Letter Supporting Protecting Financial Aid for Students and Taxpayers Act
April 19, 2012
Dear Senators Harkin and Hagan:
On behalf of the more than three million members of the National Education Association (NEA), we would like to offer our support for the Protecting Financial Aid for Students and Taxpayers Act. We thank you for your leadership in introducing this important legislation, designed to prohibit for-profit colleges from using federal student aid revenues for advertising, marketing and recruiting.
As you know, some for-profit colleges and universities get 85 to 95 percent of their revenues from federal taxpayers. These same schools spend up to a quarter of their budgets on aggressive advertising, marketing and recruitment while skimping on spending for education instruction, student support services and job placement counseling. In contrast, nonprofit colleges and universities spend an average of one-half of one percent of their revenues on marketing.
Investigations conducted by the Government Accountability Office have revealed questionable practices by some for-profit colleges including deceptive recruitment practices. Too many of these programs are preying on low-income students, minority students, and veterans seeking to further their education, who take on insurmountable debt to pursue degrees or certificates that don’t help them get jobs.
The facts are deeply troubling. For example, 15 of the largest for-profit education companies receive 86 percent of their revenues from federal student aid programs — such as the G.I. Bill and Pell grants. In fiscal year 2009, these for-profit education companies spent $3.7 billion dollars, or 23 percent of their budgets, on advertising, marketing and recruitment, which was often very aggressive and deceptive.
The Protecting Financial Aid for Students and Taxpayers act offers common-sense, fiscally responsible policy that will help maximize federal financial aid dollars for educating students while helping to curb deceptive advertising and recruitment practices in the for-profit higher education industry. We thank you for your leadership and look forward to continuing to work with you this important issue.
Director, Center for Advocacy
Director of Government Relations