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For-Profit College Executives, Once Big Obama Supporters, Change Course In 2012

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Four years ago, during the last presidential election, James "Bill" Heavener, CEO and co-chairman of the for-profit Full Sail University, served as a major source of campaign contributions for Barack Obama's presidential campaign and the Democratic National Committee, raising nearly $100,000 alongside members of his family.

So did Ed Haddock, Heavener's business partner and co-chairman at Full Sail, who brought in more than $200,000 in checks as a "bundler" for the 2008 Obama campaign in Florida, a crucial swing state.

But this election cycle, following the issuance of new regulations from President Obama's Department of Education aimed at reducing the towering debt levels of students at for-profit colleges, both executives have had a change of heart.

Heavener is now listed as the co-chairman of Mitt Romney's Florida fundraising committee, and has donated substantially to both Romney's campaign and an affiliated fundraising committee. For his part, Haddock has expressed frustration with the administration, warning Obama campaign staff over the summer that he was tired of feeling "ignored and shut out of the process" involving the college regulations, according to a memo obtained by HuffPost. Though he will still support Obama this year, Haddock said he will not volunteer as a bundler this election because he is busy with family and business matters.

Just as Wall Street has largely abandoned the Obama campaign this election year following financial regulatory reforms, for-profit colleges offer another example of an industry alienated by regulation during the president's first term -- even as many student advocates say the administration caved to industry demands by weakening final regulations. Although Romney has not staked out an official position on the Obama administration's new for-profit college rules, he has praised such colleges on the campaign trail as a way to hold down the rising costs of higher education.

Romney spokeswoman Andrea Saul said in a statement that the former Massachusetts governor supports "increased choice in both K-12 and higher education" and wants to encourage a "level playing field for different types of schools held accountable for their results.

"To increase access and affordability, we must support the availability of a full portfolio of college options, public and private, traditional and on-line," Saul said.

According to The New York Times, Romney has praised for-profit colleges on the campaign trail, arguing that they are likelier to "hold down the cost of their education" because they face market risks.

"I just like the fact that there's competition," Romney told the editorial board of Iowa's Ames Tribune in December, according to the Times. "I like the fact that institutions of higher learning will compete with one another, whether they're for-profit or not-for-profit."

Yet for-profit colleges typically charge tuition that is nearly twice that of public four-year universities and nearly five times as much as public community colleges, according to Department of Education data analyzed by the College Board. Although for-profit college tuition is on average lower the rates at private non-profit schools, the schools devote much less money to student instruction, and students graduate at much lower levels.

Heavener, the Full Sail University chief executive, has donated the maximum $2,500 to Romney's campaign and an additional $45,000 to a pro-Romney super PAC, Restore Our Future Inc., that has paid for controversial television ads attacking his opponents. But he said his decision to support Romney instead of Obama this election year was "completely personal" and had nothing to do with Full Sail or regulation of the industry.

"It's a bigger issue with me," said Heavener, who described himself as a "lifelong Republican" despite a strong show of support for Obama last term. "I see the Obama administration overly regulating all kinds of businesses, and as a Republican I feel that less regulation is better than more. Whether it's telecom or banking or the SEC or education, there's just a massive amount of regulation that this administration has put in."

In addition to the Romney donations, Heavener has also contributed to the congressional campaigns of some of the strongest opponents of the Obama administration's "gainful employment" regulations, which are intended to ensure that for-profit college students are securing jobs allow them to repay student loan debts. He declined to give an opinion of the regulations, saying only: "A good debate has taken place between the for-profit industry and the regulators, and wherever that comes down we'll comply and do the best we can do in all the areas that we serve."

Haddock, the Full Sail co-chairman and "bundler" from the 2008 campaign, said his decision not to be a major fundraiser for Obama this year was unrelated to the regulations on his business.

"I know it's a very compelling thought, that maybe they're tied together, but my philosophy is that if you're in a regulated business you should be concentrated on doing a good job and complying," Haddock said. "Whether you agree with all the rules or don't agree with them, as a businessman you should just get that out of your head."

He said he isn't personally concerned with Full Sail's ability to comply with the regulations, noting that the school's overall graduation rate of more than 80 percent is among the highest in the industry.

Haddock has donated more than $450,000 to Democratic committees and candidates over the past two decades, including hefty donations to Obama and the Democratic National Committee.

This summer, HuffPost's Sam Stein obtained a memo to White House aides from Jessica Clark, the Obama campaign's finance director in Florida. The memo said that Haddock, who had helped raise between $200,000 and $500,000 for the 2008 campaign, had stopped being "helpful" in 2009.

According to the memo:

"Ed needs and wants an ongoing point of contact inside the White House to periodically give input. From his view, he is CEO of four different companies and has the ability to give business and economic ideas above and beyond the average check writer. But when he has attempted to do so—primarily on the education issue but not exclusively—there has been no way in. Indeed, he feels like the White House is hostile to outside help, especially if it comes in the form as help from business. YOU should engage Ed on his concerns and tell him you want an ongoing relationship that seeks to hear his ideas and concerns, even if in the end we don't always agree."

Haddock didn't dispute the emotions expressed in the memo, but said those feelings won't cause him to support another candidate this election.

"I didn't waver in my Obama support, even though as you can tell I was concerned about a lack of ability to give input," he said.

Haddock said he will not be a "bundler" for the 2012 Obama campaign, which denotes supporters who have worked to raise more than $50,000 from other donors, and some, like DreamWorks Animation executive Jeffrey Katzenberg and film executive Harvey Weinstein, who have brought in more than $500,000.

Although Full Sail, an entertainment industry-focused technical college outside of Orlando, is much smaller than other publicly traded for-profit schools such as the University of Phoenix and DeVry, its executives have been among the larger industry donors in recent congressional and presidential races, according to a HuffPost analysis of campaign finance data. Heavener's donations so far this election cycle constitute more than half of the for-profit college industry contributions directed to either Obama or Republican candidates.

"With me, and with Bill, too, it's a personal thing," Haddock said. "We take our system of government and our role as citizens personally."

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