Fast-track bills would aid Minnesota students hurt by Argosy closure

Minnesota lawmakers are proceeding quickly on emergency legislation to help students affected by the sudden closure of Argosy University.

Twin bills in the House and Senate moved ahead Wednesday and should be voted on before the Legislature's session ends. Around 1,000 students were left in the lurch by the shuttering of the corporate-owned school's Eagan campus in March.

The stand-alone legislation would permit recipients of state grants to access those awards directly and offer them loan safeguards. Argosy had already been paid some of the money on behalf of the enrolled students, so a state agency would be permitted to work with lenders to protect the debt holder.

Sen. Paul Anderson, R-Plymouth, said students would be relieved of liability for loans for courses they couldn't complete because of the closure.

"The objective here is to help the students who were not the responsible party here. Argosy received these funds, shut their doors, took the money," Anderson said. "Students were left literally holding the bill."

Minnesota Office of Higher Education Commissioner Dennis Olson Jr. told a House committee that the bill's scope is limited.

"This is a one-off to provide immediate relief to those students specific to Argosy University, but we do know that if this happens in the future we want additional student protections," Olson said.

The bill requires Olson's agency to suggest legislation to prevent future school closures and ways to assist students.

Some Minnesota public colleges have stepped in to help Argosy students keep working toward degrees.

Rep. Jim Davnie, DFL-Minneapolis, said lawmakers should consider enacting a law to compel for-profit colleges tell the state what would happen to students in the event of closure. He compared it to what large companies must do before a big layoff.

"If a company is going to do a mass layoff there is an orderly and a lengthy timeline so that those workers can come to the state and apply for retraining and educational support and that sort of thing," Davnie said.

"I wonder if that shouldn't be a requirement similarly on for-profit colleges that they give the students a heads-up, 'Hey we're approaching the financial shoals and before you sign up for another semester, maybe you should know that,'" he added.

In a Senate hearing, Sen. Scott Newman urged the bill's sponsors not to let the school's holding company off the hook as Argosy or its parent company heads into possible bankruptcy proceedings.

"If we are going to absorb these losses, then we should require the commissioner to explore and pursue any legal remedies that the state has," Newman, R-Hutchinson, said.

Betsy Talbot, the manager of institutional licensing and registration at the Minnesota Office of Higher Education, assured lawmakers that the state is attempting to recoup money.

"Yes, we are doing everything we can to make the taxpayer whole," she told a House committee, saying Minnesota has been involved in receivership actions. She warned that once the case enters federal bankruptcy "we have a lot less control over how money is used and spent."

Another Senate committee hearing on the bill is set for Thursday. The House bill has two more committees to clear before a floor vote.