Grand Canyon University, federal officials spar again over multimillion-dollar fine

PHOENIX - There was a war of words between federal education officials and Grand Canyon University on Nov. 22, as the private Christian college in Phoenix continues to appeal a fine that was imposed on the institution.

In October, we reported that the U.S. Department of Education's Office of Federal Student Aid accused GCU of misstating the cost of its programs, with the school being accused of falsely advertising a lower cost than "what 98% of students ended up paying to complete certain doctoral programs."

"GCU stated that those doctoral programs cost between $40,000 and $49,000. GCU made these false claims about the cost on the school’s website and net price calculators, as well as in its enrollment agreements, catalogs, policy handbooks, and other marketing materials," read a portion of the statement released by federal officials.

Federal officials said that for a ‘vast majority’ of the graduates, they needed so-called ‘continuation courses’ to complete the dissertation requirements in doctoral programs, resulting in a roughly 25% increase in tuition costs.

In a lengthy statement posted to the university's website on Oct. 31, GCU officials state they categorically deny "every accusation in the Department of Education’s statement." On Nov. 16, university officials announced their decision to appeal the fine. 

Read More: Grand Canyon University fined millions by federal education officials: Here's what to know

On Nov. 22, officials with GCU issued a statement, stating that they have not seen complaints among doctoral students in their end-of-course and end-of-program surveys, and that federal officials have refused to share who filed a complaint, despite requests by GCU officials to share such information with them.

In the same statement, GCU officials accused the Biden Administration of incentivizing students to come forward with complaints as a way to provide a rationale for student debt relief.

In response, Federal officials call GCU's accusation untrue.

"The Department has heard from GCU students who reported being misled about the cost of their graduate programs," read a portion of the statement.

GCU's statement, in full

Our statement has been twofold. First, due to our numerous and transparent disclosures related to the need for continuation courses in order to complete a dissertation, we are not seeing complaints among doctoral students in our end-of-course and end-of-program surveys, which are anonymous to allow students to be candid. Second, we have also stated that the Department has told us that their allegations are not based on student complaints but rather their interpretation of our disclosures. We are aware the Department purports to have received complaints, but they have refused to share those with us even though we have asked repeatedly. If students have concerns, we would like to address them and also determine the validity of those complaints.

The Biden administration has incentivized students to come forward with complaints so that they can then circumvent Congress and use those unsubstantiated complaints as a rationale to relieve student debt, which has been a priority issue for them (this is referenced in the last sentence of the DOE’s statement you provided). We saw this in the Sweet v Cardona case in which the Department unilaterally granted $6 billion in debt relief to any student at 150 for-profit institutions who filed a complaint. They did not review the claims to determine if they had merit and automatically granted debt relief simply because the students attended a for-profit institution. GCU is lawfully a nonprofit institution as determined by the State of Arizona and the IRS, but we are subject to decisions such as Sweet v Cardona because the Department intentionally misclassifies GCU as a for-profit institution for purposes of federal funding. Of the claims we reviewed involving GCU students prior to the Sweet v Cardona decision, none had merit and many were cut-and-paste verbatim accusations from third-party websites in order to qualify for debt relief.

Here is the statement we released at the time of that settlement.

Specific to the Department’s interpretation of our disclosures for doctoral students, we do not dispute the Department’s statement that most doctoral students pay for additional courses beyond the 60-credit requirement. We state that as well. We do dispute their characterization of our disclosure as being "deceptive" or in "fine print." We make clear in the most prominent place we provide financial disclosures for academic programs – our Degree Program Calculator – that the average doctoral student takes several continuation courses with the associated costs 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. The number of continuation courses, which are common in doctoral programs, vary for each student, which is why GCU discloses the 60-credit cost estimate and provides information about average student experiences with continuation courses. This is not "false advertising" as the Department claims. GCU reiterates the need for continuation courses in six other areas prior to the start of classes. The net impression of these disclosures is the reason two objective third parties have made the exact opposite determination of GCU’s disclosures as that of the Department of Education.

One of those parties is 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. In that decision, the courts rejected the claim that GCU’s disclosures misrepresented the time or cost to complete a doctoral program. The other is our accrediting body, the Higher Learning Commission, which conducted a comprehensive review of the university in 2021. Specific to GCU’s doctoral program, the HLC stated that GCU’s doctoral disclosures are "robust and thorough, providing prospective students a clear picture of their academic and financial path toward a degree at GCU."

GCU offered to have another objective third party, the Federal Mediation and Conciliation Service, provide mediation on this matter, which the Department refused, citing the appeal process available to GCU. All of those appeal opportunities fall within the Department of Education, first with the Department’s Office of Hearings and Appeals, and then to the Department’s Secretary of Education.

Federal official's response, in full

The Department’s responsibility to enforce the law is not contingent upon receiving complaints from students. Nonetheless, Grand Canyon University’s (GCU) claim is untrue. The Department has heard from GCU students who reported being misled about the cost of their graduate programs. In general, the Department hears from students through several channels, not all of which are publicly available. These include Federal Student Aid’s Feedback System, investigative work, and contact centers; social media; the Federal Trade Commission’s non-public Consumer Sentinel Network; and evidence provided in the applications of students seeking loan discharge through borrower defense to repayment.