For-profit colleges face more state scrutiny

Last month, Maryland’s House and Senate enacted measures that would eliminate all state aid to for-profit schools, ban commissions or bonuses for student recruiting, and make all for-profit schools in the state contribute to a fund to protect students if any college in their group breaches a contract.

California lawmakers approved legislation that would restrict a for-profit college’s eligibility to receive state aid in the form of Cal Grants. According to The Sacramento Bee, the state has been sending $20 million more in Cal Grants to for-profit schools each year than to public community colleges.

This is not the first time California regulators have taken on this issue. Legislation mandating the schools to meet certain graduation job-placement goals to gain accreditation expired in 2007 when lawmakers and then-Gov. Arnold Schwarzenegger failed to reach an agreement to extend it.

Now that for-profit schools are back in the spotlight, state officials are once again trying to regulate them.

Like many higher-education institutions, for-profit schools such as the University of Phoenix and Argosy, Kaplan, and DeVry universities have seen an enrollment boom since the start of the recession.

More than 2.2 million students enrolled in a private for-profit institution in the fall of 2009, almost 25 percent more than the previous year, according to a federal study. Many of those students take their courses online.

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