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Colleges All Across The US Are Closing At An Accelerated Rate

Many more closures may be yet to come.

Posted on July 19, 2017, at 1:32 p.m. ET

Christine Armario / AP

More than 5% of American colleges closed or stopped being able to take federal financial aid last year. That's a significant increase from previous years and a sign of the sharp decline of the for-profit college sector, according to a government report released this week.

The number of schools eligible to receive federal aid, a measure of how many schools are open nationwide, fell by 5.6% in the 2016–2017 school year, the fourth year in a row that the number of colleges getting aid has declined. Last year, though, the decline was just 2%, and the year before, it was 1%.

Numerous schools shut down programs due to the threat of the Obama administration's "gainful employment" rules, which yank financial aid eligibility from for-profit college programs where students take on too much debt and earn little in return.

Eleven percent of the country's for-profit colleges — some 366 — closed or stopped getting aid last year, crippled by impending government regulations and a sharp decline in enrollments that began in 2013. Many of those schools, like the for-profit giant ITT Technical Institutes, shuttered abruptly in a bog of financial and legal problems, leaving thousands of students stranded partway through their educations.

For-profit schools have fallen 17% since their peak in 2012, the report showed, when there were more than 3,500 nationwide. Now, in the wake of several mass shutdowns like ITT's, there are just 2,899 receiving federal aid.

Many more are on the precipice of a potential closure this year — like scores of colleges owned by EDMC, which was once one of the country's largest for-profit college companies and owns nationwide chains like the Art Institutes, Argosy Universities, and Brown Mackie College. EDMC announced plans to close many of its campuses and is desperately trying to sell off the rest.

Private nonprofit schools also closed at a surprising rate last school year, the report showed. Thirty-three nonprofit colleges shuttered or stopped taking financial aid between the 2015 and 2016 school years — a potential symptom of the struggles of small colleges that lack prestige and endowments.

Burlington College, in Vermont, closed altogether at the end of 2016, after years of declining enrollments and amidst allegations of financial improprieties by its former leader, Jane Sanders, the wife of Bernie Sanders.

The annual National Center for Education Statistics report measures the number of colleges eligible to receive government financial aid each year. The vast majority of colleges in the country get federal aid — and rely on it to stay open.

A BuzzFeed News investigation, in partnership with the International Consortium of Investigative Journalists, based on thousands of documents the government didn't want you to see.