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States Move to Intervene in Federal Case on For-profit College Watchdog

Attorneys general file motion to intervene in education case, signaling a larger effort by states to protect Obama-era policies.

“For far too long, ACICS enabled fraud and abuse in federal student lending by allowing the for-profit school industry to take advantage of students and taxpayers,” Massachusetts Attorney General Maura Healey said in an emailed statement. (Steven Senne/AP Photo)

Democratic attorneys general from five states and the District of Columbia announced yesterday that they intend to intervene in a federal case involving an embattled for-profit college accreditor.

The Accrediting Council for Independent Colleges and Schools, known as ACICS, filed a lawsuit last December after the former U.S. Education Secretary John King announced the department was severing ties with the troubled agency.

It is unclear whether the Trump administration will decide to reverse King’s decision on ACICS, but some education experts view Tuesday’s motion as an important step in trying to continue the priorities of the education department under former President Obama.

“You have an uncertain administration,” said Ben Miller, senior director for postsecondary education at the Center for American Progress, who views the action by the states as critical to protecting students and taxpayers. “The intervention serves as a form of insurance.”

The White House did not respond to a request for comment on the new administration’s intentions regarding the case. Betsy DeVos, President Trump’s pick for education secretary, had her confirmation hearing last week and the committee vote is scheduled for Jan. 31. DeVos has limited experience in higher education, and her approach to regulating the for-profit college industry is unknown.

Before the department terminated its recognition, ACICS was one of the most powerful for-profit college watchdogs in the country. It was responsible for accrediting over 200 colleges that enrolled hundreds of thousands of students.

Accrediting agencies are responsible for ensuring college quality, and without their stamp of approval, colleges cannot access federal student aid dollars. In 2015, colleges accredited by ACICS received about $5 billion in federal student aid.

But there have been persistent questions about ACICS’ oversight of the schools it monitored.

ProPublica found that colleges accredited by the agency on average had the worst graduation rates in the country. Students attending ACICS-accredited schools also had the lowest student loan repayment rates and more than a fifth of the students defaulted on their loans within three years of leaving school.

Corinthian Colleges and ITT Educational Services, two for-profit college chains overseen by ACICS, kept their accreditation despite facing numerous investigations from government agencies. Both college chains have since declared bankruptcy, leaving thousands of students with tarnished degrees and deeply in debt.

As we also reported, many ACICS commissioners, who make the ultimate decisions on college accreditation, have direct ties to the schools they’re supposed to police. Two-thirds of agency’s commissioners worked concurrently as executives at for-profit colleges, many of which were under investigation.

“For far too long, ACICS enabled fraud and abuse in federal student lending by allowing the for-profit school industry to take advantage of students and taxpayers,” said Massachusetts Attorney General Maura Healey in an emailed statement. Healey said the motion was filed “to defend the Obama administration’s decision to stop this national accrediting agency from repeatedly failing to do its job and ensure quality education at certain for-profit institutions.”

ACICS leaders say they’ve made changes since the agency came under heightened scrutiny and that the accreditor deserves to be reinstated. The next hearing in its case against the education department is scheduled for Feb. 1.

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“The agency has undergone serious and sustained critical review, renewal and reinvention for a markedly strengthened accreditation process,” said ACICS interim president Roger J. Williams in an email, adding that allowing ACICS to continue would offer a more “beneficial outcome” for students.

The ACICS-related move by the attorneys general appears to coincide with a broader effort from some states to protect Obama-era policies and actions from rollbacks by the Trump administration.

A coalition of 17 attorneys general filed a motion on Monday to intervene in a federal appeals court case on whether the structure of the Consumer Financial Protection Bureau is constitutional.

The attorneys general noted in their filing that because of Trump’s election, “the situation had changed.” Trump had suggested during his campaign that he would “dismantle” the Dodd-Frank Act, which authorized the creation the bureau.

Also on Monday, a group of eight state attorneys general filed a motion to intervene in challenges to the emissions standards established by the Environmental Protection Agency and the National Highway Traffic Safety Administration. The challenges are currently pending in the United States Court of Appeals for the District of Columbia.

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