State, federal penalties against for-profit
A national for-profit college with campuses in Greenfield and Madison will not be allowed to enroll any new students from Wisconsin either at its campuses or online until it can convince the state's Educational Approval Board that it is financially stable.
The state's action against ITT Technical Institute — one of the first for-profit colleges overseen by the EAB in Wisconsin — comes in the wake of a U.S. Department of Education announcement Thursday that it will step up financial oversight of the Indianapolis-based company, ITT Educational Services.
ITT offers online classes and has campuses in 38 states with 45,000 students nationwide, including about 550 in Wisconsin. ITT was established in the United States in 1969, according to its website, which says it has six schools of study: information technology; drafting and design; electronics technology; business; criminal justice; and nursing and health sciences.
The federal government sent a letter to the company Thursday ordering it not to enroll any new students anywhere who use federal financial aid, and to pay $152 million within 30 days to cover liabilities in case it closes. The company also may not give pay raises or bonuses to its executives under the federal orders.
ITT has been under federal and state scrutiny over its accounting and recruiting practices.
As of July, ITT had 448 students at its Greenfield campus, 59 at its Madison campus, and 42 Wisconsin residents enrolled online, according to David Dies, executive director of the state Educational Approval Board. ITT has had a campus in Greenfield since 1989.
ITT also had a campus in Green Bay, but closed its doors in July. Last October, ITT notified the EAB that it was re-evaluating its Madison campus, and suspended new enrollment there. Classes continue to be held in Madison, though.
ITT has had issues with meeting accreditation standards, and accreditation is critical to an institution being eligible to receive federal financial aid, Dies said.
The EAB previously had been concerned about the U.S. Department of Education's already heightened cash monitoring of ITT, and the financial stability of ITT, Dies said.
EAB already was considering suspending new enrollment in Wisconsin, but ITT appealed and agreed to appear before the EAB in September with audited financial statements, according to Dies.
Thursday's action by the U.S. Department of Education prompted immediate action in the interim, Dies said.