April 08, 2020

Durbin, Warren, Colleagues Urge Education Department to Protect CARES Act Funds from Predatory For-Profit College Industry

WASHINGTON – U.S. Senators Dick Durbin (D-IL), Elizabeth Warren (D-MA), along with Senators Sherrod Brown (D-OH) and Richard Blumenthal (D-CT), sent a letter to the Department of Education requesting clarification on whether it will allow for-profit colleges to be eligible for funding in the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which establishes the $14 billion Higher Education Emergency Relief Fund to aid students and stabilize colleges and universities impacted by the COVID-19 pandemic. In a letter to Department of Education Secretary Betsy DeVos, the Senators encouraged the agency to use its authority to target funding to public and nonprofit colleges—calling excluding for-profit colleges from the funding the “most legally sound” approach. 

“If the Department determines that for-profit colleges are eligible for this funding, we urge the Department to include in such a determination strong accountability policies to support students and protect taxpayers, including policies to prohibit for-profit colleges from using such funding for any purposes beyond those which directly support student instruction, emergency financial aid to students, and student support services central to schools’ educational missions,” the Senators wrote.

The Senators specifically asked the Department to include the following policies to protect students and taxpayers:

  1. A requirement to use 100% of the funding for student instruction, emergency financial aid to students, and student support services central to the educational mission.
  2. A ban on for-profits using funds for executive compensation and requirement that for-profit colleges that receive funding to freeze executive compensation.
  3. A ban on publicly-traded for-profit colleges that receive funds from buying back stock. 
  4. A ban on for-profits using funds for any advertising, marketing, or recruitment purposes. 
  5. A ban on for-profits that receive higher ed CARES Act funds from seeking additional stimulus funds from other sources authorized by the CARES Act.
  6. Consider CARES Act funding as federal funding for 90/10 compliance.
  7. Report to Congress how for-profit colleges used the funds. 

The Senators have requested responses to their letter by April 21, 2020.

Full text of the letter is available here.

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