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Recruitment Ads For-Profit Colleges ‘Prohibit’ Federal Money

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04/21/2012 09:10 PM ET

Sen. Tom Harkin and Sn. Kay Hagan introduced a bill Wednesday to prohibit recruitment ads for-profit schools and colleges of all kinds from using dollars from federal money. The two senators say that for-profit colleagues are using too much taxpayer money to recruit students and funding for the advertisement campaigns should not be from student assistance programs.

Student financial aid makes up for 90 percent revenue for colleges that are for-profit. That’s astounding because it’s federal money that keeps a college afloat when they’re not even a non-profit organization. In fact, the revenue can be more in some cases if veterans attend the school on the GI bill.

The figures for these institutions can vary, but most spent 25 to 40 percent of their revenues on recruiting, which is far more than traditional colleges.

According to a recent report done by the Senate, based on 15 large for-profit colleges, 86 percent of their revenue from taxpayers are spent on marketing and recruiting. The total cost: $3.7 billion annually on marketing and recruiting.

Sen. Tom Harkin, D-Iowa, says the connection is clear: “Their marketing budgets are funded by taxpayers.”

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