Colleges in Dire Financial Straits

[polly_mer]

More bad news

https://www.insidehighered.com/quicktakes/2020/12/18/judson-college-will-close-if-it-doesnt-receive-gifts

The question that comes immediately to mind: why is this a two-weeks notice instead of having started banging the drum last March and writing a letter like Jonathan Gibralter did for Wells College?

https://baptistnews.com/article/judson-college-needs-1-5-million-or-will-be-forced-to-close-in-january/#.X9zV2C1h2i4 has more detail including that Judson College only enrolls about 300 students.  One bad thing about being a tiny college is that also means having a tiny alumna base from which to draw for donations.  300 students/4 cohorts = 75 students/graduating cohort.  75 graduates * 30 years = 2250 alumna.  Unless many of those alumna are somehow very wealthy (why would they have chosen to go to a tiny, women's college instead of a good, small women's college?), that's a tiny pool from which to raise half a million dollars on short notice ($222 from everyone during a pandemic when money is tight for many people) and then they will have to raise another million dollars by May (total of almost a thousand dollars per alumna if everyone donates).

And that's not fixing the problem.  That's ensuring that the doors don't close this year. With a budget of $10M, being $1.5M short in a year is big!

[marshwiggle]

I was looking for something else when I came across Leaders consider future of tiny liberal arts colleges from 2016.  This article has aged very poorly since most of the explicitly named institutions have closed or merged.

From that article:

Taken on its own, a marketing plan might not be enough to help the tiny colleges overcome headwinds they face with students and finances. They simply do not have the benefits of scale that a larger institution would have, said Susan Resneck Pierce, former president of the University of Puget Sound and president of SRP Consulting.

"The problem for those small institutions is they all still need a registrar, they all still need an admissions staff," she said. "There are certain things you still need to have whether you are 800 or 8,000 or 50,000. To sustain themselves financially in this market has become more and more challenging."

Am I the only one that is stunned that the main problems with small institutions that are identified are administrative? The lack of program diversity, and pedagogical infrastructure like labs, etc. aren't even on the radar.

[spork]

More bad news

https://www.insidehighered.com/quicktakes/2020/12/18/judson-college-will-close-if-it-doesnt-receive-gifts

Judson College has been running deficits every year since 2010, except for 2017, when it had net revenue of $13,890. Anyone who throws money at this school is a moron.

As for

https://www.ndnu.edu/future-of-ndnu/message-from-president-carey-to-the-community/,

it's highly doubtful that the plan will end well, if it is actually implemented.

[secundem_artem]

More bad news

https://www.insidehighered.com/quicktakes/2020/12/18/judson-college-will-close-if-it-doesnt-receive-gifts

Starting a GoFundMe page is no way to run a college.

[apl68]

More bad news

https://www.insidehighered.com/quicktakes/2020/12/18/judson-college-will-close-if-it-doesnt-receive-gifts

Judson College has been running deficits every year since 2010, except for 2017, when it had net revenue of $13,890. Anyone who throws money at this school is a moron.

As for

https://www.ndnu.edu/future-of-ndnu/message-from-president-carey-to-the-community/,

it's highly doubtful that the plan will end well, if it is actually implemented.

My thoughts as well--better to contribute to something that's not already clearly a lost cause.  As polly notes above, it's far too late to try a desperation move like this, and such a tiny school just isn't going to have a large enough constituency to provide the needed resources.

It's a shame.  The place is 180 years old!  Looks like kind of a neat little school.  But really, a women's college with under 300 students and no vast endowment?  It's a wonder it has lasted as long as it has.  You still have to feel for the alumnae, the people who will be losing their jobs, and the community that is losing what was no doubt considered something of a local gem.

[Hibush]

It's a shame.  The place is 180 years old!  Looks like kind of a neat little school.  But really, a women's college with under 300 students and no vast endowment?  It's a wonder it has lasted as long as it has.  You still have to feel for the alumnae, the people who will be losing their jobs, and the community that is losing what was no doubt considered something of a local gem.

The economic effects may not be as big as the thought of a college closing suggests. Their revenue of $10 million is equivalent to four Panera shops. We are used to quick-service restaurants coming and going, they don't last 180 years.

[apl68]

It's a shame.  The place is 180 years old!  Looks like kind of a neat little school.  But really, a women's college with under 300 students and no vast endowment?  It's a wonder it has lasted as long as it has.  You still have to feel for the alumnae, the people who will be losing their jobs, and the community that is losing what was no doubt considered something of a local gem.

The economic effects may not be as big as the thought of a college closing suggests. Their revenue of $10 million is equivalent to four Panera shops. We are used to quick-service restaurants coming and going, they don't last 180 years.

Marion, Alabama is even smaller than the town that I live in.  Ten million dollars' a year worth of business gone will probably be a pretty significant blow in that context.  Plus, it's a local landmark, and probably to some extent a cultural center.

[polly_mer]

I was looking for something else when I came across Leaders consider future of tiny liberal arts colleges from 2016.  This article has aged very poorly since most of the explicitly named institutions have closed or merged.

From that article:

Taken on its own, a marketing plan might not be enough to help the tiny colleges overcome headwinds they face with students and finances. They simply do not have the benefits of scale that a larger institution would have, said Susan Resneck Pierce, former president of the University of Puget Sound and president of SRP Consulting.

"The problem for those small institutions is they all still need a registrar, they all still need an admissions staff," she said. "There are certain things you still need to have whether you are 800 or 8,000 or 50,000. To sustain themselves financially in this market has become more and more challenging."

Am I the only one that is stunned that the main problems with small institutions that are identified are administrative? The lack of program diversity, and pedagogical infrastructure like labs, etc. aren't even on the radar.

If you're stunned, then you haven't been paying attention.  The academic costs at small places  really don't matter if the majority of the costs are the fixed costs of just being open.

One "fun" part of having a front row seat at Super Dinky during the accreditation visit was finding out that the majority of the costs were not direct instructional costs.  A competent enough registrar will insist on being paid what they are worth and will walk if they are underpaid to do an impossible task.  The handful of accountants in the business office likewise will command market rates including benefits and will walk as soon as the job becomes too hard for the money.  The people who are good at the kind of thinking and skills at using the database systems to fill out the regulatory paperwork likewise will walk as soon as the money is not worth the effort.

Oddly, the faculty will insist that they are important, but seldom walk even when things are bad because they can't get other jobs.  The less available comparable professional jobs (e.g., many humanities and social science fields), the more likely the faculty will be to stay and just keep wringing their hands, while the necessary and unglamorous paperpusher positions that do require a specific mindset and useful-outside-of-academia skills tend to turn over because those folks have the relevant critical thinking skills to see the writing on the wall.

Thus, the problem is seldom directly the academics; the first big hard problem of tiny schools is how to get enough revenue to just keep the lights on and have a functioning organization into which one can admit students and hire faculty.  Not having people who can do the paperwork so that students can use federal financial aid means not having a viable school in most cases, regardless of what the majors are or how great the faculty are.

[spork]

Guilford College board of trustees will pause the implementation of a budget reduction plan:

https://www.insidehighered.com/quicktakes/2020/12/18/guilford-board-pauses-budget-cuts.

Guilford should have academically restructured a minimum of fifteen years ago. Now it is up against a wall.

Previous president quit before her contract was up and can ride out the rest of her career as a tenured English professor. Interim president was probably told to start putting Guilford on a financially sustainable path -- a temporary person who can take the blame for shutting down programs. Now she's being undercut by the board that hired her. 

[marshwiggle]

I was looking for something else when I came across Leaders consider future of tiny liberal arts colleges from 2016.  This article has aged very poorly since most of the explicitly named institutions have closed or merged.

From that article:

Taken on its own, a marketing plan might not be enough to help the tiny colleges overcome headwinds they face with students and finances. They simply do not have the benefits of scale that a larger institution would have, said Susan Resneck Pierce, former president of the University of Puget Sound and president of SRP Consulting.

"The problem for those small institutions is they all still need a registrar, they all still need an admissions staff," she said. "There are certain things you still need to have whether you are 800 or 8,000 or 50,000. To sustain themselves financially in this market has become more and more challenging."

Am I the only one that is stunned that the main problems with small institutions that are identified are administrative? The lack of program diversity, and pedagogical infrastructure like labs, etc. aren't even on the radar.

If you're stunned, then you haven't been paying attention.  The academic costs at small places  really don't matter if the majority of the costs are the fixed costs of just being open.

Oh, I get that. What amazed me was that people advocating for small institutions,talking about how to market to prospective students and parents, don't see the limitations of what they can provide as being a significant problem. The fact they they offer "personalized instruction" and  a "campus community" are assumed to be vastly more relevant to recruitment than whatever students can actually study when they get there. The main problems of scale that they see have nothing to do with their academic offerings.

Thus, the problem is seldom directly the academics; the first big hard problem of tiny schools is how to get enough revenue to just keep the lights on and have a functioning organization into which one can admit students and hire faculty.  Not having people who can do the paperwork so that students can use federal financial aid means not having a viable school in most cases, regardless of what the majors are or how great the faculty are.

Again, it's the idea that in recruiting the academics are almost irrelevant that seems surreal. It's no wonder places with more money build climbing walls, swimming pools, etc. if the program offerings are seen as inconsequential. 

With many of these small places, it seems there'd be way less program choice than in their high schools. Why would students go to a place with less choice than they had in high school?

[Hibush]

Interim president was probably told to start putting Guilford on a financially sustainable path -- a temporary person who can take the blame for shutting down programs. Now she's being undercut by the board that hired her.

Trustees that melt once the blowback begins are terrible, but it is so easy to understand the dynamic. Word must get around to the prospective Chainsaw Al's of academe. Then the school is really toast. What do they do, have the board chair step in as interim?

[polly_mer]

With many of these small places, it seems there'd be way less program choice than in their high schools. Why would students go to a place with less choice than they had in high school?

For decades (more than a century in many cases), these tiny school served people for whom 500 students is bigger than their high school and may be bigger than their entire town.  I come from such a place where we were the regional high school and had people bused from all over to create a high school of about 350 students, almost none of whom would go to college.

I went to a college of about 1500 students in a town of 10k people and felt overwhelmed by the hugeness.  I was pretty happy once I got into my major classes of 4-6 (new major and we were the first cohort) because that was so much more like the education I was used to, not like the huge classes of 70+ for Calculus I.

I didn't really care about the low selection of classes in large part because I was used to the idea of one picks a track, follows the course enrollment on the track, and then graduates in a timely manner with the education one gets on that track.  My high school worked exactly like that: I was college bound, so I took the courses that the college bound folks took.  Since we were in rural Wisconsin, that track was set up to get us into UW-Madison with 4 years of English, 4 years of science, 4 years of math, 4 years of a foreign language (could choose from German or Spanish), 3 years of the required history/civics, and several HS graduation requirements like gym, health, consumer living (taxes, budgeting, basic economics).  The electives I took was band with an abbreviated lunch and orchestra instead of a study hall.

One problem for the tiny colleges is how few college-going-age students like me remain at this point and how much farther afield a tiny college must recruit to get those students.  Even the president of Super Dinky didn't want to believe that there were only a few hundred HS students in the fifty-mile radius that is typical for non-elite college attendance and those students were primarily in the demographic groups that don't go to college right out of HS.

Sure, academic offerings matter for the students who know why they are going to college.  That was much less important even twenty years ago when any college degree was good enough and most of the tiny rural institutions were serving the "elite" of the region and providing teachers who would go on to get master degrees in education along with their history/English/language/philosophy BA or pre-med, pre-law, or pre-dental.  The person who would get a college degree in something academic and then return home to work in the small family business or small town government is no longer the primary audience for this schools.  Those folks go to the branch campus and then stay in the "big" city or go to the state flagship and stay in the big city.  The small towns in many places are all but dead.

[apl68]

With many of these small places, it seems there'd be way less program choice than in their high schools. Why would students go to a place with less choice than they had in high school?

For decades (more than a century in many cases), these tiny school served people for whom 500 students is bigger than their high school and may be bigger than their entire town.  I come from such a place where we were the regional high school and had people bused from all over to create a high school of about 350 students, almost none of whom would go to college.

I went to a college of about 1500 students in a town of 10k people and felt overwhelmed by the hugeness.  I was pretty happy once I got into my major classes of 4-6 (new major and we were the first cohort) because that was so much more like the education I was used to, not like the huge classes of 70+ for Calculus I.

I didn't really care about the low selection of classes in large part because I was used to the idea of one picks a track, follows the course enrollment on the track, and then graduates in a timely manner with the education one gets on that track.  My high school worked exactly like that: I was college bound, so I took the courses that the college bound folks took.  Since we were in rural Wisconsin, that track was set up to get us into UW-Madison with 4 years of English, 4 years of science, 4 years of math, 4 years of a foreign language (could choose from German or Spanish), 3 years of the required history/civics, and several HS graduation requirements like gym, health, consumer living (taxes, budgeting, basic economics).  The electives I took was band with an abbreviated lunch and orchestra instead of a study hall.

One problem for the tiny colleges is how few college-going-age students like me remain at this point and how much farther afield a tiny college must recruit to get those students.  Even the president of Super Dinky didn't want to believe that there were only a few hundred HS students in the fifty-mile radius that is typical for non-elite college attendance and those students were primarily in the demographic groups that don't go to college right out of HS.

Sure, academic offerings matter for the students who know why they are going to college.  That was much less important even twenty years ago when any college degree was good enough and most of the tiny rural institutions were serving the "elite" of the region and providing teachers who would go on to get master degrees in education along with their history/English/language/philosophy BA or pre-med, pre-law, or pre-dental.  The person who would get a college degree in something academic and then return home to work in the small family business or small town government is no longer the primary audience for this schools.  Those folks go to the branch campus and then stay in the "big" city or go to the state flagship and stay in the big city.  The small towns in many places are all but dead.

The demographics of polly's alma mater and its home town sound almost identical to mine.  Polly's high school sounds similar as well, except that at our 300-odd-student school Spanish was the only foreign language available.

The above is a pretty good overview of both the attractions and the contemporary challenges of a small rural college.  I think that polly's experience with Super Dinky sometimes leads her to sell other small colleges that are potentially still more viable than that short.  But she's all too correct that many of the little places don't stand much of a chance in today's environment.

[polly_mer]

Small colleges with a unique mission that can draw enrollment from the whole nation and have a great endowment or otherwise aren't primarily tuition driven have a good shot at survival.

Tiny colleges that are interchangeable and been relying mostly on locals who stay close to home with minimal career aspiration with practically no endowment and are already at over 50% tuition discount rates in a desperate attempt to get enough butts in the seats have almost no shot, especially if they double down on "the liberal arts are important" instead of addressing local employment needs.

It's not that size will doom every institution; it's that a fair number of smaller institutions have almost no resources beyond tuition as expenses go up fast and demographics shift.  Those smaller places are not competitive on price for the people who have options or know they want something else.

[polly_mer]

UC Berkeley: https://www.kqed.org/news/11849485/were-fragile-uc-berkeley-officials-battle-budget-woes