SC TIMES: For-profit colleges should consider new status

Career College Central Summary:

  • President Obama's proposal to make community college free was another blow to for-profit higher education providers, according to a recent Forbes article that analyzed the for-profit sector's deep troubles, and a further decline in stock prices after the announcement.
  • In Minnesota, the state Senate's DFL majority leadership also recently proposed free tuition for community college.
  • There is no other way to say it. Reconciling return-on-shareholder investment with providing affordable, cost-effective education to middle- and low-income students challenges the for-profit business model.
  • As educational institutions, for-profit education providers will always be subject to criticism when held up against their public and nonprofit brethren. How can a profit-making endeavor hold its head high against either a land grant state-funded college or a university founded by nuns or priests? This challenge becomes even harder given that for-profit schools tend to serve a population less able to access elite nonprofit higher education providers.
  • Here's a possible solution. Recently Rasmussen College — a regionally accredited private college (a for-profit enterprise owned by private investors) — issued a news release celebrating its first anniversary as a Public Benefit Corporation. Rasmussen is one of the largest for-profit colleges operating in Minnesota.
  • (And by the way, a recent report from the state's Office of Higher Education suggests that Minnesota's for-profit colleges compare favorably on some key outcomes to their public competitors.)
  • It remains to be seen whether the Public Benefit Corporation banner will enable Rasmussen and other Minnesota for-profits to survive and prosper, but we congratulate Rasmussen for taking this innovative course. The chartered benefit corporation model allows a for-profit school to legitimately say that student outcomes and success are at least as important as shareholder return on investment.

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