ITT students in Arkansas face uncertain future, for-profit chains files for bankruptcy

More than 200 former ITT students in central Arkansas are still unsure of their futures after the parent company of the for-profit school filed for bankruptcy after shuttering more than 130 campuses across the U.S. two weeks ago, including the lone Arkansas location in West Little Rock.

For-profit higher education giant ITT Educational Services unexpectedly announced Sept. 6 it was ceasing operations nationwide. At the time, the nation’s fifth-largest for-profit university said federal regulators decision to increase the school’s surety requirement to 40% of its Title IV federal funding and the placement of the school on the “Heightened Cash Monitoring Level 2” forced the company’s hand.

Since then, things have only gotten worse. The company filed for bankruptcy protection in the United States Bankruptcy Court for the Southern District of Indiana on Sept. 16, seeking debt relief for its ITT, ESI Service Corp., and Daniel Webster College operations in 40 states.

That has left officials at the state Department of Higher Education (APHE) scrambling to find a soft landing place for the dozens of former ITT students in Central Arkansas left unsure about their educational futures and thousands of dollars of student loan debt.

Alana Boles, program specialist at APHE for academic affairs, and the SARA (State Authorization Reciprocity Agreements), told Talk Business & Politics that her department is communicating with former ITT students in Arkansas and working with a third-party college transcript firm to make sure student records are available to those seeking to transfer credits.

“We have a Listserv set up where I’ve sent several emails to those students telling them about Parchment that ITT has partnered with and they have the electronics transcripts and diplomas from 2001 on and the students are able to go there and order whatever students records they need,” Boles said.

Boles said APHE is acting as an informational liaison providing ITT students in Arkansas with two core options: seeking to have their federal student loan discharged or transferring their credits to a comparable program.

Boles said she has taken dozens of calls and emails from former ITT students and concern parents, while officials from the University of Arkansas at Little Rock and National Park College in Hot Springs have reached out to some of the former ITT students. However, she admitted that transferring credits from a for-profit entity to a public institution has traditionally been rather difficult in Arkansas.

“Normally, not much is taken if you go from a for-profit to public institution, but this is under different circumstances there might be a different answer for that,” she said. “We’ve just been kind of giving them information as we get it because it is a fluid situation.”

Still, U.S. Department of Education Secretary John King admitted earlier this week that the federal agency has received thousands of emails and calls from its former students trying to find their way forward. King said the U.S. Department of Education has worked to support ITT’s more than 40,000 students. He said partner organizations and state-level higher education departments across the U.S. have stepped up to do the same.

Concerning ITT in Arkansas, Boles said since the recent bankruptcy filing, all of the for-profit employees in Little Rock have lost their jobs, the doors of its Little Rock campus have been permanently closed, and the company has failed to respond to queries from, former student, state officials or the media.

The APHE program specialist said state higher education officials are working to gain access to the former ITT campus at 10800 Financial Centre Parkway in Little Rock to obtain ITT records and transcripts of former students who attended the for-profit school in Arkansas before 2001.

“Some students have called who attended ITT before 2001 and their records aren’t in electronic format and we are attempting to get those records for them,” she said.

The U.S. Department of Education has schedule a series of ongoing national webinars for all ITT students to share information and address students’ questions and concerns. Representatives from the Department of Veterans Affairs will be available to discuss options for veterans and field questions. Those webinars are limited to 1,000 participants, and former ITT students in Arkansas can register for an upcoming presentation at this link.

Students can also order their school records and transcripts from Parchment at this link.

Meanwhile, ITT shareholders and employees are facing difficult times too. The for-profit chain is facing multiple lawsuits from former employees who allege that the publicly-traded university violated the federal Worker Adjustment Retraining and Notification Act. That law requires a notice of 60 days before mass layoffs and affects employers with more than 100 employees and business sites with more than 50 workers.

Meanwhile, ITT shareholders are suffering too since the Sept. 6 announcement. The New York Stock Exchange has said it will delist ITT on Oct. 3, and the company’s stock has plummeted to penny stock level at 15 cents a share in Thursday’s morning session.