Home News Commentary/Editorial A Comparison of CollegeAmerica – Denver with State-Supported Community Colleges
A Comparison of CollegeAmerica – Denver with State-Supported Community Colleges

A Comparison of CollegeAmerica – Denver with State-Supported Community Colleges


By Glenn Bogart, J.D.

You may remember from a previous issue of Career Education Review that CollegeAmerica, won a big victory over the Colorado Attorney General’s office. Let me disclose, first, that I was not paid for writing this article.

Using National Center for Education Statistics (NCES) data, I compared demographics and outcomes of CollegeAmerica, which has three campuses in Colorado, with its community college competitors. We know what proprietary schools (or in this case, schools that were proprietary until recently, when they went non-profit) generally face in the way of student demographics. Lots of minorities, lots of females, and lots of poor people (whatever their race or sex). I don’t need to go into why that is – many others have done that. Whatever the reasons, people tend to vote with their feet.

Frankly, when I actually studied this a bit, I was surprised at what I found. Proprietaries not only do well when compared with community colleges – they do extremely well.

I’m no statistician and I can’t personally vouch for the data, since it was collected from the schools by the NCES. However, presuming the numbers NCES is putting out there are correct, here are my observations.

For inputs, I looked at student body in these aspects:

  1. Racial composition. It is fairly well known that in general, Black and Hispanic students have lower family income than whites. Although listed in the NCES data, I ignored “other” in race, because it could mean anything. I figured the analysis would be cleaner if I excluded these unknowns.
  2. Percent of undergraduates receiving Pell Grants. This is not as good a proxy for poverty as it used to be, but it’s still pretty good. Even though more middle-income students are now eligible for Pell Grants, at least we can say they are not high-income students.

For outputs, I examined the 2011 3-year cohort default rates, graduation rates, and average salary of graduates, as listed on the new College Scorecard.

First, I populated a spreadsheet with the available numbers from NCES and the College Scorecard. Unfortunately, several Colorado community colleges are not listed on the College Scorecard. Some of them just don’t show up on the College Scorecard site. I used what data was available. I wonder why the other ones aren’t there…

Graduation Rates
School Graduation rate
CollegeAmerica – Denver 43%
Northeastern Jr. College 36%
Lamar Community College 39%
Pikes Peak Community College 22%
Community College of Aurora 22%

CollegeAmerica-Denver clearly outperforms its competitors. It beat Lamar by a nose, and beat the others significantly.

2011 3-Year Cohort Default Rates
School Cohort default rate
CollegeAmerica – Denver 26%
Northeastern Jr. College 26%
Lamar Community College 23%
Pikes Peak Community College 22%
Community College of Aurora 22%

Yes I checked the numbers twice. Pikes Peak and Community College of Aurora both report the same graduation rates as their default rates – 22 percent. CollegeAmerica – Denver and Northeastern Jr. College tie with the highest cohort default rate, at 26 percent. There’s not much difference between 22 percent and 26 percent. Is this statistically significant? Beats me. But we’ll see later what may explain this small difference.

Graduate Salaries
School Graduate salaries
CollegeAmerica – Denver $28,800
Northeastern Jr. College $34,200
Lamar Community College $26,600
Pikes Peak Community College $29,900
Community College of Aurora $32,000

Graduates of the community colleges appear to get higher pay, except for the graduates of Lamar Community College, who earn $2,200 less than graduates of CollegeAmerica – Denver. Based on salary alone. Northeastern Jr. College looks like the place to go. But now, let’s look at the students these institutions serve.

Racial Composition
School Black + Hispanic %
CollegeAmerica – Denver 53%
Northeastern Jr. College 13%
Lamar Community College 29%
Pikes Peak Community College 21%
Community College of Aurora 41%

The Community College of Aurora is the closest to CollegeAmerica – Denver on the Black plus Hispanic percentage, although there is still a 12-point difference. But notice the huge difference in racial composition between CollegeAmerica – Denver and Northeastern Jr. College. CollegeAmerica – Denver has four times as many Black and Hispanic students as Northeastern Jr. College. I’m going to go out on a limb, here, and suggest this could explain, in part, the difference in graduates’ salaries.

Percent of Students who Receive Pell Grants
School Percent receiving Pell Grants
CollegeAmerica – Denver 74%
Northeastern Jr. College 30%
Lamar Community College 33%
Pikes Peak Community College 44%
Community College of Aurora 36%

Interesting. Twice as many CollegeAmerica students, on a percentage basis, receive Pell Grants, as Community College of Aurora students. The difference is even greater between CollegeAmerica and Northeastern Jr. College. As mentioned above, Pell Grant eligibility is not a perfect proxy for household poverty, but it certainly is a significant indicator. Ethnicity is not a perfect proxy for poverty either – but again, it’s a significant indicator. Taken together, the prevalence of minority students and the prevalence of Pell Grant recipients form a pretty clear picture of the obstacles any school faces in getting its students through a program, to graduation. Such prevalence also most likely has an impact on the average graduate’s earnings, from all I have read and learned in 35 years in the field of student financial aid.

A better study would look at raw numbers, and at the educational level of the students’ parents, at marital status, at whether the students have high school diplomas or GEDs, and maybe other things as well. But I don’t have all that, and even if I did, I would have no idea how to manipulate it to produce a statistical answer to this question: Which school does a better job – CollegeAmerica – Denver, or Community College of Aurora, for example? I do know these facts, though, assuming the NCES data are correct.

School %Black and Hisp. % Pell recip. CDR Salary Grad rate
CollegeAmerica 53 74 26 $28,800 43%
Community College of Aurora 42 36 22 $32,000 22%

CollegeAmerica has twice as many students, on a percentage basis, as Community College of Aurora, who receive Pell Grants. To the extent that this is a proxy for poverty, that’s significant.

CollegeAmerica also graduates nearly twice as many of its students, as does Community College of Aurora. Whether or not the students are impoverished, that’s really significant. (And please don’t tell me that community colleges have a lot more students who are “just taking courses.” If they’re not there to get a degree or certificate, it is illegal for them to receive federal student aid.)

Although CollegeAmerica’s default rate is a little higher than Community College of Aurora, CollegeAmerica does have more Black and Hispanic students, and twice as many students eligible for the Pell Grant. That seems a reasonable tradeoff to me, as a taxpayer. But look at the graduation and salary data of these two schools!

As a taxpayer, would you rather see 22 percent of a school’s students graduate and earn $32,000 (Community College of Aurora), or see 43 percent of another school’s students graduate and earn $28,800 (CollegeAmerica)?

Let me put it another way. Would taxpayers be better off if CollegeAmerica did not exist, and its “future” students instead attended Community College of Aurora? The graduation rate of those students could well drop from 43 percent to 22 percent. I’d rather have those 21 out of 100 students – the difference – graduate and get jobs, even if those jobs pay a little less. Call me crazy… In truth, those students probably would do even worse than the 22 percent graduation rate the community college now “enjoys,” since they are more marginal students by far, and might respond even more negatively to the regimentation and impersonal treatment they would receive at a community college than would the students the community college already has.

The would-have-been CollegeAmerica students who did manage to graduate from the community college, even though the odds would be worse, might make a little more money – but then again they might not, since the more Blacks and Hispanics and poor people you have in a cohort, the less the cohort earns, on average, no matter what school they attend. I know, I haven’t proven that here, but this is generally known. If you want statistics on that, look around, and you’ll find them.

As I said earlier, I am no statistician. Somebody who knows more about statistics probably could give you a better analysis. But just looking at the numbers as a layman, CollegeAmerica – Denver looks pretty good to me, compared to community colleges in the same state.

Nearly twice as many graduate from CollegeAmerica, even though the proxy data show that more than twice as many CollegeAmerica students, than Community College of Aurora students, are poor, as measured by Pell Grant eligibility. And, CollegeAmerica has 26 percent more Black and Hispanic students, compared with Community College of Aurora.

CollegeAmerica goes into this, therefore, with at least a 50 percent disadvantage, apparently, looking at the demographics. Then they go and graduate twice as many of their students. If I were a policymaker who wanted to increase graduation rates, I would go to CollegeAmerica and try to figure out how they’ve managed to do that. Once I figured it out, I would try to implement whatever CollegeAmerica is doing at the community colleges, so they could double their graduation rates.

Is CollegeAmerica typical of proprietary schools, in having a relatively high graduation rate with a large minority population, compared with community colleges? I think it is. I may explore this in a future article.

Here’s an idea for policy-makers. Take a look at what would happen if we were to terminate every proprietary school whose graduation rate is less than its nearby community college counterpart and terminated every community college with a worse graduation rate than its nearby proprietary school counterpart. That would be easy to administer – much easier than the administration of the gainful employment regulations is going to be. If the idea is to get rid of schools that aren’t performing, my plan is a better and easier way to do it. Now, if the idea is simply to put proprietary schools out of business so that the sacrosanct community colleges will have no competition, obviously my plan wouldn’t do…

Glenn Bogart

GLENN BOGART, J.D. is a Title IV compliance consultant who specializes in school compliance reviews and Department of Education program review responses and appeals. A former ED program review officer, he holds a bachelor’s degree in government from Southern Illinois University, and earned the Juris Doctor degree at Western New England College in 1986. He resides in Birmingham, Alabama, but travels all over the U.S.

Mr. Bogart started his consulting business in 1992, after having served briefly as director of internal audit and compliance at Phillips Colleges, Inc., and prior to that as corporate vice president for financial aid for another large group of proprietary schools. Over the years, he has contributed frequently to these pages.

Contact Information:Glenn Bogart, J.D. // 3603 Buck Horn Cove Birmingham, AL 35242 // 205-249-5453 // glennbogart@aol.com // www.glennbogart.com


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