Government & Politics

Campaign donations, lobbyists tie Sen. Roy Blunt to for-profit college industry

Campaign donations from for-profit colleges and personal connections with lobbyists tie Sen. Roy Blunt of Missouri (left) to an industry under attack for its business practices.
Campaign donations from for-profit colleges and personal connections with lobbyists tie Sen. Roy Blunt of Missouri (left) to an industry under attack for its business practices. The Associated Press

For the past two years, Sen. Roy Blunt has been a powerful ally to the nation’s beleaguered for-profit colleges as they fight government regulation.

At the same time, the industry and its lobbyists have funneled at least $100,000 in campaign donations to the Missouri Republican.

That total is a fraction of the $14.6 million Blunt has raised overall in his re-election effort.

But the money from for-profit colleges — and Blunt’s personal connections with lobbyists — closely tie the former college president from Springfield to an industry under attack for its business practices and, some say, for ripping off students.

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His influence may prove critical for the profit-driven schools during an especially tough era:

▪ More than two dozen companies that operate for-profit colleges have come under investigation by federal agencies and state attorneys general on suspicion of fraud and other illegal activity.

▪ Their businesses rely heavily on U.S. taxpayers for revenue, from both federal student aid programs and veterans’ GI Bill benefits.

▪ Blunt is the second-highest recipient in the Senate of donations in the 2016 election from individuals who work for for-profit education companies and their political action committees, with a total of $28,800. He’s gotten at least $73,550 more from lobbyists hired by for-profits, and an unknown amount from fundraisers those lobbyists threw for him, according to an analysis of public records by McClatchy.

▪ At least four times, Blunt’s campaign cashed checks from lobbyists within days of the senator taking action in the Senate that would have helped their for-profit client, Bridgepoint Education. The company recently agreed to forgive $24 million in private student loan debt after allegedly misleading students about repayment costs.

Blunt is battling Democratic challenger Jason Kander to keep his Senate seat. He declined an interview for this article. His deputy campaign manager, Burson Snyder, said in an email that the senator sees the federal crackdown on for-profits as an example of the Obama administration’s regulatory overreach.

Snyder said the senator knows firsthand how problematic federal government interference in higher education can be.

Blunt was the first in his family to go to college. Before his election to Congress in 1996, he taught high school history and served as president of his own alma mater, Southwest Baptist University, a nonprofit private school in Bolivar, Mo.

“He understands that higher education has been successful in this country in large part because the federal government stayed out of the way,” Snyder said. The senator, she said, “believes that any changes in policy should be thoroughly vetted and debated by the Congress, not enacted by regulatory fiat.”

Like Blunt, Kyle Hemming wanted to be the first in his family to graduate from college.

But Hemming, 29, says the college he attended in Kansas City was a scam. ITT Technical Institute left him with more than $100,000 of debt and few job prospects.

ITT declared bankruptcy in September and shut down its campus in Kansas City along with more than 130 other locations across the country. It was the latest setback for the for-profit education industry, which faces plummeting enrollments amid widespread allegations of fraud.

The industry and its investors blame their woes on tighter regulations imposed by the Obama administration. Institutions such as ITT have poured millions of dollars into lobbying to weaken those regulations.

ITT alone paid $290,000 over the past two years to lobbying firm Thompson Coburn. Thompson Coburn donated $14,000 to Blunt’s campaign and leadership PAC from 2015 to 2016, public records show.

Hemming considers such donations as “nothing but legalized bribery.” He’s willing, however, to give Blunt the benefit of the doubt.

The Republican senator might be looking at for-profits “through rose-tinted glasses,” Hemming said.

“Being the first person in your family (to graduate from college) is a wonderful thing,” Hemming said, “but that’s not what schools like ITT Tech are doing, and either he doesn’t see it or he chooses not to see it.”

The only senator who has gotten more money from for-profits than Blunt is John McCain of Arizona, whose state is home to the nation’s largest for-profit college, University of Phoenix.

A third of the nearly $30,000 in donations Blunt received from for-profits came from the Washington-based trade association that represents the industry, Career Education Colleges and Universities, records show.

The group’s political action committee donated $10,000 to Blunt this election cycle, “more than any other federal candidate, according to the Center for Responsive Politics, a nonpartisan campaign watchdog group.

“We remember our friends,” said Steve Gunderson, the trade association’s president.

“When it’s incumbents running for re-election we support them based on their record,” Gunderson said. “Here you have, with Sen. Blunt, a senator who has a long record both in the House and the Senate of supporting our sector and supporting equal rules for all schools.”

Half a dozen lobbyists working on behalf of the for-profit industry — including former staffers of Blunt — have hosted fundraisers for him in Washington.

They’ve also donated thousands of dollars to Blunt directly, sometimes within days of him filing or co-sponsoring legislation that would roll back regulations on the for-profit industry.

“This is an industry that is in crisis because the Obama administration has been really cracking down on some of the abuses, and now Congress represents their best hope for easing some of those restrictions,” said Viveca Novak, spokeswoman for Center for Responsive Politics.

At the very least, the companies and their lobbyists likely are getting excellent access to Blunt’s office, Novak said. “Their voices are being heard.”

All of this, she pointed out, is perfectly legal.

“But it’s the kind of practice that frustrates the public when they’re looking at what goes on in Washington,” she added.

In January 2015, Blunt took the helm of a Senate subcommittee responsible for funding federal student aid programs. The post gave him considerable power over for-profit colleges’ main source of income: taxpayer-funded federal financial aid grants and subsidized student loans.

“He’s on the committee that controls essentially their primary source of funding,” said Kevin Kinser, head of the education policy studies department at Pennsylvania State University.

It’s not surprising that for-profit colleges might try to get cozy with politicians sitting on key committees that dole out those funds, Kinser said. “Their viability as a business requires them to continue to have access to this money.”

But for-profits’ dependence on federal aid dollars is costing taxpayers. Students attending for-profit colleges have run up massive federal student loan debt in the tens of billions of dollars, according to Department of Education data.

Eight of the top 10 contributors to federal student loan debt are for-profit colleges. Together those for-profits accounted for more than $86 billion in taxpayer-backed debt as of 2014, the data shows.

And though only about 9 percent of higher education students in the United States attend for-profit institutions, they account for 35 percent of student loan defaults.

The for-profit company with the closest connection to Blunt is Bridgepoint Education. Bridgepoint operates Ashford University, an online college that enrolls about 6,000 veterans among its 75,000 students.

Among the top-flight lobbying firms Bridgepoint hired in recent years are CGCN and Fierce Government Relations, both of which employ lobbyists who know Blunt. In four cases, they made donations within days of Blunt taking action on legislation that would help their clients.

One of those lobbyists, Sam Geduldig, is a partner for CGCN. He spent four years working as a senior adviser to Blunt when the lawmaker was House majority whip. Geduldig’s bio on his lobbying firm’s website notes the connection to Blunt and boasts that he knows how to “kill legislative threats to his clients.”

He maxed out his individual donations to the senator’s campaign committee with a $5,400 contribution on March 11, 2015, one day after Blunt signed on to co-sponsor a bill that would weaken regulations on the for-profit education industry.

Kirsten Chadwick, a lobbyist with Fierce Government Relations, worked closely with Blunt as a lobbyist in the House, helping him count votes and rally support for trade legislation, according to The Hill newspaper.

She donated $2,700 to Blunt’s campaign on June 29, 2015, four days after he reported out of the Appropriations Committee an education funding bill he’d written. That bill would have blocked a requirement that for-profits prepare students for well-paying jobs.

Neither CGCN nor Fierce Government Relations responded to requests for comment.

Snyder, from Blunt’s campaign, noted in an email that Geduldig and Chadwick have long histories of supporting the senator, and she attached a spreadsheet showing records of their contributions dating to 2004.

“This should help put their support this cycle in context,” she said.

Blunt did not respond to written questions from McClatchy about the timing of the lobbyists’ donations. He also didn’t answer whether he was aware that Bridgepoint Education has come under investigation by four federal agencies and attorneys general in multiple states.

Thousands of veterans who attend Bridgepoint colleges could lose access to their GI Bill benefits because of the company’s legal woes.

Amid Bridgepoint’s troubles, the company has continued its lobbying and campaign spending. Bridgepoint Education employees and its PAC have given the most money to politicians of any for-profit education company — more than $312,000 this cycle, according to the Center for Responsive Politics.

Bridgepoint’s PAC donated $5,000 to Blunt.

A spokeswoman for Bridgepoint did not respond to phone calls or emails requesting comment.

Gunderson, the for-profit trade association president, said the industry had been unfairly targeted by the Obama administration and Democratic attorneys general.

“There’s no question we are a political football in the current environment,” Gunderson said. “Other sectors in the higher education environment can do the same things we do and get away with it. If you sense we are a little defensive about the inequity of treatment, you’re right.”

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