RI roadblock has Neumont U. chief eyeing Mass. as alternative

Ned Levine

By Ted Nesi

PROVIDENCE, R.I. (WPRI) – The head of Neumont University, the Utah-based for-profit school seeking a green light from lawmakers to open its second campus in Rhode Island, met with officials in Boston last week to review his options there amid uncertainty about whether the General Assembly will act.

“Rhode Island is our preferred home,” Ned Levine, Neumont’s president, told WPRI.com on Friday. “But we need a New England campus. There’s a market and there’s demand among employers in the Northeast, and therefore that’s attractive to students.”

Rhode Island is the only state in the nation that requires for-profit colleges to pass a special law authorizing them to operate, after which the school would need to win approval from the R.I. Board of Governors for Higher Education. No special law is needed in Massachusetts, where Neumont’s application would go directly to the Mass. Board of Higher Education.

“We have to be in the Northeast,” Levine said. “We hope it’s Rhode Island, but it will be some place.” The college would lease space rather than build if it wins approval, he said.

Neumont needs Rhode Island lawmakers to make a decision by April at the latest in order for the school to move forward with its plan to enroll 80 students at a Providence campus by the fall of 2013, said Levine, a former Rhode Island School of Design trustee and Johnson & Wales University executive. Neumont would also move its headquarters here.

Neumont offers a technology curriculum to college-age students, who can get a bachelor’s degree from the school in two and a half years for about $83,000 when all costs are included. Its proposal is strongly opposed by the Association of Independent Colleges and Universities of Rhode Island, which has pointed to mismanagement in other parts of the for-profit education sector and argued Neumont isn’t needed.

“The acceptance of for-profit higher education is not an economic development or work force policy issue as its proponents have attempted to frame it as, but rather a higher education policy issue as to the state’s direction in delivering quality higher education,” Daniel Egan, the association’s president, told WPRI.com.

“Undoing the current higher education policy will have long-term ramifications for students and their families seeking quality higher education in our state if we do not heed recent warnings and learn from past experiences,” he said.

To counter that opposition, Levine cited letters supporting Neumont’s argument that it’s needed in Rhode Island from some of the state’s best-known tech executives, including Donald Stanford of GTECH; Stephen Lane of Ximedica; Jeanne Lieb of FM Global; Jim Donovan of EMC Corp.; Anne S. De Groot of EpiVax; and Charlie Kroll of Andera.

“I can report first-hand that the shortage is real,” wrote Kroll, a Brown University graduate whose firm is often cited as a local success story. “Andera currently employs seven overseas programmers due to our challenges recruiting here. Additionally, we recently acquired a company based in San Francisco in part to tap into the more robust recruiting market there.”

Neumont is looking to expand to the East Coast because Utah is too far for many potential students, Levine said. Providence is an attractive location because of its large supply of vacant office space, relatively low cost-of-living for the region and its pool of potential adjunct faculty, he said. He argued the support form Kroll and other local industry leaders shows there is an unmet need for targeted IT training locally.

“There’s no ambiguity about what we do,” Levine said. “It’s learning for outcome. What’s the outcome? The outcome is to launch a cool career. Our guys come from high school, spend two and a half years [learning] and are employed at graduation earning $63,000 a year average. It is documented. It’s on those offer letters. We measure it. We audit it.”

“The promise is unambiguous and very focused, and we have organized ourselves to deliver on that promise,” he said. “We have an advantage. It’s strategic. We’ve made a commitment to do one thing. It is to provide an educational program that allows the student to learn the hard and soft skills that will make them very effective immediately in a software development environment.”

Levine strongly disputed comparions of Neumont with the ill-fated Katharine Gibbs School, which left students high and dry when it closed up shop before they’d completed their degrees. Neumont educates students fresh out of high school and 68% of those who enroll get a four-year degree, while Gibbs educated adults trying to change careers, he said. Most graduate with about $50,000 in debt, he said.

Levine noted that Neumont will pay taxes as a for-profit organization, unlike other Providence schools such as Brown and Johnson & Wales – alluding to a major concern of the Taveras administration. And he described his university as being part of a wave of change in higher education amid soaring costs and unemployed liberal-arts graduates.

“We are a new delivery model in a traditional kind of package,” Levine said.

(photo: Neumont University)

16 thoughts on “RI roadblock has Neumont U. chief eyeing Mass. as alternative

  1. Sometimes roadblocks are important, they keep drivers from driving into hazards.

    The so-called for for-profit college industry is rife with problems and Rhode Island would do well to avoid this type of hucksterism. See, of course these CEO’s love the model – they have figured out a way to outsource their entire IT training program and get the taxpayers to subsidize it! After all, why should the company pay for training people when you can hire send hire students from Neumont that have gone to school paid for with student loans backed by the US tax payers? Then, in five years when the training becomes obsolete – fire this cohort of federally paid for students and get a new crop. Its the perfect corporate welfare model of industry.

    No wonder why a Government Accountability Office Report was titled :Undercover Testing Finds Colleges Encouraged Fraud and Engaged in Deceptive and Questionable Marketing Practices
    GAO-10-948T, Aug 4, 2010?

    Rhode Island is better than what Neumont is selling….

  2. Pat,

    There is another side to this. The current crop of so called college educated students are in many cases standing behind the counter at Starbucks, or in bread lines.

    The problem is that mainstream colleges and universities have failed these iPod junkies at how to actually function in the harsh world of global competition. I don’t like it any more than you do, but it is the current reality.

    In the past, competition for a job was limited to the iPod junkie next door. Now it is a hungry Hungarian 7000 miles away who will work twice as hard for less pay.

    Universities are still stuck teaching in the “neighbor next door” model.

    I say we need to question the role of mainstream education left only to elite tenured do nothings who couldn’t function in the real world for less than a week.

    Bring on Neumont!

    • Am reminded of the Harvard Business School article on why Fortune 500 companies tended to survive no longer than two generations. Essentially, the entrenched managers became more focused on defending their brand to competition while the world moved beyond them. The famous analogy of the frog came from this article. A frog who is left comfortablly in a pot of water as the heat is gently increased goes to sleep and perishes. A frog who jumps into a boiling pot knows enough to get out.

      We can cite many examples of this but perhaps the most elevant is the PC, a game changer coming from an unkown kid named Gates. Can you say Digital, Wang?

      One man’s opinion, it is not likely that change of any merit will come out of government or established bastions of education where trillions of dollars are at stake, this is especially so here in RI.

      The turf battle faced by Neumont is real, and it is grim. jharker

      • John,

        Love the frog story.

        To anyone who thinks the US does not need to adapt to the new global economic realities, they might want to read Jared Diamond’s book “Collapse: How Societies Choose to Fail or Succeed”.

  3. “Rhode Island is better than what Neumont is selling….” Really?

    The problem is that Rhode Island lacks visionary leadership and recognition that the marketplace can sort these types of issues out. Students need to understand that they are consumers of education. Instead of driving the bus, too many are encouraged to fall into a ride-along mentality, then end up in the wrong destination.

  4. Let them come in but they should NOT be allowed to take in ANY PELL GRATNS, FED LOANS, or any sort of Title IV funding or even GI BILL Money.

    For-profit colleges shouldn’t be allowed to syphon off Federal Funding.

    Just look at the damage that CEC, EDMC, and others did.

    Students can’t pay back the debts created with the jobs they end up in and the executives get the money while lowballing instructors.

  5. Paying taxes? How generous, they are a for-profit – they should pay taxes.

    How does a Neumont lease on space for 80 students result in a cash windfall for Providence? Any property they will rent is already paying taxes. Given Neumont’s size, Brown and JWU are individually paying already much more in taxes on property not used for educational purposes than Neumont will ever pay indirectly via a lease.

    Not to mention the $2 million annual cash payment by the four colleges and universities represents more than 10 times Neumont anticipated tax payment by way of a lease.

    • Dan

      I’m sure you are aware of the basic macro economic principle that one new dollar introduced into an economy creates an overall 10 fold effect across the overall economy.

      Any “new dollars” created in any way by Neumont U is money that would not be in RI if there was no facility.

      I was responsible for staffing computer facilities in the last part of my career. I can assure you that there are few graduates from traditional educational sources that can hit the ground running in corporate America. There is an entire industry set up to provide specialized training to so called “graduates” in IT.

      If Neumont is filling part of this niche, then that is all “new dollars” into the RI economy.

      That is in part what business friendly is all about.

  6. Graduates with computer science degrees are in demand everywhere. Assuming that these graduates will stay in Rhode Island when wages are significantly higher in our neighboring states seems unrealistic. It would be great to hear from the businesses in Rhode Island who have actually hired Neumont graduates instead of just speculating on whether this school is a good decision for the state.

  7. Here we have the nay-sayers doing their best to make Neumont out to be a diploma mill. Interesting, given that these students are required to attend classes full time with no summers off, on their way to a degree that puts them into a job that pays twice what the average college degree pays! And that remark “well they should pay taxes!” is just how many feel about Brown, JWU, RISD and other “traditional” institutions of higher learning and maybe they should. I can appreciate how a new model like Neumont creates concerns within the parochial establishment as it has found an innovative educational track where they are underperforming and circling the wagons is a natural reaction. Nobody with outdated operating models likes competition, even educators; but competition in all aspects of our economy is the new global reality. We need to look to new models of traditional service delivery not just in education but in all aspects of our economic culture. Now, if only our state government would come to understand that a make over of the status quo in delivery of state services is also long past due but that is for another day. Today, the state political leadership needs to step up and not just “allow” Neumont to build here but they need to actively recruit them as Massachusetts is doing. Talk of building a high tech economy requires more than talk and here is a chance to lay an important stone in the foundation of our state’s future economy.

    • The emphasis was made to reintroduce the fact that the four independent colleges and universities DO in fact pay taxes, as they should as well.

      I find it hard to believe they are being actively recruited by Massachusetts after more than three-years of fact finding and choosing RI. In fact, Neumont University would most likely not pass the standards set for a “university” status in Massachusetts as proposed.

    • Neumont’s last failed expansion was in Virginia, where they set up shop in a mall next to Old Navy http://bit.ly/xVGKMq. While that is an innovative, new model, it’s probably not one we need in Rhode Island.

  8. RI and its cities can continue to be content with being a victim of economic evolution or it can become a participant in that evolution. Our state and its leaders need to take comprehensive steps to create a true culture of opportunity for businesses and its citizens. This requires bold thinking and bold, imaginative leadership by our political community. Embracing cut backs and pension reform as a growth industry is not a long term comprehensive strategy for the future of RI and its citizens’ prosperity.

    Prosperity means jobs; and employment increasingly means education and skills. Neumont stands ready and willing to provide the choice of specific training to students inclined to a technical education, providing them with a skill set to compete.

    I am inclined to believe that Nuemont sees great opportunity in the Northeast and will find a regional location to expand. The choice, to host it here or be content to observe it from over the border, now depends on our legislator’s vision of the future.

  9. This is not about Neumont being recruited by Massachusetts. Massachusetts higher ed regulations do not even allow a university to be licensed without 4 graduate degree programs(610 CMR 2.04 Degree Granting Regulations). Neumont does not have any graduate programs. This is all about Neumont’s venture capital owners looking for the easiest path to set up a degree granting facility in the Northeast. Ironically, because RI presently does not allow for-profit colleges there are no regulations in place for for-profits. Passage by the General Assembly forces the RI Board of Governors to create a new path to accreditation. One could easily make the argument RI is the easiest state to set up a for-profit because of a lack of regulatory controls The only time the RIBOGHE was forced to do this by the General Assembly (Katie Gibbs) it was a miserable failure. We can wax philosophic all day about the merits of for-profit versus non-profit education, but until we put legitimate regulations in place to oversee the development of for-profit colleges, we do a grave disservice to higher education in RI.

    • Gus

      My experience is with professional certification programs as offered from companies like Cisco, IBM, Lucent, where training programs leading to professional certification was the end goal for employees. These certification programs are some of the toughest in the IT industry.

      What private industry appears to have figured out (that the education regime has not) is how to segment material that is best delivered in a computerized, self paced media, and material that must be delivered by a warm body standing before a class.

      What the traditionalist’s want is that all material is best delivered by a warm body. It’s that obstacle that I think many on the receiving end distrust.

      You are correct, some oversight is needed. But at the same time, how much progress in productivity are we losing because of outdated thinking. Somewhere in the middle there is an answer.

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