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August 24, 2013

Oversight of career schools is lacking

The Daily Star
The Daily Star

---- — Prospective college students and parents who are considering vocational schools in New York state should first do diligent research, given the findings in a recent audit of private career schools by state Comptroller Thomas DiNapoli.

Such schools can fill an important economic niche by teaching workers skills that aren’t taught at four-year colleges. But for every career school that provides useful skills that can lead to a job, there’s another whose entire purpose is to rake in profits from publicly subsidized student loans.

In New York, private career schools that charge tuition are required to register with the state Department of Education. But according to DiNapoli’s report, schools that don’t register with the state face little in the way of consequences. State auditors who inspected a sample list provided by the Department of Education of 100 private career schools found that 18 lacked licenses.

“In several instances, auditors found that when unlicensed schools were identified and contacted, the Department of Education took no action if the school did not respond,” the comptroller’s report said. “Based on the sample results, there is considerable risk that a significant number of career schools are operating without a license.”

Of the 491 schools that did register with the state, nearly 60 percent ignored state requirements to report graduation rates and job-placement statistics. When such institutions receive taxpayer funding in the form of student loans, the state has a right to know whether it’s getting a return on its investment.

Unfortunately, the state Department of Education lacks investigative authority, and can do little more than send angry letters to unlicensed schools.

The problem of for-profit colleges putting shareholders before students isn’t unique to New York. Boston University researchers last year found that while only 12 percent of college students attend for-profit colleges, that group accounts for almost half of all student-loan defaults.

In some cases, the Department of Education’s complaints to other authorities have spurred action. New York Attorney General Eric Schneiderman this week announced a $10 million settlement with Career Education Corp.

According to the Department of Justice, the company advertised that its seven New York schools had job-placement rates ranging from 55 to 80 percent, when those rates actually ranged from 24 percent to 64 percent.

But given the power of the for-profit education lobby, parents and students shouldn’t count on public officials holding these schools accountable. Instead, they should spend their education dollars carefully, and heed the maxim caveat emptor – “let the buyer beware.”