2 For-Profit Education Companies Seek to Move West for Accreditation

September 23, 2010

In recent months, the Higher Learning Commission of the North Central Association of Colleges and Schools, one of the nation's major regional accrediting organizations, has taken a tough stance on some of the for-profit institutions that it accredits.

Now, two of those institutions—Argosy University and Bridgepoint Education—are both applying to be accredited by the Western Association of Schools and Colleges, which oversees institutions in California and Hawaii.

But the commission's more-rigorous policies and the institutions' pending moves are not entirely related, say officials from both the accrediting agencies and the institutions. Geography, they explain, is the main reason for the unusual plans to move to a different accreditor.

Argosy, which has 19 locations across the country, including five in California and one in Hawaii, has been considering changing accreditors for a couple of years and is already in the process of moving its administrative offices from Chicago to a site near its Orange County campus, said Craig D. Swenson, the university's chancellor.

The relocation is due largely to the growing market for students in the Golden State, Mr. Swenson said, especially as an increasing number of students find themselves unable to attend the state's public colleges, where enrollments have been capped in some cases and course offerings cut.

Ralph A. Wolff, president of the Western Association, said Argosy is in the final stages of being approved, and it will probably be fully accredited after the U.S. Department of Education finishes reviewing the proposal.

Bridgepoint, meanwhile, has administrative offices in San Diego and small campuses in Iowa and Colorado, although practically all of its students study exclusively online. It has only recently begun the process of applying for accreditation, Mr. Wolff said. If all goes well, the company could be approved by the association before summer, he said.

Changes at North Central

Bridgepoint's proposed move comes at the same time that North Central's Higher Learning Commission is close to approving a new policy calling for the institutions it accredits to have a "substantial presence" in its 19-state region. That measure will require that a majority of a college's administrative and business operations be located within the region, along with at least one campus.

In the case of institutions that are mostly online, like Bridgepoint, the location of the administrative offices, rather than where students are located, will be key to how the policy will be interpreted, said Sylvia Manning, president of the Higher Learning Commission. "We're not going to ask you where the students are dialing in from," she said.

Officials from Bridgepoint could not be reached for comment, but the company noted in filings with the U.S. Securities and Exchange Commission that it was unclear if Bridgepoint would meet the commission's new standard. Those statements also sparked rumors that the commission was trying to crack down on Bridgepoint, which is under investigation by the Education Department's Office of Inspector General for possible violations of recruiter-compensation rules.

But the Higher Learning Commission—which has been under scrutiny itself, from Congress and the Education Department, in recent months—is not trying to force Bridgepoint out of its association, Ms. Manning said.

Instead, the policy resulted from a change in the commission's bylaws, and it was meant to clarify that the organization would not, for example, accredit freestanding international colleges, she said.

"When things converge, people tend to infer a causal relationship," she said.

The Higher Learning Commission has been in the spotlight recently as lawmakers and Education Department officials consider how to hold colleges accountable for the quality of the education they provide, and the role of accreditors in that effort.

In a report this spring, the department's inspector general faulted the commission's standards in giving its approval to American InterContinental University, despite a review that found the institution was awarding inflated credit hours to students for some courses. Later this summer, the education committee of the U.S. House of Representatives questioned Ms. Manning on the same subject.

The commission has responded by providing more details about how peer reviewers should apply the organization's standards. And it has shown a willingness to take a harder line on the for-profit institutions. In June, the commission rejected an application to transfer accreditation to a group of investors seeking to buy Dana College in Nebraska. As a result, the sale was called off and the college closed.