DeVry to Limit Revenue From Federal Funding
September 20 2016 - 8:50AM
Dow Jones News
DeVry Education Group Inc. on Tuesday said it would voluntarily
edge down the share of money it gets from federal funding, as it
looks to limit its exposure amid a government crackdown on
for-profit colleges.
The parent of DeVry University and others said it would limit
the revenue that each of its six Title IV institutions derive from
federal student aid to 85%, including Department of Veterans
Affairs and military tuition assistance benefits. Federal
regulations allow for 90%, excluding military assistance.
Chief Executive Lisa Wardell said the move "underscores our
commitment to finding solutions to the issues facing higher
education today."
The move would diversify DeVry's revenue streams as the federal
government has clamped down on the for-profit education industry in
recent years.
Earlier this month, ITT Technical Institute, among the nation's
largest for-profit college chains by revenue, abruptly closed more
than 130 campuses, forcing more than 40,000 students at campuses in
38 states to begin looking for another school after the government
banned it from enrolling new students receiving federal aid. That
move follows last summer's liquidation of Corinthian Colleges
Inc.
The government has also cracked down on for-profit schools'
aggressive recruiting practices and has enacted stricter policies
intended to ensure that schools are preparing students for gainful
employment. The for-profit college industry has shriveled in recent
years, with enrollments at the largest chains plummeting by more
than half in the past five years.
The Federal Trade Commission in January took aim at DeVry,
saying it allegedly ran false television and online advertisements
about the employment success and earnings of its graduates.
Write to Anne Steele at Anne.Steele@wsj.com
(END) Dow Jones Newswires
September 20, 2016 08:35 ET (12:35 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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