Citizen-Times.com

There is a growing chorus demanding that the abuses of for-profits colleges be reined in. The task now is to convert those demands into laws.

If you own a television set, you know about for-profit colleges. They advertise heavily, showing the smiling faces of people who say they got a new start at Whozis Tech or Whatzis University. Such tactics, along with extensive offerings of night and online course, have allowed for-profits to increase enrollment by 225 percent between 1998 and 2008.

Unfortunately, the ads often do not reflect reality. Instead of being on track to prosperity, too many ex-students are unemployed and saddled with student loan debt. If they want to change schools, they learn that the "credits" they earned often are not transferable.

A Los Angeles Times story documented how for-profits "prey on veterans with misleading ads while selling expensive and woefully inadequate educations." An NBC News report told of high-pressure recruiting tactics to scoop up anyone regardless of qualifications.

According to the Department of Education, for-profit schools enroll 10 percent of the nation's college students. The students account for 25 percent of all student loans and grants and nearly half of student loan defaults. As much as 90 percent of a for-profit college's revenue comes from loans and grants, while they on average spend more than 20 percent of their revenue on recruiting students.

Some for-profits start from scratch. Others scoop up troubled nonprofits and convert them. Bridgepoint Education Inc. bought the Franciscan University of the Prairies in Clinton, Iowa, which had only 215 students, in 2005. Bridgepoint enrollment grew from less than 1,000 in the fall of 2005 to nearly 78,000 five years later.

Executives of for-profit schools say their default rate is high because they enroll low-income students not served by traditional universities. Sen. Tom Harkin, D-Iowa, says they target low-income students because those students are eligible for Pell grants and for more student loans.Another group heavily targeted is veterans eligible for the Post-9/11 GI Bill. Those who served at least three years of active duty since Sept. 11, 2001, can receive full tuition and fees for up to four years at the most expensive public institution in each state, plus money for books and a monthly housing stipend. For-profits account for 38 percent of all GI Bill payments.

Harkin, chair of the Senate Health, Education, Labor and Pensions Committee, this summer released the results of a two-year investigation of the for-profits. The 800-page report documents case after case of high enrollment growth, high-pressure recruiting tactics and low academic achievement. One reason students at for-profits have so many loans is these schools cost twice as much as a conventional four-year school and six times as much as a community college.

Sen. Jim Webb, D-Va., a Vietnam veteran who sponsored the Post-9/11 GI Bill, has introduced legislation to require that schools report graduation and default rates. Hearings have been held in the Veterans' Affairs Committee, but there has been no committee vote.

Sen. Kay Hagan, D-N.C., a member of Harkin's committee, has sponsored a bill that would forbid schools from using federal student assistance money for advertising. It is in Harkin's committee.

If abuses are not curtailed, the defaults could jeopardize the federal student-loan program. "In recent years, an absence of federal oversight has allowed a dangerous bubble to grow in the for-profit college industry," Harkin said. "The challenge is to crack down on the bad actors and abusive practices while preserving the positive options and innovations that many for-profit colleges have pioneered."

A good start toward that goal would be committee votes on the Webb and Hagan bills.