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GCU, Goldwater Institute raise concerns of government transparency, overreach over federal fine

Late last year, the U.S. Department of Education fined Grand Canyon University nearly $40 million for allegedly defrauding students over the cost of its doctoral programs.

Now, the conservative think tank the Goldwater Institute is suing the U.S. Department of Education, claiming the federal government is targeting the private, Christian university.

But it’s not the first time the federal government has been at odds with GCU. The Show talked more about it with Helen Rummel, the Arizona Republic’s higher education reporter.

Full interview

HELEN RUMMEL: So last October, the Department of Education came forward and they presented this $37.7 million fine to Grand Canyon University because they said that there were far fewer students that were able to complete their doctoral program under the costs that were advertised. An investigator conducted by one of their departments found that only around 2% of students paid what was advertised, resulting in much higher costs and much higher students loans being taken out for those degrees. And so they felt that these students had lost a lot of money as a result and gave Grand Canyon University this fine which they have since disputed.

LAUREN GILGER: Right. Right. But now we have this other wrench kind of thrown into this, which is the Goldwater Institute now suing over this, and it's in a little bit of a sideways approach here. Tell us a little bit about what Goldwater is arguing.

RUMMEL: Yeah. So you're right. It's a very specific lawsuit. And it is over this fine because they feel that Grand Canyon University has been targeted. And so they say out of public interest, they would like more transparency over some of the emails being exchanged between different Department of Education officials over this investigation and what went into the investigation. So the complaint in this lawsuit is very specifically over freedom of Information Act laws. And their claim is that the Department of Education is in violation of those laws by not being very specific on when they will be able to provide these emails that the Goldwater Institute has asked for as of late last year.

So those documents, there are a lot of them, they asked for around 7,000 emails, and the Department of Education came back and said that the typical amount of time it takes for people to get a Freedom of Information Act request back is around eight months. And so, you know, some people may not be as familiar with that process, but when you file for public records, it can take some time for departments to make sure that those records are in keeping with different laws that determine what is and is not public. Sometimes things need to be redacted, depending on what they include.

And so the Department of Education came forward saying that it would take some time for them to get all of those documents back to the Goldwater Institute. And the Goldwater Institute has come back saying that they have not provided a concrete answer on when and how those documents will be returned to them within the 20 business day requirement. So it is a very specific complaint, but it does just touch on some of these overarching themes of government transparency that the Goldwater Institute is claiming that the department is not in full compliance with.

GILGER: Let's back up, Helen, a little bit and talk about the history of Grand Canyon University here a little bit, like we all know in Phoenix, this is a private, Christian university. It's grown a lot in recent years, but it has had a hard time in the past. And I think this is still ongoing now of trying to get nonprofit status, as most universities are. It's still a for-profit university in some sense. Tell us where that effort stands now.

RUMMEL: Yeah. So currently, it's kind of murky at the moment. So the Internal Revenue service had previously allowed Grand Canyon University to define themselves as a nonprofit just for their purposes. And the Department of Education actually has come back and does not view Grand Canyon University as such. They see them as a for-profit university for their purposes. And so there is this disagreement there. And as as of last month, the Ninth Circuit Court heard arguments from both sides to determine whether that will mean changes for Grand Canyon University, or it will remain the same. So there will be an update on that, but it is unclear on when that will come out.

GILGER: And I want to talk more about this claim that that GCU is being targeted. Like Goldwater in its press release on this, talked about how the fine against GCU, which is like more than $37 million, is 10 times bigger than the penalties that the Department of Ed has assessed against many other big universities in in maybe higher profile cases. They gave the example of Penn State and Michigan State for covering up the sexual crimes of Jerry Sandusky and and Larry Nassar. Are these comparable cases?

RUMMEL: So the Department of Education has stood fast in, in that fine. And like you said, it is a record-breaking fine, and that is why Grand Canyon University does feel like it's unfair. But the Department of Education has come back saying that there were thousands of students affected by this unexpected cost that they were taking on when they decided to pursue this degree, this doctoral degree. And so they feel that in this case, it is also a special circumstance that since so many students were affected, the fine is warranted in this case.

GILGER: So we talked about what the Goldwater Institute is arguing in this new lawsuit here. But tell us what is Grand Canyon University saying? I mean, they, as we mentioned, are disputing this. But what's their argument?

RUMMEL: So Grand Canyon University has claimed that they feel they have been targeted because they are a large private, Christian University. And they also feel that there has been government overreach. Their president, President Brian Mueller, has said multiple times that he feels that the government has gone too far in their investigations. And this is also not the only investigation that's taking place in Grand Canyon University. Currently, the Federal Trade Commission, is suing both Grand Canyon University and its president over very similar claims that the Department of Education had. And so that's still an ongoing situation between the federal government and the university.

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Lauren Gilger, host of KJZZ's The Show, is an award-winning journalist whose work has impacted communities large and small, exposing injustices and giving a voice to the voiceless and marginalized.