ITT Technical Institute to Close After Government Cuts Off New Funding

[mahatmakanejeeves]

Last edited Tue Sep 6, 2016, 01:06 PM - Edit history (3)

Source: The Wall Street Journal.

ITT Technical Institute to Close After Government Cuts Off New Funding

Company cites actions by U.S. Department of Education for closure; 8,000 employees affected

By Joshua Jamerson

[e-mail]
http://twitter.com/joshjame

Sept. 6, 2016 7:59 a.m. ET

ITT Technical Institute will cease all of its academic operations, eliminating most of its 8,000 employees effective today, after the government last month banned the for-profit college chain from enrolling new students who receive federal aid.

“The actions of and sanctions from the U.S. Department of Education have forced us to cease operations,” ITT’s parent company, ITT Educational Services Inc., said. “We reached this decision only after having exhausted the exploration of alternatives, including transfer of the schools to a nonprofit or public institution.”

ITT Technical Institute is facing accusations from its accreditor of chronic mismanagement of its finances and using questionable recruiting tactics. The parent company is also under investigation by state and federal authorities. ITT, which as of this spring was the fifth-largest for-profit college chain by revenue, says it runs more than 130 campuses in 38 states. It recently had about 43,000 students nationwide.

The Education Department said in late August it had lost faith that ITT would survive the scrutiny and banned its schools from accepting new students that receive federal loans and grants to pay for the school’s tuition. Such aid provided 68% of the company’s $850 million in revenue last year. Analysts said at the time the Education Department’s move would almost surely force the company to close many if not all of its campuses.

Read more: http://www.wsj.com/articles/itt-technical-institute-to-close-after-government-cuts-off-new-funding-1473163181

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ITT has been around for decades. Back in the 1970s I knew people who were building Heathkit TVs and stereo receivers while taking ITT courses. They were avionics technicians and so forth who had been through "A" School at the Naval Aviation Technical Training Center at NAS Memphis. They were taking the courses on a mail order basis, and they had no objection to Uncle Sam's picking up the tab for a TV set for them to keep after they built it.

ETA: I think it was ITT. Bell and Howell was also offering Heathkits as part of its electronics courses.

[liberal N proud]

1. While the loss of jobs is really sad, this is good news for education

I have seen the results of some of the training form these schools. Most need to be trained once you hire them.

[yeoman6987]

2. Most people need trained regardless of field

The companies always have the procedures they want regardless of what you learned in school. I think it's tragic a tech school is closing resulting in trying to get more kids into traditional schools they have no desire for and 100,000 debt for a fluff degree. Not good.

[brush]

5. It was a debt mill, as are many of the other for-profit colleges

The accreditation level in many of them is questionable, and their students are mired in debt from the predator student loans they are duped into taking.

The loans btw, are/were guaranteed by the government which makes up the schools profits. They get the money but don't deliver quality education to their students, may of whom drop out but are still saddled with years of debt to repay.

Good riddance to them.

And don't get me started on how badly adjunct professors are treated in those "schools" — no quarter-to-quarter or semester-to-semester certainty of classes/income.

These for-profit colleges are nothing but rackets. Thank goodness the Feds are cracking down on them.

[mitch96]

21. With this kinda scum

it's all about the money, not education..
m

[Stand and Fight]

34. Amen to that. I hope UoP, Art Institute, Capella, and others follow. n/t

[Gormy Cuss]

15. Community colleges are the better alternative for most students

as are the for-profits that actually recruit qualified students and offer good training.

ITT and its ilk were just cashing in on government assistance. Proof of that is their swift closure rather than trying to retool their recruiting and fiscal management practices.

[PersonNumber503602]

43. I've swayed a few people away from placed like ITT-Tech and DeVry, and directed them toward

community college programs. It cost significantly less and there will be much less doubt about the credits being useful elsewhere. Where I'm at someone can get an A.S degree for under $5k (including books) at the local community college. Whereas a similar degree at a place like ITT-Tech would have been $50k.

[liberal N proud]

18. Some training, yes but not the skills of what they went to school for.

[GummyBearz]

4. Everyone needs some form of training after school. That is why doctors do like 4 years in residency

ITT provided a valuable service. People that want to get a good job in technology but don't have the means or tools to go to a 4 year university... now its going away. If you want to be a tech in my field of engineering the only option left to get there is military service

[Tempest]

8. Nonsense

"If you want to be a tech in my field of engineering the only option left to get there is military service"

You act like ITT was the only game in town. There are other options.

[GummyBearz]

9. None that I know of

In 10 years working for a 100,000 employee engineering firm every technician we hired came from either the marine corps or ITT

[Tempest]

11. Ivy Tech, for one

Piedmont Technical College, for another.

Just because you sole sourced doesn't mean alternatives don't exist.

And ITT is poorly ranked by former students.
http://www.gradreports.com/colleges/itt-technical-institute

[GummyBearz]

13. Its probably more that those 2 are no where near where I used to work

I agree the ITT guys were way behind the marine corps techs, but we picked good ones and got them up to speed and it worked well 99% of the time

[erpowers]

14. Community College

There is a community college in my area that seems to have a fairly good tech training program. It offers a number of tech programs for fairly inexpensive prices. At one point they offered a CompTIA A+ program for $512. They recently bumped the price up to $600. They also offered other programs like CCNA. I think that program was around $1,000-$3,000. They also offer a cybersecurity program. I do not know the cost of that program. I think the school also offers a engineering technician program.

I mentioned all this to get to the point that maybe someone who needed/wanted to go to ITT could just go to a nearby community college. It seems going to a community college would be cheaper than going ITT.

[GummyBearz]

16. Those are good fields

I'm sure people in them do well. My field is a lot more expensive to train in (hardware for radar or wireless communication). The basic lab equipment will cost around $1 million for one station. Not many places can afford it, ITT was one that did

[erpowers]

20. What is Your Field

Would you mind telling me your field? I wanted to know in order to just see if the local community college has training for the field. They do seem to have some type of training wireless communication, but that might be in another field.

[GummyBearz]

38. I mentioned above

Wireless communication hardware. Mainly at frequencies from 12GHz to 60GHz. The lab equipment is expensive, and the techs need to have hands on experience with it to even get an interview

[liberal N proud]

19. Community colleges are a great resource for technical training

[liberal N proud]

17. Not to the exterm these new hire did

It was like they were shown very simple basics of the skill but no method.

[chrisau214]

32. In Many Cases Even the Basics Weren't Taught

I had a Photoshop/Illustrator class when I was in the Web Design program and the instructor wasn't able to answer the simplest of questions from some of my fellow students.

Knowing Photoshop very well I became the defacto teacher of that class. The instructor didn't even know what the pen tool was used for or how to create curves using that tool.

There were many examples of things like this happening in many of the classes. I had a Visual Basic class where a fellow student was more more the teacher than the ITT paid instructor.

The instructor's answer to almost any question was, 'Get a tutor.'

Beyond that the administration lied to students about the school's job placement percentages and about the salaries students could expect upon graduation.

ITT was a criminal enterprise.

[PersonNumber503602]

44. I took a VB6 class at ITT-Tech and had almost the exact same experience you described

That was on of the last classes I took before bailing. At the time I started, there was a huge lawsuit against them. Many of the people in my class got involved in it, because they were actively lying to us about the placement rate and the ability for credits to transfer to the state college. I probably should have go involved in that suit against them.

After I left they tried coming after me for $1,500. They never got a nickle of that from me. Although they did get the students loans I had to pay back. Oh well, at least it wasn't as bad as it could have been.

[brush]

28. Why are you shilling for them? ITT was a for-profit debt mill that saddled their students . . .

with years of high debt and not commensurate training, in terms of accreditation, for the money they'll be paying back for years.

[GummyBearz]

39. I'm shilling for options

When it comes to education, you get out what you put in. You can get a good education from ITT (seen it), or you can get an ITT education from Harvard (seen it). The fact is there is one less option out there.

[brush]

40. Community colleges are much better options, and a lot less expensive

For-profits are predatory debt mills — been there, done that.

[Stand and Fight]

35. Western Governors University. Fully accredited and the cheapest on the market. All online. n/t

[saidsimplesimon]

29. I agree.

Many are scam artists, like rump u. It gives a bitter taste for it does not serve the need for training much needed to create jobs. Education and job growth is just another for profit venture of the socially challenged "private education" industry.

[liberalhistorian]

36. These so-called "colleges" and "institutes"

are nothing more than predators preying on the less fortunate and the desperate, saddling them with horrendous debt that they then can't find a job to repay because their "education" and "training" has been bad and meaningless while they happily whistle all the way to the bank.

[liberal N proud]

37. Exactly

[harun]

3. Chalk another win up for the big money brick and mortars

And another loss for lower and middle class students needing tech training.

[brush]

6. Wrong. Most of those schools are rackets. They're debt mills

They leave their students mired in years of debt from the student loans they dupe them into taking.

The loans, btw, are federal loans guaranteed by the government, guaranteed meaning the schools get their profits from the loans but the students get low quality education as many of the for-profit colleges accreditation is questionable.

[NuclearDem]

7. ITT was a scam.

There are plenty of community colleges and tech schools that don't exploit the vulnerable to get federal education dollars.

Ivy Tech has campuses within minutes of ITT Tech's headquarters in Carmel, and they actually give people a good education for their money and work to get them employed after graduation.

[harun]

10. That's good to hear.

[chrisau214]

12. GOOD!!!

It's about time.

I attended ITT and was STUNNED by the remedial level of the courses, by how unprofessional many of the teachers were, and ultimately by how poorly regarded the school is by employers.

The debt created that I will be paying forever is more than what would have been accrued at a real university.

I was literally laughed at during interviews when the interviewer saw ITT listed on my resume.

You could get the exact same quality education from picking up a series of 'Dummies' books relating to your chosen field as what was taught at ITT.

Biggest mistake of my life was attending that 'school'.

[mahatmakanejeeves]

22. Additional links:

JoeMyGod: ITT Tech Closes Nationwide After Student Loan Fraud Scandal, School Officials Blame Obama Administration

Roanoke Times: ITT Technical Institutes shuts all 130 campuses, including in Salem

Correction
Tuesday, Sept. 6, 2016, 11:55 a.m.: The originally published version of this story incorrectly reported the start of the fall quarter and has been updated.

Posted: Tuesday, September 6, 2016 10:13 am | Updated: 10:31 am, Tue Sep 6, 2016.

By Shahien Nasiripour | Washington Post News Service

ITT Educational Services Inc. has abruptly shut down its eponymous for-profit technical schools, closing more than 130 campuses and leaving as many as 40,000 students stranded in one of the largest college closures in American history.
....

The government annually doles out more than $100 billion in loans and grants to students. Colleges rarely face any consequences if their students fail to graduate or subsequently default on their debt. But an increasing array of allegations that ITT misled students about its success at placing graduates in their fields while defrauding investors-the company faces pending lawsuits from the federal Consumer Financial Protection Bureau, Securities and Exchange Commission, and the Massachusetts attorney general-led the Education Department to restrict the company's access to taxpayer funds. ITT has denied the allegations.

Students enrolled at the company's schools have received close to $5 billion in federal aid since 2010, Education Department data show. About $3 billion of that was in the form of student loans. Most of that money went to the company.

Students now enrolled at the company's technical schools will be able to cancel any federal student debt they incurred for their education if they decide against transferring their credits elsewhere. Other former students are pushing to have their debts canceled by alleging that the company defrauded them into taking out the debt by advertising false job-placement rates. Taxpayers will record a loss on those debt cancellations. It's exactly the kind of situation that the feds tried to avoid by demanding that the company produce additional collateral.

[Xolodno]

23. I remember their commercials on TV....

Some guy is interviewing what looks like to be obvious recent college grads and asks "Have you ever dealt with anything hi-tech?". Which is a pretty dumb question to begin with...WTF do you mean by "hi-tech"? Yes, I know how to use a computer....geez.

Not to mention the implication that public universities were worthless.

[eggplant]

24. It's about freaking time.

I taught at ITT Tech for a semester between jobs (computer programming).

They are (were!) a horrible parasite on the weakest members of our society. They would target drop outs, single moms, anyone desperate to get out o their current situation. They would foist government-backed student loans, which would go straight to the school. As long as the student remained enrolled past a certain point, the school didn't have to return the money if/when they dropped out of the program. So the NUMBER ONE responsibility of the faculty was to do whatever it took to keep them coming to class during that period. The teaching part was essentially reading powerpoint decks that were created at their corporate headquarters.

It *was* possible to go there, study hard, and actually learn useful skills. Those were the people you would see in their late night TV ads. But those students were strongly self motivated, and would likely have found success some other way if need be. The rest would end up dropping out and be saddled with huge student loans, putting themselves in even more difficult times.

I'm very happy that they are being shut down.

[discntnt_irny_srcsm]

26. I taught a tech school during the blizzard of '93

At the school there was about 20 inches of snow on the ground that Monday. The PA turnpike and the interstates were closed. The school was open. Revenue was based on the number of days open. I made it in 2 hours and 20 minutes late after getting on the road 40 minutes early. One of my students who traveled 1200 feet to get to class was the first to arrive 90 minutes before I did. A total of 4 of my 29 students made it in at all.

Another debt mill.

[groundloop]

25. Funny how their press release blames the federal govt. for their demise

Never mind the fact that they are nothing but a debt mill, offering sub-par education using outdated equipment. My step-son attended ITT, he has a huge pile of debt and not much real education to show for it.

For-profit education has no place in this country, it's always the same story - cut quality to maximize profits.

[Ernesto]

27. I am a well retired UNION Sheet Metal Worker. I can say we all knew ITT was a joke....

I taught for 2 different community colleges as a part-time apprenticeship instructor. My students worked on the job and learned in class also. When they became journeymen in 5 years, they had NO debt, good pay, benefits and retirement accounts already in place.

Union membership is the key to success!

BTW, after retiring, I was offered a teaching job @ a charter high school...... that sucked too!

[mrmpa]

30. I've met some of these graduates & some.......

just entering ITT. These young people (all were no older than 25) honestly believed that their 2 year "degree" would get them hired over MIT and Carnegie Mellon graduates. This is the propaganda ITT was handing out.

[Joanie Baloney]

31. Good!

Rot in hell, Tick Tock Tech. And the rest of this type of business.

-JB

[King_Klonopin]

33. Politicians always talk about "training people for new, high-tech, non-manufacturing jobs"

but never tell you HOW they intend to accomplish this, or other details such as
what type of jobs they are referring to, exactly.

Empty promises. Just like the empty promises about mental-health care parity.

[Rex]

41. Now where will all those happy actor families find work in commercials?

I weep for the actor children. HEAR THAT HALLMARK!? Next up.

[mahatmakanejeeves]

42. ITT Tech Students Should Take Their Money And Run, Experts Say

Business
Sep 7 2016, 3:28 pm ET

ITT Tech Students Should Take Their Money And Run, Experts Say

by Ben Popken

The shuttering of all ITT Technical Institute locations is leaving its 43,000 students with an unexpected lesson in harsh realities and unanswered questions about what will happen to their credits and tuition fees.
....

The Department of Education published a blog post detailing options for former ITT Tech students and a landing page at studentaid.gov/ITT for forthcoming information.
....

The post outlined the two options students have: Apply for a discharge and possibly get some of your money back, or transfer your credits to another "comparable" school. .... If you transfer your credits, you're not eligible for a discharge. And it's not clear how many credits a reputable school will accept, if any.

Advocates say students should just try to cash out and start over or otherwise move on with their lives. ... "It's best for folks to cut their losses," Alexis Goldstein, a senior policy analyst at Americans for Financial Reform, told NBC News in a phone interview. She said students have had a lot of problems getting good schools to accept ITT credits. ... "Get that debt canceled and get that weight lifted," said Goldstein. "Otherwise you might not be able to transfer that many credits — and still have to pay tens of thousands of dollars in loans to a school that no longer exists."

[Corey_Baker08]

45. I Have Outstanding Student Loan Debt From ITT, Will It Be Forgiven?

[mahatmakanejeeves]

46. See post #42.

The Department of Education published a blog post detailing options for former ITT Tech students and a landing page at studentaid.gov/ITT for forthcoming information.

[mahatmakanejeeves]

47. ITT Tech parent company to cease all operations

ITT Tech parent company to cease all operations

By Danielle Douglas-Gabriel
https://twitter.com/DaniDougPost

September 14 at 4:15 PM

ITT Educational Services, the parent company of ITT Technical Institutes, is ceasing all operations Friday, a week after closing the doors at the national chain of for-profit colleges, according to a regulatory filing issued Wednesday.

The company blamed sanctions handed down by the Department of Education last month for the decision to close what’s left of its operations, which includes Daniel Webster College in New Hampshire. ITT has struck an agreement with Southern New Hampshire University, an nonprofit school that offers online courses, to make it easier for the students at Daniel Webster to complete classes this academic year.

{ITT Technical Institutes shut down after 50 years in operation}

The end of ITT comes weeks after education officials said the company could no longer enroll new students who rely on federal loans and grants, award raises, pay bonuses or make severance payments to its executives without government approval. They also demanded that the company provide a letter of credit from a bank assuring the availability of as much as $247 million, up from the $124 million letter of credit ITT already had on file.

{This really might be the end of ITT}