JACKSONVILLE BEACH, Fla. — (Note: The video above was originally published with a previous report.)
The federal government has cut off student aid at Jacksonville’s Florida Coastal School of Law, saying that information in financial statements “raises substantial doubt about its ability to continue operations.”
The U.S. Education Department said Thursday it had rejected the school’s request to reinstate a contract for participation in federal student aid programs that expired March 31.
The agency said the law school hadn’t met standards for financial responsibility.
“Florida Coastal School of Law operated recklessly and irresponsibly, putting its students at financial risk rather than providing the opportunities they were seeking,” Richard Cordray, the department’s new chief of federal student aid, said in a news release about the decision.
The school has 10 days to appeal the agency’s decision, and college President Peter Goplerud said in emailed remarks that he was reviewing options and expects to talk more with agency officials.
“At this time, we are doing all we can to ensure our students receive the education they need to continue on their path to becoming attorneys. Today and tomorrow, our students are taking finals and our faculty and staff are focused on keeping the students on track.”
Goplerud said the college had sent the American Bar Association a “teach-out plan,” a plan providing for equitable treatment of students if the law school shuts down before they’ve completed their studies. The ABA requires a plan like that when the government limits or ends a school’s participation in federal student loan or grant programs.
Florida Coastal will have about 150 students after a graduation ceremony this weekend, a college spokeswoman said. About 6,000 students have graduated since 1999.
The Education Department framed its decision as delivering on a pledge by President Joe Biden to stop for-profit education programs from profiteering off students.
"Too often, we see for-profit schools that try to take advantage of students, misuse taxpayer dollars, and skirt the rules to participate in federal student aid programs,” Education Secretary Miguel Cardona said in remarks included in the release. “Today we want to be heard and understood by for-profit schools around the country: we will be vigilant in ensuring they meet their commitments to students, families, and taxpayers.”
The Department of Education said the college had the lowest possible score on a financial composite score and that a review done in connection with its accreditation concluded it was "failing to provide critical services that it advertises and failing to meet its obligations to correctly determine student eligibility for the federal student financial aid programs."
Florida Coastal has been owned by a for-profit firm, Infilaw, although the education department said that last month, “the private equity firm that had owned 98.6% of the institution relinquished its ownership. This move demonstrated its unwillingness to assume any potential liabilities related to noncompliance rather than using its resources to support the school’s continued participation in the federal student financial aid programs.”
The department said Florida Coastal has been hurt financially by decreased enrollment and debt its owners faced from the closure of two other law schools, Charlotte School of Law in Charlotte, N.C. and Arizona Summit Law School in Phoenix, Ariz.
Since last year, the school has also been fighting a lawsuit in state court by a former professor and a former dean, both of whom say the college unilaterally changed their employment contracts and underpaid them.
Click here to read more from the Florida Times-Union.