By Shannon Gilchrist The Columbus Dispatch
COLUMBUS – Blaming hefty sanctions levied in late August by the federal government, ITT Technical Institute announced on Tuesday morning that all 137 of its campuses nationwide — including those near Hilliard and on the East Side — are closed permanently.
READ MORE: In The Columbus Dispatch
This development affects about 2,000 students in Ohio on nine ITT campuses. The for-profit college, which offered vocational programs in areas such as business, information technology, nursing, business and criminal justice, employs more than 8,000 people nationwide.
The fall quarter was scheduled to begin next Monday, but ITT’s central-Ohio buildings were locked and the parking lots were deserted on Tuesday morning, except for the occasional unaware student who would show up to try to conduct business at the college.
Karena Huston of Columbus was about nine months from getting an associate degree in nursing at ITT near Hilliard. She has reached out to several local colleges to see where she might continue her education without having to start over again. A few have told her that spring is possible, but she might have to wait until next fall.
“I have no ill will against my teachers. We had some really incredible teachers,” Huston said. “I’m just floored and flabbergasted at the corporate…They’re leaving a lot of people high and dry.”
The possibility of a federal loan discharge was part of a message from U.S. Education Secretary John B. King to ITT students, posted on the department’s website on Tuesday.
“The school’s decisions have put its students and millions of dollars in taxpayer-funded federal student aid at risk,” King’s post read, adding that the department’s decision to take corrective action against ITT was not made lightly.
On Aug. 26, the U.S. Department of Education announced that it no longer would allow ITT to enroll new students with federal Title IV loans. Plus, it said ITT would be required to provide a letter of credit equal to 40 percent of all the federal loan money it received in 2015, or about $247 million. And the final whammy was that the college needed to have that whole amount on hand, because the Education Department was canceling an installment-payment plan it had created earlier.
One Columbus woman who asked not to be named said she had come to the Hilliard campus to talk to an academic counselor about the electrical engineering program she’s enrolled in. When she heard that the U.S. Department of Education might be discharging federal student loans for current or recent ITT students, she closed her eyes and said, “Oh, thank God.”
The chain of schools has been under federal scrutiny from several agencies in recent years. In 2014, the Consumer Financial Protection Bureau filed a lawsuit against ITT, claiming that the company misled potential students about job-placement rates and accreditation, and also pressured students into predatory private student loans, knowing they were likely to default.
In 2015, the Securities and Exchange Commission accused ITT’s parent company and two top executives of fraud for withholding information from investors about the poor performance of its in-house loan program.
ITT issued a defiantly worded release on Tuesday morning to announce the closures, placing blame on “what we believe is a complete disregard by the U.S. Department of Education for due process to the company.”
“We had no intention prior to the receipt of the most recent sanctions of closing down despite the challenging regulatory environment that now threatens all proprietary higher education,” the company said in the statement. “The damage done to our students and employees, as well as to our shareholders and the American taxpayers, is irrevocable.”