>If not, then they are refunded all costs for the time spent at the failed institution.
I'm currently just one semester away from earning my bachelor's degree. To do so, I resigned from a reasonably decent sysadmin job. If I was put into the position of one of the students going to the failed college in the article I would be out 3 years of my life. For me the difference in salary alone, even if I was compensated for every dime spent on education from tuition, rent, utilities, books, gas, everything would still be over $100,000.
Just covering costs is a drop in the bucket compared to the value of literally years of someone's life. If my college closed their doors the day after the start of next semester I would be apoplectic. For profit colleges should absolutely be required to have enough funds in reserve to make sure that they could continue operation long enough to let all currently enrolled students finish at a full time enrollment schedule.
Students are left with student loans that are basically impossible to discharge in bankruptcy. Student loan forgiveness programs like the one for public service almost never actually pay out. Even if you die and your assets aren't enough to cover the loan, debt collectors will often go after immediate family members even though they are under no obligation to pay the debt in an effort to trick them into assuming responsibility for it. The whole point of making student loans unable to be discharged under basically any circumstances is to let creditors loan money for education without collateral.
Why shouldn't we require similar protections to keep for-profit colleges from defaulting on their obligations? I don't think what you're suggesting goes far enough to protect students and even if it did, it would need some teeth to it to meaningfully enforce it. We already have regulations to discharge student loans when an institution goes under but because of parasites like Betsy DeVos in the majority of cases those loans are still being collected on today.
I think the main thing here is that if an institution has "failed" then the government has already failed. Regulations should be structured in such a way that if an institution wants to close then it's cheaper to stop accepting new students and let the current ones finish rather than default and immediately close.
Is it realistically possible to structure things so that an organization cannot fail within some time window? I'm skeptical. If there's some wind-down (or refund) money held in escrow, it's reasonable to expect that maybe a semester window might be realistically possible. A couple years probably isn't. It would be a lousy situation especially to the degree credits weren't easily or fully transferable but it's not clear to me how much power the government has to do something about it.
I'm not saying make it literally impossible for an institution to fail, I'm just saying we should mitigate the risk by making sure there's some funds in reserve to act as collateral and mitigate cash flow problems while they're winding down. In addition pass some of that liability off onto the directors. Just making it clear that they have a fiduciary duty to students would go a long way.
Right now if a for-profit college is going under there's no incentive at all to try and minimize the impact to students. If you know that a degree program is getting the axe in 6 months it's pretty scummy to still be accepting freshmen into it. From a business standpoint not doing that means passing up hundreds of thousands of dollars in tuition while still incurring the same costs in terms of facilities and faculty.
UK: further education colleges are state funded, I can't think of any purely private ones off the top of my head. The funding organisations would act to 'protect provision' if a college did fail - the funders can require mergers &c.
The fees they are charging tend to suggest that the University is not claiming skills funding agency money for this foundation course. In the UK further education colleges work at a level below universities and what we call 'level 3' qualifications (e.g. A levels, BTEC National Diploma &c) are needed to enter most university courses. Universities can offer their own foundation courses - a foundation year is common in the fine art field.
I'm currently just one semester away from earning my bachelor's degree. To do so, I resigned from a reasonably decent sysadmin job. If I was put into the position of one of the students going to the failed college in the article I would be out 3 years of my life. For me the difference in salary alone, even if I was compensated for every dime spent on education from tuition, rent, utilities, books, gas, everything would still be over $100,000.
Just covering costs is a drop in the bucket compared to the value of literally years of someone's life. If my college closed their doors the day after the start of next semester I would be apoplectic. For profit colleges should absolutely be required to have enough funds in reserve to make sure that they could continue operation long enough to let all currently enrolled students finish at a full time enrollment schedule.
Students are left with student loans that are basically impossible to discharge in bankruptcy. Student loan forgiveness programs like the one for public service almost never actually pay out. Even if you die and your assets aren't enough to cover the loan, debt collectors will often go after immediate family members even though they are under no obligation to pay the debt in an effort to trick them into assuming responsibility for it. The whole point of making student loans unable to be discharged under basically any circumstances is to let creditors loan money for education without collateral.
Why shouldn't we require similar protections to keep for-profit colleges from defaulting on their obligations? I don't think what you're suggesting goes far enough to protect students and even if it did, it would need some teeth to it to meaningfully enforce it. We already have regulations to discharge student loans when an institution goes under but because of parasites like Betsy DeVos in the majority of cases those loans are still being collected on today.
I think the main thing here is that if an institution has "failed" then the government has already failed. Regulations should be structured in such a way that if an institution wants to close then it's cheaper to stop accepting new students and let the current ones finish rather than default and immediately close.