Students at for-profit schools might soon have fewer protections in Kentucky

A proposal to significantly loosen oversight of for-profit colleges and schools in Kentucky has passed its first hurdle in the General Assembly, but some worried lawmakers say they hope to improve the final version of the proposal.

House Bill 281, sponsored by Rep. Phillip Pratt, R-Georgetown, would remove some requirements and standards that for-profit schools must meet to get a state license from the Kentucky Commission on Proprietary Education, including those aimed at ensuring instructional and content quality. The changes would affect for-profit schools that do not offer four-year bachelor’s degrees.

At a House Education Committee meeting Tuesday, Rep. Reginald Meeks. D-Louisville, said he was extremely concerned.

“From what I understand from reading the bill, it looks like there are a number of critical areas we should be concerned about, ” Meeks said. “Qualifications of professors, qualifications of administrators, things like oversight of the academic programs, all those things will now not be regulated under the bill.”

David Floyd, chairman of the commission’s board, said the agency has only one full-time staff member who cannot oversee everything the law requires. The commission currently oversees about 155 schools, which pay fees that fund the commission.

The schools also pay into a $500,000 fund that the commission uses to refund students when schools go out of business, lose accreditation or discontinue a program.

Floyd, a former lawmaker who now works for House Majority Leadership, said he understood Meeks’ suspicion about the bill because it eliminates language about quality and qualifications. But under the current statute, the commission could choose to inspect any school it wanted without any consistency. In order to evaluate the quality of instructors or content, the commission would have to hire qualified people to make those judgments.

“The purpose of the bill is to more narrowly define the mission of the commission and to eliminate in statute those things with which it is not equipped to comply without a substantial influx of tax funds, either to hire staff or specialists,” he said. “There’s nothing untoward about it.”

The world of for-profit schools saw substantial turmoil during the Obama Administration because of what federal officials saw as misleading and predatory practices that left many students without job preparation and with heavy student debt. The U.S. Department of Education stopped granting federal loans to students at some schools because of those practices, which effectively shut them down. Those included Corinthian Colleges and ITT Technical Institutes, which closed campuses all over the country, including in Kentucky, leaving thousands of students with no degrees but plenty of debt.

The education department then ended federal recognition of the Accrediting Council for Independent Colleges and Schools, which accredited about 270 for-profit schools. Federal officials said ACICS had failed to oversee schools like Corinthian and ITT.

But Betsy DeVos, education secretary under President Donald Trump, has signaled a different view on for-profit schools.

Last fall, 17 Democratic state attorneys general filed suit against DeVos because the U.S. Department of Education blocked Obama-era protections that cut off funding to low performing for-profit programs. Kentucky Attorney General Andy Beshear wrote a letter in support of the lawsuit.

Last March, Beshear joined seven other attorneys general asking the U.S. Department of Veterans Affairs to restore educational and vocational benefits to veterans “victimized by Corinithian Colleges for predatory practices.”

In 2011, former Kentucky Attorney General Jack Conway led an investigation of for-profit schools that allegedly misled students about their graduation and employment rates. The state entered into a $1.2 million settlement with Daymar College, and National College lost a Supreme Court appeal against Conway’s office for refusing to comply with a subpoena.

Several committee members who voted yes for Pratt’s proposal said they hoped he would meet with concerned legislators to make changes to the bill. He did not return a call from the Herald-Leader seeking comment for this story.

Rep. Jody Richards, D-Bowling Green, however, voted no, alluding to past troubles for for-profit schools.

“I think we should have better monitoring,” he said. “We know we’ve had serious trouble with them. If we pass this bill and some parent spends money and then they call us and say why didn’t you monitor these schools better?”

This story was originally published February 7, 2018 at 2:24 PM with the headline "Students at for-profit schools might soon have fewer protections in Kentucky."