How a For-Profit Tycoon Turned His Colleges Into Nonprofits – The Chronicle of Higher Education
For decades, Carl Barney owned and operated a small empire of for-profit colleges and universities across the United States. Then, as 2012 drew to a close, he made a surprise move, transferring his life’s work to a free-market-minded nonprofit. Barney called the decision a personal sacrifice, saying in 2016 that if he hadn’t shed his colleges, “I could be a billionaire today.”
But the U.S. Education Department has viewed so-called college conversions with skepticism. Some converted nonprofits still have ties to their former for-profit owners. In Barney’s case, he became a lender, landlord, and board member for the Center for Excellence in Higher Education, the nonprofit organization that took control of his former institutions.
Four years ago, then-Education Secretary John B. King Jr. was unequivocal when the organization, known as CEHE, asked his department to recognize those colleges as nonprofits. “Don’t waste your time,” was King’s blunt response.
CEHE sued, however, eventually reaching a settlement with the Trump administration that granted the colleges nonprofit status. The existence of that December 2018 deal has not been publicly revealed until now.