For-profit colleges draw attention from regulators and millions of students
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By Elaine Korry and Liz Willen
Monday, June 14, 2010SACRAMENTO -- A year ago, Joseph Carrillo Jr. had to fight to get into crowded classes here at the public American River College. He couldn't find a guidance counselor, and he felt lost. So he switched to the private University of Phoenix. There, everything fell into place -- at 17 times the cost.
Carrillo's move from the community college to the for-profit university shows the allure of a higher-education sector that is growing so fast the federal government wants to rein it in. The 24-year-old, who hopes to own a business someday, said he was impressed by the ease of course scheduling at his new school and unconcerned about future debt.
"What good is cheap tuition if classes are so packed you can't even get in?" he asked.
But Congress and the Obama administration are concerned.
For-profit schools may be offering an educational alternative, but that choice often comes with crushing student debt, some observers say.
New federal rules, expected to be formally proposed in coming days, would tighten oversight of the industry. One much-debated proposal would cut federal aid to for-profit schools in certain cases if graduates spend more than 8 percent of their starting salaries to repay loans. Sen. Tom Harkin (D-Iowa) also plans this month to begin hearings on the industry, examining recruiting practices and student loan default rates.
Supporters of the schools say the proposed rules could shut down hundreds of programs, undermining President Obama's goal of making the nation the world leader in college completion by 2020.
"It will have a horrendous effect on programs in California and nationally," said Harris N. Miller, president of the Career College Association, which represents more than 1,400
"What good is cheap tuition if classes are so packed you can't even get in?" he asked.
But Congress and the Obama administration are concerned.
For-profit schools may be offering an educational alternative, but that choice often comes with crushing student debt, some observers say.
New federal rules, expected to be formally proposed in coming days, would tighten oversight of the industry. One much-debated proposal would cut federal aid to for-profit schools in certain cases if graduates spend more than 8 percent of their starting salaries to repay loans. Sen. Tom Harkin (D-Iowa) also plans this month to begin hearings on the industry, examining recruiting practices and student loan default rates.
Supporters of the schools say the proposed rules could shut down hundreds of programs, undermining President Obama's goal of making the nation the world leader in college completion by 2020.
"It will have a horrendous effect on programs in California and nationally," said Harris N. Miller, president of the Career College Association, which represents more than 1,400