Florida Coastal School of Law flunks Department of Education's gainful-employment test

By Nancy Crist | Feb 21, 2017

JACKSONVILLE — A Florida law school has failed the U.S. Department of Education’s gainful-employment test, which measures debt-to-earnings ratios, according to a report released by the agency last month.

Florida Coastal School of Law in Jacksonville is at risk of being disqualified for federal student loans if it fails gainful employment standards again next year, the American Bar Association Journal reported in a Jan. 11 article. Infilaw System is the parent company of Florida Coastal and another school under DOE scrutiny, Charlotte School of Law, which was placed on probation last fall when the school made “substantial misrepresentations” to students regarding its ABA compliance, the article stated.

“The demand for law schools is down, and that’s put financial pressure on schools,” Kyle McEntee, executive director and co-founder of the nonprofit Law School Transparency, told the Florida Record. “Florida Coastal in particular has had to cut their admission standards to fill their classes. The school is setting up a lot of its graduates to fail … it’s graduating them with massive debt and little hope of finding a job.”

The gainful-employment regulations were finalized in October 2014 and went into effect on July 1, 2015. According to the DOE website, the purpose of the regulations is “…to protect Americans from poor career training programs by targeting those programs that leave students buried in debt with few opportunities to repay it.”

Under the regulations, the annual loan payments of a school’s typical graduate must not exceed 20 percent of their discretionary income or 8 percent of total income. Degree programs that exceed these levels may be barred from participating in taxpayer-funded student financial aid.

“When we were founded almost eight years ago, law schools were not required to disclose information about job outcomes,” McEntee said. “In fact, schools were misleading students with false and incomplete information.”

His organization led a successful public policy push to strengthen ABA requirements for accreditation.

“The net result is that there is a lot more information available about the kind of jobs that graduates get, which has put tremendous pressure on the schools because demand dropped (steeply),” McEntee said.

Law schools are powerful institutions and not long ago everyone used to assume the deans of these schools were unimpeachable, McEntee said.

“If a dean talks, everyone listens and assumes he is right. That’s no longer the case when it comes to defending the value of a legal education," he said. "Journalists are more skeptical.”

A recent story in the Florida Times-Union reported that approximately 85 percent of Florida Coastal students received loans or grants totaling $76 million in federal money as of spring 2012.

“We have been working hard to lower student debt load in order to meet debt-to-earnings ratio set by gainful employment,” Florida Coastal Dean Scott DeVito said in the Times-Union story.

“Florida Coastal may be working hard, but the question is, are they succeeding?” McEntee said. “There is zero evidence provided publicly that they are. Our organization would be happy to review the evidence and write about it in the various publications we partner with. If there is evidence, it needs to be published.”

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