Thousands of Jewish students are at risk of losing their federal student aid after the Michigan Jewish Institute failed for a second time to win accreditation — and now faces the risk of closure.
The Accrediting Council for Independent Colleges and Schools deferred its decision to grant the Chabad-affiliated MJI accreditation until December 13.
MJI’s current grant of accreditation, which is required for students to receive Federal Pell Grants worth $5,500 per year, runs out at the end of 2013.
A Forward investigation in the fall of last year revealed that MJI received $25 million in federal aid between 2008 and 2012 despite graduating hardly any students.
So far this year, the college has received $8.6 million in federal funds.
Only American citizens are eligible for the Federal Pell Grant Program, the government’s largest education aid program targeting low-income students. Almost all of MJI’s students are enrolled in study-abroad programs, mainly in Israel, and in online programs. Few, if any, of the students complete their degree courses.
Jane Glickman, a Department of Education spokeswoman, said that without accreditation, MJI’s students will not be eligible for federal funding. Glickman said that in most cases colleges that lose accreditation are forced to close because students cannot afford tuition and the schools in question can no longer afford to pay teachers.
MJI charges students a fixed administrative fee of $2,650 for its study-abroad program in addition to the host school’s tuition fee. Ninety-nine percent of its students receive federal aid, according to the education department.
MJI’s assets have risen in line with the growth of its study abroad and online programs. According to tax records, MJI’s assets grew from $1.2 million in 2008 to $3.9 million in 2012.
When the Forward interviewed MJI’s Director of Academic Administration, Dov Stein, last year, he offered contradictory information about MJI’s student enrollment.
Initially, Stein said MJI had about 3,000 students. Later, he revised that figure down to about 2,000 students.
During a Forward visit to MJI, in West Bloomfield, near Detroit, a reporter was unable to find any college students.
Instead, classes appeared to be targeted towards a couple dozen high school students taking dual-enrollment classes in Hebrew.
Although MJI offers degrees in business or computer programs, the overwhelming majority of students pursue a Judaic Studies degree.
In July of this year, Stein posted a photograph of more than one dozen folders containing MJI student files to the social networking site, Google Plus.
It appears that the photograph was meant to celebrate a crop of recent MJI graduates. But it also inadvertently displayed the names and Social Security numbers of several students. The photo has since been taken down.
The Forward conducted a public records search of the students to try to find out if they were based in America. The database search, performed by LexisNexis, a major database aggregator, returned no results.
A LexisNexis specialist said that the firm’s database only contains information about people who have created a public record in America, for example, by applying for a cell phone contract, a driver’s license or a credit card.
The absence of data on the students suggests that they may live overseas, said the specialist, but he cautioned that it is also possible they never applied for loans or other services tracked by the database.
The Forward asked Stein, via email, why the students did not appear to exist in the United States. It also asked why ACICS had deferred its grant of accreditation twice and whether MJI’s students had been informed that the college’s accreditation runs out at the end of this year.
In a statement, MJI responded: “Michigan Jewish Institute, which remains accredited by ACICS, expects to receive a new grant of accreditation by ACICS in the very near future.”
ACICS, which has accredited MJI since the late 1990s, only grants accreditation to institutions with what a spokesman called, “an on-site presence.”
MJI runs classes in The Shul, an impressive $6 million Chabad-Lubavitch synagogue.
The Shul sits at the heart of a 45-acre Campus of Living Judaism, owned by Chabad of Michigan.
MJI’s president, Kasriel Shemtov, is the spiritual director of The Shul and the son of Berel Shemtov, the head of Chabad of Michigan.
This January, MJI won planning approval to build a 16,000-square-foot headquarters on the campus.
Anthony Bieda, an ACICS spokesman, said his organization has been in regular contact with the Department of Education since the Forward investigation was published last year. A team of inspectors from ACICS visited MJI in February as a routine part of the accreditation process.
Since then, ACICS has deferred its decision to grant a renewal of accreditation, in April and in August, while it awaits further information from MJI.
“There has been a lot of scrutiny, interest and questions about how we’re applying our standards to this particular institution through the course of renewal grant and the special visit we did in February,” Bieda said.
Bieda would not reveal why ACICS has deferred accreditation. “It’s between us and the school,” he said. “But it has to do with compliance with our standards and expectations.”
Bieda said that it was not unusual for ACICS to defer a renewal grant of accreditation once. But, he added, “It’s more unusual to have it deferred twice, and it’s extremely rare to have it deferred a third time.”
If ACICS does defer its decision again in December, it would have to formally issue an extension of its current grant of accreditation so that MJI’s students can continue to receive federal aid. In theory, according to Department of Education guidelines, that situation could repeat itself through 2014.
Glickman said that if MJI were to lose its accreditation, the college could appeal. In such a case, “The institution remains accredited until the decision on the appeal is made, and students are able to get Title IV [Pell] aid,” she said.
Contact Paul Berger at firstname.lastname@example.org or on Twitter, @pdberger