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Review Shows Scholarships Awarded to Students Attending For-profit Colleges

FRANKFORT, Ky. — A newspaper’s review has found that Kentucky has paid $97 million for scholarships since 1999 to for-profit colleges, including some that are under investigation.

A review of public records by the Lexington Herald-Leader found that nearly 8 percent of need-based student aid goes to for-profit colleges ( That’s double the national average, according to the National Association of State Student Grant and Aid Programs, which found that only four states give more.

Among the for-profit schools in Kentucky to receive state aid was Decker College in Louisville, which closed after declaring bankruptcy in 2005 amid allegations of fraud and inadequate accreditation.

Some state lawmakers say the issue of which schools get state aid should be discussed in the next General Assembly, which begins in January.

That’s because there’s not enough financial aid for all the students who apply, according to state House Education chairman Carl Rollins, D-Midway.

Rollins said in the 2010-11 academic year that 37,836 students received $59 million from the need-based College Access Program while 76,025 students seeking $119 million were turned away.

Other states, such as Ohio, are moving to reduce how much state aid goes to for-profit colleges, saying state colleges whose budgets are being cut should get aid for their students first.

The move comes as the federal government and states are scrutinizing for-profit colleges’ advertising, student loan defaults and teaching quality.

“Some of these for-profit schools are very profitable and make millions of dollars every year, much of it from public money. But we have no idea where that money goes or how it’s used, whether it’s for the classroom or the bank account of the owners. There’s no transparency,’” said Democratic state Rep. Reginald Meeks of Louisville. Meeks is vice chairman of the House budget committee that funds higher education and an administrator at the University of Louisville.

Candace Bensel, executive director of the Kentucky Association of Career Colleges and Schools, said for-profit colleges should remain eligible for state aid. She said students decide where they want to go for a higher education and the aid follows them. She said many students prefer the hands-on vocational training offered at “career colleges.”

“The career college sector is focused on providing the training and education necessary to individuals who fill many of the vacant jobs that businesses and manufacturers across the commonwealth need to fill,” Bensel said. “For career colleges and our students, it’s all about the job.”

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