Kathleen Misukanis & Tom Kosel of the Minnesota Career College Association
Let for-profit schools fully
participate to help produce a competitive workforce
A Civic Caucus
Focus on Competitiveness
Interview June 6, 2014
John Adams, Paul Gilje
(coordinator), Randy Johnson, Sallie Kemper, Tom Kosel, Dan Loritz
(chair), Kathleen Misukanis, Mark Misukanis, Paul Ostrow, Dana
Schroeder, Clarence Shallbetter.
According to Tom Kosel of Globe
University and Katie Misukanis of Rasmussen College, both active in
the Minnesota Career College Association (MCCA), for-profit
(proprietary) higher education institutions serve students who haven't
found success elsewhere and are often those students' "last hope." The
for-profit schools, whose focus is to train students for jobs, offer
extensive support services and serve older students, with an average
age of 27, who are coming back to school to be retrained. Fourteen
for-profit postsecondary companies, with 36 campuses in Minnesota, are
part of the MCCA. There are 30,000 students statewide in the
for-profit higher education sector, most of whom (63 percent) get
associate degrees. A higher percentage of students at for-profit
schools take out loans and, on average, their cumulative debt when
they finish school is higher than in the public and nonprofit
Kosel says the for-profit sector offers
competition to public-sector higher education institutions. He said
for-profit schools have had extensive student support services all
along and were among the first to offer students hybrid courses, which
combine online work with on-campus classes that meet once a week.
Public sector schools have since picked up a lot of these things, he
notes. Misukanis maintains that proprietary schools can adapt more
quickly to changes in the job market by sunsetting programs where
there is little job demand and adding new programs with good job
Kosel and Misukanis call proprietary
colleges and universities "educational businesses" and recognize that
not everybody accepts the concept of making a profit in education.
They point out that for-profits are left out of high school college
and career centers and are rarely recommended by high school
counselors or state workforce centers. They are also excluded from the
state's Postsecondary Enrollment Options program (PSEO), which allows
high school students, at no cost, to enroll in public and nonprofit
postsecondary schools and earn both high school and college credit.
Tom Kosel is Director of
Government Relations for the Globe Education Network of Schools, which
includes Globe University, Minnesota School of Business, Minnesota
School of Cosmetology, Institute of Production and Recording, and
Kosel has worked in higher education for 37
years and has been an active member of the Minnesota Career College
Association (MCCA) for over a decade, serving as chair in 2003-2004.
He currently chairs the MCCA legislative committee. He is also an
active member of the Minnesota Chamber of Commerce, serving on its
Education and Workforce Development Committee.
On a national level, Kosel holds the post of
vice chair of the grassroots committee for the Association of Private
Sector Colleges and Universities. He received a B.S. degree in
education from the University of Minnesota and an M.A. in
administration from the University of St. Thomas.
Katie Misukanis is Government Relations
Director for Rasmussen College, a post she has held since 2011, and
chair of the Minnesota Career College Association (MCCA). Her time
with Rasmussen also includes her work as Director of Admissions for
Rasmussen's Lake Elmo/Woodbury campus. In her current role, she acts
as a liaison for the college to local officials and state legislators
in Minnesota, Wisconsin, North Dakota, and Kansas and advises
Rasmussen's policy decisions and actions. She also serves as chair of
the Wisconsin Council for Independent Education.
Misukanis received her B.A. degree in
Business Management and Political Science from the College of Saint
Benedict and is graduating in July with a Master's in Public
Administration from Gannon University.
For-profit (proprietary) colleges and universities are educational
businesses. According to Tom
Kosel of the Globe Education Network of Schools and the Minnesota
Career College Association (MCCA), because they are businesses,
for-profit schools belong to chambers of commerce and are active in
looking for partnerships. But, he said, the schools' focus is to train
students. "Making a profit in education is not accepted by everybody,"
he said. "As an educational business, our only source of revenue is
tuition. Employers are our customers and students are our product. If
our students do not master the skills and knowledge needed by
employers, they will stop attending our institutions, our revenue will
end and we will cease operations like any other for-profit business
whose product is no longer in demand by its customers."
Kosel said the for-profitschools look at
curriculum from the outcomes they want. "Since we are career-focused,"
he said, "we strive to organize programs around the technical skills
and knowledge needed for employment, while integrating the general
education courses." The schools are nationally or regionally
accredited by the U.S.Department of Education. They are registered
with the Minnesota Office of Higher Education (OHE) and do the same
kinds of reporting as other private, nonprofit educational
"We pay taxes, which is unusual for a
school," Kosel said. "We do not get state appropriations. The schools
must charge fees and tuition, borne by the students, to cover their
costs and then hope there's a profit left over that they can use to
reinvest. It's a unique situation and I don't know how well it's
Fourteen for-profit colleges, with 36
campuses, are part of the MCCA. There are several other for-profit
colleges in Minnesota that do not belong to the MCCA.
Proprietary schools have a lot of students
who haven't been in the education system or didn't go very far in that
system. "They're looking for a home, a place that supports them,
that will go with them to the end of the line and help them find
work," Kosel said.
There are 30,000 students statewide in the
for-profit higher education sector. "Without us, those students
may not go anywhere else," said Katie Misukanis of Rasmussen College
and the MCCA. About 70 percent of the students have already been at
other higher education institutions. She said Rasmussen students
transfer in with an average of 24 credits earned elsewhere and bring
with them an average of $24,000 in debt. "They've tried other
institutions and have not found success for a variety of different
reasons," she said. The average age of Minnesota for-profit college
students is 27. "They're coming back to be retrained or gain skills to
advance themselves," she said.
"We are the last step," Misukanis said.
"We're the last hope for these students. We see ourselves and our
sector as filling a need in that human capital rung for students who
haven't found success elsewhere but who want to work and need the
skills they learn at our institutions to be able to do that."
The for-profit sector offers competition to
the public sector. "We've done some things early on," Kosel said,
"like hybrid courses students can do online and only come to the
campus one day a week. We've had strong support services all along,
such as working with mentors, providing sequential scheduling to help
students stay on schedule to graduate, and offering an active career
services staff to assist in finding employment. He said public-sector
schools have since picked up a lot of these things.
"Competition is good," he continued.
"Education needs the stimulus of someone who's out there thinking
The U.S. Department of Education's gainful
employment rules attempt to ensure that for-profit career training
schools are putting people to work at the right place, earning the
right salary. The rules require that the first year the graduates
are working, they must be able to service their own debt at eight
percent of their income, Kosel said. If it's more than that, the
program will be considered noncompliant and can lose its Title IV
funding, which provides federal student financial aid, such as Pell
Grants and Stafford Loans.
"We welcome accountability," he said, "but
the Department's reliance on first year's earnings against student
loan debt does not recognize the full value of postsecondary
education. This metric should use the second or third year's earnings
against the student loan debt."
At the associate's and bachelor's degree
levels, students graduating from for-profit institutions borrow more,
on average, than students at public and private nonprofit
institutions. According to the Minnesota Office of Higher
Education, 91 percent of students receiving an associate's degree in
2009-2010 from two-year for-profit schools had loans, with an average
cumulative debt of almost $27,000. A lower percentage of associate's
degree students from public two-year schools (62 percent) and two-year
private nonprofit schools (87 percent) had loans, with an average
cumulative debt for students from both the public and private
nonprofit schools of almost $15,000.
"It should be noted," Misukanis added, "that
Minnesota residents also are among the highest degree-attaining
populations, as well as highly likely to pay back their student loan
In 2009-2010, average cumulative debt was
considerably higher for bachelor's degree recipients from for-profit
schools ($45,000) than for those from MnSCU institutions ($25,000),
the University of Minnesota ($27,000) and private nonprofit
Minnesota's higher education institutions
are doing things now they weren't doing three years ago. An
interviewer noted that the state demographer has said that Minnesota
will have fewer people of working age in a few years than we have
today. Right now, businesses are urgently looking for qualified
people. He asked if the training institutions are doing what has to be
done to prepare for the future and, if not, what should be done in
order to better prepare.
Kosel responded that the Minnesota State
Colleges and University (MnSCU) system and the Minnesota Chamber of
Commerce have recently held listening sessions with businesses all
over the state to determine what kinds of skills they need, what the
gaps are and what kind of training they need. The Itasca Project is
using that information to identify specific trades and skills that are
needed in each industry. Kosel said institutions in all sectors are
now looking at shorter programs that lead to a demand area where there
are jobs. Hopefully, he said, that will lead to stackable credentials,
so students can get credentialed in different areas on their way to a
An interviewer commented that it seems the
proprietary schools are able to respond more quickly to the need for
specific training than the MnSCU schools. He said that before MnSCU
was formed, vocational-technical schools were part of local school
districts. When the schools were more local, he said, they could be
more flexible in starting training programs businesses needed.
Institutions must work with students of
color, who are not going on to postsecondary education in great
numbers. "We have to somehow close the gap between high school and
postsecondary education, so students are more successful, more
welcome, more willing to go to school," Kosel said.
Misukanis agreed there is a gap in alignment
between high school and higher education. "There are high-demand
programs, like welding, manufacturing, medical assisting, that are not
being filled with students," she said. "Are students not aware of the
potential earnings out there? Where is that disconnect? We can offer
as many programs as we think will fill the jobs, but if students don't
show up for those programs, the problem will continue to grow."
A number of for-profit schools offer free
dual-credit programs, through which high school students can take
college courses and get high school and college credits. Students
who do that are more likely to go on to postsecondary education and to
succeed there, Kosel said.
The for-profit institutions are ruled out of
the state's Postsecondary Enrollment Options (PSEO) program, he
continued. PSEO allows high school sophomores, juniors and seniors to
take college courses at Minnesota public or nonprofit higher education
institutions, at no cost to the student, and receive high school and
college credit. "The school districts lose revenue when students
enroll in postsecondary courses through PSEO, which is where the rub
can often occur," Kosel said.
Misukanis said during the 2012 legislative
session, the MCCA worked with State Senator Gen Olson to get the
proprietary schools included in the expansion of PSEO allowing 10th
graders to participate in the program by taking postsecondary career
and technical classes. She said the MCCA institutions even offered to
cover the costs of enrolling the high school students in their
courses, by passing on the PSEO money the institutions would have been
paid by the state to the students' home school districts. The effort
failed, however, and the for-profit schools are still not eligible to
take part in any of the PSEO program. "That is disappointing,"
Misukanis said. "In a time where student loan debt is such a growing
concern, why would we not be doing everything we can to expand this
"The proprietary colleges wouldn't accept
any dollars through PSEO," Misukanis said. "We just want to be in the
program to expose more high school students to the options offered by
Kosel added that, instead, Globe has a High
School Advantage program that offers free college courses to high
school students for high school and college credit. Misukanis said
many schools in the for-profit sector offer similar programs.
Rasmussen's program is called Early Honors. "We do that without
receiving PSEO dollars," she said.
MnSCU and the for-profit schools have a very
similar clientele. An interviewer commented that public
vocational-technical schools, private career-training nonprofits like
Dunwoody College of Technology and private for-profits like Globe and
Rasmussen all work in overlapping markets. He asked how what the
for-profits do is different from what the MnSCU vocational-technical
Misukanis responded, "The student-to-faculty
ratio is going to be much smaller at our institutions. Rasmussen's is
12 students per faculty member. MnSCU's is higher. We can offer the
support system that a lot of students in that clientele need. There
are first-generation students who have never seen a postsecondary role
model. We offer advising, tutoring, career advising and assistance.
These are tools that help someone who has not found success
"We are not going to offer welding
tomorrow," Misukanis continued. She said the schools' program
offerings are influenced by Bureau of Labor Statistics (BLS)
information and business advisory groups. "We won't offer a program if
we don't see a demand for it," she said.
The proprietary schools have been shut out
from a lot of the high school conversations.
An interviewer asked how high school students who aren't suited for an
academic college degree find out about the for-profit schools as an
option. "It's been a challenge to get into the high school
college/career centers," Misukanis responded, "because we are not a
traditional choice for traditional students.".
The interviewer commented that high schools
often rate themselves by how many of their students enroll in
conventional colleges, irrespective of whether a student wants to do
it or is ready for it. "Many kids drop out of school because they know
the conventional four-year program isn't for them and they think they
don't have any other options," he said.
Misukanis responded that the Statewide
Longitudinal Educational Data System (SLEDS) is trying to answer the
question of how many students go back for the second year of college,
among other questions. The Minnesota Office of Higher Education runs
Increasing the acceptance of career-oriented
training options will require a culture change. An interviewer
commented that about 10 years ago, Minneapolis Edison High School was
going to encourage technical skills by offering career-oriented
classes. "They absolutely got pilloried by middle-class parents, who
didn't want their kids going into blue-collar industrial jobs," he
said. "So Edison gave up that program. How do you overcome that
stigma? How do you work with others to change hearts and minds?"
Kosel said the for-profit schools are
inviting high school counselors in to try to educate them about their
programs. "We can't call what's after high school 'higher education'
or 'college,' he said. "We have to call it 'postsecondary.' That's the
world we have to help students enter."
"MCCA and MnSCU schools alike are struggling
with this," Misukanis said. "It's a culture change. It's really
educating students and parents as to what the earning potential is and
what the training looks like."
"We've told our kids all you need is a
four-year degree," Kosel said. "During their college years, the
economy changed and there aren't jobs." He said there might not be as
much student debt if students realized they have other options.
Many faculty members at MCCA campuses are
adjunct instructors. In response to a question, Misukanis said
about 25 percent of Rasmussen's faculty are full-time and about 75
percent are adjunct, most of whom are also employed in their field.
"Students do like that," she said. "They say it's different being
taught by someone who's in the field, rather than being taught theory
about what could be."
Most students who decide to enroll in the
for-profits are looking for jobs and want a career path. Misukanis
noted that referrals are a common way for students to find out about
the for-profit schools' programs. Most of the state workforce centers,
she said, will send the students to MnSCU, because the for-profits are
more expensive and because a state agency will be more likely to send
students to a state institution. Also, Kosel added, a lot of the
workforce centers are located on MnSCU campuses.
State grants for postsecondary students, in
place since 1972, give access and choice for all students receiving
the grants, whether at public, nonprofit or for-profit institutions.
Students finishing their bachelor's degree
at for-profit institutions leave with an average $45,000 debt, which
includes any debt they may have brought with them when they enrolled
at the institution. Misukanis said those graduates will earn
anywhere from $30,000 to $50,000 a year when they leave school,
depending on the program and credential level they completed. She said
all students must go through financial counseling before they can take
out a loan.
Misukanis said Rasmussen College has
declined about 20 percent of students attempting to enroll, since
instituting a qualified enrollment process. The students must pass
minimum aptitude tests and background checks and complete an online
About 15 percent of proprietary school
students receive tuition reimbursement from their employers.
In Florida, there are more students in the
for-profit system than in the public community college system.
Misukanis said there are a lot of proprietary schools in Florida and
they are meeting the needs of the businesses. "Florida is very
friendly to the proprietary sector and not as adversarial as other
states are, she said. "
Apprenticeships are coming back strongly.
The 2014 Legislature passed a bill, known as "PIPELINE," creating
advisory committees to form stronger apprenticeships in agriculture,
IT, health care and manufacturing. Businesses will be involved in
deciding the standards and criteria for the internships. "Some of our
programs already require internships," Kosel said.
Most students (63 percent) at Minnesota
proprietary schools get associate degrees. Kosel said the programs
at each school differ, but students can find the following programs
offered by proprietary schools in the state: certificate programs,
two-year associate degrees, four-year degrees, master's degrees and
Sixty percent of for-profit school students
work full-time while they're going to school. That's why they like
the flexibility of hybrid on-campus/online classes, Kosel said.
Profits from the proprietary schools are
reinvested. An interviewer asked where the profits from for-profit
schools go. "In Minnesota, we're the opposite of the national trend,"
Misukanis said. "Our schools are mostly privately owned by people like
the Meyers family, who own Globe. We don't have many publicly traded
colleges. We can offer programs like free courses for high school
students, because our profits are reinvested. We also are able to
expand high-demand programs or offer costly programs like nursing
because of the reinvestment. All colleges make a profit. We pay taxes
Kosel said private owners of the colleges
might expand the number of campuses when the schools are growing, but
they also take on the risk of facing declining enrollments, which is
happening currently. "It's an education business and you live it," he
Conclusion Misukanis closed by saying the
proprietary sector serves high-need students with support services in
a career-focused education, backed by research. "The programs we offer
are based on advisory groups, BLS data and salary expectations," she
said. "If we don't think students will meet the salary
expectations, we will sunset programs and add other programs." For
example, Rasmussen sunsetted its exercise science programs and added
cyber security programs. "We're trying to always be relevant to the
needs of the labor market," she said. "As a result, our students are
going on and finding successful jobs, after they haven't found success
in school before. If we couldn't meet the needs of students and the
market, we wouldn't exist. We're compassionate to students and
dedicated to meeting the human capital needs of the state."
Kosel said the for-profit schools serve an
adult population, including 63 percent women and 22 percent students
of color. "We do everything we can to make it an easy place to come
to," he said. Most of the proprietary schools give credit for prior
work experience, he added, in order to give the students as many
credits as possible when they start, cutting costs and helping make
the programs affordable.
The Civic Caucus
is a non-partisan,
tax-exempt educational organization. The Interview Group
includes persons of varying political persuasions,
reflecting years of leadership in politics and
business. Click here
to see a short personal background of each.
S. Adams, David Broden, Audrey Clay, Janis Clay, Pat Davies, Bill
Frenzel, Paul Gilje (coordinator), Randy Johnson, Sallie Kemper, Ted
Kolderie, Dan Loritz (chair),
Tim McDonald, Bruce Mooty, John Mooty, Jim Olson, Paul Ostrow, Wayne
Popham, Dana Schroeder, Clarence Shallbetter, and Fred Zimmerman