Is the era of college nonprofit conversions over?
Natalie Schwartz
December 19, 2022
A recent federal court ruling and coming regulations could deter some for-profit colleges from attempting to become nonprofits under complex deals.
Earlier this month, Grand Canyon University, a Christian institution headquartered in Arizona with a large online footprint, lost a legal battle it was waging against the U.S. Department of Education.
A few years earlier, the Education Department determined that it would consider the university a for-profit college for federal financial aid purposes — even though it had nonprofit standing with the IRS. In its decision, the agency cited a Grand Canyon University services contract that gave a sizable portion of the institution’s revenue to its former owner.
