Kim Clark Discusses Paying for College

Important Point RE: 90:10 Rule

Under the federally established 90:10 Rule, for-profit, post-secondary colleges and univerisities may not generate more than 90% of their total revenues from federal dollars (pell grants, Title IV, Parent Plus, etc.). If a school exceeds the 90% cap, they automatically lose the ability to draw down Title IV funds. This law forces for-profit schools to increase their tuition, especially when the government makes more federal dollars available to support students pursuing a college education. For example, the government has and plans to continue increasing the amount of Pell eligibility for students. This goes towards the 90%, and subsequently results in for-profit schools needing to consider increasing their tuition costs.

This law only applies to for-profit colleges and universities, and not the non-profit, private and public schools. The is the main reason for the high costs of education in the for-profit school and the subseqent debt these graduates face. The article gives the impression that the for-profit colleges and universities are taking advantage of their students by charging high tuition and saddling their graduates with large debt service obligations. The 90:10 Rule forces these colleges and universities to drive up their tuition and increase their graduates debt.

The for-profit colleges and universities promote accessibility to higher educaton and are much more "student-centric" than their non-profit counterparts. They provide their students the individualized support they frequently need to be successful. The 90:10 Rule is unfairly applied to the for-profit colleges and universities, and thus unfairly targets those students who need the service and support that these schools provide.