Trump administration’s Education Department says the Arizona university remains a for-profit, a surprising decision that may dump cold water on other nonprofit conversion bids.
Grand Canyon University announced last year that had succeeded in its second bid to convert from a for-profit to a nonprofit institution, winning almost all of the needed approvals. But the one exception — the Trump administration’s Education Department — has ruled to the contrary.
The surprising decision by the department, announced Wednesday by the university’s for-profit holding company and first reported by Education Dive, raises questions about ongoing efforts by other for-profit colleges to change their tax status.
Grand Canyon said Wednesday that it will challenge the department’s move to treat it as a for-profit under federal aid laws.
“Holy shit,” Trace Urdan, a managing director at Tyton Partners and an expert on the for-profit higher education sector, said of the news. He said numerous other for-profits are considering or working on converting, and that the department’s decision may make those colleges reconsider the change.
The Phoenix-based Grand Canyon is one of the nation’s largest universities, enrolling 105,000 students in its thriving online and campus-based programs. The Christian institution enrolls more than 20,000 students at its campus in Phoenix, where it has spent over $1 billion on capital improvements over the last decade.