Largest Christian university in the US wins legal battle after probe from Biden Education Department
"We saw it coming because of how the hearing went. And it was a 3-judge panel. It was a unanimous decision. People try to make something political out of everything," Mueller said about the Department of Education's objection to the university's non-profit status.
The Biden Education Department (ED) denied GCU's non-profit recognition after it was approved by the Arizona Board for Private Postsecondary Education, the Internal Revenue Service (IRS), the State of Arizona, and the Higher Learning Commission.
Mueller explained further to Fox News Digital that the ED "did not have the authority to deny our nonprofit status."
"The IRS clearly has the authority to grant us nonprofit status. There's an objective set of criteria that they use to do that, and they did it. The ED has never not honored what the IRS has determined," Mueller said.
"This is the first time that they've ever done it," he added.
The 9th U.S. Circuit Court of Appeals ruled unanimously that the Education Department unlawfully applied an incorrect standard to determine the university's nonprofit status.
The case is now being remanded back to ED.
"Today's decision is a long-awaited correction to the Department's unlawful application of a standard that improperly denied GCU of its nonprofit status, and we are hopeful for a quick affirmation of the university as a nonprofit institution," GCU spokesperson Bob Romantic said on the day of the ruling via press release.
The former for-profit institution GCU was probed by ED shortly after the school returned to a nonprofit model in 2018.
"When GCU's Board of Trustees decided to return the university to its historical status as a nonprofit institution in 2018, it did not envision years of hard-fought litigation against federal agencies," Romantic said.
The department denied GCU's nonprofit status for purposes of federal student financial aid and classified the school as a for-profit entity.
The Department of Education did not immediately respond to a request for comment about the recent ruling.
In October 2023, Mueller alleged that GCU was being unfairly targeted. The institution retaliated with a lawsuit against ED, arguing the department's decision to deny its non-profit status was "arbitrary and capricious."
Mueller explained to Fox News Digital last year that having a nonprofit status would help the university gain full access to grant-writing and research. GCU's non-profit status grants it access to federal dollars due to the institution's large Hispanic population. It was unable to access those federal dollars under the for-profit classification.
An official from ED responded to claims made by Mueller in a statement sent to Fox News Digital, claiming the department determined under the Trump administration in 2018 that GCU does not meet the Higher Education Act's definition of a nonprofit because the majority of GCU's revenues were allocated to a former owner, a for-profit entity.
GCU faced a number of investigations from ED and other federal agencies as well as a threat to be shut down by ED Secretary Miguel Cardona.
Cardona in April vowed to shut down GCU during a House Appropriations Committee hearing about for-profit colleges. The Biden administration official claimed that "predatory schools" are "preying on first generation students."
GCU is facing another hurdle while appealing a $37.7 million fine imposed by the ED in November last year on allegations that the Arizona-based higher learning institution misled students about the cost of its doctoral programs over several years. The fine is much larger than what ED previously gave to schools like Penn State ($2.4 million) and Michigan State ($4.5 million) for failing to address Jerry Sandusky and Larry Nassar's crimes, respectively.
