State Law to Open Public Colleges and Universities to For-Profit Companies? Not a Good Idea.

A statement from the Campaign for the Future of Higher Education:

Despite the praise heaped on California Senate Bill 520 by Phil Hill and Dean Florez in a recent panegyric published in Inside Higher Ed, the bill was not the right answer for California’s higher education access woes; and it is a poor model for other states to emulate.

A bill that would open the door to for-profit companies—even unaccredited “fly-by-night” ones—to offer courses in the name of a state’s colleges and universities is fraught with danger.

A bill that would require a state’s colleges and universities to outsource their core educational function is truly misguided, however well-intentioned the idea may have been.

That’s the real reason for the huge uproar and the rare universal opposition to California’s SB 520 from those close to higher education—from faculty groups as well as the universities themselves.

Let’s be clear about one thing that’s not acknowledged in Hill and Florez’s piece: colleges and universities around the country already allow transfer credit from other universities as long as those courses meet the quality control standards of the home institution. That tradition has been in place for a long time precisely to balance the needs of those students who take courses at more than one institution with the needs of the public to ensure quality control and the integrity of degrees from its taxpayer-funded institutions.

The people of California (including employers) need to know that a degree from the University of California, the California State University, or a state community college is just that—and NOT something offered by an unknown entity.


By mandating that state public colleges and universities begin a process of outsourcing its courses, SB 520 would have seriously weakened transparency and accountability in California’s institutions of higher learning. That’s one reason why the provosts of major universities in the Midwest have argued against out similar schemes in their institutions.

Alumni and trustees at Thunderbird Business School also have expressed serious concerns about how such a proposed relationship would threaten the reputation of that school and the value of its degrees for all students.

There is good reason for such concern, for cautionary tales about relying on for-profit companies to offer a college’s courses are unfolding right now around the country. In a December 2012 court settlement, for instance, the New York Institute of Technology was found legally and financially liable for actions of its for-profit partner.

More recently, Tiffin University has seen its accreditation threatened because of over-reliance on unaccredited for-profit companies to offer its courses.

If SB 520 had passed, it would not have expanded meaningful access to quality higher education in the state.

But it would have thrown open the door to massive profits for edu-businesses, who are accountable not to the people of California, but to investors and stockholders. No wonder so many CEOs were there to praise SB 520.

Florez and Hill labor mightily to make SB 520 sound bold and innovative, an effort to “wake up [California’s] higher education community,” they say.

 What everyone, including the state’s elected leaders, really need to wake up to are the fundamental facts about higher education funding in California. 

According to a report published in February 2013 by Postsecondary Opportunity: The Pell Institute for the Study of Opportunity in Higher Education and titled “State Disinvestment in Higher Education FY1961 to FY2013,” California’s state fiscal support for higher education as a percentage of state personal income dropped by 58.2% (adjusted for inflation) between 1980 and 2013.

The trajectory is clear: if the current long-term trend continues, California will reach zero in state funding for higher education in the year 2054. Unfortunately, as Postsecondary Opportunity’s research demonstrates, many other states are also in a “Race to Zero.”

SB 520 was no “wake-up call” for anyone. It was, in fact, a dangerous diversion from the reality that there is simply no substitute for public investment in higher education, and there is no single cheaper teaching modality or low-cost “magic bullet” that will meet our need for qualified college graduates.

With all that is at stake for the futures of millions of students and for our country, we need to take a harder look at so-called “innovative” solutions that make the old promise of “something for nothing.”

See this article as it was published in Inside Higher Education. CFHE encourages faculty members and supporters of public higher education to post comments about this topic on the IHE article.


The Campaign for the Future of Higher Education [ ] is a loose association of the major faculty unions and faculty associations in the United States. These groups have come together several times each year to share information on issues affecting high education and to shape responses to those issues that emphasize the paramount importance of instruction. I encourage you to become more involved in this national advocacy group.

Other CFHE re-posts that I have made to this blog have included:

Big $$$ Foundations Are Driving the Policy Train:

The Business Model for Higher Education:

CFHE Letter in Support of the City College of San Francisco:

CFHE Report on Contingent Faculty:

CFHE’s Response to President Obama’s August 22, 2013 Plan for Higher Education:

CFHE Statement on California Senate Bill 520:

The Cold Facts about Higher Education and Contingent Faculty Appointments:

College Educators from across the U.S. Take on Ways Online Classes Can Help or Wreck a Student’s Chances at a Good Education:

Funding Higher Education: The Search for Possibilities:

Join the Campaign for the Future of Higher Education:

Letter from the CFHE Steering Committee to the Committee on Institutional Cooperation:

More Bad Ideas from Florida on Higher Education:

Who Needs a Liberal Education These Days:

One thought on “State Law to Open Public Colleges and Universities to For-Profit Companies? Not a Good Idea.

Your comments are welcome. They must be relevant to the topic at hand and must not contain advertisements, degrade others, or violate laws or considerations of privacy. We encourage the use of your real name, but do not prohibit pseudonyms as long as you don't impersonate a real person.

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s