Surely nobody at the US Department of Education would ever come out and say that, on occasion, you need to end someone’s college career in order to save it. But for stranded students of the now-defunct ITT Technical Institute, department rules may do just that.
The for-profit chain of vocational schools collapsed early last month, under pressure from federal regulators, state attorneys general, and its own accreditors. At that point, Anthony Ristaino, 33, was mere months from finishing a bachelor’s degree in information systems security at the ITT campus in Norwood.
“I was going full speed,” the Wrentham resident said in a recent interview. “The things that I wanted — to be able to continue with my life — are going to have to wait longer. And there’s going to be a financial impact that’s overwhelming.”
The Department of Education writes off loans to students at shuttered schools, but forgiveness is an all-or-nothing proposition. Students who transfer any of their credits to another school — even if it’s only a fraction of them — lose their eligibility for loan forgiveness.
Alas, few colleges are generous about awarding credits for classes at ITT Tech, or about giving degrees to transfer students who have only a semester or two left. So Ristaino, who says he’s borrowed about $46,000, will likely lose at least a year’s worth of credits — and have to pay for two more years of school. Here are his choices: He can walk away with no bachelor’s but substantial debt relief. Or he can invest still more of his time, and end up with five years of loans for a four-year degree.
For ITT students who thought they were on the verge of graduating, these are lousy incentives to stay in school.
The government’s loan-forgiveness rules make sense in other scenarios — for example, for students at a conventional nonprofit college that finally succumbs after circling the drain for years. Administrators can orchestrate an orderly shutdown. Students have lots of time to transfer elsewhere and take their credits with them.
ITT Tech was bound to be a different story. The chain gorged itself for years on federal student loans, then abruptly shut down as regulatory scrutiny of its loan default rates, marketing practices, and financial stability intensified.
There were good reasons for all that extra attention on companies like ITT Tech. “Our goal,” a Department of Education spokesman told me, “is to always protect the students — always.”
But the administration didn’t make adequate provision for when big chains fail. When I met with Ristaino and his classmate Yvette Ahern, the sudden meltdown had hit them hard. I’ve interviewed students who thought ITT was a waste of time and money, but Ristaino and Ahern aren’t among them. Both were satisfied with their school; they were just eager to finish up and get on with their lives.
“I thought, there’s going to be four years, and I’m going to give it all I have,” Ahern says. “And then there’s going to be a payoff.” The money she spent on gas, the mileage she put on her car, the time she missed with family and friends as she shuttled between jobs and internships and classes — these were sacrifices. “You can’t get me back those things.”
Having indulged ITT Tech for as long as it did, and then pushed it to the precipice, the least the government can do for students is write off some of their loans, roughly in proportion to the percentage of credits they’ve earned but can no longer use.
Often, when large groups of people all end up in the same jam — disaster victims, for instance — the federal government improvises a way to help them through it. The higher-ed sector, meanwhile, knows the meaning of empathy too. In 2005, when Hurricane Katrina shut down New Orleans for months, schools around the country threw open their doors to the city’s college students, who didn’t deserve to have their schooling interrupted.
To their own detriment, the ITT students now in limbo may not be visible enough as a group to win a special dispensation. When Massachusetts Attorney General Maura Healey’s office held workshops after ITT’s closure, they drew about 200 students — hardly the makings of a vast political movement. But the chain had campuses across the country. Lots of lives are caught up in the gears.
In a more conventional election season, the fate of ITT Tech students might be the kind of policy question that the major-party nominees would wrestle over. But Donald Trump’s positions on student lending have been hard to pin down. Hillary Clinton, meanwhile, has joined Bernie Sanders in embracing a gauzier vision of “debt-free college” — that is, of pushing tuition costs down through a massive infusion of federal money into public universities.
If present trends hold, though, lots of troubled schools could collapse long before that far-off goal becomes reality. ITT Tech rose and fell on the changing tides of federal policy. After the chain’s collapse, the burden shouldn’t fall on students who’ve done nothing wrong.Dante Ramos can be reached at firstname.lastname@example.org. Follow him on Facebook: facebook.com/danteramos or on Twitter: @danteramos.