|
 |
Education Dive
Running without state approval, Lambda School shows challenge of regulating new entities
The agency that oversees private education in California says the
popular coding academy has not properly registered and told it to stop
operating.
Jeremy Bauer-Wolf
Jan. 22, 2020
Less than three years in, California-based coding academy Lambda School
has emerged as one of the increasingly popular online alternatives to
traditional postsecondary education.
Lambda and other entities like it are marketed as self-paced and more
affordable than a typical college or university. Their pitch is
alluring — in many cases, students face no upfront costs for their
education. Instead of tuition payments, several such schools use a
financing tool called an income-share agreement (ISA) that allows
students to repay the cost of attendance as a percentage of their
income after finishing the program.
The model has attracted attention. Lambda arose from Y Combinator, the
same startup accelerator that launched Airbnb and food delivery service
Doordash. It has raised at least $48 million from the likes of GV,
formerly Google Ventures, the online behemoth's investment arm, and
Sound Ventures, actor Ashton Kutcher's company.
But despite Lambda School's rising acclaim, it has not been approved as
an educational entity in the state, according to the government agency
that authorizes private institutions there, the Bureau for Private
Postsecondary Education (BPPE).
The resulting skirmish highlights the difficulties in regulating
institutions that fall outside the scope of traditional higher ed.
Last year, BPPE told the school it must cease operations in California
and fined it $75,000 because it did not have state approval. Lambda
officials said they immediately began the process of registering with
the BPPE and appealed its decision with the state attorney general's
office, which did not respond to Education Dive's request for comment
sent last week.
Lambda has continued operating, and it's unclear whether it will face
additional penalties for not halting its operations as BPPE directed.
The attorney general, which would enforce BPPE's order, has not yet
done so, according to Cecilia Ziniti, Lambda's general counsel.
Internal bureau emails obtained by Education Dive indicate it will not
be taking further action against Lambda. As one BPPE official wrote
earlier this month: "Since we have received an application seeking
approval, Lambda School is demonstrating a willingness to comply with
the Bureau. The Bureau won't pursue further disciplinary actions in the
case that an institution is attempting to come into compliance with
state laws and regulations."
That means students who think they haven't gotten their money's worth
from Lambda have few avenues for remedy from the state, given that the
school is not yet under the bureau's purview.
In the interim, Lambda students have publicly complained about shoddy
instruction at the school. Several anonymously described an
unprofessional and sometimes racist environment to Business Insider in
October, declaring it a "cult."
|
|
|
|
