Tens of thousands of former ITT Tech students are adrift after the school’s sudden closure two weeks ago — and the Education Department is being criticized by Republicans and Democrats alike for not doing enough to guide students who have no idea what to do next.
Students who went into debt to pay ITT tuition may have to retake classes elsewhere because their credits won’t transfer, and veterans attending ITT using GI Bill funds are facing the loss of thousands of dollars in tuition. And while the Education Department and ITT have been criticized for doing little to ensure other schools would absorb the displaced students, some for-profit colleges — what one critic called “vulture schools” — are aggressively recruiting them.
Conservative Republican lawmaker Virginia Foxx said the department left students “out in the street.” New Mexico’s Democratic attorney general says the students have been “re-victimized.”
And a group of more than 20 Senate Democrats penned a letter to the Education Department last week that expressed concerns that former ITT Tech students might be “lured by other for-profit colleges facing state and federal investigations and lawsuits.”
The senators, who included Sens. Patty Murray (D-Wash.), Elizabeth Warren (D-Mass.), and Sherrod Brown (D-Ohio), expressed strong support for the federal crackdown on ITT, but wrote that “the Department must work to ensure these students have high quality, affordable options.”
The criticism comes as students must make difficult decisions in the wake of ITT’s sudden closure. They can ask for “closed school” federal loan forgiveness, but that means forfeiting the ITT credits they earned. They can transfer to a cheaper community college, but most of their ITT credits likely won’t be accepted. Or they can transfer to another for-profit college, which is more likely to accept their credits, but in some cases could also be in financial or legal trouble.
Other for-profit colleges have begun recruiting former ITT students. Among them: the Art Institute, whose parent company, Education Management, has been the target of multiple attorneys general investigations. In November, Education Management paid $95 million to settle Department of Justice allegations that it violated federal law in how it paid its recruiters.
The Art Institutes’ website says: “ITT Students: Join us to begin the next step of your academic journey.” The college held a “Transfer Fair” for ITT students on Friday, at dozens of Art Institute campuses across the country.
“Every time a school closes, the vultures come out of the woodwork,” said Robyn Smith at the National Consumer Law Center.
The for-profit industry’s trade association countered that most of the schools interested in signing up former ITT students are “good schools with sound financial and academic records.”
“And they just truly want to help,” said Steve Gunderson, the president and CEO of Career Education Colleges and Universities.
But ITT students who choose the Art Institute face the risk of being displaced once more, as its parent company has been closing campuses and laying off hundreds of workers. The company’s stock currently trades at one cent.
The parent company, Education Management, said it is doing some marketing and outreach to ITT students because it was asked to do so by states and accreditors trying to find schools where students can complete the courses they need to earn their degrees.
Students who enroll at the Art Institutes won’t be left stranded like they were at ITT, Education Management spokesman Bob Greenlee said, because the Art Institutes are committed to serving students enrolled — even if a campus has stopped accepting new students, he said.
“Our commitment to all of our current students has been, ‘If you make the commitment to enroll, we’re going to make the commitment to serve you,’” Greenlee said. “I think our record on maintaining campuses at considerable cost to the Art Institutes speaks to that.”
Education Department officials, meanwhile, say they’ve done a lot to inform students about their options.
In the days since the closure, the Education Department has sent out two emails to students explaining their choices, and has created a website with frequently asked questions, links to state assistance programs and a calendar of transfer fairs at schools across the country.
“There’s no way around it. This is hard for students,” Education Secretary John B. King, Jr. told reporters last week. “But ultimately we took oversight steps because we knew we were about to send millions more dollars to ITT to not deliver a quality education, and potentially to shut down mid-semester.”
Former ITT student San Touch said he read one of the emails from the Education Department, but he still has questions.
“You can read it all day long, I’ve read it like 15 times trying to make sense out of it,” Touch, 36, said. “I want a definite answer from the horse’s mouth. I want to talk to somebody who can give me answers. I want to hear it directly, not from a piece of paper.”
Education Department spokeswoman Kelly Leon said the department has “been working nonstop to reach out directly to students and to rally those who can help, including colleges, state authorizers, accreditors, and others. This work is ongoing and we plan to announce additional efforts in the coming days.”
Many former ITT students discovered last week just how bleak of a situation they are in. Some of them had no idea that ITT was on the verge of collapse. They’ve already paid thousands of dollars — or taken out loans — to cover this term’s classes, which will no longer be taught.
Although the federal government will discharge ITT students’ loans if they give up the credits, veteran students who attended ITT Tech using GI Bill funds can’t get that money back.
“That’s my livelihood. The GI Bill is my income. I hadn’t held a job since I got out of the military,” said Heather Pierce Stremel, a former hospital corpsman in the Navy who said she spent a full year of her benefits on classes at ITT. Stremel has now taken a seasonal job as a UPS driver, to make ends meet, while she figures out what to do.
Many community colleges across the nation have welcomed these students, but the credits earned at ITT often won’t transfer.
“We want to make sure that students can meet the course requirements,” said Stephen Head, chancellor of the massive Lone Star College System near Houston. “It’s about maintaining the integrity and the reputation we have and really the perception of the quality of education you’re getting. The degree they’re going to get now will say Lone Star College on there.”
Students going this route will likely have to retake classes — and in some cases they may have to start all over. Terea Scruggs, 43, who was working toward a degree in network systems administration at an ITT campus in Louisville, Ky., said officials at two different colleges told her last week that she’d need to take 30 more credit hours worth of courses. Scruggs said she was two classes away from completing an associate’s degree at ITT, for which she’d taken out some $18,000 in loans.
As of last week, the Education Department was aware of just one formal “teach-out” agreement, in which a college agrees to take on former students from a closed school and provide whatever classes they need to finish their degree. That agreement is between Daniel Webster College — a small New Hampshire-based school owned by ITT’s parent company — and nonprofit Southern New Hampshire University. The agreement covers only about 550 students.
Other similar agreements may be in the works. But for now, the 39,000-plus students who were enrolled at 130 ITT Tech campuses are on their own.
Raul Valdes Pages, a former for-profit college industry executive, said the lack of wide-reaching teach-out agreements is a failure on the part of ITT Tech, the Education Department, the for-profit college trade groups and the school’s accreditor, the Accrediting Council for Independent Colleges and Schools. Valdes Pages said all parties should have worked harder to reach these agreements sooner, when it was apparent that ITT Tech was in serious trouble.
“They’ve all been abysmal in handling this,” said Pages, who is now a vocal critic of the for-profit industry. “You’re talking about kids who don’t understand what accreditation is, what pre-paid tuition is, what transfer credits are — all that. All they know is they’re out at sea.”
Gunderson, the trade group president, said some for-profit schools were working behind the scenes to arrange agreements to take these students, but were slowed down by regional accreditors who were wary of the quality of ITT’s courses, simply because the college was nationally accredited. Regional accreditation is generally regarded as superior.
“One of the reasons accreditation faces such hostility in Congress and across the country is because of what … I would call the academic arrogance of saying my accreditation is better than anybody else’s,” Gunderson said. He blamed the Education Department for forcing ITT to close abruptly by cutting off its access to federal funds for new students.
The Education Department has said the aggressive enforcement against ITT was necessary to protect students and taxpayers.
ITT’s national accreditor, the Accrediting Council for Independent Colleges and Schools, is fighting for its own life, as the Education Department is considering revoking its federal recognition. In a statement, ACICS interim President Roger Williams said he takes the plight of ITT students “very seriously.”
“The tragedy that thousands of students are just beginning to face surely brings with it tremendous uncertainty and frustration,” Williams said. “We are working diligently, with government officials, ITT personnel and other education institutions to identify ways to best serve the students as they seek a quality educational experience.”
The schools most likely to accept for-profit college credits are other for-profit colleges. When the scandal-plagued Corinthian Colleges chain of for-profit schools imploded last year, its students were left in a similar predicament.
Critics of the for-profit industry say the former ITT students should be skeptical of the promises coming from recruiters at other schools.
“Here you are a knight in shining armor, stepping in to ‘help,'” said Barmak Nassirian, director of federal relations and policy analysis at the American Association of State Colleges and Universities. “The only difference between you and ITT is you haven’t closed yet.”
ITT students need “very careful, very thoughtful” counseling, Nassirian said.
“The vast majority of them,” he said, “may arguably be better off just declaring academic bankruptcy, letting go of the credit and the boat anchor of debt that ITT has wrapped around their necks.”