Three Local For-Profit School Programs Fail to Meet Employment Standards

Two bachelor’s degree programs at Tucson’s for-profit Southwest University of Visual Arts have received failing grades from the federal government. Graduates from the graphic design and interior design programs reportedly don’t earn enough to repay their student loans without financial hardship.

These programs, located at 2525 N. Country Club Road, did not meet the new “gainful employment” standards implemented by the federal government. The standards, effective since January 1, are aimed at preventing high student debt relative to earnings post-graduation.

“The regulations are intended to protect students and taxpayers by providing warnings about programs with relatively high loan debt compared to the earnings their students could hope to achieve after graduating,” stated the U.S. Education Department lawyers in a recent court filing.

To comply with these standards, the typical graduate’s loan payments must not exceed 8 percent of total earnings or 20 percent of discretionary income. However, Southwest University’s tuition and fees are $23,000 annually. Data shows that graduates from the graphic design program earn a median annual income of $29,393, and those from the interior design program earn $32,046.

Last school year, Southwest hosted about 140 students across different programs, nearly 60 percent of whom utilized federal student loans. Attempts to contact Southwest officials for comments were unsuccessful.

Additionally, the cosmetology program at Arizona Academy of Beauty, located at 5631 E. Speedway, also did not meet the new federal standards. The academy charges $14,500 for a 54-week program, and its graduates reportedly earn $8,977 annually.

Carey White, the owner of the beauty school, contested the reported earnings, stating that income figures are artificially low as many cosmetologists do not report tips to the IRS. This argument echoes the stance of the American Association of Cosmetology Schools in a lawsuit seeking to halt the new regulations.

Despite expectations that the Trump administration might favor for-profit educational institutions, Education Department lawyers are actively defending the regulations. They argue that “the public interest is served by allowing the (education) department to go forward with implementing the (gainful employment) regulations.”

Programs that fail to meet the standards repeatedly will be excluded from federal student aid eligibility.

Contact reporter Carol Ann Alaimo at 573-4138 or calaimo@tucson.com. Follow on Twitter: @StarHigherEd.