Last March we wrote on how a growing number of small liberal arts colleges were facing major financial challenges with the risk of shuttering operations. Since last spring, the number of small private school closures has grown to include: St. Gregory’s University, Grace University, Concordia College, Marygrove College, Atlantic Union College, and Moody Bible Institute.
These small schools share specific traits: high tuition, minimal endowments, religious affiliations and locations in rural or suburban areas. Roughly one-third of the small private colleges rated by Moody’s Investors Service generated operating deficits in 2017, an increase from 20 percent in 2013.
Today’s students continue to shy away from expensive liberal arts schools that leave them in debt and are considering larger, public universities. Moody’s recently released a report about college closures and said the amount of colleges closing in 2017-18 is expected to triple with small colleges the most at risk.
Increased tuition has forced many students to think more about value. In recent years, larger schools have been able to offer better rates of financial aid and lower tuition. With fewer students choosing smaller, more expensive universities, revenue from tuition has fallen. Bigger schools have bigger endowments, allowing for flexibility. Smaller, private schools don’t always have the assurance of large endowments to fall back on. When budgets are stretched, the first thing to go are specialized programs and facilities. Eventually smaller schools may be forced to lay off faculty and staff, thus decreasing overall value in the eyes of potential students.
Last year, due to ‘financial challenges’ St. Joseph’s College announced that it would cease operations at the end of its spring semester. The school lost $4 to $5 million each year in revenue since 2012. Board Chairman Benedict Sponseller said the school took out a large mortgage in hopes of increasing enrollment. When enrollment did not increase, St. Joseph’s began to spend its endowment, around $24 million in 2015, to stop the bleeding. It did not work.
St. Joseph’s is not alone as St. Gregory’s University hoped a $12.5 million loan from the Citizen Potawatomi Nation – through the US Department of Agriculture – would keep it from closing. Despite de-annexing from the city of Shawnee to qualify, the loan was denied. Board Chairman of St. Josephs, Rev. Don Wolf said, “”Without this component in the financial plan, the ability to sustain the university at this point is not possible.” The university suspended operations in the fall.
Dowling College, St. Catharine College, and Marian Court College are among others who have shut their doors in recent years. David Warren, head of the National Association of Independent Colleges and Universities, says small schools must understand their own value and cut costs to survive. With larger schools offering what today’s students want- generous financial aid, access to urban areas, and numerous school programs backed by large endowments – small liberal arts schools have a lot of value to make up.
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New research from Higher Education Publications, Inc. indicates that top-level positions at colleges and universities are experiencing some of the highest employee turnover compared to other administrators. Our analysis tracked administrators at accredited colleges and universities in the United States and found that presidents, chancellors and provosts were three of the top four positions with the highest turnover rates in the last 18 months.
Noted are the top ten turnover percentages for college administrators tracked in the HEP, Inc. database since October 2016.
- Dean/Directors of Education 22%
- Provosts 21%
- President’s/Chancellors 18%
- Dean of Business 18%
- Dean of Art and Science 18%
- Director of Institutional Advancement 17%
- Dean/Director of Nursing 16%
- Dean/Director of Math/Science 16%
- Director of Admissions 15.5%
- Chief of Student Affairs 14%
*Positions listed require a minimum of 350 reported administrator counts to be included.
- The average turnover rate of 124 different administrator positions tracked by HEP Inc. was 12%.
- Of the 3,893 provosts listed in The Higher Education Directory in 2017, 808 or 21% are new as of April 2018.
- Presidents and Chancellors are third on the list with a total of 840 out of 4,717, or 18% being new.
- Rounding out the bottom of the list with the lowest percentage turnover are deans/directors of government relations, at 6%.
When compared to other administrators, the cause for such high-level turnover can be linked to many diverse issues such as growing financial, faculty, Board and political pressures. Also, traditionally colleges and universities have made leadership selections from within, minimizing risk. According to the American Council on Education, 60 percent of current presidents at doctoral-granting universities were once provosts prior to accepting presidency. However, another study released by ACE found that only 30 percent of provosts planned to pursue presidency. As a result, traditionally qualified presidents are becoming harder to find, thus creating a higher risk of turnover through a limited supply of conventional talent. In order to increase the likelihood of a long, successful tenure, presidents must develop an acute understanding of the complex issues that lead to involuntary turnover and act accordingly.
Education Secretary Betsy Devos has signed an official order retaining the status of the Accrediting Council for Independent Colleges and Schools (ACICS) as a federally recognized accrediting agency. Citing a “flawed” decision-making process, Devos’ order comes on the heels of a federal district judge’s ruling that previous secretary, John King, failed to consider key evidence and used a flawed process before removing the recognition of ACICS in 2016.
ACICS, a historically for-profit accreditor, has fought for its accreditation reinstatement since the Obama administration eliminated its recognition in 2016. King removed ACICS’s recognition after citing “pervasive compliance” problems with schools that had attained accreditation under the council. Shuttered schools such as ITT Tech, The Corinthian Colleges, and other for-profit institutions “routinely failed to adequately police schools under its oversight,” according the Education Department. However, in March a federal court found that ACICS’s 36,000 pages petitioning for recognition had not been entirely examined by Education Department officials in leu of revoking ACICS’s status.
While temporary, with restored recognition more than 100 colleges under ACICS will again be eligible to receive federal student aid. The department’s announcement does not entirely reverse the Obama era ban but allows ACICS continued recognition for an additional 12 months while the department “conducts a further review of ACICS’s 2016 petition for recognition.” Devos also said she would review the 2016 documents and allow ACICS to submit further information to prove its future compliance. According to the order, ACICS must file written submission and “provided additional evidence that is relevant to these issues” by May 30th. The Education Department will respond to said submission by July 30th.
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Harvard Names Next President
Harvard has announced that its next president will be former Tufts University President, Dr. Lawrence S. Bacow. Bacow will take over for Dr. Drew Gilpin Faust, who is resigning after 11 years at the helm. He will begin in June of this year.
New President Announced at Bentley University
Former Dean of the Ross School of Business at Michigan, Dr. Alison Davis-Blake, has been appointed president of Bentley University. Dr. Davis-Blake will begin in July.
William and Mary Selects First Female Presidet
Current provost of Smith College, Dr. Katherine A. Rowe, has been named the 28th president at William and Mary. Rowe said, “This is an institution that was founded by a woman as well as a man. It feels right.” She will succeed President W. Taylor Reveley III, who announced his plans to retire in June, 2018.
Bluffton Announces Next President
Dr. Jane Wood has been selected to become the 10th president of Bluffton University in South Dakota. Wood will take over for Mr. James Harder, who will retire in June. Harder has served the school for the past 12 years.
New President Announced at Chowan University
The Board at Chowan University has named Dr. Kirk Peterson to become the schools 23rd president. Peterson previously served as president at Urbana University in Ohio. He will begin his tenure on June 1, 2018.
Gordan State Names New President
Dr. Kirk Nooks has been named the next president of Gordon State College in Barnesville, Georgia. Nooks is currently president at Metropolitan Community College Longview in Missouri. He will begin in June.
Miles Davis Appointed President
Dr. Miles Davis has been appointed the 20th president of Linfield College in McMinnville, Oregon. Currently dean of Shenandoah University’s school of business, Dr. Davis will begin at Linfield College this July.
Lord Fairfax CC appoints New President
Dr. Kim Blosser has been appointed the next president of Lord Fairfax Community College. Blosser previously worked as LFCC’s provost. She is the school’s fifth president and began in early February.
Marymount California Names Board Member President
Current CEO of Titan Oil Recovery Inc. and Board Member, Brian Marcotte, has been named president of Marymount California University. Marcotte was appointed after former president, Lucas Lamadrid was put on leave.
Third President Picked at Pennsylvania CAD
Mr. Michael Molla has been named the next president of Pennsylvania College of Art & Design. Molla is currently VP of strategic initiatives at Maryland Institute College of Art. Molla replaces President Mary Heil, who will retire on July 1st.
Quinnipiac Selects New President
For the first time in 30 years, Quinnipiac University has named a new president. Dr. Judy D. Olian has been selected to succeed President John Lahey in July. Olian is currently chair of management at UCLA’s school of management.
New President Announced at San Diego State
Adela de la Torre has been named the ninth president of San Diego State University. De La Torre will become the school’s first female president at the end of June.
Union College Picks New Leader
Dr. David Harris has been selected to become the next president of Union College in Schenectady, New York. Harris is currently the provost at Tufts University. He will replace current President Stephen Ainlay, who is retiring at the end of June.
Elizabethtown President Retiring
President Carl Strikwerda has announced that he will retire in June of next year. Strikwerda has served as president since 2011. The board will begin looking for the school’s next president in the upcoming months.
Wagner President Announces Retirement
Dr. Richard Guarasci has announced that he will retire from Wagner University after 21 years at the helm. Guarasci will step down in June of 2019.
Retirement at Wentworth Institute
The first female president of Wentworth Institute, Zorica Pantic, has announced that she will retire in May of 2019. Pantic served the school for the past 14 years.
Maryland Eastern Shore President to Resign
University of Maryland Eastern Shore President, Juliette Bell, has announced that she will leave her post early in June. Bell has served as president of the school since 2012.
Spokane Falls CC President Resigns
The interim president at Spokane Falls CC has resigned after allegations of sexual harassment. Dr. Darren Pitcher became the schools acting president last summer.
The NCAA Division I Men’s Basketball Tournament is set to begin a little less than a month from now and a successful run can pump up more than a school’s spirit. According to a study of past tournament wins by Moody’s Investor Service, schools that were successful in the NCAA men’s basketball tournament directly correlated with a surge in student applications. “Enhanced demand can result in increased applications, higher net tuition revenue and greater fundraising,” the New York ratings agency said in their report.
Following the University of Connecticut’s two national championship wins in 2011 and 2015, applications at the school increased 27 and 35 percent in those respective years. In 2011 Virginia Commonwealth University was able to reach the final four as a double-digit seed, becoming only the third team in history to do so. As media coverage and homepage visits to the school’s website grew, so too did VCU’s freshman application numbers—by more than 15 percent from the previous year. Back in 2010, Butler saw a 43 percent boost in applications after a loss to Duke in the national championship game.
Long term, being consistent in the NCAA tournament can benefit schools beyond applications. Gonzaga University first made an unlikely run in 1999, when it advanced to the Elite Eight. Since then, the school has made the tournament eleven times, including the national championship game last year vs. North Carolina. In that time, Gonzaga’s enrollment has nearly doubled, undergraduate applications have grown 300 percent, and the school’s endowment has multiplied to $212 million. Gonzaga President Thayne McCulloh said, “I think it’s fair to say there have been many initiatives…and the success of the basketball program has played a significant role in our ability to raise funds.” Over the past two decades, Gonzaga has also worked to increase financial aid, update infrastructure, and develop new programs for an evolving workforce. “Basketball has certainly been a major factor these 20 years in terms of people’s awareness of the university. We’ve certainly not missed the opportunity to capitalize on the success of the team and the appearance they’ve had on the national stage,” McCulloh said.
While Moody’s report identifies that the increase in applications may be temporary, it notes: “the publicity provided by the tournament can reach more potential students than a university might otherwise have the resources to pursue.” According to a report by economists Devin and Jaren Pope titled “Understanding College Applications Decisions: Why College Sports Success Matters,” the awareness provided by a sports victory to out-of-state students can be significant financially. For VCU the results of a final four run directly impacted enrollments and tuition revenue. In 2008, 92 percent of freshman were from Virginia. In 2012, in-state enrollment rates had decreased to 85 percent. Based on VCU’s 2012 admission’s rates, out-of-state students added an additional $3.4 million in tuition revenue.
In Gonzaga’s case, making the tournament helped spark the beginning of the university’s long-running success and branding. And as schools face the reality of seeking new solutions to funding shortages, a Cinderella run in March Madness may not be the complete answer, but it can certainly help.
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Education Secretary Betsy DeVos is being sued by several civil rights organizations about how her agency is investigating sexual assaults on college campuses. This past fall, the Education Department dropped Obama-era policies and issued new rules on how colleges deal with sexual assault and harassment claims. The new instructions now require that universities use higher standards of evidence to proceed with campus judicial action in the case of an allegation.
Civil rights advocacy groups argue that previous Obama-era guidelines offered critical protections for survivors of sexual assault and that the new rules, under DeVos, create a system which discourages sexual violence and assault victims from using the campus process to come forward “leading to further reductions in reports of sexual violence and assault.” According to Stacy Malone, the executive director of the Victim Rights Law Center, “They (survivors) fear they are no longer able to get a fair shake.” The actual lawsuit alleges a “Myriad of statements and actions by the Department’s leadership reveal a discriminatory viewpoint. Thus, not only does the Department’s 2017 Title IX policy fail to meet the reasoned decision and other requirements of the Administrative Procedure Act, it also violates the Fifth Amendment’s equal protection guarantee. Plaintiffs therefore respectfully request that the 2017 Title IX policy be vacated.”
Secretary DeVos announced the changes to Title IX in September, saying the previous system “lacked basic elements of due process and failed to ensure fundamental fairness.” She continued with, “There’ve been too many students wronged in a well-intentioned attempt to ensure that this issue is not swept under the rug and not in back rooms of schools any longer.” The Department of Education said it plans to enact the new guidelines after a public comment period.
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This year’s national championship between Alabama and Georgia was a nail-biter of a game, with a deep pass to seal the win for the Crimson Tide. The competition on the turf seems to align off the field as well, as the average amount spent per year on a single player by both teams was between $300,000 and $350,000.
According to a recent study performed by the Knight Commission on Intercollegiate Athletics, annual spending on sports by public non-profit universities in the largest ‘big six’ conferences, has surpassed $100,000 per athlete—around 8 to 12 times the amount spent on academics per full time student. Twenty plus schools spend more than $200,000 per football player, including all of the ten top-ranked FCS programs.
The increased spending on student athletes comes at a time when many college and universities are struggling to fill the gap with funding needs. According to the Center on Budget and Policy Priorities, state spending on public higher education is now at lower levels than pre-recession rates. A recent study from the CBPP highlights that funds allocated to colleges and universities for the 2017 school year were almost $9 billion below the 2008 level.
Concurrently, spending on athletics has grown immensely since the recession. According to the Knight Commission data, major conferences (Big Ten, SEC, ACC, Pac12, Big12) have seen growth in player spending of around 30% and as high as 42%, since the recession. In a report by the American Association of University Professors, average pay of head basketball and football coaches almost doubled from 2006 to 2012. The average salaries for fulltime professors grew at a rate of 4 % at top doctoral level institutions.
University presidents face the reality of seeking new solutions to funding shortages, and athletics can be a tempting source for increased revenue. However, in doing so they must not lose overall sight of their purpose: educating their student body. According to an NCAA report, officials argue that only around two dozen of the 300 plus Division I athletic departments are truly self-sustaining—with revenues exceeding or breaking even with overall costs. As state schools increase funding to their athletic departments to compete, many are having to balance their budgets by increasing student fees and tuition at alarming rates. As institutions spend more on athletes at vastly disproportionate amounts compared to their average students, they risk undermining themselves, and in turn perpetuating the public’s increased weariness of the higher education system itself.
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