Law Schools, Student Loans

Charlotte Law's Access To Federal Student Loans May Be Reinstated By Department Of Education

A law school seemingly on the brink of closure received some very unexpected news...

By  
on

Late last week, my colleague David Lat ventured a guess that the next law school to close would be a member of the Infilaw System, with the Charlotte School of Law perhaps being the most likely candidate of them all.

Please note the UPDATES below.

From being placed on probation by the American Bar Association over its graduates’ repeated bar failures to coming perilously close to failing the Department of Education’s gainful employment test to posting the worst bar exam passage rates in the school’s history to having two deans quit (one right after the other) to being investigated by the state attorney general under civil consumer protection laws to being in danger of losing its license to operate, we’ve chronicled the school’s various hardships over the years, up to and including the Department of Education’s decision in late 2016 to strip the school of access to federal loan dollars. As free-flowing federal loan dollars are what keep the lights on at many a law school, a for-profit law school unable to secure these loans for its students is a law school that most likely won’t be able to keep its doors open for very long.

In an effort to prevent the school from closing, Charlotte Law hired the Podesta Group to lobby for it on “higher education issues” before the Senate, the House of Representatives, and the Department of Education, paying a $50,000 retainer for these services. It seems as if those efforts may have panned out to the school’s benefit, because on Friday afternoon, members of the administration received some incredibly unexpected welcome news regarding its student loan situation, and quickly relayed the update to its remaining students.

Here is part of the email sent to students on Friday by Interim Dean Paul Meggett and President Chidi Ogene (the full email is available on the next page):

We are very pleased to share that CSL has been notified by the U.S. Department of Education that it is prepared to reinstate the school’s ability to award Title IV funds, effective for the coming fall semester. The Department has specified certain conditions, with which the school must agree and comply in order to allow eligible CSL students enrolling for the fall semester to receive Federal Direct Loans. We are confident the school will be able to satisfy the conditions specified by the Department.

We wondered what conditions the Department of Education set forth in order for Charlotte Law to regain its eligibility for access to federal student loans. We contacted a spokeswoman for the school in search of an answer, but have not yet received a response. If and when we do, we will provide an update.

Sponsored

UPDATE (1:11 p.m.): Shortly after publication, we received this statement from a representative of Charlotte School of Law (parts of which are largely repetitive of what was included in the email sent to all students last week):

We are very pleased to share that Charlotte School of Law has been notified by the U.S. Department of Education that it is prepared to reinstate the school’s ability to award Title IV funds, effective for the coming fall semester. The Department has specified certain conditions, with which the school must agree to comply in order to allow eligible CSL students enrolling for the fall semester to receive Federal Direct Loans. The school has notified the Department of its willingness to abide by the necessary conditions, details of which are under discussion.

In response to the good news, Dean Meggett said: “We are excited at the prospect of being able to help our students complete their legal education. In the meantime, CSL continues to work closely with the American Bar Association and the UNC Board of Governors to resolve all remaining compliance-related matters.”

CSL’s fall classes are slated to begin on August 28, 2017.

UPDATE (08/01/17): Not so fast, Charlotte Law. According to a spokesperson from the Department of Education, “[d]iscussions are ongoing at this time. Until the discussions reach a successful conclusion, CSL will remain ineligible to participate in the Title IV programs.” In a letter dated July 27, 2017 (available in full on the next page), the Department of Education laid out all of the conditions the Charlotte School of Law comply with in order to become eligible to receive federal student loan funds, including a $6 million letter of credit with a December 31, 2018, expiration date that will cover costs for a teach-out plan, refunds for current and former students, and any fines under Title IV of the Higher Education Act. The Education Department’s letter also requires that Charlotte Law adhere to strict standards for the enrollment of new students.

In the meantime, while it’s wonderful that the law school’s few remaining students may be able to receive federal funding to complete their education, we’re not quite sure why they would want to remain with such a troubled institution. Yes, Charlotte Law took a chance on many of its students when the for-profit institution decided to admit them, but it’s a different story now that the administration is asking those same students to take a chance on the school, knowing full well about the parade of horribles (e.g., bar exam, debt, and joblessness woes) that could be waiting for them after graduation.

Sponsored

How many of Charlotte Law’s students will give the school the benefit of the doubt and stick around? Only time will tell, but we wonder how many of them that do will be disappointed about their decisions after they see how their classmates fared on the July 2017 bar exam.

(Flip the page to see the full letters regarding Charlotte Law’s federal loans.)

Earlier: Law School DENIED Access To Federal Student Loan Dollars
And The Next Law School To Close Down Will Be….

Staci ZaretskyStaci Zaretsky has been an editor at Above the Law since 2011. She’d love to hear from you, so please feel free to email her with any tips, questions, or comments. You can follow her on Twitter or connect with her on LinkedIn.

1 2Next »

Topics

, , , , , , , , , , , , ,