CARMEL, Ind. (WTHR) - ITT Technical institute announced Tuesday that it is shutting down, citing the decision by the Department of Education to discontinue federal student aid to the school.
An e-mail to students shared with Eyewitness News said, in part, "We proposed alternatives to the Department of Education, but they were rejected. Therefore, after evaluating the impact of these new requirements on our institutions, we have made the very difficult decision to discontinue our operations effective immediately at the end of the June 2016 quarter and to cancel the upcoming September quarter that was scheduled to begin Monday, September 12."
ITT has more than 130 campuses across the nation, with six in Indiana. Nearly 2,000 Hoosiers go to those schools. Students arriving on campus Tuesday were met with locked doors. ITT's headquarters in Carmel was closed as well.
Several students showed up to find answers on what happens next after ITT Tech announced it was shutting down. The closure comes just days after the U.S. Department of Education banned ITT from enrolling students who use federal financial aid.
The shutdown affects about 40,000 students in 38 states. Around 8,000 employees are losing their jobs.
Among those left in the lurch are nursing students who were just 12 weeks away from their degree.
"I need to know where can I finish school at? Are they going to take our credits because basically all our financial aid and all our money went to ITT. So now we don't have financial aid to transfer to another school. Basically we just need to know what we need to do so we can finish our education," said DeShanta Livers, ITT student.
"I could not envision a way in which ITT could remain open," said Indiana Commissioner for Higher Education Teresa Lubbers. "They weren't allowed to enroll anymore students. It's disturbing, it's concerning, but I was not surprised with today's announcement."
Lubbers says they have been monitoring the situation with ITT Tech and they will be looking to see if other similar programs can pick up ITT students and allow them to earn their degrees without starting over from scratch.
"So I hope there won't be students who are two or three years into a degree who lose everything. Hopefully we'll find some partners who can look at their credits and find some validity to the credits they've received and accept those. But I can't say any of that with certainty today," she said.
There are some encouraging signs. Late Tuesday, the Indiana Commission for Higher Education told Eyewitness News that it has heard from both Indiana Wesleyan University and WGU Indiana. They have expressed their willingness to help ITT Tech students continue their educations. Indiana Wesleyan specifically has a transfer agreement going back 20 years.
As for ITT Tech, it put out a statement at the beginning of the day saying it profoundly regrets the shutdown, which it says was forced on them by the Department of Education.
This is the complete email sent to enrolled students from ITT Tech:
"On August 25, the U.S. Department of Education imposed a series of new requirements and conditions on the ITT Technical Institutes, including imposing conditions on our institutions’ continued participation in the federal student financial aid programs that the Department of Education administers. We proposed alternatives to the Department of Education, but they were rejected. Therefore, after evaluating the impact of these new requirements on our institutions, we have made the very difficult decision to discontinue our operations effective immediately at the end of the June 2016 quarter and to cancel the upcoming September quarter that was scheduled to begin Monday, September 12.
At this time, we expect that all students will be able to complete their June 2016 academic quarter. Students attending the ITT Tech campus in Baton Rouge should plan to attend any scheduled classes this week necessary to complete the current academic quarter.
Please know we worked diligently to identify alternatives that would have allowed you to start or continue your education at ITT Tech, and earn your degree. But the Department of Education’s actions have forced us to cease operations at the ITT Technical Institutes. We are truly sorry to have to make this decision, but wanted to communicate it to you as soon as possible so that you can begin deciding the next steps to take that are best for you.
Background
The Department of Education’s August 25 letter imposed a combination of requirements on ITT Educational Services, Inc. (ITT) that we believe are unprecedented in the history of the Department of Education. They required us to post a letter of credit or other cash deposit with the Department of Education of nearly $250 million, they imposed a freeze on our receipt of Pell Grants and student loans for all our students, and they prohibited us from enrolling any new students who needed any federal grants or loans to finance their education. We proposed alternatives to the Department, including giving us time to sell our schools to another company that would continue your education or conducting an orderly closure of our schools over the course of the September term. Days ago, the Department of Education told us they were rejecting our proposals, and standing by their new requirements.
The Department of Education has told us that the most recent event that caused the Department to place these additional restrictions on ITT was the action by our schools’ accrediting agency, the Accrediting Council for Independent Colleges and Schools (ACICS), to continue the “show cause” directive that ACICS had issued to ITT earlier this year, identifying areas of the ACICS accreditation standards that our schools were not fully in compliance with. ITT has been in extended discussions with ACICS about those issues, and ACICS recently told us that they were satisfied by our responses to some of those issues but that more remained to be done concerning other issues.
The Department of Education has instructed us to inform all students about these ACICS actions and to tell you that the ACICS accreditation standards concerning a “show cause” order state that the “Council determines that [the] institution is not in compliance with the Accreditation Criteria, and is unlikely to become in compliance.” ITT respectfully disagrees with these conclusions and has been working with ACICS to confirm that our ITT Technical Institutes remain worthy of continued accreditation.
ACICS recently informed ITT that we should submit additional information on the open issues and appear before ACICS at its next regular meeting in December to further discuss the schools’ ongoing accreditation. Despite the fact that our schools’ accreditation remains in place and ACICS has not made any final decision about our schools’ ongoing accreditation status, the Department’s actions, as described, above have made it impossible for the ITT Technical Institutes to continue to operate. Otherwise, ITT has been financially sound, had no intention of closing down, and has been responsive to all of the requests of the various regulatory agencies that oversee our schools."