Department of Defense Lifts Ban on Tuition Assistance for University of Phoenix, But The Institution Still Faces Issues

Posted By Eliana Osborn on February 5, 2016 at 12:45 pm
Department of Defense Lifts Ban on Tuition Assistance for University of Phoenix, But The Institution Still Faces Issues

After a challenging 2015, some good news for the University of Phoenix: The Department of Defense has lifted their ban on armed forces using the Tuition Assistance Program at the school.  Things aren’t exactly back to normal though – there’s still a one year review with more intensive scrutiny in place.  With thousands of service members looking to continue their education, University of Phoenix will have to prove to the DoD that they are complying with both the letter and the spirit of the regulations.

The October 2015 sanctions were put in place by DoD “due to allegations about Phoenix improperly sponsoring recruiting events,” according to Inside Higher Ed.  Republican Senators, including those from Arizona, asked for the decision to be reversed.  They believe that the problems with Phoenix are technical in nature and not worth putting 4,000 students in turmoil.

However, despite some support from policymakers, the University is still facing major problems. The Apollo Education Group, which owns the University of Phoenix, as well as other for-profit education ventures, is looking for a buyer.  Enrollment at the institution is down significantly: March 2014 reported just 213,000 students, compared to 460,000 in 2009.  The most current enrollment numbers indicate a continuing decrease in students: enrollment in the first quarter of 2016 was 24,500 for new degreed and 176,900 for degreed students, compared to 39,000 and 227,400, respectively, for the first quarter of 2015.

Revenue for the first quarter of 2016 was $586 million, down from the same period in 2015 at $714 million.  University of Phoenix’s stock price is also down, meaning that something is going to have to change.  In a recent press release, Apollo indicated plans to improve both efficiency and retention, as well as continue global expansion.

When the potential sale of UoP was reported in early January, Apollo stock prices increased 17%, reports CNBC.  No buyer has been mentioned publicly, however, and other for-profit education groups have faced similar scrutiny from regulators, as well as financial stresses.

State and federal investigations into for-profit colleges continue, but perhaps University of Phoenix has turned a corner.  With lower-pressure recruitment and honest discussions about costs and post-graduation job prospects, well-informed students may well be able to get valuable educations.  David Halperin, policy and advocacy author and expert, explains the necessary considerations: “Some [for-profits] deliver solid career education, but many others are mostly focused on recruiting new students and cashing their federal financial aid checks – and they use deceptive tactics to recruit.”

Eliana Osborn
Eliana Osborn is an associate English professor at Arizona Western College, with degrees from Brigham Young University and Northern Arizona University. She’s published widely in forums such as The New York Times, the Washington Post, the Christian Science Monitor, and the Chronicle of Higher Education.

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