<SEC-DOCUMENT>0000950123-11-080731.txt : 20110829
<SEC-HEADER>0000950123-11-080731.hdr.sgml : 20110829
<ACCEPTANCE-DATETIME>20110829090051
ACCESSION NUMBER:		0000950123-11-080731
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20110829
ITEM INFORMATION:		Other Events
FILED AS OF DATE:		20110829
DATE AS OF CHANGE:		20110829

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:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-34211
		FILM NUMBER:		111061512

	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>8-K
<SEQUENCE>1
<FILENAME>c21980e8vk.htm
<DESCRIPTION>FORM 8-K
<TEXT>
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<TITLE>Form 8-K</TITLE>
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<P style="font-size: 14pt" align="center"><B>UNITED STATES<BR>
SECURITIES AND
EXCHANGE COMMISSION<BR>
<FONT style="font-size: 12pt">Washington, D.C. 20549
</FONT></B>

<P style="font-size: 18pt" align="center"><B>FORM 8-K</B>

<P style="font-size: 12pt" align="center"><B>CURRENT REPORT<BR>
Pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934</B>

<P style="font-size: 10pt" align="center"><B>Date of Report (Date of earliest
event reported): August 29, 2011 (August 24, 2011)</B>



<P style="font-size: 24pt" align="center"><B>Grand Canyon Education,
Inc.<BR>
</B><FONT style="font-size: 10pt">(Exact name of registrant as
specified in its charter) </FONT>
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cellpadding="0" width="100%">

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  <TD width="32%">&nbsp;</TD>
  <TD width="1%">&nbsp;</TD>
  <TD width="33%">&nbsp;</TD>
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  <TD width="32%">&nbsp;</TD>
 </TR>
 <TR valign="bottom">
  <TD style="border-bottom: #000000 1px solid"><B>Delaware</B></TD>
  <TD>&nbsp;</TD>
  <TD style="border-bottom: #000000 1px solid"><B>001-34211</B></TD>
  <TD>&nbsp;</TD>
  <TD style="border-bottom: #000000 1px solid"><B>20-3356009</B></TD>
 </TR>
 <TR valign="top">
  <TD>(State or other Jurisdiction of Incorporation)</TD>
  <TD>&nbsp;</TD>
  <TD>(Commission File Number)</TD>
  <TD>&nbsp;</TD>
  <TD>(IRS Employer Identification No.)</TD>
 </TR>

</TABLE>
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cellpadding="0" width="100%">

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  <TD width="49%">&nbsp;</TD>
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 <TR valign="bottom">
  <TD style="border-bottom: #000000 1px solid"><B>3300 W. Camelback
Road<BR>
Phoenix, Arizona<BR>
</B></TD>
  <TD>&nbsp;</TD>
  <TD style="border-bottom: #000000 1px solid"><B>85017</B></TD>
 </TR>
 <TR valign="top">
  <TD>(Address of Principal Executive Offices)</TD>
  <TD>&nbsp;</TD>
  <TD>(Zip Code)</TD>
 </TR>

</TABLE>


<P style="font-size: 10pt" align="center">Registrant&#8217;s telephone number,
including area code: <B>(602) 639-7500</B>
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cellpadding="0" width="30%">

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  <TD style="border-bottom: #000000 1px solid" nowrap><B>&nbsp;</B></TD>
 </TR>
 <TR>
  <TD nowrap>(Former name or former address if changed since last report.)</TD>
 </TR>

</TABLE>


<P style="font-size: 10pt" align="left">Check the appropriate box below if the
Form 8-K filing is intended to simultaneously satisfy the filing obligation of
the registrant under any of the following provisions:

<P style="font-size: 10pt" align="left"><FONT face="Wingdings">o</FONT> Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)<BR>
<BR>
<FONT face="Wingdings">o</FONT> Soliciting material pursuant
to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)<BR>
<BR>
<FONT
face="Wingdings">o</FONT> Pre-commencement communications pursuant to Rule
14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))<BR>
<BR>
<FONT
face="Wingdings">o</FONT> Pre-commencement communications pursuant to Rule
13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))<BR>



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

<P style="display: none; font-size: 10pt" align="center">1
</DIV>

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<DIV align="left" style="font-size: 10pt; margin-top: 10pt"><B>Item&nbsp;8.01. </B><U><B>Other Events</B></U><B>.</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">Grand Canyon Education, Inc. is providing the following update regarding the program review
initiated by the Department of Education in July&nbsp;2010.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 10pt"><B>Review of Previous Disclosures Regarding Program Review</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">As initially disclosed in our Current Report on Form 8-K filed on August&nbsp;6, 2010, and as
further disclosed in our subsequent periodic reports, including in our Annual Report on Form 10-K
for our fiscal year ended December&nbsp;31, 2010 and our Quarterly Reports on Form 10-Q for our fiscal
quarters ended September&nbsp;30, 2010, March&nbsp;31, 2011 and June&nbsp;30, 2011, in July&nbsp;2010, the Department
of Education initiated a program review of Grand Canyon University covering the 2008-2009 and
2009-2010 award years. As part of this program review, a Department of Education program review
team conducted a site visit on the University&#146;s campus in July&nbsp;2010 and reviewed, and in some cases
requested further information regarding, the University&#146;s records, practices and policies relating
to, among other things, financial aid, enrollment, enrollment counselor compensation, program
eligibility and other Title IV compliance matters. Upon the conclusion of the site visit, the
University was informed by the program review team that it would (i)&nbsp;conduct further review of the
University&#146;s documents and records offsite, (ii)&nbsp;upon completion of such review, schedule a formal
exit interview to be followed by a preliminary program review report in which any preliminary
findings of non-compliance would be presented, and (iii)&nbsp;conclude the review by issuance of a final
program review determination letter.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">Following the conclusion of the site visit, but before it had yet received notification of the
timing of its exit interview or the Department of Education&#146;s preliminary program review report or
final program review determination letter, the University became aware that the program review team
had two preliminary findings of concern:
</DIV>

<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="8%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The first issue (the &#147;incentive compensation issue&#148;) was whether a compensation
policy in use during part of the period under review improperly rewarded some
enrollment counselors based on success in enrolling students in violation of applicable
law.</TD>
</TR>

<TR style="font-size: 8pt">
    <TD>&nbsp;</TD>
</TR> <TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="8%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The second issue (the &#147;gainful employment issue&#148;) was whether, during the award
years under review, certain programs offered within the University&#146;s College of Liberal
Arts provided students with training to prepare them for gainful employment in a
recognized occupation. This &#147;gainful employment&#148; standard has been a requirement for
Title IV eligibility for programs offered at proprietary institutions of higher
education such as Grand Canyon University although, pursuant to legislation passed in
2008 and effective as of July&nbsp;1, 2010, this requirement no longer applies to designated
liberal arts programs offered by the University and certain other institutions that
have held accreditation by a regional accrediting agency since a date on or before
October&nbsp;1, 2007 (the University has held a regional accreditation since 1968).
Subsequent to the site visit, the program review team submitted a written request to
the University in which the program review team stated the view that, prior to July&nbsp;1,
2010, traditional liberal arts programs were not considered as being eligible under
Title IV but then requested additional information from the University that would help
the Department of Education determine whether the programs offered within the
University&#146;s College of Liberal Arts were eligible under Title IV because they did
provide training to prepare students for gainful employment in a recognized occupation.
While the University was not informed as to which specific programs offered within the
University&#146;s College of Liberal Arts the program review team believed were ineligible,
in August&nbsp;2010 the University provided the Department of Education with the requested
information which the University believed would demonstrate that the programs offered
within the University&#146;s College of Liberal Arts met this requirement.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 10pt"><B>Update on Program Review Status</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 10pt">While the University never received a formal exit interview, which the University had understood to
be the typical step prior to the Department of Education&#146;s issuance of a preliminary program review
report, on August&nbsp;24, 2011, the University received from the Department of Education a written
preliminary program review report that includes five findings, two of which involve individual
student-specific errors concerning the monitoring of satisfactory academic progress for two
students and the certification of one student&#146;s Federal Family Educational Loan as an unsubsidized
Stafford loan rather than a subsidized Stafford loan. The other three findings address the
incentive compensation issue, the gainful employment issue and one additional issue not previously
raised with the University, as follows:
</DIV>
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<DIV style="margin-top: 10pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><I>Incentive compensation issue</I>. During a portion of the period under review, the
University had in place a compensation plan for its enrollment counselors that was designed
to comply with the regulatory &#147;safe harbor&#148; in effect during such period that allowed
companies to make adjustments to fixed compensation for enrollment personnel, provided that
any such adjustment (i)&nbsp;was not made more than twice during any twelve month period, and
(ii)&nbsp;was not based solely on the number of students recruited, admitted, enrolled, or
awarded financial aid. The plan at issue provided for enrollment counselor performance
to be reviewed on a number of non-enrollment-related factors that could account for a
substantial portion of any potential base compensation adjustment. The report does not
appear to set forth any definitive finding regarding the plan, but the Department of
Education has requested additional information from the University regarding its enrollment
counselor compensation practices and policies in effect during the period under review.
The University continues to believe that the plan at issue, both as designed and as
applied, did not base compensation solely on success in enrolling students in violation of
applicable law and will continue to communicate with the Department of Education to resolve
this matter.</TD>
</TR>

<TR style="font-size: 8pt">
    <TD>&nbsp;</TD>
</TR> <TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><I>Gainful employment issue</I>. The preliminary program review report sets forth the
Department of Education&#146;s position that the University&#146;s Bachelor of Arts in
Interdisciplinary Studies program was not an eligible program under Title IV because it did
not provide students with training to prepare them for gainful employment in a recognized
occupation. While the University is pleased that the gainful employment issue, which
originally focused broadly on all programs offered within the University&#146;s College of
Liberal Arts, is now focused on a single program, the University continues to believe that
its Interdisciplinary Studies program, which it first offered in Fall 2007 in response to a
request by one of the University&#146;s employer-partners, was an eligible program and intends
to communicate with the Department of Education to resolve the matter.</TD>
</TR>

<TR style="font-size: 8pt">
    <TD>&nbsp;</TD>
</TR> <TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="4%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><I>Inadequate procedures related to non-passing grades. </I>The preliminary program review
report sets forth the Department of Education&#146;s position that the University, during the
period under review and prior to the time the University converted from a term-based
financial aid system to a non-term, borrower-based financial aid system in mid-2010, failed
to have an accurate system to determine if students with non-passing grades for a term had
no documented attendance for the term or should have been treated as unofficial withdrawals
for the term, thereby potentially requiring the University to return all or a portion of
the Title IV monies previously received with respect to such students. Although the
University is confident in the legal sufficiency of its policies that were in place during
the period under review, the University is currently reviewing the draft findings and
considering the manner in which it will respond to the Department of Education. As part of
the process of reviewing and responding to this finding, the Department of Education has
requested that the University conduct a further review of student files and provide
additional information to the Department of Education following the completion of such
review.</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The University cannot presently predict whether or if further information requests will be
made, how the foregoing issues will be resolved, when the final program review determination letter
will be issued, or when the program review will be closed. At this time, the Department of
Education has not specified the amount of any potential penalties, and the Company has not accrued
any amounts in connection with the program review.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The University&#146;s policies and procedures are planned and implemented to comply with the
applicable standards and regulations under Title IV and the University is committed to resolving
any issues of non-compliance identified in the final program review determination letter and
ensuring that Grand Canyon University operates in compliance with all Department of Education
requirements. If the Department of Education were to make significant findings of non-compliance in
the final program review determination letter, then, after exhausting any administrative appeals
available to the University, the University could be required to pay a fine, return Title IV monies
previously received, or be subjected to other administrative sanctions. While the University cannot
currently predict the final outcome of the Department of Education review, any such final adverse
finding could damage the University&#146;s reputation in the industry and have a material adverse effect
on the University&#146;s business, results of operations, cash flows and financial position.
</DIV>
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<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>SIGNATURES</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly
caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
</DIV>

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<TR>
    <TD width="48%">&nbsp;</TD>
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<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left">GRAND CANYON EDUCATION, INC.<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">Date: August 29, 2011&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/ Daniel E. Bachus
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">Daniel E. Bachus&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" nowrap align="left">Chief Financial Officer<br>
(Principal Financial and Principal Accounting  Officer)&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>


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