Higher Ed Insights: Week of October 17, 2016

Business of Higher EdReuters wrote about how a Chinese company, Dipont, bought access to admissions officers at elite U.S. colleges and universities including Vanderbilt, Tulane, the University of Virginia, and Wellesley College. Eight former Dipont employees were interviewed about the company’s practices with U.S. admissions officers. One of those practices, hosting a summer program in China and inviting U.S. admissions officers to attend, included paying for round-trip travel expenses.

Inside Higher Education interviewed several members of the National Association for College Admission Counseling (NACAC), who stated that the organization’s Statement of Principles of Good Practice excludes any language pertaining to travel expenses or honoraria to attend domestic or international conferences, but that practice is not unusual. NACAC revised its practices in 2013 to allow U.S. institutions to pay commissions or fees to agents who recruit international students but require the institution to monitor agent integrity.

This case does not involve agency fees. Dipont charges students for information on how to apply and be accepted to high-end U.S. colleges and universities. What appears to be an unusual practice is allegations by a few of the former Dipont employees that payments of $100 bills are made to the admissions counselors and are neither reported to the IRS nor to the universities represented. Other allegations made include Dipont employees writing admissions essays or modifying applications for Chinese students paying to attend their seminars. With hundreds of thousands of Chinese students attending American colleges and universities, it is likely that this will not be the last word on this topic or company.

The Chronicle of Higher Education reported that the Lumina and Gates Foundations had issued statements regarding some of the areas that will receive higher education funding from each of them over the next few years. Lumina intends to fund projects that help adults with little college experience to earn some form of post-secondary credential, expand the use of competency-based education, and new ideas for creating a better quality assurance process for all types of education. Lumina would like to see 5.9 million more people holding one of its post-secondary credentials by 2020. The Gates Foundation intends to increase financial support for: organizations trying to simplify the federal student-aid system; those working to ease barriers to student success such as poorly-designed remedial courses or faulty transfer of previously-earned academic credit; and those creating ways to provide data to policy makers and others to track student progress during, and after, college.

The rpk Group issued a report about competency-based education and its potential for lowering the costs of higher education. The study looked at the business models for competency-based education at four institutions: Wisconsin Extension, the Kentucky Community & Technical College System, Brandman University, and Walden University. Notably, the report did not examine Western Governors University, whose 70,000 students might constitute the most efficient example of competency-based programs in higher education. The four institutions project an average annual cost of $3,200 per student in education-related spending when their programs mature. Start-up costs during the first three years ranged from $6.3 million to $11 million after spending on technology and new curricula. According to the report, getting to breakeven will require aggressive growth in enrollments of approximately 150% annually for the first five years. Breakeven is estimated to occur when approximately 6,000 students are enrolled, and occurs at a relatively high level of enrollments due to the low price point at which most competency programs have settled, somewhere between $5,000 and $6,000 in tuition annually. Rick Staisloff, an rpk principal and co-author of the report, warns about settling in at such a low tuition point, particularly for boutique programs. He also advises colleges considering implementing competency-based programs to carefully assess the federal student aid requirements of “regular and substantive interaction” between faculty and students in such courses.

Contract discussions between the faculty union and Pennsylvania State System stalled over wages and benefits, resulting in a faculty walkout at 14 campuses last Wednesday. Issues related to vast differences in proposed pay and hours between full-time and adjunct faculty as well as changes in deductibles, co-pays, and premiums for health insurance.  Part of the problem stems from decreased state funding for higher education; the state was ranked 49th in higher education support per capita in 2014. By the end of the week, a tentative agreement was reached, bringing the faculty back to classrooms at all campuses.  Final resolution is expected in approximately six weeks.

The Competency-Based Education Network (C-BEN) released a draft set of voluntary quality standards  for the growing number of institutions offering or planning to offer competency-based education programs. More than 30 colleges have joined the recently-created group.  Under Secretary of Education Ted Mitchell addressed the group in Phoenix this week, noting that the Obama administration remains optimistic about the potency for competency-based education but that it will be important for institutions offering programs to self-police “to eliminate the ones that are on the wrong end of the tail.”  The group expects to finalize their standards by the end of next year after receiving public comments and expert assistance.

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