-----BEGIN PRIVACY-ENHANCED MESSAGE-----
Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
Originator-Key-Asymmetric:
 MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen
 TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB
MIC-Info: RSA-MD5,RSA,
 P1QXmUFUCXxPq4Gmv90Q1FNfMYuv5a4xg0Yd832/6N8dvSZeg3RRH8cvLFgMSFg3
 O9WhBRWeZRv6CXe6iAyLJQ==

<SEC-DOCUMENT>0000950123-09-068835.txt : 20100225
<SEC-HEADER>0000950123-09-068835.hdr.sgml : 20100225
<ACCEPTANCE-DATETIME>20091207154533
<PRIVATE-TO-PUBLIC>
ACCESSION NUMBER:		0000950123-09-068835
CONFORMED SUBMISSION TYPE:	CORRESP
PUBLIC DOCUMENT COUNT:		1
FILED AS OF DATE:		20091207

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			Grand Canyon Education, Inc.
		CENTRAL INDEX KEY:			0001434588
		STANDARD INDUSTRIAL CLASSIFICATION:	SERVICES-EDUCATIONAL SERVICES [8200]
		IRS NUMBER:				203356009
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		CORRESP

	BUSINESS ADDRESS:	
		STREET 1:		3300 W. CAMELBACK ROAD
		CITY:			PHOENIX
		STATE:			AZ
		ZIP:			85017
		BUSINESS PHONE:		602-639-7500

	MAIL ADDRESS:	
		STREET 1:		3300 W. CAMELBACK ROAD
		CITY:			PHOENIX
		STATE:			AZ
		ZIP:			85017
</SEC-HEADER>
<DOCUMENT>
<TYPE>CORRESP
<SEQUENCE>1
<FILENAME>filename1.htm
<TEXT>
<HTML>
<HEAD>
<TITLE>Correspondence</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<DIV style="font-family: 'Times New Roman',Times,serif; margin-left: .25in; width: 7.20in">

<DIV align="center" style="font-size: 10pt; margin-top: 10pt">December&nbsp;7, 2009
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 10pt">VIA EDGAR<BR>
Larry Spirgel<BR>
Assistant Director<BR>
United States Securities and Exchange Commission<BR>
Division of Corporation Finance<BR>
Mail Stop 3720<BR>
100 F Street NE<BR>
Washington, D.C. 20549

</DIV>

<DIV align="left" style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; background: transparent; color: #000000">
<TR>
    <TD width="7%"></TD>
    <TD width="1%"></TD>
    <TD></TD>
</TR>
<TR valign="top">
    <TD nowrap align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Re:</TD>
    <TD>&nbsp;</TD>
    <TD>Grand Canyon Education Inc.<br>
Response to your letter dated November&nbsp;23, 2009 concerning<br>
Form&nbsp;10-K for the Fiscal Year Ended December&nbsp;31, 2008<br>
Form&nbsp;10-Q for the Quarterly Period Ended September&nbsp;30, 2009<br>
File No.&nbsp;1-34211</TD>
</TR>
</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 10pt">Dear Mr.&nbsp;Spirgel:
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">This letter responds to the letter of the staff of the Securities and Exchange Commission (the
&#147;Staff&#148;), dated November&nbsp;23, 2009, to Grand Canyon Education, Inc. (the &#147;Company&#148;) regarding the
Form 10-K for the fiscal year ended December&nbsp;31, 2008, filed by the Company on February&nbsp;19, 2009
and the Form 10-Q for the quarterly period ended September&nbsp;30, 2009, filed by the Company on
November&nbsp;3, 2009.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">This letter sets forth each comment of the Staff in the comment letter (numbered in accordance
with the comment letter) and, following each comment, sets forth the Company&#146;s response.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 10pt"><U>Form&nbsp;10-K for the Fiscal Year Ended December&nbsp;31, 2008</U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 10pt"><U>16. Valuation and Qualifying Accounts, page 126</U>
</DIV>



<DIV align="left" style="font-size: 10pt; margin-top: 10pt; margin-left: 4%"><I>Staff Comment:</I>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%"><I>1.&nbsp;We note that you determine the adequacy of your allowance for doubtful accounts based on an
analysis of the aging of your accounts receivable and historical bad debt experience. Provide us
with more specific details regarding how you determine your allowance, including how you &#147;estimate
losses resulting from the inability, failure or refusal of your students to make required
payments.&#148; In concluding that your reserves at December&nbsp;31, 2008 are adequate to cover any write
offs that you may make, tell us if, and how, you considered the &#147;impact of current economic
conditions on your current and former students,&#148; which could cause an increase in your cohort
default rate for the 2008 federal fiscal year as disclosed in a subsequent </I><I>Form 8-K</I><I> on August&nbsp;27,
2009. Tell us whether there has been any change in your assessment during each interim period thereafter.</I>
</DIV>
<P align="center" style="font-size: 10pt">&nbsp;

<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif; margin-left: .25in; width: 7.20in">


<DIV align="left" style="font-size: 10pt; margin-top: 10pt; margin-left: 4%"><U><I>Company Response:</I></U>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The Company establishes allowances for student receivables deemed to be uncollectible
primarily based upon a periodic review of the Company&#146;s receivables aging. The Company applies
reserves to each aging category based upon an estimate of the risk presented by the age of the
receivables, and the Company fully reserves for any balances that are over 12&nbsp;months from the start
of the semester to which the balance relates. The Company assesses the reasonableness of its
estimation process by comparing actual and projected write-offs as a percentage of revenue on a
semester by semester basis to the bad debt expense recorded in the general ledger to determine if
the composition of the Company&#146;s accounts receivable has materially changed, which could indicate
that modifications to the allowance may be required. The Company has noted that as a result of
the current economic conditions, a higher percentage of aged receivables are not being paid.
However, this deterioration in collections of aged receivables has recently been more than offset
by changes that the Company has implemented with respect to its student accounts receivable
collection process, which has resulted in fewer accounts reaching aged status. Thus, the amount of
aged receivables as a percentage of revenue is decreasing on a year over year basis, which has
resulted in a corresponding reduction in bad debt expense as a percentage of revenue in recent
periods.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">Management does not consider changes in the cohort default rate when analyzing the adequacy of
the Company&#146;s allowance for uncollectible receivables, because management does not see a direct
correlation between the Company&#146;s receivable collection experience and the cohort default rate.
The cohort default rate represents the number of students that default on Federal Family Education
program loans, or FFEL loans, as a percentage of the number of students that went into repayment.
The Company is not responsible for administering the collection of these loans and the Company does
not guarantee these loans; accordingly there is no collection risk to the Company. In the August
27, 2009 Current Report on Form 8-K, the Company included a risk factor related to the cohort
default rate because the Company may lose its eligibility to participate in some or all of the
federally guaranteed student loan programs if, for three consecutive years, 25% or more of its
students who were required to begin repayment of their student loans in one year default on their
payment by the end of the following year or if the default rate exceeds 40% for any single year.
The Company cohort default rates on FFEL loans for the 2005, 2006 and 2007 federal fiscal years,
the three most recent years for which such rates have been calculated by the Department of
Education, were 1.8%, 1.6% and 1.4%, respectively.
</DIV>
<P align="center" style="font-size: 10pt">&nbsp;

<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif; margin-left: .25in; width: 7.20in">

<DIV align="left" style="font-size: 10pt; margin-top: 10pt"><U>Form&nbsp;10-Q for the Quarterly Period Ended September&nbsp;30, 2009</U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 10pt"><U>Derivatives and Hedging, page 7</U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 10pt; margin-left: 4%"><I>Staff Comment:</I>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%"><I>2.&nbsp;Please disclose if the derivative financial instruments contain financing elements and how
they were reported in the Statements of Cash Flows. Refer to paragraphs 44(c)(1) and 45A of SFAS
133.</I>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 10pt; margin-left: 4%"><U><I>Company Response:</I></U>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The Company entered into two derivative agreements to manage its 30 Day LIBOR interest
exposure related to its variable rate debt on June&nbsp;30, 2009. Neither of these instruments
contained financing elements. The adjustment of $302,000 for the effective portion of the loss on
the derivatives as of September&nbsp;30, 2009 is included as a component of other comprehensive income,
net of taxes, and this adjustment was treated as a non-cash transaction between other assets, notes
payable and other, and other comprehensive income in the statement of cash flows. The Company will
include this disclosure in respect of its derivative financial instruments in all future filings.
The interest rate swap instrument was an at-the-money plain-vanilla interest rate swap involving no
payments between the parties at inception. The interest rate corridor required an upfront payment
of $164,000 by the Company to the counterparty solely for the time value of an out-of-the-money
option contract based on the forward LIBOR rate curve at the instrument&#146;s inception. The
contractual terms of the Company&#146;s derivative instruments have not been structured to ensure that
net payments will be made by one party in the earlier periods and subsequently returned by the
counterparty in the later periods of the derivative&#146;s term as discussed in paragraph 45A of SFAS
133. Furthermore, neither of the Company&#146;s derivative instruments have been amended or modified
since their inception.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">In connection with the above response, the Company acknowledges that (i)&nbsp;it is responsible for
the adequacy and accuracy of the disclosure in its filings with the United States Securities and
Exchange Commission, (ii)&nbsp;Staff comments or changes to disclosure in response to Staff comments in
the filings reviewed by the Staff do not foreclose the Commission from taking any action with
respect to the filings, and (iii)&nbsp;the Company may not assert Staff comments as a defense in any
proceeding initiated by the Commission or any person under the federal securities laws of the
United States.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">If you require any additional information on these issues, or if we can provide you with any
other information that will facilitate the Staff review process, please advise us at your earliest
convenience. You may reach me at (602)&nbsp;639-6648.
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="48%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="44%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">Sincerely,</TD>
</TR>
<TR valign="bottom" style="padding-top: 1px"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom" style="padding-top: 1px">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">Grand Canyon Education, Inc.</TD>
</TR>
<TR valign="bottom" style="padding-top: 1px"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom" style="padding-top: 1px">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">By:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">/s/ Daniel E. Bachus</TD>
</TR>
<TR valign="bottom" style="padding-top: 1px">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Name:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Daniel E. Bachus</TD>
</TR>
<TR valign="bottom" style="padding-top: 1px">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Its:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Chief Financial Officer</TD>
</TR>
<!-- End Table Body --></TABLE>
</DIV>



<P align="center" style="font-size: 10pt">&nbsp;

<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>




</BODY>
</HTML>
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
