Editorial: Assess 'Excelsior Effect'

THE ISSUE:

For-profit colleges are seeking state-subsidized scholarships.

THE STAKES:

This should wait at least until the program's impact on not-for-profit colleges and universities is fully assessed and addressed.

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Before the full impact of New York's "free" public college tuition program is clear — especially on the state's many private, not-for-profit colleges — a bill to expand these state tuition awards to less-regulated, for-profit institutions sits on Gov. Andrew Cuomo's desk. He should veto this premature proposal.

Excelsior Scholarships, heralded by Mr. Cuomo last year as a way to provide free tuition for middle class students who attend the state's public colleges, is having some unintended consequences for many of the state's private institutions, particularly smaller, already struggling schools. The Commission on Independent Colleges and Universities reports that 30 such institutions saw enrollment declines this fall, the first semester in which the Excelsior Scholarship program was in effect.

It's unclear how much of the decline is due to potential students opting for the free tuition at public colleges and universities. But it seems hardly coincidental.

When the Excelsior program was announced last year, private nonprofit schools warned of the harm it might cause them. In response, the governor worked with lawmakers to create Enhanced Tuition Awards, offering students a $6,000 tuition discount at private colleges that agree to match the state's contribution. Of course, most of these schools already give significant financial aid, so the effect of the program is still a financial burden on the colleges.

The bill on Mr. Cuomo's desk, which passed at the end of the legislative session in June, would expand the Enhanced Tuition Awards to for-profit or proprietary institutions. Supporters argue the thousands of students who attend for-profit schools are being disadvantaged. Perhaps. But the for-profit higher education industry has a poor track record. Nationally, some have been forced out of business after losing accreditation or are under investigation for aggressive and deceptive marketing tactics, high loan default rates and poor employment outcomes for graduates.

Take, for example, Trump University, a for-profit real estate sales training program owned by Donald Trump's company before he was president. It paid $25 million in 2016 to settle class action suits charging it was a scam. And a national chain that had a campus in the Capital Region, ITT Technical Institute, closed last year amid federal and state scrutiny. Yet the Trump administration is easing federal oversight of the for-profit college industry that had been put in place under President Barack Obama.

It's simply not a good time for the state to give new subsidies to for-profit colleges, where prospective students are unable to know if they're going to get a good education, or to use public money to increase for-profit schools' competitiveness with the private nonprofit institutions, which have long been part of the historic and economic fabric of many communities.

This idea needs a lot more analysis and justification. A veto now by Mr. Cuomo would allow a thoughtful legislative examination next year.