December 12, 2023 | WASHINGTON, D.C. — Today, the House Education and Workforce Committee voted to advance the Bipartisan Workforce Pell Act, H.R. 6585, by a vote of 37-8. This legislation would allow workers to use federal Pell Grants to pay for so-called “short-term” certificates and other workforce training programs, including programs offered by for-profit schools and entirely online programs offered by private-sector tech companies.
In response, Student Borrower Protection Center (SBPC) Executive Director Mike Pierce issued the following statement:
“Make no mistake, this bill is an early holiday gift to the shady for-profit colleges and online tech companies that have been salivating at the chance to cash in on federal Pell dollars in order to pad their bottom line. We know the playbook; we have seen it before. These programs make lofty promises, fail to deliver, and leave our most vulnerable students to pay the price.
“For a decade now, the so-called “skills gap” has been used by economic policymakers to avoid taking the necessary steps to get Americans back to work. Today, it is a convenient excuse to funnel billions in public money to the failing for-profit colleges and tech companies that prey on the most vulnerable workers. These firms are failing in the midst of an historically strong economy and are looking to Congress for a way to stay afloat. Our message to lawmakers is clear: no more industry bailouts.”
In contrast to traditional degrees granted by colleges and universities, these training programs can be as short as 8 weeks long and include short-term coding bootcamps that have been shown to have poor quality and produce bad outcomes for students. H.R. 6585 was introduced by Committee Chairwoman Virginia Foxx (R-NC) and Ranking Member Bobby Scott (D-VA). The bill is expected to be considered by the full House early next year.
Background
SBPC has written at length on the dangers of the shady for-profit college industry and the growth of online EdTech companies known as Online Program Managers (OPMs). OPMs are for-profit companies that purport to help colleges expand their online course offerings. A growing body of evidence shows that OPMs use deceptive marketing and lofty, frequently hollow promises to drive students into massive debt for low-quality educational programs.
In 2021, SBPC unveiled findings from an investigation that showed troubling partnerships between universities and OPMs offering short-term, non-degree granting credential programs referred to as “bootcamps” driving students into the risky shadow student debt market. These bootcamps are generally targeted toward students who are older or who have already entered other careers, and they regularly make lofty promises of high-paying jobs in the technology industry upon graduation.
Last year, the Government Accountability Office released a report revealing the U.S. Department of Education is failing to meaningfully supervise the OPM industry despite clear warning signs of student harm. In response,SBPC, in partnership with the Century Foundation, urged the Consumer Financial Protection Bureau to step in to protect students.
Most recently, as one of the largest players in the EdTech space, 2U, teeters on economic collapse, SBPC sounded alarms about the need for federal policymakers to have a plan in place to protect students if the company collapses.
Further Reading
SBPC Investigation on Troubling Partnerships Between Universities and OPMs to Saddle Students With Dangerous Student Debt: Student Borrower Protection Center Investigation Uncovers that Public Colleges and Universities are Partnering with Unaccountable Contractors to Saddle Students with Dangerous “Shadow Student Debt”
SBPC Blog on the Need for Holding OPMs Accountable: With ED Asleep at the Wheel, the CFPB Must Protect Students from Out-of-Control Online Program Managers
Op-Ed by SBPC Executive Director Mike Pierce on the Risks of Increased Dependence on EdTech in Higher Education and Workforce Training: Government Must Act Fast to Protect Students and Colleges from Silicon Valley’s Economic Threat
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About Student Borrower Protection Center
Student Borrower Protection Center (SBPC) is a nonprofit organization focused on eliminating the burden of student debt for millions of Americans. We engage in advocacy, policymaking, and litigation strategy to rein in industry abuses, protect borrowers’ rights, and advance racial and economic justice.
Learn more at protectborrowers.org or follow SBPC on Twitter @theSBPC.