Around 4,500 students at 10 Heald College campuses in California won’t be getting their Cal Grant awards in a timely fashion, or at all, after their school failed to submit the proper paperwork to the state on time.
The $1 million was held up until the school submits financial documents that were due in December, according to the San Francisco Chronicle. That might take awhile. Heald’s parent company, Santa Ana-based Corinthian Colleges, has been under siege by state and federal officials for more than a year and was forced to sell a big chunk of its 100-plus schools to others in December.
Corinthian held on to Heald, which has campuses in the Bay Area and the Central Valley. The $1 million is small compared to what lies ahead. California Student Aid Commission spokesperson Patti Colson told the Sacramento Bee another $13 million in award money reserved for payment by the end of June was in jeopardy.
Students can still claim their Cal Grants and use them, but it would have to be at another school. The grants range from $2,000 to $11,000. The Wall Street Journal reported that students attending Heald’s campuses in Portland, Oregon and Honolulu aren’t affected.
Corinthian was not shocked and amazed by the commission’s action, but it was “surprised and disappointed,” according to a statement by the college. Corinthian spokesman Joe Hixson told the Journal the college would “vigorously oppose” the commission’s decision.
The California attorney general filed a lawsuit against Corinthian in 2013, charging predatory practices and other illegalities. But the death blow was delivered by the feds last September when they cut off access to federal student loan money. Corinthian, like many other nonprofit colleges, feasts on tuition loans obtained for its students who are overwhelmingly low-income students
A scathing 2012 report (pdf) on for-profit colleges, released by then-U.S. Senator Tom Harkin (D-Iowa), questioned their high drop-out rates, questionable programs and targeting of non-traditional students who piled up loads of debt.