Colleges in Dire Financial Straits

[Trogdor]

And another article about the College of St. Rose in Albany.
https://www.timesunion.com/education/article/college-saint-rose-asks-state-albany-officials-18520279.php

Sounds about as dire as it gets. They're basically begging for money from New York State.

It's not even clear how many students they actually have.

enrollment, which had fallen from 4,000 to 2,800 students

according to their accrediting agency (middle states)

the college has nearly 2,600 students, said spokeswoman Denise Dagnino

Fitch Ratings, the prominent credit rating agency, said the college had 2,215 full-time-equivalent students in the 2022-2023 school year, when Saint Rose reported 2,800 students (both full- and part-time.)

Stavisky (chair of the state senate's Higher Education Committee) said she was told the college had 1,778 undergrads this fall

In September, the college withdrew from Fitch's rating service rather than share its latest financial details.

Damn. what a mess.

[mythbuster]

Birmingham Southern is not dead yet. They get a $5 million loan.
Birmingham Southern Loan

[lightning]

Baldwin-Wallace University faces a nearly $20 million budget deficit, far larger than the $3 million deficit it thought it had. That is proportionally worse than the University of Arizona oopsie. They are finding it challenging administering grant-supported science faculty and grant-free humanities faculty who are feuding with each other, as well as a very expensive conservatory.

There are only about 3,000 students at BW. Holy sh*t!!! How could some be so inept that they didn't know what was really going on. Considering the relatively small size of BW, making this kind of financial mistake is completely inexcusable. The admins should all be sacked immediately.

I googled around a bit. Here is the first newspaper article I have ever come across that reports on the subject of a higher ed institution's finances with some relevant facts: BW Finances

Past deficits were covered from endowment! [Eat your house until it's gone and you don't have a place to live anymore.] The person doing this was the CFO, who just retired. End game!

His boss clearly had no incentive to monitor his behavior. The structure of a non-profit gives the bosses a way to have a soft life -- until the money runs out.

Happens in the private sector--more than it should. That's where these clown administrators in higher-ed get the idea--they get it from private-for-profits. Run higher ed like a business, until the money runs out, and when it goes bankrupt, walk away with full pockets and the experience of the lifestyle that it afforded can't be taken away.

[dismalist]

Baldwin-Wallace University faces a nearly $20 million budget deficit, far larger than the $3 million deficit it thought it had. That is proportionally worse than the University of Arizona oopsie. They are finding it challenging administering grant-supported science faculty and grant-free humanities faculty who are feuding with each other, as well as a very expensive conservatory.

There are only about 3,000 students at BW. Holy sh*t!!! How could some be so inept that they didn't know what was really going on. Considering the relatively small size of BW, making this kind of financial mistake is completely inexcusable. The admins should all be sacked immediately.

I googled around a bit. Here is the first newspaper article I have ever come across that reports on the subject of a higher ed institution's finances with some relevant facts: BW Finances

Past deficits were covered from endowment! [Eat your house until it's gone and you don't have a place to live anymore.] The person doing this was the CFO, who just retired. End game!

His boss clearly had no incentive to monitor his behavior. The structure of a non-profit gives the bosses a way to have a soft life -- until the money runs out.

Happens in the private sector--more than it should. That's where these clown administrators in higher-ed get the idea--they get it from private-for-profits. Run higher ed like a business, until the money runs out, and when it goes bankrupt, walk away with full pockets and the experience of the lifestyle that it afforded can't be taken away.

It's actually harder to this in the for profit sector. Somebody -- the board -- has its members money stuck in the firm, which gets lost if the firm goes under.

In the non-profit sector nobody has skin in the game.

My favorite corporate disciplining device is the hostile takeover! If only that could be done in higher education. :-)

[artalot]

Bacone College in Oklahoma. This one hasn't hit the national media, yet, but I have a friend who works nearby. Apparently, a judge has ordered the campus to go up for auction to settle a lawsuit over unpaid debts. The current president claims they found out about the auction in the newspaper and that the debt was incurred under the previous administration that left no records.   
It's a predominantly indigenous serving institution, so it's sad.

[apl68]

Bacone College in Oklahoma. This one hasn't hit the national media, yet, but I have a friend who works nearby. Apparently, a judge has ordered the campus to go up for auction to settle a lawsuit over unpaid debts. The current president claims they found out about the auction in the newspaper and that the debt was incurred under the previous administration that left no records. 
It's a predominantly indigenous serving institution, so it's sad.

The current leadership literally had to read in the paper that their campus was about to be auctioned out from under them?  How on Earth does something like that happen?  And we thought that Baldwin-Wallace's leadership was out of the loop!

[Hibush]

Bacone College in Oklahoma. This one hasn't hit the national media, yet, but I have a friend who works nearby. Apparently, a judge has ordered the campus to go up for auction to settle a lawsuit over unpaid debts. The current president claims they found out about the auction in the newspaper and that the debt was incurred under the previous administration that left no records.   
It's a predominantly indigenous serving institution, so it's sad.

It sounds as if Bacone was about to expire a few years ago, but some area tribes bought in on the bet that they could become a Tribal College and use the subsidies those colleges get to make the finances work. That was not successful, so there was no path to financial sustainability.

[selecter]

The St. Rose car crash has been slow motion, but inevitable. Operating deficit, bond debt, deferred maintenance on old physical plant, no brand, declining reputation, and lots of local competition.

[apl68]

Bacone College in Oklahoma. This one hasn't hit the national media, yet, but I have a friend who works nearby. Apparently, a judge has ordered the campus to go up for auction to settle a lawsuit over unpaid debts. The current president claims they found out about the auction in the newspaper and that the debt was incurred under the previous administration that left no records.   
It's a predominantly indigenous serving institution, so it's sad.

It sounds as if Bacone was about to expire a few years ago, but some area tribes bought in on the bet that they could become a Tribal College and use the subsidies those colleges get to make the finances work. That was not successful, so there was no path to financial sustainability.

A sad story, since Bacone could have been a case of a small college filling a needed niche.  Unfortunately there seems simply not to have been enough money available to make it work.  And from the look of things, not enough good leadership either.

[apl68]

The St. Rose car crash has been slow motion, but inevitable. Operating deficit, bond debt, deferred maintenance on old physical plant, no brand, declining reputation, and lots of local competition.

Their request for a government bailout shows just how desperate they are.  You're just not going to see a state government bailing out a small private school like that.  Maybe if somehow it was the only higher education option in the region, but it's not that either.

[polly_mer]

The St. Rose car crash has been slow motion, but inevitable. Operating deficit, bond debt, deferred maintenance on old physical plant, no brand, declining reputation, and lots of local competition.

Their request for a government bailout shows just how desperate they are.  You're just not going to see a state government bailing out a small private school like that.  Maybe if somehow it was the only higher education option in the region, but it's not that either.

Birmingham-Southern was pleased with the recently passed state law for a loan, sued when denied, and now has a loan from city council: https://www.insidehighered.com/news/quick-takes/2023/11/29/embattled-birmingham-southern-secures-5-million-loan

St. Rose probably is hoping for the same type of unwarranted miracle.

[apl68]

Hi, polly!

[mythbuster]

We've missed you Polly! I hope all is well.

[dismalist]

The St. Rose car crash has been slow motion, but inevitable. Operating deficit, bond debt, deferred maintenance on old physical plant, no brand, declining reputation, and lots of local competition.

Their request for a government bailout shows just how desperate they are.  You're just not going to see a state government bailing out a small private school like that.  Maybe if somehow it was the only higher education option in the region, but it's not that either.

Birmingham-Southern was pleased with the recently passed state law for a loan, sued when denied, and now has a loan from city council: https://www.insidehighered.com/news/quick-takes/2023/11/29/embattled-birmingham-southern-secures-5-million-loan

St. Rose probably is hoping for the same type of unwarranted miracle.

Interesting. If one reads the article one learns that $2.5 million is a gift. The remaining $2.5 million is a loan secured by the property of the college.

If I understand correctly, the state is setting aside $30 million for these kinds of contingencies.

Given how these places have been run, my question is what happens when the money runs out?

Well, I do know: Daddy, I want more, now. :-)

[Wahoo Redux]

Yo! Pol-ly!