Education Officials Urge Termination of For-Profit Accreditor

The Biden administration should revoke approval of a college accreditor with a long history of compliance and oversight failures, career Education Department officials recommended Friday.

The Accrediting Council for Independent Colleges and Schools, which primarily oversees for-profit programs, has been scrutinized for years following the shutdown of two for-profit chains, Corinthian Colleges and ITT Tech.

Accreditors monitor college quality and give schools the seal of approval needed for access to federal student aid. Tougher oversight of ACICS after the Corinthian and ITT failures led the Obama administration in 2016 to yank recognition of the agency in an unprecedented step. Former-Education Secretary Betsy DeVos reversed the decision two years later, allowing scores of for-profit colleges accredited by ACICS to keep access to federal student aid.

Thousands of former Corinthian and ITT students who alleged fraud at their programs are still seeking loan forgiveness from the federal government.

While higher education enrollment has dropped off during the pandemic, for-profit colleges have fared relatively well — likely in part because of the established online programs at many schools. On the campaign trail, President Joe Biden promised to renew tougher oversight of for-profit programs, whose students take on more loan debt and default at higher rates compared with peers in public or nonprofit other programs.

He’s promised to restore Obama administration regulations that targeted the worst performers in the sector. Hundreds of millions of dollars in federal student aid money is at stake in the decision on the accreditor, which could be the first major sign that Biden will take a harder line on for-profit colleges.

Education Department staff made their recommendation to a federal board that oversees college accreditors. That group, the National Advisory Committee on Institutional Quality and Integrity, will consider the recommendation at a February meeting before sending its own decision to the secretary of education for a final determination. Biden has nominated Connecticut state schools chief Miguel Cardona for education secretary, although he has not been confirmed.

Photo by Alex Wong/Getty Images

Former U.S. Secretary of Education Betsy DeVos speaks during a White House Coronavirus Task Force press briefing at the U.S. Department of Education.

Political Tug of War

Critics of ACICS, which accredits 73 college campuses, say it allowed billions to go to schools accused of defrauding students without proper scrutiny. Obama officials in 2016 called the accreditor’s oversight of Corinthian a complete failure. Meanwhile, it’s repeatedly fallen short of federal standards for accrediting organizations.

The decision to terminate ACICS set off a scramble by colleges to find recognition from other accreditors so they wouldn’t lose federal funding, an outcome that would doom most U.S. colleges. ACICS sued the Education Department, and a federal judge ordered a new review of the agency by the Trump administration.

An internal Education Department report in 2018 found that ACICS failed to meet 57 of 93 of federal standards. Despite those findings, a top Trump administration official said ACICS could get back on track recommended that DeVos restore the organization’s recognition.

Later that year, another for-profit chain overseen by ACICS, Education Corporation of America, abruptly closed its doors with little notice to students or staff. The failure of those schools left the federal government on the hook for millions in student loan cancellations.

New Biden Personnel

New political appointees the Education Department announced this week include Ben Miller, the former vice president for higher education at the Center for American Progress and a longtime critic of ACICS. American Progress, a center-left think tank, produced a 2018 analysis finding numerous colleges accredited by the organization were unable to find approval elsewhere.

Miller, who will serve as senior adviser to the chief of staff, warned the Trump administration that restoring recognition to ACICS would be “an affront to those students still waiting for relief” and would cheapen college oversight efforts.

Bobby Scott (D-Va.), chairman of the House Education and Labor Committee, endorsed the department’s recommendation in a statement. The Trump administration itself found that ACICS failed to meet federal standards to avoid conflicts of interest or establish competency, he said.

“Revoking ACICS’ recognition will protect students across the country, including many servicemembers and veterans, from schools that routinely leave students with crippling debt, non-transferrable credits, and no degree,” Scott said.

To contact the reporter on this story: Andrew Kreighbaum in Washington at akreighbaum@bgov.com

To contact the editors responsible for this story: Adam Schank at aschank@bgov.com; Cheryl Saenz at csaenz@bloombergindustry.com; Robin Meszoly at rmeszoly@bgov.com