On my drive to and from school each day, I typically listen to NPR. My commute is only about 10-15 minutes, even with traffic, so I generally only hear a handful of stories. Even so, in the last couple of weeks, I’ve heard a number of stories about the recent decision by ITT Technical Institute, a for profit college, to shut down virtually overnight.
If you’re not familiar with the situation, the U.S. Department of Education announced in August that ITT Tech wold not be permitted to enroll students who use federal financial aid. This came after a number of investigations which alleged fraud and a number of other questionable business practices.
As I was driving in this morning, I heard this story, produced by our local NPR affiliate (WUSF). The gist is that ITT students—some of whom were only months from graduation—are basically left high and dry, and they now face a difficult decision: They can transfer some (though likely not all) of their credits to another institution and continue holding their debt in full, or they can discharge most (though likely not all) of their debt and start over from scratch at another institution. It’s a lose-lose situation.
The story quotes an ITT administrator in Fort Lauderdale as saying, “If I had a magic wand, I would have said, ‘If you’re closing, you teach them out, [show] that there’s a plan in place to teach out anyone who’s currently enrolled and that you don’t just shut the doors, you don’t just do that to people.”
To me, this story gets at the heart of my concerns about for-profit education ventures. I’ll be the first to admit that I am no expert on this issue, and I’m sure there are some valid arguments in favor of for-profit education. Still, I believe that educational institutions (even private, for-profit ones) have a fiduciary responsibility* to their students—a responsibility to act in their students’ interest that goes beyond their obvious responsibility to provide a quality educational experience. Unfortunately, in a for-profit school (or college, in this case), the motives and responsibilities become blurry.
Is the institution’s motive to education—or to make a profit, come what may? Is its responsibility to its students—or to its shareholders/stakeholders? Of course, those don’t have to be mutually exclusive, but when push comes to shove, which will it be? We now know the answer for ITT Tech.
* I am not a lawyer and thus don’t use this term in a strictly legal sense. Rather, I use to suggest that institutions (or, more precisely, the administrators who guide those institutions) must consider students’ interests when making decisions about the company. They must honor the trust that students place in them when they enroll.