54 percent of students enrolled in 2008-09 left without a degree or certificate by mid-2010. In two-year associate degree programs, 63 percent left without a degree.
The staff report was issued by Sen. Tom Harkin, D-Iowa, chairman of the Health, Education, Labor and Pensions Committee.
The report said veterans were among those vulnerable to the tactics of for-profit schools, since these colleges receive the largest share of military educational benefit programs. Eight of the top 10 recipients of GI bill money since the Sept. 11, 2001, attacks went to for-profit education companies.
The report said quotas were the highest priority for recruiters. Publicly traded companies operating these schools had an average profit margin of 19.7 percent. They paid an average of $7.3 million in 2009 to top executives, while the five highest paid leaders of large public universities averaged $1 million, and leaders at nonprofit colleges averaged $3 million.
Steve Gunderson, president and chief executive officer of the Association of Private Sector Colleges and Universities, dismissed the report as inaccurate.
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