February 11, 2007 New York Times
Troubles Grow for a University Built on Profits
By SAM DILLON
PHOENIX — The University of Phoenix became the nation’s largest private
university by
delivering high profits to investors and a solid, albeit low-overhead, education
to midcareer
workers seeking college degrees.
But its reputation is fraying as prominent educators, students and some of its
own former
administrators say the relentless pressure for higher profits, at a university
that gets more
federal student financial aid than any other, has eroded academic quality.
According to federal statistics and government audits, the university relies
more on part-time
instructors than all but a few other postsecondary institutions, and its
accelerated academic
schedule races students through course work in about half the time of
traditional universities.
The university says that its graduation rate, using the federal standard, is 16
percent, which is
among the nation’s lowest, according to Department of Education data. But the
university has
dozens of campuses, and at many, the rate is even lower.
In an interview, William J. Pepicello, the university’s new president, defended
its academic
quality and said it met the needs of working students who had been largely
ignored by
traditional colleges.
But many students say they have had infuriating experiences at the university
before dropping
out, contributing to the poor graduation rate. In recent interviews, current and
former students
in Arizona, California, Colorado, Florida, Michigan, Pennsylvania, Texas and
Washington who
studied at University of Phoenix campuses in those states or online complained
of instructional
shortcuts, unqualified professors and recruiting abuses. Many of their comments
echoed
experiences reported by thousands of other students on consumer Web sites.
The complaints have built through months of turmoil. The president resigned, as
did the chief
executive and other top officers at the Apollo Group, the university’s parent
corporation. A
federal court reinstated a lawsuit accusing the university of fraudulently
obtaining hundreds of
millions of dollars in financial aid. The university denies wrongdoing. Apollo
stock fell so far
that in November, CNBC featured it on a “Biggest Losers” segment. The stock has
since gained
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back some ground. In November, the Intel Corporation excluded the university
from its tuition
reimbursement program, saying it lacked top-notch accreditation.
It adds up to a damaging turnaround for an institution that rocketed from
makeshift origins
here in 1976 to become the nation’s largest private university, with 300,000
students on
campuses in 39 states and online. Its fortunes are closely watched because it is
the giant of forprofit
postsecondary education; it received $1.8 billion in federal student aid in
2004-5.
“Wall Street has put them under inordinate pressure to keep up the profits, and
my take on it is
that they succumbed to that,” said David W. Breneman, dean of the Curry School
of Education
at the University of Virginia. “They seem to have really stumbled.”
In the interview, Dr. Pepicello shrugged off the bad news. Many top corporations
still pay for
employees to attend the university, he said, and the exodus of top officials has
resulted from a
healthy search for new directions. “We are reinventing ourselves,” Dr. Pepicello
said.
The government measures graduation rates as the percentage of first-time
undergraduates who
obtain a degree within six years. On average across all American universities,
the rate is 55
percent. Dr. Pepicello said this was a poor yardstick for comparing other
universities with his,
which serves mostly older students who started college elsewhere. Alongside the
16 percent
rate, the university Web site also publishes a 59 percent graduation rate, but
that is based on
nonstandard calculations and does not allow comparison with other universities,
he said. The
official rates at some University of Phoenix campuses are extremely low — 6
percent at the
Southern California campus, 4 percent among online students — and he
acknowledged
extraordinary attrition among younger students.
“We have not done as good a job as we could,” he said, adding that the
university was creating
tutoring and other services to help keep students.
“The university takes quality in the classroom seriously,” he said. The
university brings a lowoverhead
approach not only to its campuses, most of which are office buildings near
freeways,
but also to its academic model. About 95 percent of instructors are part-time,
according to
federal statistics, compared with an average of 47 percent across all
universities. Most have
full-time day jobs. Courses are written at university headquarters, easing class
preparation
time for instructors.
The College Board reports the university’s annual tuition and fees as $9,630,
about half the
average at private four-year colleges and twice that of four-year public
colleges.
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Students take one course at a time, online or in evening classes, which meet for
four hours,
once a week, for five or six weeks, depending on degree level. As a result,
students spend 20 to
24 hours with an instructor during each course, compared with about 40 hours at
a traditional
university. The university also requires students to teach one another by
working on projects
for four or five hours per week in what it calls “learning teams.”
Government auditors in 2000 ruled that this schedule fell short of the minimum
time required
for federal aid programs, and the university paid a $6 million settlement. But
in 2002, the
Department of Education relaxed its requirements, and the university’s
stripped-down
schedule is an attractive feature for many adults eager to obtain a university
degree while
working. But critics say it leaves courses with little meat.
“Their business degree is an M.B.A. Lite,” said Henry M. Levin, a professor of
higher education
at Teachers College at Columbia University. “I’ve looked at their course
materials. It’s a very
low level of instruction.”
In November, the university’s reliance on part-time faculty caused a problem
with Intel,
hundreds of whose employees it has educated. Alan Fisher, an Intel manager, said
the
company had decided to pay for employees to attend only highly accredited
programs.
Although Phoenix is regionally accredited, it lacks approval from the most
prestigious
accrediting agency for business schools, the Association to Advance Collegiate
Schools of
Business.
John J. Fernandes, the association’s president, said the university had never
applied. “They’re
smart enough to understand their chances of approval would be low,” Mr.
Fernandes said.
“They have a lot of come-and-go faculty. We like institutions where the faculty
is stable and can
ensure that students are being educated by somebody who knows what they’re
doing.”
Dr. Pepicello defended the effectiveness of the faculty, saying instructors were
carefully
certified.
Most educators acknowledge that the university has helped traditional
institutions recognize
the needs of older students.
Some of the university’s detractors suggest that it has always relied too much
on part-time
faculty and raced too quickly through course material. Others say the
university’s academic
program was once better but has deteriorated in breakneck expansion — it has
opened 50
campuses in a decade. Today, even a cursory Internet search will turn up
criticism on sites like
ripoffreport.com and uopexperience.com.
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“Phoenix claims that 95 percent of their students are satisfied, but the reports
we get indicate
otherwise,” said James R. Hood, founder of a similar site, consumeraffairs.com.
Many reports follow a similar pattern. Students say they liked recruiters’
descriptions of the
classes, but after enrolling concluded that they were learning too little or
paying too much.
Many who quit say they were left with huge debts.
Robert Wancha, 42, a former National Guard commander who is pursuing a
bachelor’s degree
in information technology at the university’s Detroit campus, said that in a
computer course
last fall his instructor, Christopher G. Stanglewicz, had boasted that he had a
doctorate but did
little teaching, instead assigning students to work in learning teams while he
toyed with his
computer.
Mr. Stanglewicz, reached at his home, acknowledged that he had covered only a
fraction of the
syllabus , partly, he said, because the university required him to cram too much
information
into too few sessions.
“Students get overwhelmed,” he said. Mr. Stanglewicz asserted in the interview
that he had
earned a doctorate in economics from the University of Kentucky. But the
authorities there
said his name was not in their records. (Dr. Pepicello said that Mr. Stanglewicz
had never told
the university that he had a doctorate, and that he was qualified to teach.)
Not all students are critics. Yvonne-Louise Catino, 43, of Bloomington, Minn.,
who is studying
online for a doctorate, said she believed she was getting a rigorous education.
In a week, Ms.
Catino said, she might read eight journal articles and write several essays. “I
love the online
environment,” she said, “being able to direct where I want to go.”
But some students said their early enthusiasm had soured.
Stacey Clark, 32, an office manager in East Wenatchee, Wash., enrolled in online
courses in
April and was delighted to receive A’s in her first courses, she said. Later,
Ms. Clark decided her
instructors were too disengaged to criticize her work. One returned a 2,500-word
essay on
performance-enhancing drugs with an A but not one comment, she said.
“You’re not learning from an actual teacher, you’re teaching yourself,” Ms.
Clark said.
Many students accuse recruiters of misleading them, and the university’s legal
troubles trace
back to similar accusations of recruitment abuses. In 2003, two enrollment
counselors in
California filed a whistle-blower lawsuit in federal court accusing the
university of paying them
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based on how many students they enrolled, a violation of a federal rule.
After the lawsuit was filed, the Department of Education sent inspectors to
California and
Arizona campuses. The department’s report, which became public in 2004,
concluded that the
university had provided incentives to recruit unqualified students and
“systematically operates
in a duplicitous manner.”
The university paid $9.8 million to settle the matter, while admitting no
wrongdoing. But the
department’s searing portrait of academic abuse aroused skepticism among many
educators.
Dr. Breneman was finishing a chapter on the university in a book he helped edit
when he read
the report in 2004. He said he found it “credible and compelling.”
When the book, “Earnings from Learning: the Rise of For-Profit Universities,”
was published
last year, it said the university’s academic model was convenient for working
students, but
included a “cautionary note” saying the recruiting scandal had raised
“disturbing questions.”
Those questions are likely to dog the university as it defends itself in the
lawsuit, which a
district court had dismissed but an appellate court reinstated in September. The
university
could be forced to repay hundreds of millions of dollars if it loses. It asked
the Supreme Court
last month to review the appellate ruling, arguing that an adverse outcome in
the lawsuit could
expose it to “potentially bankrupting liability.”
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