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Unbundling For-Profit Higher Education: Relaxing the 90/10 Revenue Constraint

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  • Zachary G. Davis

    (Alex G. McKenna School of Business, Economics, and Government, Saint Vincent College)

Abstract

In 2008, congress passed the Higher Education Opportunity Act. This act relaxed the 90/10 rule requiring for-profit institutions to earn at least 10 percent of their revenue from non-Title IV funds by revoking eligibility after 2 years of non-compliance instead of 1 year. To comply with the 90/10 rule, for-profit institutions bundle campuses together. Unbundling the campuses doubles the number of 1-year violations though the number of 2-year violations remains the same. For-profit institutions receive almost one billion dollars, or about 4.5 percent, more federal aid under the 2-year violation rule than the 1-year violation rule.

Suggested Citation

  • Zachary G. Davis, 2023. "Unbundling For-Profit Higher Education: Relaxing the 90/10 Revenue Constraint," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 49(2), pages 176-200, April.
    • Handle: RePEc:pal:easeco:v:49:y:2023:i:2:d:10.1057_s41302-023-00236-3
    DOI: 10.1057/s41302-023-00236-3
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    References listed on IDEAS

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