FIU turns to partnership firm for international online degrees

With its state funding shrinking — and online college classes rising in popularity — Florida International University is banking on students from abroad to boost its finances and expand its academic reach.

In that endeavor, the college is turning to Academic Partnerships, an experienced, successful (and politically connected) player in the fast-growing Internet education industry.

FIU first teamed up with the Dallas-based company in 2009 — creating an online-only Corporate MBA program in which tuition revenue is split between the two parties. Now, FIU is poised to ink another deal: Known as “FIU Global,” the proposed new contract would create an online jointly operated degree program targeting students in Latin America and, eventually, maybe China.

The university’s international reputation could rise or fall based upon the program’s success, and if it’s a significant moneymaker for FIU, it will help shore up a school budget that has been battered by years of state funding cuts.

But the involvement of Academic Partnerships is drawing scrutiny. The company’s close ties to former Gov. Jeb Bush have raised questions of political influence, and FIU signed its first contract in 2009 without notifying faculty.

“I’m very concerned with FIU Global and our relationship with Academic Partnerships,” history Associate Professor Brian Peterson told FIU President Mark Rosenberg at a recent faculty meeting. “It seems like political pressure is being put on FIU to do this thing.”

Tuition revenues

Since 2009, FIU has made more than $18 million in tuition revenues from the Corporate MBA program — in which tuition costs $37,500. Academic Partnerships collected close to $20 million, initially taking about 70 percent of tuition revenues, though FIU later renegotiated that to about 45 percent. All state universities are allowed to charge higher “market rate” tuition for some graduate degree programs, with the goal of reinvesting the extra money into the university’s budget.

The FIU Global contract is in preliminary discussions, school leaders say. The questions of what degrees it will include (and how the tuition dollars will be split) have not been negotiated.

Some faculty are asking why FIU handpicked Academic Partnerships for both contracts, as opposed to using a competitive process.

Academic Partnerships’ founder and chairman is Randy Best, a close friend of Bush’s. Bush serves on the advisory board for another of Best’s companies, Whitney University System, and in 2011, the former governor co-hosted a “Future of State Universities” conference that was sponsored by Academic Partnerships.

‘Great opportunity’

On the company website, Bush and Best appear jointly in a promotional video in which Bush speaks of the “exponential growth” of demand for online degrees, particularly abroad.

“This is a time of incredible change,” Bush says. “Great opportunity, but also great peril for universities that don’t want to change.”

Bush and Best declined to comment for this report.

Rosenberg insists the contracts are not political. For the first contract, FIU leaders said they did informally consider at least one competitor, and they argue that Academic Partnerships has done a good job with the MBA program and deserves additional work. FIU administrators say they aren’t obligated to use a competitive process, and the state does indeed exempt various education-related purchases from that requirement.

“This isn’t about Jeb Bush or Randy Best,” said Rosenberg, who was selected by FIU trustees (several of them Bush appointees) as FIU’s fifth president in mid-2009. “This is about finding a way for us to build relationships that can work.”

Since leaving the Governor’s Mansion in 2007, Bush has continued the educational focus that was a hallmark of his time in office. Bush’s Foundation for Excellence in Education has raised millions of dollars to promote his educational philosophy across the nation, with an emphasis on items such as school-choice vouchers and online learning.

Much of that money has come from corporations that stand to profit from the legislative agenda Bush is pushing. More than 30 states have adopted at least part of his educational platform.

It was Bush who connected former FIU President Modesto “Mitch” Maidique to Academic Partnerships, said FIU provost Douglas Wartzok.

“Jeb Bush talked to President Maidique before the first contract ... an introductory sort of thing.” Wartzok said, adding Bush had suggested Maidique arrange a meeting with Best.

Still, the provost stressed, “There’s been no influence and no pressure and no interference or anything like that.”

Since then, Academic Partnerships has steadily expanded, and now holds contracts with 40 state universities around the country, including the University of West Florida. UWF signed a master’s degree in education partnership in 2011.

The first contract

FIU first signed on with Academic Partnerships in February 2009, when the company was operating under the name Higher Ed Holdings. The firm had engineered dramatic online enrollment growth through its first partnership at Lamar University in Texas, and was taking its sales pitch across the United States.

One Arkansas State University professor called the company’s arrival a “scam,” and resigned from an academic committee in protest. But just like at FIU, Arkansas State signed its contract so quickly that faculty had no real chance to stop it.

At the University of Toledo, professors raised concerns about academic quality, the sharing of tuition revenues, and Best’s educational track record.

Best, a major fundraiser for former President George W. Bush, had years earlier created a tutoring program called Voyager Expanded Learning. The company received millions in federal reading-education money under Bush’s No Child Left Behind law, but the U.S. Department of Education’s inspector general later found evidence of favoritism and conflicts of interest. A federal review of Voyager’s teaching methods, meanwhile, found them to have “potentially negative effects” on students’ reading comprehension.

Toledo’s united faculty opposition persuaded administrators to abandon the proposed partnership, said Leigh Chiarelott, chairman of its department of curriculum and instruction.

“Some of our alumni said, ‘Don’t cheapen our degrees,’ ” Chiarelott said. “We just said no, and provided evidence as to why we didn’t think this was a good product for us.”

FIU math Professor Enrique Villamor was chair of the Faculty Senate’s online committee when professors discovered the 2009 contract with Best — after the deal had been signed.

The frustrated Faculty Senate, which normally approves new degree programs, passed a formal resolution demanding a faculty vote on future contracts. But administrators say FIU Global (and the existing Corporate MBA partnership) aren’t new academic programs, but expansions of approved majors; therefore, no vote is required.

“Back then, we said that it shouldn’t be done that way,” Villamor said. “But they’re coming back and doing the same thing, with the same company.”

The MBA program

FIU administrators say Academic Partnerships has delivered impressively on its Corporate MBA deal, particularly in its marketing and promotion. But university records show that the company has usually fallen short of its student-recruitment goals.

The company pledged to provide 100 students for every entering class. Out of 16 total entering classes, only once did it hit that number — 117 students in July of 2011. The three most recent classes had 67, 54, and 40 company-recruited students, respectively.

But FIU administrators remain satisfied.

“They’ve been very close,” said FIU dean Joyce Elam, who oversees online programs.

Marketing online-only degrees is labor intensive, she said, and requires fully staffed recruitment call centers, which Academic Partnerships provided.

Wartzok said the company’s recruitment totals, while below the target numbers, are still much higher than the number of students FIU attracts on its own. Academic Partnerships recruited 40 students in December, for example, while FIU recruited 17.

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