Wednesday, November 27, 2019

U.S. Dept. of Educ. Finds Newly Nonprofit Grand Canyon University Is Not a Nonprofit

Download (2)In a significant set back for a former for-profit university, the U.S. Department of Education has decided that Grand Canyon University is not a nonprofit for the purposes of Title IV funding even though it has been recognized by the IRS as tax-exempt under Internal Revenue Code section 501(c)(3). The University had also (eventually) secured approval from its accreditor for the terms of its conversion from for-profit to nonprofit status, even given a continuing and extensive financial relationship with a for-profit company. The Department of Education found that relationship to be particularly troubling, concluding that the primary purpose of the relationship "was to drive shareholder value" for the for-profit "with GCU as its captive client - potentially in perpetuity." The University has responded with a detailed statement and a lengthy letter, signaling it plans to aggressively fight this adverse decision.

Coverage: Education Dive; Inside Higher Ed.

Lloyd Mayer

https://lawprofessors.typepad.com/nonprofit/2019/11/us-dept-of-educ-finds-newly-nonprofit-grand-canyon-university-is-not-a-nonprofit.html

Federal – Executive, In the News | Permalink

Comments

Post a comment