College of St. Joseph in Vermont is put on probation because of financial woes
The College of St. Joseph, a small liberal arts school in Rutland, Vt., that has considered closure because of financial difficulties, has been placed on probation by regional accreditors, the accrediting agency announced Wednesday.
The school is just one of many small, private colleges in New England struggling to meet costs as tuition dollars remain a shrinking source of revenue and enrollment declines.
After Mount Ida College, a small, private school in Newton, closed abruptly in May, the regional accreditors have been more watchful of such schools and are exploring ways to better problems before schools close.
The Commission on Institutions of Higher Education at the New England Association of Schools and Colleges voted to place the school on probation for not meeting standards for financial health. Probation lasts up to two years, during which the commission will monitor the school’s conditions. The vote came on June 28, and the accrediting agency made the decision public Wednesday.
“Though disappointing news, this should not come as a surprise to anyone, given how open we have been about our financial struggles,” said Jennifer Scott, who became the school’s seventh president in June.
On Sunday, the Globe reported that at more than half of the 75 smallest private colleges in the region tuition revenue is failing to keep up with expenses.
The College of St. Joseph, and many others like, it, have turned increasingly to tuition discounting to entice students to enroll, but that happens to the detriment of their own bottom line.
Tuition covered 91 percent of operating expenses at the College of St. Joseph in 2012 but just 58 percent of expenses in 2016, according to a Globe analysis of federal financial data about small colleges in New England. During that same time period, expenses per student grew.
Larry Jensen, the president at that time, cited declining enrollment as well as the failure of a planned physician assistant program, which was abandoned in 2016 after it was denied accreditation, according to the Rutland Herald. But the school had pulled $2.5 million from its then $5 million endowment to try to launch that program.
Scott, the current president, was not available for an interview Wednesday, according to a school spokeswoman. In the press release, however, she called the probation a “turning point” for the school and said it will use the opportunity to review its practices and strengthen the school.
“The administration, faculty and staff, and board of trustees are unified in our goal to ensure the best outcome for our students,” she said in the release.
College of St. Joseph officials are set to meet again with the commission in November to present the school’s turn-around plan to achieve financial health in two years’ time.
The school plans to reduce expenses, diversify revenue, seek financial support from local businesses and banks, develop new enrollment strategies, revitalize its fund-raising efforts, and increase its partnerships with other entities in the community, the release said.
It also plans to begin a two-year capital campaign to raise $3.5 million by June 2020.
If the school does not meet the requirements after two years, its accreditation will be revoked, meaning it will no longer be eligible to receive federal funds. Students who attend a college that is not accredited are not eligible to receive federal student loans.
There are nine standards that schools must meet to remain accredited. College of St. Joseph did not meet the standard that concerns financial resources.
The school must demonstrate it has sufficient human, financial, physical, and technological resources to support its mission. It must demonstrate that it has the financial capacity to graduate its entering class, show that it administers its resources in an ethical manner, and demonstrate adequate internal controls.