Indications That Your University Is on the Verge of Shutting Down
Corinthian Colleges decided to shut or sell virtually all of its campuses in July 2014. 72,000 students were left unsure of what to do next.
While Corinthian Colleges Inc. was an exception, with its demise resulting from fraud, more colleges and universities are grappling with diminishing funds.
Students face significant obstacles when their school closes: financial aid becomes even more difficult, transferring credits is tough, and students may be caught in limbo in the middle of a semester with no opportunity to transfer or reapply to a new school before the following term begins.
If your school closes, being proactive is the greatest approach. There are manyways to tell if your institution is in peril.
The Department of Education Gives It a Poor Financial Ranking
The financial responsibility composite score is a metric used by the US Department of Education to assess the financial condition of American institutions.
The score is predicated on a scale of 1.0 to 3.0, with 3.0 being a positive number. If your school is graded 1.5 or higher, it is financially prudent, meaning it does not have excessive debt or waste money.
If your school receives a score of less than 1.0, it is considered fiscally irresponsible.
The Institution Is Prepping to Merge
College mergers that were inconceivable 100 years ago are becoming increasingly prevalent as small schools with small resources struggle to stay solvent, according to a Boston Globe investigation.
While elite institutions and those with important urban real estate are thought to be well-positioned to withstand the storms, less-elite schools may be affected.
A merger does not necessarily imply that the institution will close; in fact, some mergers benefit both schools’ students. However, not every merger succeeds, and a failed merger might result in the institutions demise.
The Administration Acts Unprofessionally
Burlington College was challenged with accreditation and closed at the conclusion of the school year in 2016, due to financial constraints, including debt and the loss of the school’s credit line, and poor decision-making by the college management.
Examine what your college president and management want to accomplish in the next few years; are there any doubts? If this is the case, your institution could be on the verge of closing.
More college closures are inevitable in the future as schools struggle to deal with a growing number of financial challenges and increased competition. Surviving them may, sadly may meangetting ahead of them.