Weekly Market Update
STATES MAY INCREASE OVERSIGHT OF STRUGGLING COLLEGES
Thursday, February 14, 2019
Green Mountain College recently announced it will be closing after this academic year, leaving hundreds of students with little time to figure out next steps. This is one of several recent closures in the New England area, causing state officials to consider increasing the oversight of private, independent colleges. In Vermont, legislators attempted to pass a bill requiring schools placed on probation for financial reasons by their accrediting agency to inform the state. In Massachusetts, state officials are developing plans to screen colleges and assess their risk of closure, requiring schools to notify students if the state concludes a school might close within the next academic year. Both states' attempts at increasing oversight have been met with strong criticism by college leaders who worry that schools deemed at risk of closure by state officials may suffer undeserved reputation damage.
In Other News
- Philanthropic giving to higher education grew 4.6% this past academic year to reach a record $46.7 billion. The top 20 institutions raised approximately 28% of the total.
- Creighton University is partnering with St. Joseph's Hospital, District Medical Group, and Maricopa Integrated Health System to build a new $99 million medical school in Phoenix, approximately 1,300 miles from Creighton's main campus in Omaha, Nebraska. Creighton's stated purpose for locating in Phoenix is to help alleviate the shortage of physicians in Arizona.
- Michigan State University is funding the legal settlement it reached with victims of Larry Nassar's sexual abuse from the proceeds of a recently closed taxable bond issue. MSU's Board approved a $500 million settlement, $323 million of which will be funded by the bonds. Moody's and S&P rated the bonds Aa2 and AA, respectively, after downgrading the school last year following the news of the settlement.
- Wright State University in Dayton, Ohio came to an agreement with its unionized faculty members after a 20-day strike during which many students chose not to attend classes being taught by replacement instructors.