Unbundling For-Profit Higher Education: Relaxing the 90/10 Revenue Constraint

Zachary G. Davis ()
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Zachary G. Davis: Alex G. McKenna School of Business, Economics, and Government, Saint Vincent College

Eastern Economic Journal, 2023, vol. 49, issue 2, No 4, 176-200

Abstract: Abstract In 2008, congress passed the Higher Education Opportunity Act. This act relaxed the 90/10 rule requiring for-profit institutions to earn at least 10 percent of their revenue from non-Title IV funds by revoking eligibility after 2 years of non-compliance instead of 1 year. To comply with the 90/10 rule, for-profit institutions bundle campuses together. Unbundling the campuses doubles the number of 1-year violations though the number of 2-year violations remains the same. For-profit institutions receive almost one billion dollars, or about 4.5 percent, more federal aid under the 2-year violation rule than the 1-year violation rule.

Keywords: For-profit higher education; Regulatory compliance strategy; Title IV financial aid; H52; I23; I28 (search for similar items in EconPapers)
Date: 2023
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DOI: 10.1057/s41302-023-00236-3

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