The Deal The Feds Have Offered Charlotte School Of Law

Aug 7, 2017

Updated 10:13 a.m. Aug. 8
Charlotte School of Law said last week it expects to offer students federal loans again in time for the fall semester. To do that, the school has to agree to certain conditions from the U.S. Department of Education. We now have a better idea of what those conditions are.  

DELIA: So what are those conditions?

WORF: First, neither the school, nor the department has been willing to discuss the conditions. But the American Bar Association Journal, posted a letter from a director at the department of education to the school, detailing them. It's dated July 27. It says the school must secure a $6 million line of credit. The school could use that money to refund tuition, pay fines that could arise, and, if it closes, pay for a plan to allow students to complete their degrees. And then there's this one: the school must notify everyone who was a Charlotte School of Law student still in their first year last December, that they have the option to receive a full refund of tuition and fees. That runs about $44,000 a year. And the school would have to pay that.

DELIA: How many refunds are we talking about?

WORF: I asked the school for an exact number, but didn't immediately hear back from them. We do know that the school's total enrollment was around 750 last December when the Department of Education yanked the loan money.

DELIA: What other conditions stick out to you?

WORF: There are several that deal with how the department would monitor Charlotte School of Law and what information the school must disclose to federal officials and to students. It also sets admission standards for the school, since admitting too many unqualified students was one of the reasons the ABA placed the school on probation in the first place.   

DELIA: So has Charlotte School of Law actually agreed to these conditions?

WORF: It doesn't seem like it. I asked a spokeswoman for the school today and she just replied with the same press release from last week. It said "the school has notified the department of its willingness to abide by the necessary conditions, details of which are under discussion." I asked the same thing to the Department of Education today and haven't heard back from anyone there.

DELIA: If the school agreed to this, would it be completely reinstated to the federal loan program?

WORF: That does seem to be the case. The letter notes future classes and Charlotte School of Law spokeswoman Victoria Taylor told the ABA Journal – this is a "restoration" of participation in the federal loan program, "which like all certifications will be subject to periodic renewal."

8/8/17 UPDATE: "Negotiations over terms are ongoing and no agreement has been reached yet," says a U.S. Department of Education spokesman.