Las Vegas Sun

March 28, 2024

Millions of dollars in tuition at stake in computer school’s closure

Computer Learning Centers Inc.'s sudden closure Monday left 212 Southern Nevada students locked out of their classrooms.

The company's Henderson campus at 2240 Corporate Circle was among the 25 CLC schools nationwide that closed.

Officials with the state's Commission on Postsecondary Education already have begun reviewing enrollment and tuition records and will attempt to place students in other schools that have similar programs. Others will get refunds from a state fund established specifically for such closures.

But David Perlman, administrator of the commission, is worried that the fund would be depleted by the CLC closure.

"The fund is capped at $250,000 and we're looking at (tuition totals) of $3 million," Perlman said. "We're hoping that most of the students are placed in other programs."

The $250,000 recovery fund administered by the commission was built from assessments of the state's private postsecondary schools.

CLC suspended classes at their schools and told employees not to report to work Monday morning while the Manassas, Va., parent company started considering its options, including the possible filing of a bankruptcy petition.

Company officials have not been available for comment and have been communicating through a series of press releases. On Thursday, the publicly traded company reported that it was notified by the U.S. Department of Education that the school was not meeting financial responsibility standards and that its lenders would not provide additional funding.

Perlman said in addition to that problem, the school was accused in December of illegally paying commissions to recruiters. The company acknowledged the allegation in a December press release, saying that the Department of Education was requiring the return of $187 million in funds received by the school and its students since July 1, 1994, under Title IV federal student aid programs.

School administrators said they were trying to sell the school in recent weeks and officials with CLC's Boston school told students that classes would continue to be conducted while the company found a buyer. When the company announced the closure, it also said plans to sell the schools were suspended.

Perlman said he has been monitoring CLC's situation since the December disclosure. But like others, he was assured the school would remain open while efforts were made to sell it.

Perlman said he was notified of the closure when he arrived at work Monday morning and there was a message on his answering machine. He said he immediately went to the Henderson campus, where he met with local administrator Dave Evans, who has been with the school since it opened in 1999. Evans was cooperative in providing student records, Perlman said.

But students arriving for class Monday morning found the doors locked and were given fliers.

"Classes have been suspended," the flier said. "Contact your state agency (fill in name and contact)."

Perlman said it probably will take his agency -- the one referred to in the flier -- several days to contact students.

"Right now, we're trying to set up teach-outs with other schools as well as contact students," Perlman said. "It's a lengthy process and we've been very busy since this (Monday) morning."

Among the schools that will take students are The Learning Center, the city's largest computer training school with 14 classrooms, ITT Technical Center and the University of Phoenix.

But the process of finding similar teaching programs isn't as simple as it sounds. Perlman said the way CLC presented certain programs may be different from curricula offered at other schools. For example, CLC may offer comprehensive instruction on a certain computer system, while other schools may offer beginning, intermediate and advanced courses on the same system.

Perlman said CLC has had an excellent reputation for its curricula. But the business administration of the program appeared to be the school's downfall, he said.

"They've got solid programs, new equipment and an excellent facility," Perlman said. "Otherwise, they wouldn't have had some many students. I would say this was a fluke."

But computer training school closures have been a problem in Las Vegas. In late 1999, two computer schools closed. Computer Skills Institute, one of the city's oldest training operations, closed Dec. 30. A month earlier, Vitrex Corp., Ogden, Utah, filed for bankruptcy protection and closed its Las Vegas school. Its local operation was acquired by New Horizons, a computer training franchise.

Perlman recommended that prospective students do their own due-diligence investigations before spending their money at a private school.

"It's like any other big-money purchase," Perlman said. "We don't make recommendations on particular schools, but we tell students when they consider a school, to tour the building and take a good look around. Is the equipment new? Are the carpets dirty? Is the school in a good part of town?"

The owner of a rival school, The Learning Center's Linda Montgomery, said students should take the investigation of a school even further.

"Check the track record of the school," she said. "How long has it been there?"

She also said locally owned operations tend to be safer than franchise operations because they have a greater interest in the community. She cited the CLC situation as an example.

"They may have had a good program, but you have to follow the rules," Montgomery said in reference to the Department of Education allegations. "You can't pay a commission to recruiters."

Even though The Learning Center may benefit by getting some CLC students, "I actually hate to hear about a school closure like this," Montgomery said. "It puts the whole industry in a bad light."

CLC's stock trading was suspended Monday after the closure was announced. The closing price Friday was 25 cents a share.

archive