Grand Canyon Education CEO defends tuition-share agreements
Natalie Schwartz
February 17, 2023
Dive Brief:
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The CEO of Grand Canyon Education, an educational services firm whose biggest client is Grand Canyon University, offered a defense of tuition-sharing during a call with analysts Thursday, saying the practice shields universities from financial risk.
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“Critics point to the revenue-share model as bad for universities,” GCE CEO Brian Mueller said during the call. “The past two years have proven them wrong, and we expect that in the next year, this will become even more apparent.”
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GCE takes around 60% of Grand Canyon University’s tuition and fee revenue in exchange for a suite of services, such as help with financial aid and marketing. Mueller’s defense of tuition-sharing came one day after the U.S. Department of Education announced it would review 2011 guidance that allows colleges to enter these types of contracts with companies that provide recruiting services.
Dive Insight:
Democratic lawmakers and policy advocates have been criticizing tuition-share agreements for years, arguing they incentivize companies to aggressively recruit students and drive up the cost of higher education.
They’ve also questioned whether these deals comply with federal law. The Higher Education Act bars colleges that receive federal financial aid from giving employees or companies incentive compensation for recruiting students into their programs.
