ITT Tech stu­dents need retroac­tive pro­tec­tion

Baltimore Sun - - COMMENTARY - By Dana Stein and Marce­line White Del. Dana Stein (dana.stein@house.state.md.us), a Demo­crat rep­re­sent­ing Dis­trict 11 in Bal­ti­more County, in­tro­duced the guar­anty fund bill in the Mary­land House of Del­e­gates. Marce­line White (marce­line@mary­land­con­sumers.o

Dur­ing this year’s leg­isla­tive ses­sion, the Mary­land Gen­eral As­sem­bly passed a bill to in­crease over­sight of Mary­land’s for-profit col­leges. The bill didn’t just cre­ate tougher stan­dards for for-profit schools, it also es­tab­lished a guar­anty fund meant to re­im­burse Mary­lan­ders who were at­tend­ing col­leges that closed.

But be­cause it didn’t go into ef­fect un­til Oct. 1, its pro­tec­tions may be too late to help Mary­land stu­dents who at­tended the nowde­funct ITT Tech­ni­cal In­sti­tute, which closed in early Septem­ber.

Last year, Mary­land’s ITT Tech stu­dents in­cluded 233 vet­er­ans uti­liz­ing their GI Bill ben­e­fits and about 897 fed­eral loan bor­row­ers. Many were peo­ple of color. In­deed, at Mary­land’s two cam­puses, nearly 60 per­cent of bor­row­ers were African-Amer­i­can, with more than 65 per­cent qual­i­fy­ing for Pell Grants de­signed to help stu­dents from lower-in­come fam­i­lies.

Like all stu­dents, they en­rolled with the hope that a col­lege ed­u­ca­tion would be a gate­way to the mid­dle class. What many of them prob­a­bly did not know was that ITT Tech had its own fi­nan­cial chal­lenges long be­fore it closed. With an in­sti­tu­tional loan de­fault rate of 18 per­cent and only 40 per­cent of bor­row­ers able to pay down any of the principal on their loans, Mary­land ITT Tech stu­dents were pay­ing an av­er­age of $28,000 an­nu­ally for their de­grees.

ITT Tech’s stu­dent bor­row­ers who were en­rolled within 120 days of its clo­sure and did not com­plete their de­grees can ap­ply for a closed school dis­charge, but that dis­charge pro­vided by the Depart­ment of Ed­u­ca­tion will only ap­ply to fed­eral loans. The dis­charge does not ap­ply to Pell Grants, out-of-pocket ex­penses or GI Bill ben­e­fits. Fur­ther­more, it will not give re­lief to stu­dent bor­row­ers with pri­vate loans or the in­sti­tu­tional loan pro­gram that is cur­rently em­broiled in law­suits from the Se­cu­ri­ties and Ex­change Com­mis­sion and Con­sumer Fi­nan­cial Pro­tec­tion Bureau.

Worseyet, stu­dents whow­ere­over­charged are find­ing the re­im­burse­ment checks they have been sent are no good.

Con­sider the email that Vet­er­ans Ed­u­ca­tion Suc­cess, an or­ga­ni­za­tion ded­i­cated to pre­vent­ing the abuse of vet­eran stu­dents, re­ceived from a vet­eran who was us­ing the Post-9/11 GI Bill to at­tend ITT: “They sent me a re­fund check and on Tues­day last week I de­posited it into my ac­count, my­bank cleared it on Thurs­day and made funds avail­able. On Mon­day night my ac­count went $1,700 in the hole. The check was orig­i­nally for some­where around $2,600, and it had been re­turned from JP Mor­gan Chase Bank. I am cur­rently go­ing to end up so far be­hind in bills and rent…”

In short, ITT Tech failed as an in­sti­tu­tion of higher learn­ing, and those with the duty to over­see its op­er­a­tions also failed. Un­less the Mary­land Higher Ed­u­ca­tion Com­mis­sion (MHEC) de­cides to make the law retroac­tive, ITT Tech stu­dents will be un­able to re­coup much of the money that was meant to send them to col­lege — another po­ten­tial fail­ure.

MHEC should make the guar­anty fund retroac­tive and help make ITT stu­dents whole. But we need to go even fur­ther. The state of Mary­land must step up and demand real ac­count­abil­ity and mea­sur­able out­comes from these schools.

In late Septem­ber, the Ac­cred­it­ing Coun­cil for In­de­pen­dent Col­leges and Schools (ACICS) that gave ITT Tech ac­cess to fed­eral ed­u­ca­tion dol­lars, was “de-rec­og­nized” by the U.S. Depart­ment of Ed­u­ca­tion. For years, the depart­ment had been con­cerned about ACICS’s lax stan­dards and shoddy over­sight. In fact, ACICS con­tin­ued to ac­credit the be­lea­guered Corinthian Col­leges un­til their clo­sure in 2014. Another six Mary­land col­leges, en­rolling around 2,000 stu­dents, are ACICS ac­cred­ited and now may be in dan­ger of clo­sure.

Ac­cred­it­ing agen­cies must do more as gate­keep­ers for fed­eral tax dol­lars that fund for-profit col­lege ed­u­ca­tion. The fed­eral gov­ern­ment must bet­ter an­tic­i­pate trou­bled ed­u­ca­tional in­sti­tu­tions in or­der to serve both tax­pay­ers who fund its fi­nan­cial aid as well as the stu­dents who rely upon it to re­ceive their ed­u­ca­tions.

Most col­lege stu­dents, in­clud­ing those at the former ITT Tech, be­lieve their cho­sen in­sti­tu­tions have their best in­ter­ests at heart. In­stead, thou­sands of stu­dents na­tion­wide be­came vic­tims through no fault of their own.

Now is a time to act, not blame or com­mis­er­ate. It is time for in­tegrity — not prof­its — to be the watch­word for higher learn­ing.

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