Another Not-for-Profit Leaves Students in the Lurch

The Chronicle for Higher Education reports today that Kelsey-Jenny College in San Diego has declared bankruptcy, abandoning students with nothing more than a notice on the door. Confused students have nowhere to turn, reports WASC, who also pulled their accreditation.

Oh, those pesky not-for-profit schools, dumping their students because of money!

In another article, the Chronicle reports the founding of a virtual university in Syria. Intended for students around the world, it focuses on science and mathematics, but also:

"Our target isn't only Syrian students," says Hassan Risheh, the minister of higher education. "I have been to Central Asia, and I've seen how hungry they are for knowledge about Islam and Islamic culture. We could also teach them a lot about our own ancient Mesopotamian heritage through interdisciplinary programs."

The cost will be about $7,000 per year.

Oh, those public universities and their profit-minded ways!

(I am a graduate of two public schools and one private, not-for-profit. I am currently enrolled in a not-for-profit. I've never attended a for-profit school.)

 

I've attended:

Public not-for-profit (Most of my undergrad work, but didn't graduate there.)
Private DL not-for profit.
Private traditional for-profit.

In my opinion they all have their pros and cons.

 

It just occurred to me that I've never earned a degree from a private university of any kind--ECU is public, Cal State is of course public, and Regents was public at the time I did my degree (1995-96).


Cheers,

 

Rich - We've gone around about the for-profit, not-for-profit business before. Let's see if I can articulate a position:

1. All schools have to charge students to operate, and all schools have expenses. In the long run if a school can't cover its operating costs it goes out of business - regardless of profit status. However, for-profits have significant cost disadvantages over non-profits. They have to provide a profit to their owners. They have to pay taxes (such as property taxes) that non-profits don't have. Further, for-profits lack endowments, gift income and other sources of funding that non-profits have. For profits compensate with economical moves like using all adjunct faculties. Ok - but who does research? Who provides continuity in programs? Who advises students? Sales represeentatives? For profits don't do research, you might say. But how can the transmission of knowledge to students be separated from the creation of new knowledge?

2. The quality and ethical behavior of non-profits runs the gamut. Some of the tuition driven non-profits operate largely like for profit schools. Higher tier non-profits, however, have greater financial flexibility than for-profits as noted above. As a result their decision making process about the admission of students and program offerings isn't driven solely by tuition dollars. Their reputation and the quality of their programs comes into play.

What is the admission rate at the top non-profits? Harvard admits less than 12% to their undergraduate programs. Many top private schools accept fewer than half of their applicants. But what about for-profits? Have you ever seen one of these schools turn down a student with money (or signed loan forms) in their hands? I see it all the time - unqualified students are admitted into graduate (esp. MBA) programs at for-profit or low tier non-profits. The results - lots of folks have "MBA" after their name - but these students haven't mastered business at all.

3. The quality of for-profits schools is, IMHO, suspect. How do I know this? Employer surveys noted in this NG certainly suggest that employers think there is some sort of difference - even if they don't know what it is. Take a look at a college ranking list - US News or another list. Where are the for-profits? Few are even listed and none are highly regarded. Why? I'd argue because their quality is suspect.

I find the concept of for-profit education to be fundamentally flawed. The diverse groups of stakeholders and missions, for one, make education a poor fit for the market economy. One recent example, makes this point. Edison Schools sounded like a great idea. Private enterprise can turn around poor public schools? Take a look at their recent performance - they are losing contracts and their stock price is on the way down. Test results are not significantly improved. It sounded like a noble experiment - but it looks flawed in the end.

Regards - Andy

 

Andy.
You stated:
"However, for profits have significant cost advantages over non-profits......Further, for profits lack endowments, gift income and other sources of funding that non-profits have."

Yet according to the US News tuition at non-profit universities across the US are increasing as much as 18.9 percent at Ohio State University and 21 percent at University of North Carolina- Chapel Hill. Can you say which for-profit university is planning a huge tuition increase?
Some online universities do not have a campus. You mentioned that non-profits do not pay property taxes. Do you know the cost of maintaining a large campus? Building services, janitorial services, landscaping etc. can be very expensive.

You also stated:
"Take a look at a college ranking list - US News or another list. Where are the for-profits? Few are even listed and none highly regarded."

Yet if you check the information provided by US News, in selecting the schools or program they rank, it clearly states:
"If an accrediting body exists for a discipline or professional program, we use the list of accredited programs in good standing at the time of our survey to define the population of schools or programs to be considered in our ranking."
They use listings from ABA, AACSB, ABET and others.
The AACSB was the source used for the list of 352 accredited US masters program in business that US News surveyed. Of the 352 only 270 responded. Are you saying that the 82 AACSB accredited schools that did not respond are inferior seeing that they were not ranked by US News or that the other 2000+ regionally accredited schools that are almost all non-profit are not good.
For-profit schools are not accredited by AACSB for reasons already discussed in this forum and were not included in the survey by US News.
Where did you get the information that none are highly regarded? I am assuming that this is your opinion and not based on information you have researched.

Michael.
Proud of the for-profit schools attended.
ISIM University - MBA.
Capella University - Ph.D. (Learner)

 

Just to further complicate the public, not-for-profit and for-profit discussion, I work at a public university in Austalia, and in the last decade the government has reduced our funding by 60%. We are now expected to generate our own income from research and teaching fees. As we are predominantly a teaching university we supplement our revenue with full fee paying graduate students. A large majority are international students mainly from Asia. From my experience and that of many of my colleagues we are feeling the pressure to drop entry and passing standards in order to attract and keep these full-fee paying students in order to get our much needed revenue.

A couple of years ago an annonymous survey was conducted of academics in Australia where many admitted to reducing academic standards due to business pressures.

Interestingly an emiritus professor friend of mine who teaches both at a public traditional university and for-profit distant university in the US commented that the for-profit university had the better quality students for his courses. He put it down to their maturity and work experience, as the average age of the distant university students was around mid 40s.

 

Mike - Here is a reply.

None of the for profits are planning such tuition increases, because they already have tuition charges that are much higher than state schools such as you mention. For example, Ohio State's current undergraduate charges are tuition and fees (per year): "$4,269 for in-state, $12,696 for out-of-state ". North Carolina is tuition and fees: $3,183 for in-state, $12,349 for out-of-state. Compare that to $1400 for a single on-line course at some of the DL programs discussed in this NG. Not to mention - compare the credential you end up with - a degree from Ohio State or the University of North Carolina (both top 50 universities) - or a degree from a DL institution that most folks haven't heard of and have some suspicions about?

True - on-ground schools maintain such buildings for a purpose - for faculty and students to engage each other in learning. Realize that for most bricks and mortar schools, up to 90% of their expenses are salaries and not building services.

For profits have to earn a return for their owners. The 10-15% margin they earn dwarfs any difference between renting office space and operating a campus. Not to mention, even tuition driven non-profits typically earn 5-15% of their operating revenues in gifts and endowment income. For profits don't have this.

Actually, 5-15% is conservative. A notable for-profit earned $46 million before tax on revenue of $222 million in a recent period. If the same organization was non-profit, the $46 million (a whopping 20% of revenue) would be spend in educating students, conducting research and doing other socially useful things.

Actually, you are making my point. Why don't the for-profits (and lower tier non-profits) achieve AACSB accreditation? Because they can't meet the accreditation requirements.

But virtually all of these schools are included in the "Best Colleges" guide, even if they don't appear in the graduate college list. Again, where are the for-profits in any of the US News lists? They aren't there.

Yes - like the fact that they can't qualify for AACSB - because they don't employ adequate faculty, have appropriate library resources, employ any significant admissions requirements, etc. Hey - the for profits could go for ACBSP if they were really interested demonstrating their commitment to quality - but I argue that they are so tuition driven that it doesn't matter. They have "customers" who want MBA degrees - and they provide them. Are there academic requirements - sure. But what's the goal - graduating happy students.

Well - this is certainly my opinion. But none of the for profits are ranked on any of the ranking lists, for one. Recently, I met with a faculty recruiter from a notable for-profit at an academic conference. She lamented her experience in recruiting adjunct faculty. She had been to two of the major academic conferences in my discipline - and didn't get a single bite from academics. Frankly, they laughed at her.

Is some of this a bias to a new way of delivering education? Perhaps, but there is some underlying suspicion of for-profits. I believe that this suspicion has some basis in fact.

Certainly - be proud of what you have accomplished. But realize the perception that many have in this world about DL (whether it is for-profit or non-profit).

 

Future learning

One day, in the not so distant future, I suspect the B&M schools will be seen as old fashioned and innefectual. People will one day look at a resume and wonder just who would bother to spend thier time on campus. Must be a party animal or a spoiled rich kid. They will then hire the DL student, you know the one person who knows the value of solitary effort. Before you jump down my throat please ask yourself. Have I actually taken a DL course online? Do I know about the topic I am about to rant and rave about for 1000 words. I believe that many of the posters who complain constantly about DL have never taken the opportunity to properly educate themselves on the subject. There are several phd's on this board whom enjoy posting negative, dare I say it, PROPOGANDA about DL. Give it a rest. I am sure that someone will say that I am ignorant the facts about DL. Save your hunt and peckers. I have learned both ways, and I can believe that DL is the superior model!!! The rest of the world will too one day. ..... sooner than you think

 

Re: Future learning

Dear Pickelhead - I believe one day, the world stop caring about the labels "B&M" and "DL" and be concerned with the quality of education one receives and what it enables one to do.

The body of research on "no significant difference" is pretty strong. All other things equal, DL versus on-ground doesn't matter much. The point isn't the medium of instruction - it is the instruction itself. Indeed, "all other things" aren't equal in many cases. I've learned and taught both ways - and seen good and bad instruction in both DL and on-ground classes.

What's wrong with DL, IMHO, isn't DL - it is the sort of institutions (e.g. tuition driven for-profits and non-profits) that many DL schools are and the way they operate. In their desire to satisfy ever increasing numbers of "customers" they operate with open effectively admission policies (a 2.5 GPA from today's grossly grade inflated undergraduate world is a joke as an admission standard for MBAs), weak and/or inbreed faculty and a lack of rigor. When I see MBA classes at such schools that use a single undergraduate text as the course "reading list", I just want to puke! What comes out are people with degrees "MBA", "PhD", and the like that don't mean as much as graduates from non-tution driven schools.

Are students "customers"? Yes, but then employers are and so is society. DL schools may strengthen their bottom lines by graduating students the "easy way", but no one else benefits.

One well known DL school (NOT my "beloved" UoP) ran an interesting ad in a local paper around here recently. The ad shows a page of help wanted ads. The message was "xxx can give you the credentials to get one of these jobs". What a line of nonsense!! Doesn't anyone understand that what people need aren't credentials but education? People need life changing education that expands their minds - not letters after their name. Quality education is like "good money". It chases "bad money" out everytime.

Back to your point - Will Harvard, Princeton or Yale ever be considered "innefectual"? It hasn't been seen that way in 200-300 years. And nothing that UoP, Capella, NSU and a host of other DL schools are doing today will change their standing anytime soon.

Regards - Andy

 

Re: Future learning

I too have taken courses in both formats (DL & Traditional on campus). Both formats have their pros and cons. However, in terms of sheer difficulty I would have to say that DL is the more difficult way to get through a topic. You have to become (in many ways) the teacher AND the student. That said: I also feel that the quality of learning can also be a lot higher in a DL course. I remember just about every detail of the DL courses I took, but only bits and pieces of my on-campus undergrad courses.

(Obviously there are exceptions to each case, and these are just my generalizations.)

 

You are funny Andy

You are correct sir, many of the for-profit DL schools are turning out a less than stellar product, then again, so are many not-for-profits. I was just having a little fun. It is a shame that the academic reputations of many credible schools suffer from the practices of of the degree mills of the world. What really bothers me is the way that the for-profits are lumped together as though they are glued to the hip. That is unfair, and unfortunate. Do you really love UoP Andy? I do! Why do you?

 

Re: You are funny Andy

Andy, you keep talking about tuition driven schools skirting quality as if the accreditation bodies no longer exist.

If we are going to use the RA as a point of quality assurance, shouldn't we trust them enough in so far as schools that they stamp "accredited" measure up to an acceptable level of quality?

 

Re: You are funny Andy

As for the "for profits" I guess I see multiple "lumps" (flagrant degree mills, state approved and so-so RA schools, etc) - but none of the lumps represent high quality graduate education. My evidence - show me a for-profit school on any ranking list (USNews or other).

As for UoP - I was just having a little fun. In times past I used to speak out against UoP, particularly with Jim Lane, because of serious quality flaws that I believed were present in the school. I haven't been associated with them since 1998 so I'll let their record (and graduates) speak for themselves.

Regards - Andy

 

Reply

Having just been through both NCA and IACBE accreditation visits, I have to wonder. It sure didn't seem like they looked too hard. NCA has taken a new track of being a "consultant/evaluator". Perhaps they are too much of the former and not enough of the latter. I'm not totally sure that NCA is chasing out bad institutions. I'm more impressed with SACS - they seem to put schools on notice that are in trouble.

As for RA being an acceptable level of quality - I'd argue that RA is the minimal level of quality that one should consider. Within RA there is wide variation - Harvard is RA, so are a lot of DL schools.

The point is when is a school so bad that its degrees aren't credible?

Regards - Andy

 

I'd argue that if a school is RA then it is at least credible. Now, if this is Chevy credible or BMW credible is another point of debate. We've seen SACS and others put schools on warning (yellow flag) and even remove the accreditation from some institutions (red flag). The most recent example in my mind is Life University in Atlanta. (LU has appealed the decision.)

As for non-RA schools being credible that would have to be taken on a case-by-case basis (or not considered at all if you consider RA the minimum standard ...)

 

RA = credible

Hey, look at that I spelled something correctly! I can't believe spelling is an issua here! Some of you so funny!

If a school is RA than it meets more than minimum standards.

Each of us should know that the student, not the school determines the quality of ones education. That is given the student attends an RA school.
Believe me, I've met some real boobs from ivy league schools, and some great minds from Smallville U.