ITT Technical Institutes Close For Good
After about 50 years of providing primarily technological and business education to students with federal aid, ITT Tech is closing 136 of its technical institutes in more than 38 states. The reason? Numerous federal and state investigations over the company’s organization, administration and financial situation have revealed that it has not been meeting with the Accrediting Council of Independent Colleges and Schools’ (ACICS) educational standards. On September 6th, the company ordered its institutes to cease all online and classroom instruction.
The decision, which will affect around 35,000 students and 8,000 employees, signals that ITT’s recruitment and accounting practices have been at the large expense of debt. The action not only raised alarm for seniors applying to college this year, but also led to wide unrest and complaints from ITT Tech students.
“I think it’d affect us in a way where student loans [would] come in and as well as the financial aid,” said senior Sandy Sanchez.
While the rest of ITT’s 15 California schools are banned from accepting new students, earlier in the year, ITT was notified by the Education Department that its surety bond would have to increase from $43,938,303 to $123,646,18. A surety bond is a three-party agreement regarding contracted documents that covers a school’s liability when it closes before the end of an academic period. The Education Department will also continue strict supervision over prohibiting awards of bonuses and raises to the company’s executives. The company’s $500 million dollar debt may have to be covered by taxpayer’s dollars.