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Mobile Apps and Higher Education

With 90 percent of college students owning a smartphone (46 percent own a tablet), colleges and universities are no longer debating whether to develop their own mobile platforms. Instead, they are creating new apps for students who are consistently using their smartphones more and more. Recruitment-focused apps tend to provide prospectus-type information, while apps leaning towards engagement try to increase the value of a student’s experience itself.

On campus, recruiters are using new campus tour apps that allow prospective students to explore campuses on their own time, and at their own pace. The apps use GPS to guide users to key points on campus. When prospective students arrive at the points of interest—audio, visual, and other effects can be used to offer information on specific locations, interests, and events. Catholic University in Washington D.C., highlights its unique architecture, and Findlay University boasts of its equestrian and vet facilities. Other advantages of virtual college tour apps include tours being offered in multiple languages, and the use of real-time analytics to gather data.

Colleges and universities are also using apps to engage with students beyond campus maps and class schedules. The University of Notre Dame’s campus app provides multiple features for students such as modules for laundry availability, safe ride requests, and indoor maps—which help students navigate and find key locations such as offices, classrooms, and printers. UVA uses its smartphone application to help students connect to support services, such as peer counseling and mental health facilities.

Beyond the Instagram and Facebook pages of higher education institutions, mobile apps are becoming increasingly necessary for schools who want to attract and maintain relevance across their populace of potential students. As of last fall, 79 percent of colleges and universities had working mobile apps or planned to offer them by the end of the academic year.  This is up 20 percent from the previous year, and 40% from 2012. According to Amy Boyd, project manager for the app at Texas State University Moblie, “Everything seems to be going mobile, and if you don’t have that, you’re really falling behind the times.”

 

The Bell Tower on the campus of Purdue University in West Lafayette Indiana a gift from the class of 1948

Supporters and Critics Speak Out on Purdue-Kaplan Merger

Purdue University recently announced its intention to acquire the for-profit Kaplan University system. If approved, the move would set a major precedent in the integration of for-profits with traditional colleges and universities.  Purdue President and former Governor of Indiana Mitch Daniels said, “A public university coming together with an established online university I think is by any definition a national first.”

The Kaplan system, which includes online learning programs, 15 campuses, 32,000 enrolled students and 3,000 employees, was purchased from its parent company, Graham Holdings, for $1 in a revenue sharing agreement that allows current Kaplan officials to continue running the new entity. Under the terms of the agreement, Kaplan will receive 12.5% of the public, nonprofit benefit corporation’s yearly revenue. If the merger is approved, Purdue will solidify its position as the first large flagship university to merge with a major for-profit player in online education.

Critics in higher education see the new partnership as a way for Kaplan to rebrand by becoming a non-profit and attaching itself to a reputable university. Bob Shireman of the Century Foundation—a think tank that investigates for-profit institutions—told the USA Today that the deal is like a bad restaurant being able to claim new ownership in order to improve its reputation without making any additional changes. Nonprofit schools are not subject to the strict regulations that have been placed on for-profit institutions in recent years. Critics also point out that Kaplan has been the focal point of past government investigations and lawsuits.

Many of the faculty at Purdue University disagree with the decision. The Purdue University Senate has passed a resolution against the Kaplan merger condemning the Board of Trustees for entering into a deal with little faculty input. Some worry that the Purdue brand will be diluted and students will be left with insignificant degrees. Bill Mullen, a Purdue professor, criticized the school by saying, “They (faculty) were never consulted about this plan, even though it is their work and excellence that has made Purdue one of the elite Universities in the world. Daniels (Purdue’s President) dirty deal with Kaplan permanently stains Purdue’s academic reputation and ruthlessly exploits the labor of its students, staff, and faculty.”

Donald Graham of Graham Holdings, Kaplan’s parent company, says Kaplan and Purdue “share the critical mission of expanding access to education,” and views the deal as mutually beneficial.  Purdue will be able to tap into a new online market and student demographic, while Kaplan will become part of a respected public Purdue system. Proponents believe the merger will provide new opportunities for nontraditional as well as former students who want to resume educations they previously put on hold. The acquisition depends on approval from both state and federal regulators, including the Department of Education and the Higher Learning Commission. If approved, the deal has the potential to change the way traditional higher education institutions operate, with more for-profit to nonprofit partnerships likely.

For updates on the Kaplan deal, changes in higher education administrators, and school accreditation info visit our website at hepinc.com.

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New Student Debt for Mortgage Swap Program

Last week Fannie Mae announced an expansion of its student loan refinance program and shed light on new policies designed to help borrowers with student debt become qualified for mortgage loans.  “We understand the significant role that a monthly student loan payment plays in a potential home buyer’s consideration to take on a mortgage, and we want to be part of the solution,” said Jonathan Lawless, vice president of customer solutions at Fannie Mae.

Fannie Mae’s new expansion includes a student loan cash-out refinance that offers homeowners a new way to pay off high interest student debt.  The program works by homeowners refinancing their homes, and the bank sending the money to the student lender to completely pay off at least one loan.  Currently, interest rates for home financing are below 4 percent, meaning it could save a borrower money (many student loans are topping 7 percent).  For some, it may be a faster way to consolidate student loan debt at a lower rate.

However, by moving debt from a student loan to a home loan, borrowers lose protection.  Student loans usually offer the option of an income-driven repayment plan or a deferral for financial difficulties.  Mortgages do not.  Rohit Chopra, senior fellow at the Consumer Federation of America, says “Once you refinance and put it into your mortgage, you’re putting your house at risk.”  Chopra expects the first users of the system will be parents who took out loans for their children’s education.  These borrowers are more likely to pay high interest rates and have plenty of home equity.

Another new policy is a ‘debt paid by others’ solution that excludes non-mortgage debt — like car loans, credit cards, and student loans — paid by someone else (steadily for 12 months) from a borrower’s debt-to-income ratio.  This is designed to improve the debt ratios of young buyers and widen their eligibility to qualify for a home loan.

According to Lawless, Fannie Mae started the new programs to help offset the negative effect student debt was having on the housing market.  “We arrived at these product ideas after seeing the size of student loan debt, which is $1.4 trillion.  But there’s another number to pay attention to – the $8 trillion in home equity,” Lawless said.  “There is enough housing equity in California alone to pay off the student debt of the entire nation.  We wanted to find a way to unlock that equity.”

Some lenders aren’t as enthusiastic about the changes. According to the Chicago Tribune, Steve Stamets, senior loan officer with Mortgage Link, worries about the sheer size of some student’s debts. He said previously these applicants couldn’t be approved under the old rules and now will qualify under the new program.  If borrowers have trouble making full payments on mortgages, they could end up in default on their home mortgages.  Fannie Mae expects mortgages that originate using the new system to have low default rates, and notes applicants must still meet regular credit score criteria.  Rhohit Chopra, with the Consumer Federation of America, says “the jury is still out” on whether the program is a good thing.  “New products and financial innovation can help borrowers save money,” he says, “but they can also be prone to abuse.”

3D Rendering analysis of financial data in charts, accounting, business finance, taxes, banking, statistics, vision for the future

Students Uncertain About Predictive Technology

As colleges continue to use big data more frequently, the long-term effects are yet to be fully understood. Major institutions and software companies see high tech programs as a means to an end in predicting the foreseeable outcome of students at colleges and universities. Though, this may to some extent be true, a growing number of students believe big data may be used to classify and designate them before they have a chance to get their academic careers off the ground. Students are concerned that data will depersonalize the student teacher relationship, and push them down a predestined path based off of a computer’s algorithm and not a student’s individual achievements.

Students from Michigan’s Macomb Community College raised concerns about these predictive programs recently at EduCon 2.9, an education and technology conference in Philadelphia. As reported by Hechinger Report, the panel of students from Macomb CC feel that existing stereotypes are already in place, and many students are not ready to trust the new, digital systems. “We don’t know who is choosing it and who is pulling the strings,” said Luis Manzano-Anzures, a student at Michigan’s Macomb Community College.

Proponents of big data’s predictive analytics argue that the programs are in place for the benefits of students. They say the information is there to identify students who are at risk of failure and provide support for those students. Students are still skeptical, asking what happens if analytical data is turned against them. Last year at Mount St. Mary’s University, their president made news after he proposed using their system’s data to find struggling students and “drown the bunnies” as he phrased it, to make them leave.

Students are worried that a similar type of program may be put into place. Hechinger Report concluded that the students at EduCon expressed concern that they won’t get to see the data being stored, and that computers may be overly predicative when it comes to academic ability. Many students see Ed tech systems that don’t take human relationships and outside influences into account. If a student is struggling because of personal reasons, predictive technology may not take that into consideration. For now, especially at community colleges where digital resources are limited and students and faculty concentrate on working class realities, digital technology may create a system that is unreliable at predicting the future of students.

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Does Revenue Sharing Have a Future in Online Education?

In today’s competitive higher education market more schools are turning to online education to provide alternate revenue and growth.  According to a recent poll from the National Center for Education Statistics, 25% of college and university students are taking some form of distance education courses.  Colleges and universities often partner with third party entities, known as Online Program Managers, to cut overhead costs.  OPMs are companies that design, run, and market online education programs for colleges and often receive a percentage of a student’s tuition in compensation.  According to Online Report Card, this figure averages around 50%, and in some cases, is as high as 85%.

But why do non-profits turn to OPMs in the first place, thereby surrendering large amounts of tuition revenue?  According to Inside Higher Education there are three basic reasons.  Many schools have never tried distance learning in the first place, so they have a lot to learn.  Some institutions do not have the internal expertise, whether it be the right people, systems, or technology.  Lastly, most schools do not have the financial resources to sustain a program while supporting the necessary marketing effort.  Though giving up high amounts of tuition revenue seems unappealing, most schools do not have a choice.

OPMs almost always operate on a tuition-splitting basis, but according to John Katzman, who opened one of the most successful OPMs in history, a new OPM model is taking hold.  His company, Noodle Partners, uses a flat fee for services instead of tuition-sharing.  Katzman says, “For a fee, we help schools assemble the tools, services, and tech to run great programs without taking money from students – it’s more flexible and transparent and wildly less expensive.”

According to Online Report Card, from 2013 to 2014, private not-for-profit institutions distance enrollments grew by 11.3%.  For-profits saw enrollments drop by 2.8 %.  An estimated 80% of online education programs are being outsourced to online program managers.  According to research by Online Report Card, 85% of students who study at least partially online are at public schools and receive federal compensation.  Millions of dollars in federal loans are being used to finance OPMs.

When the Obama administration decided to crack down on questionable for-profit market compensation, certain OPMs asked if tuition-sharing would still be allowed.  The Department of Education agreed to continue to allow tuition sharing in public and nonprofit schools as a reaction to the notion that it had previously been allowed for for-profit schools.  As a result, it now seems that nonprofit and public institutions are engaging in the same strategies that for-profits once used; aggressive, income driven marketing.

According to The Atlantic, Robert Shireman, a former Department of Education deputy in the Obama administration, believes that eventually public pressure and school leaders will bring change to the tuition-sharing process.  John Katzman also believes in the transition, saying, “The only real question is, how quickly will the old revenue-sharing model die?”

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Big Data and Student Performance

A growing number of colleges and universities are using big data to identify student performance and whether a student is in danger of failing. Known as predictive analytics, colleges are analyzing thousands upon thousands of student’s academic and personal records in an effort to save the average college student from dropping out.

With less than half of college students graduating in four years, institutions are facing increased pressure from parents and lawmakers to improve success rates. Is big data the answer? The New York Times reports that predictive analytic companies are growing in number, and currently work with around 200 universities. These companies, as noted by The New York Times, identify trends in a backlog of student data and create computer programs that identify student progress and alert counselors when students are at risk of being left behind. The idea being that a student’s performance in a certain course may predict the student’s future at the school.

Civitas Learning is a predictive analytics company that has been hired by dozens of colleges and universities across the country. The New York Times reports that data analysts at Civitas found the likelihood of graduating dropped if students received less than an A or B in a basic course pertaining to their major. The Times notes that at the University of Arizona, English Comp was essential to a student’s performance. Less than half of students who received a C in the class ended up graduating, while close to 70 percent of students with A’s and B’s received a degree. As a result, The University of Arizona began to provide more resources for its incoming freshman in writing. Frederick Corey, Vice Provost at Arizona State, said the school has been using big data to recommend possible courses for students. This helps students pursue classes that may otherwise not count toward their major, saving wasted tuition and crucial credit hours.

The payoffs in predictive analytics have been worth it at Arizona State University. Since beginning the program nearly a decade ago, the school has seen its graduation rate grow by 20 percent. At Georgia State, in 2016 the four-year graduation rate rose 5 percent and the six-year rate rose 6 percent. By monitoring graduation rates, big data helps keep tuition coming in by keeping students from dropping out. Predictive analytics is still in its infancy, as only a few hundred institutions are currently using the system. However, as technology and data continue to integrate themselves into higher education, colleges and universities are becoming more open to the idea of its use.

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The Small College Struggle

 

In the wake of the recession, a growing number of small liberal arts colleges are facing major financial challenges.  These small schools share specific traits: high tuition, minimal endowments, and locations in rural or suburban areas.  Today’s students continue to shy away from expensive, liberal arts schools that leave them in debt and are considering larger, public universities.  Moody’s recently released a report about college closures, and said the amount of colleges closing this year is expected to triple with small colleges the most at risk.

The recession has forced many students to think more about value.  In recent years, larger schools have been able to offer better rates of financial aid and lower tuitions.  With less students choosing smaller, more expensive universities, revenue from tuition has fallen.  Bigger schools have bigger endowments, allowing for flexibility.  Smaller, private schools don’t always have the assurance of large endowments to fall back on.  When budgets are stretched, the first thing to go are specialized programs and facilities.  Eventually smaller schools may be forced to lay off faculty and staff, thus decreasing overall value in the eyes of potential students.

Most recently, due to “financial challenges” St. Joseph’s College has announced that it will cease operations at the end of the spring semester.  The school has lost $4 to $5 million each year since 2012.  Board Chairman Benedict Sponseller says the school took out a large mortgage in hopes of increasing enrollment. When enrollment did not increase St. Joseph’s began to spend its endowment, around $24 million in 2015, to stop the bleeding.  Currently the endowment is about $6 million; money the school plans to use for employees’ severance packages.

St. Joseph’s is not alone as Dowling College, St. Catharine College, and Marian Court College are among others who have shut their doors in recent years.  David Warren, head of the National Association of Independent Colleges and Universities, says small schools must understand their own value and cut costs to survive.  With larger schools offering what today’s students want- generous financial aid, access to urban areas, and numerous school programs backed by large endowments- small liberal arts schools have a lot of value to make up.

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Illinois’ Public Universities Face A Difficult Year Ahead

State budget and enrollment issues are plaguing public universities across Illinois. February will be the twentieth straight month state officials have not agreed on a budget, and the standoff between lawmakers means that Illinois’ 48 community colleges and 12 public universities are not receiving the usual funding needed to run its institutions. Enrollment is also taking a hit. In 2016, freshman enrollment at regional public universities declined as much as 25 percent compared to the year before. Schools such as Eastern Illinois University and Northern Illinois University have both seen drops of over 20 percent. The Chicago Tribune reports that Senator Laura Murphy has spoken to students who are “not even considering Illinois Schools because nobody wants to put up with uncertainty.”

Cuts in state funding have forced Illinois schools to raise prices and cut programs. Chicago Mag reports that Illinois-Urbana has raised instate rates by 59 percent in the past 10 years. Rising tuition, along with grant based funding issues, isn’t allowing money to stretch as far is it used to. The Chicago Tribune interviewed Senator Bill Cunningham, whose daughter is a freshman at Illinois state. He said, “I know more than a few (students) were warned by their college counselors that perhaps the school they were looking at might not offer their major in a year or two,” referring to schools cutting programs because of budget issues. He continued saying, “the General Assembly and the governor are forcing state universities to make very difficult decisions about what programs to keep.”

The lack of confidence with the state budget situation, rising tuition, and recruiting from nearby states is compelling many potential students to study out of state. Neighboring state schools are able to attract students with scholarships while still earning more than they would from in-state students. States like Missouri are also allowing out of state students to become eligible for residential status after one year, insuring a better rate of return.

Governor Bruce Rauner said he’s ready for change and compromise. “Well, I’m pushing every day to get a balanced budget with more resources for education. For me, education is the number one priority,” Rauner said. The governor has said a budget deal has been discussed and sent to party leaders, but negotiations are still ongoing.

The bottom line is colleges across the state are guessing on what to do. Do schools raise tuition and fees while waiting for appropriation? Will they receive appropriation in the near future?   With a budget deficit approaching $12 billion only time will tell for the colleges and universities in the state of Illinois.