July 30, 2014
“Too many students attending for-profit colleges don’t get the degrees they expected, or get no degrees at all, and as a result, in end up in deep in debt,” said Rep. Davis, a senior member of the House Committee on Education and the Workforce. “Unfortunately, this is especially true for service members and veterans, who frequently fall victim to predatory for-profit colleges that all too often are more eager to get a hold taxpayer-funded GI benefits than properly educate our vets. This common-sense consumer-protection legislation will safeguard both our nation’s students and U.S. taxpayers’ dollars.”
Rep. Mark Takano Announces Legislation to Protect Students from For-Profit Colleges
Washington, DC – Earlier today, Rep. Mark Takano (CA-41) announced the Protections and Regulations for Our Students Act (PRO Students Act) in a press conference with Rep. Susan Davis (CA-53) and Rep. Steve Cohen (TN-09).
The legislation would:
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Require proprietary institutions to derive at least 15% of their revenue from non-federal student aid and ensure that military and veterans’ education benefits are included in that calculation.
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Prohibit schools from using revenues derived from federal student aid for recruiting and marketing.
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Launch a complaint tracking system for students to report grievances.
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Establish a Proprietary Education Oversight Coordination Committee and create a framework for targeting and prioritizing program reviews by the Department of Education.
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Strengthen sanctions for violations and create a Risk-Sharing system that holds postsecondary institutions financially accountable for poor student outcomes.
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Improve the quality of and access to key information, such as the student default risk index, cohort default rates, loan repayment rates, degree completion rates, and accreditation documents.
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Prohibit pre-dispute arbitration clauses in loan contracts that waive the rights available to borrowers against loan servicers.
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Strengthen whistleblower protections for faculty and staff.
“The Protections and Regulations for Our Students Act, also known as the PRO Students Act, will aim to improve accountability and protect students from bad actors in the for-profit college sector,” said Rep. Takano. “As a former high school teacher and a community college trustee, I've seen enough of these abuses and we're putting together reasonable accountability standards. It will also we ensure that our student and taxpayer dollars are being well spent, and that students are receiving quality, affordable education. I thank Rep. Davis and Rep. Cohen for joining me on this legislation that will protect students.”
“Too many students attending for-profit colleges don’t get the degrees they expected, or get no degrees at all, and as a result, in end up in deep in debt,” said Rep. Davis, a senior member of the House Committee on Education and the Workforce. “Unfortunately, this is especially true for service members and veterans, who frequently fall victim to predatory for-profit colleges that all too often are more eager to get a hold taxpayer-funded GI benefits than properly educate our vets. This common-sense consumer-protection legislation will safeguard both our nation’s students and U.S. taxpayers’ dollars.”
“We must make sure that for-profit colleges are held accountable both to the students they serve as well as to the taxpayers who keep their businesses afloat,” said Rep. Cohen. “I am proud to join Representatives Takano and Davis on this legislation that will help protect students from bad actors and ensure that taxpayer funds are used appropriately to further students’ educations, not simply to pad investors’ pocketbooks.”
Background Information:
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• The for-profit college industry enrolls just 13% of all postsecondary school students, but accounts for nearly half of all student loan defaults. On average, for-profits allocate about 23% of revenue to recruiting and marketing, 19% to profit, and just 17% to academic instruction. 72% of for-profit programs produce graduates earn less, on average, than high school dropouts.