The country’s largest Christian university is being fined $37.7 million by the federal government amid accusations that it misled students about the cost of its graduate programs.
Grand Canyon University, which has more than 100,000 students, mostly in online programs, faces the largest fine of its kind ever issued by the U.S. Education Department. The university dismissed the allegations as “lies and deceptive statements.”
“Grand Canyon University categorically denies every accusation in the Department of Education’s statement and will take all measures necessary to defend itself from these false accusations,” the school said in a five-page statement.
An Education Department investigation charges that Grand Canyon lied to more than 7,500 current and former students about the cost of its doctoral programs.
As far back as 2017, the university told students its doctoral programs would cost between $40,000 and $49,000. The department found that less than 2% of graduates completed programs within the range, with 78% paying an additional $10,000 to $12,000.
The additional cost often came from “continuation courses” that were needed to finish dissertation requirements, the department said.
What GCU says
"Grand Canyon University categorically denies every accusation in the Department of Education’s statement and will take all measures necessary to defend itself from these false accusations.
The Department’s decision to fine Grand Canyon University $37.7 million and impose conditions on its program participation agreement confirms what we previously outlined in this detailed statement and is further evidence of the coordinated and unjust actions the federal government is taking against the largest Christian university in the country.
The Department’s actions today are not validated by either the federal court system, which has already ruled in GCU’s favor in a similar matter at both the district and appellate court levels in Young v GCU, or other regulatory agencies that spend many days on our campus reviewing the robust and transparent disclosures the University provides its students. Specific to the Young case, the courts rejected the claim that GCU’s disclosures of doctoral program requirements misrepresented the time or cost it would take a student to complete a doctoral program, and it found the net impression of GCU’s many disclosures make clear the cost to complete the program. Contrary to the Department’s assertion that these are “fine print” disclosures, GCU makes clear in the most prominent place it provides financial disclosures for academic programs – its Degree Program Calculator (see pdf image in original statement) – that there can be continuation courses, and the costs associated with those, in doctoral programs in order to complete the dissertation process. GCU’s disclosure is in full-size red type and placed above the Degree Program Calculator calculation in order to bring attention to it. Continuation courses are common in higher education doctoral programs in addition to the total cost of the required 60 credits. In fact, we believe our disclosures related to continuation courses are more extensive than other universities, yet only GCU is being targeted by the Department."
More rules & regs
The Biden administration is issuing the fine amid a broader push for accountability among U.S. universities. The Education Department recently finalized a new regulation that could cut federal funding to for-profit college programs that leave graduated unable to repay loans, and the agency plans to give students and families more information about outcomes from all colleges.
Grand Canyon has 20 days to appeal the fine. The department is also adding new conditions the school must meet to continue receiving federal money.
The school will be barred from making “substantial misrepresentations” about the cost of doctoral programs, and if it tell students about the cost of doctoral programs, it must use the average cost paid by graduates.
It also has to report any other investigations or lawsuits, and it must also send a notice to current doctoral students telling them how to submit a complaint to the Education Department.
For the past four years, Grand Canyon has disbursed more federal student aid than any other U.S. institution, the department said.
Earlier this month, Grand Canyon issued a statement saying federal agencies were unfairly targeting the school with “frivolous accusations” in retaliation for an ongoing lawsuit the university filed against the Education Department in 2021.
Grand Canyon sued after the agency rejected the school’s request to be classified as a nonprofit college. It became a for-profit college in 2004 after investors saved it from financial collapse. It applied to become a nonprofit again in 2018 but the Trump administration blocked the move, saying the college remained too close to its previous parent company.
It’s considered a nonprofit by its accreditor and the Internal Revenue Service.
Responding to the fine, Grand Canyon said its cost disclosures have been upheld in court during a separate lawsuit, and by the school's accreditor. It said the fine is part of a “disturbing pattern” by the Education Department, adding that the agency declined a request to address the issue through a federal mediator.
“This speaks volumes about their agenda-driven motivation to bring harm to the university and the coordinated efforts being taken against GCU,” the school said.
The university enrolls roughly 20,000 students at its campus in Phoenix, but most of its overall enrollment comes from students who take online classes from outside Arizona. It enrolled 80,000 students in online programs as of 2021, with a roughly even split between undergrad and graduate programs.
A GCU news release also states:
Whether the fine is $1 or $37.7 million, GCU categorically rejects the Department’s claims. It is confounding that the Department would look at a university that is investing millions of dollars to provide more transparency than is legally required and, rather than work cooperatively to support or even applaud such efforts, is fixated on imposing significant penalties. This speaks volumes about their motivation and the coordinated efforts being taken against GCU.
While GCU maintains that a fine of any amount is not justified, the Department’s $37.7 million penalty is grossly inappropriate when looking at recent fines they have issued. Other universities have been found guilty of fraud in academic offerings or fraudulent data that it submitted to the U.S. News and World Report (neither of which resulted in fines from the Department) or withholding information about sexual assaults to protect the universities’ reputations, which resulted in fines of $4.5 and $2.4 million, respectively. Again, this speaks to the Department’s motivations toward for-profit institutions and its intentional mis-classifying of GCU as such.