SACRAMENTO (CBS13) — Corinthian Colleges is already in deep financial trouble, and now it is facing another big hit as the California Student Aid commission announced it is halting all Cal Grant awards to 10 Heald colleges.
It's not the first time Heald has been in the middle of a controversy. There have been lawsuits, the U.S. Department of Education has limited federal money, and if the school fails to turn in documents proving its stability, the grants may be permanently suspended.
The ads on TV for for-profit colleges promise more, but the student aid commission is saying no more Cal Grants for the 10 Heald college campuses in the state.
"Unfortunately Heald is part of Corinthian Colleges is experiencing and has been experiencing financial difficulty.," said executive director Diana Fuentes-Michel.
After the colleges failed to turn in proper documentation proving financial stability, the commission decided to put Cal Grant payments on hold.
"In the long term, it appears that Heald is financially unable to continue instruction and it's a matter of time before they close their doors," she said.
About 4,500 students are affected by this .For some, the grant only goes toward tuition. That means if the money went through before the hold, students can continue classes without having to worry. But if students enrolled in classes, and the payment hadn't gone through, then they may be responsible for paying their own tuition.
"If Heald is unable to continue, we're trying to protect students from having more debt," she said.
For now, it's a temporary halt. The commission will meet next week to determine if it will turn into a permanent withdrawal from its current contract with the colleges. Students were notified on Friday, and they're urged to contact the commission with questions.
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