Government cuts ties with for-profit college accreditor, impacts Virginia College, others in TN Valley

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HUNTSVILLE, Ala. (WHNT) – Hundreds of for-profit colleges could close, leaving up to 600,000 students scrambling to find other schools, after the Education Department withdrew recognition of the nation’s largest accreditor of for-profit schools.

This impacts Virginia College and other for-profit universities in the Tennessee Valley.

The Accrediting Council for Independent Colleges and Schools said it would appeal Thursday’s decision to Education Secretary John B. King Jr.

In a statement, ACICS Interim President Roger Williams said the council would “continue diligent efforts to renew and strengthen its policies and practices” to meet the department’s criteria for accreditors.

The accrediting agency has been accused of lax oversight of its schools, which included those once owned by the now-defunct Corinthian Colleges Inc. and the recently shuttered ITT Technical Institute.

What a Difference Two Weeks Make

In an interview with WHNT News 19’s Chris Davis earlier this month, we asked Veronica Cram, the President of Virginia College in Huntsville, if there was any danger the college might fall under similar restrictions that the Department of Education levied on ITT Tech.  “Absolutely not,” said Cram.  “I feel 100% sure about Virginia College.”

Now 14 days later, Virginia College finds themselves in a comparable situation as ITT Tech. If the ACICS’s appeal is denied, schools like Virginia College and Fortis Institute in Alabama will have 18 months to find a new accreditation body.

Virginia College’s parent company told us in a statement, “we have been closely monitoring the situation and anticipated the DOE senior official’s decision yesterday to terminate and withdraw the Department’s recognition. We have been actively considering our best course of action, including seeking accreditation from a different, recognized accrediting agency.”

Students at schools that may ultimately lose accreditation will not be eligible for any federal financial aid like student loans or pell grants. Virginia College has another 18 months before that would go into affect, meaning currently enrolled students could potentially finish their programs before accreditation and financial aid is revoked.

That’s of little consequence to former ITT Tech nursing student Tenisha Gardner.  “I had like 8 more months to go,” she says.

Gardner was counting down the days until she became an RN, only to find ITT closed before fall classes even began. She had planned to travel to Virginia College’s nursing campus in Montgomery Friday, but cancelled those plans when she learned their accreditation was also potentially in jeopardy.

“It was like, are you serious? If you can’t trust schools like professional places, who can you trust?” says Gardner.

That may be the point.

A study by the Center for American Progress found 52% of federal financial aid dollars received by ACICS approved schools, went to institutions that have faced some sort of state or federal investigation.  “Virginia College, called us today wanting to see if we’re still coming down today. You know, no,” says Gardner.

‘Does Not Inspire Confidence’

In a letter to the council released later Thursday, Emma Vadehra, King’s chief of staff, wrote that “ACICS’ track record does not inspire confidence that it can address all of the problems effectively.”

Vadehra said the department found fundamental problems with the council’s work as an accreditor. Her decision followed staff and advisory panel recommendations to sever ties with the council.

If ACICS loses its appeal, hundreds of schools would be forced to find a new accreditor within 18 months or lose their ability to participate in federal financial aid programs, such as student loans and Pell Grants. About 600,000 students attend ACICS-accredited institutions, Williams said.

While the appeal is pending, ACICS retains its federal recognition and remains determined to fully execute its accreditation responsibilities in a professional manner, he said.

Thursday’s decision was met with praise from Democratic lawmakers.

“Accreditors are supposed to be watchdogs, but this negligent agency rubber-stamped shady institutions like ITT and Corinthian for years, right up until the moment they collapsed,” said Sen. Elizabeth Warren of Massachusetts.

But Steve Gunderson, president of Career Education Colleges and Universities, an industry lobbying group that represents for-profits, said the decision will have “horrible ramifications for hundreds of thousands of students, thousands of dedicated faculty and staff, and hundreds of communities and employers that rely on institutions accredited by ACICS.”

Republican Rep. John Kline of Minnesota, chairman of the House Committee on Education and the Workforce, echoed those concerns. “Hundreds of colleges will be forced to scramble to find a new accreditor so students don’t lose their aid and everything they’ve been working toward,” Kline said.

Advocacy groups, lawmakers and others have long complained about the council. It has been accused of continuing to accredit schools under investigation for falsifying job placement rates and claims for federal aid, illegal recruiting practices and misleading marketing claims.

The council allowed Corinthian Colleges, one of the largest chains of for-profit colleges, to continue to receive accreditation even while it was under investigation for fraud. Corinthian sold many of its campuses, closed others and filed for bankruptcy protection last year. Thousands of its former students are asking the Education Department to forgive their federal loans, in a taxpayer bailout that could top $3 billion.

And earlier this month, ITT Technical Institute announced it was shutting down all 130 of its U.S. campuses, leaving more than 35,000 students scrambling across more than 30 states. The chain was banned in late August from enrolling new students who used federal financial aid because Education Department officials said the company had become a risk to students and taxpayers.

What’s Next for Huntsville ITT Students

Taniesha is a part of nearly 100 former ITT Nursing students from the Tennessee Valley that will now likely have to start over on their program. “It’s a tough and big pill to swallow but if you really want something you’ve got to go after it,” she says.

Because of the wasted credits, many of the students could be eligible for loan deferrals.  “I did call and see if we could get that ball rolling but it’s going to take a long time. It’s not really anything that’s going to happen overnight,” says Gardner.

Taniesha says there aren’t any other local universities or colleges that she’s spoken to, that have room for the displaced students to start this spring. But, she has faith.

“I’m just gonna trust God because I really strongly believe he’s got something for us. In the long run I think we’re going to look back and be thankful we went this route,” she says.

She has incredible optimism, despite an extremely difficult month,  “We’re going to start in January, you watch,” says Gardner.