| Disputed Accord in Student Loan Case
Department officials portrayed the settlement reached with the Nebraska Education Loan Network, or Nelnet, as a defeat for the for-profit company. They noted that they were declining to pay an estimated $882 million in additional reimbursement requests that the company has pending under the same loophole, and ending future payments on such loans to other lenders as well unless the lenders can prove, through audits, that they qualify for the funds. Nelnet officials themselves, too, took issue with the department’s finding but said they had settled the case to allow the company to move on. But Congressional and other critics accused the department of going soft on Nelnet and other lenders. They blasted administration officials for failing to fully follow the recommendation of the department’s inspector general, who contended in a September audit report that Nelnet should be forced to repay all funds earned through the loophole, though which lenders were paid a 9.5 percent government subsidy on a certain class of student loans.
Educator's love for students pays off
They got a $10,000 bank loan. They bought five Apple II computers. And they hired Nick, a senior at Madison Central High School (now Old Bridge High School), who was referred to them by a fellow teacher. Nick worked on the business part time, even when he went to Carnegie Mellon University in Pittsburgh to study engineering. And the team developed software to assess students' progress. School districts weren't enthused, in part, Nadler said, because it would have put teachers under closer scrutiny. "There's an element of accountability in the product that wasn't appealing," she said. So the company shifted its focus to special education, where the state and federal government required schools to assess students more closely. It wasn't a huge market; in 1986, the company's sales were less than $100,000.
ITT Educational confident in 2008 view
CARMEL, Ind. - Post-secondary education provider ITT Educational Services Inc. said Thursday it is "confident" it can achieve 2008 earnings per share of $4.50 to $4.60 despite the reduction in lender subsidies under federal student loan programs and tight credit markets which are pressuring students. Analysts surveyed by Thomson Financial expect full-year profit of $4.47 per share, on average. The company said it expects to continue to improve student retention, but believes future increases in the quarterly persistence rate will moderate from 2007 levels. "Recently, there has been a lot of speculation in the market with respect to the ability of our students to obtain the financing needed to pay their education costs," said Chief Executive Kevin Modany in a statement. "This speculation was caused by a recent reduction in lender subsidies under the federal student loan programs and the current credit crunch that arose from the subprime mortgage crisis." ITT said it has arranged for Bank of America, Chase Education Finance and Citibank, The Student Loan Corp.
More Business Digest
Oil futures rose yesterday after the government reported larger-than-expected declines in crude and heating oil inventories. In its weekly inventory report, the Energy Department's Energy Information Administration said oil inventories fell by 3.3 million barrels last week, more than double the 1.3 million-barrel decline analysts expected. Inventories of distillates, which include heating oil and diesel fuel, fell by 2.8 million barrels, much more than the expected drop of 800,000 barrels. Heating oil "stocks are just plunging," said Stephen Schork, a trader and analyst in Villanova, Pa. .
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