This Week In College Viability (TWICV) for November 18, 2024

Gary (00:01.19)
It's this week in College Viability News and Commentary for this Monday, November 18, 2024. And of course, it is the week before Thanksgiving. And my prediction of the college closure rate picking up steam has really not yet developed. I still believe there are scores of colleges out there without the resources to be viable. My concern

is now moving toward how many of these colleges will wait too long, like we have seen before, and must announce their closure with very short notice, very short notice to students and faculty and staff and communities. Time, of course, will tell. And as I've shared before, for this economic imbalance, too many college, too many college seats, and not enough students to fill them. For that economic imbalance to get

Some sort of supply and demand equilibrium. Many, many more colleges still need to close. So this week's news and commentary is heavy on that theme. The stories are Tennessee State laying off lots of employees. We'll talk about that. Harris Stowe State University and Hannibal Lagrange University. Stories in the St. Louis Post-Dispatch that both are back on full accreditation. I have concerns with both.

Several St. Louis colleges make a watch list, all right, for financial risk. It's a poor watch list. It's a lazy watch risk. It's putting some colleges with bad headlines that don't deserve them. And this is just plain lazy work on an organization we'll talk about here in St. Louis. And the last story that I want to talk about is let's regulate colleges like a business. All right, I'm sure you've heard that before, but there's some new details there and some new correlations that I think have some interest to the stories.

Layoffs and cutbacks. Tennessee State University lays off 114 employees amid financial crisis. That's a headline on Friday, November 14th, November 15th, excuse me, in News Channel 9 and the stories by Madeline Nolan or Madeline Nolan at News Channel 5. And it's really the second story that was News Channel 5 in Nashville. And it was the headline read, down to the studs, state leaders, Tennessee.

Gary (02:23.264)
State leaders tell Tennessee State University to slash spending and faculty to overcome financial crisis. From the story, the Tennessee Senate Finance Chairman has now come forward to say Tennessee State University was in such dire financial straits, dire financial straits that they had to advance, the state had to advance their money from the 2025 budget to get the 2024 school year even started.

Senator Bo Watson, again from Tennessee, said when the financial picture at Tennessee State didn't improve in October, state leaders liquidated money allocated for a $32 million agriculture building on Tennessee State's campus just to shore up payroll.

to the data we go as always. This is the National Center for Education Statistics, data from 2015 to 2022. I'll have the 2023 data out in January or February sometime when it's released by iPads. At Tennessee State, the FTE enrollment was down almost thousand students over the last eight reported years. Tuition and fees down almost 19 million, a little short of that. The four-year graduation rate, and of course I have talked

consistently about graduation rates. The four-year undergrad graduation rate at Tennessee State University hovers around 20%. That's right, two out of every 10, 20 out of every 100, for those that didn't pay attention to math class, don't graduate from Tennessee State University after even four years. And as I looked at the numbers, 20 % is being nice. The long-term debt,

is up 30 million. I don't know what they're spending that on. Maybe it was for that agricultural building, but I doubt it. Total expenses in the face of declining enrollment and poor graduation rates was up 20 % and total operating revenue in that same period was down more than $7 million.

Gary (04:32.01)
House speaker, the House speaker in Tennessee, Cameron Sexton, pointed out that the university used, now get this, the university used one time federal COVID-19 funding on scholarships. That's just the first part of the story, but did not have funding, again, did not have funding after that to sustain that influx in enrollment, that's not even well written, to sustain the scholarships. It looks,

how Speaker Cameron Sexton said, it looks like they had a plan to increase enrollment, all right, and they were going to use federal money to do that through scholarships, potentially, her words, not mine. Again, her words, but there was no plan, there was no plan in the future on how they were going to cover those scholarships, those scholarship costs after that one year of COVID funds. And this is just...

mind-boggling financial ineptitude? Did the leaders at Tennessee State University really think through the consequences of a one-time federal source of funds? Clearly not. That's a rhetorical question. Just stunning. Just stunning.

Harris Stowe State University in Missouri and Hannibal LeGrange University also in Missouri on the eastern edge, a couple hours north of St. Louis. Both had their accreditation. Their higher learning commission accreditation restored. This story was in the St. Louis Post-Dispatch last week. And kudos, first of all, kudos to the folks at Harris Stowe on their accreditation renewal.

tongue in cheek. There were certainly many I's to dot and T's to cross and that's not even the story. I've talked about that before. The story is this is yet another example of an accrediting agency. This time it's the Higher Learning Commission only focusing on inputs. And here's what I mean. Here are some highlights from a LinkedIn post by the university's president.

Gary (06:45.652)
and she is female, she said, this first island, the culture of student achievement. Harris Stowe State University has established specific measurable goals to measure student success and has demonstrated ongoing review of those goals. What, what does that even mean? The school typed something up and promised to do it despite a history of not doing it that

is an input. The output, ladies and gentlemen, is the pathetic graduation rate, hovering not even at 20%.

And you'll see that that miserable graduation rate in the data notes below. So Higher Learning Commission is it? Here's my question. So the Higher Learning Commission, is it more important to you that a college says they will graduate students or is it more important to actually graduate them? I think you're telling us it's the former, not the latter. The second item was they created a culture of academic accomplishment. I guess that doesn't include

graduation rates, sarcasm intended. The quote from the LinkedIn posting from the university president, the university has demonstrated efforts to improve assessment of student learning with improved systematic data collection and analysis. All right. I will cautiously yield the point on this one. Very cautiously. But again, as I've asked before, why haven't they always done that?

And if they, even if they do capture the data on improving student learning, what's the lead time for that data to become functionally useful to the college and to the students it allegedly serves? And what in the world is gonna be the timeframe for Harris Stowe State University to graduate something even close to 50 % of its students in four years or even six years?

Gary (08:53.982)
The third item was a culture of service excellence. I guess service again doesn't include graduation. Harris Stowe's resource base has been strengthened such that it supports the institution's education program and student needs. Again, I say, what does that even mean? What, a new culture has been created in two years? Really? Really?

that hardly seems to be something that would be so quickly ingrained into any organization that owned a college education organization. And again, if it was done in the past, if it wasn't done in the past, if it was not done in the past, why now? And the final one was, all right, was fiscal responsibility.

From the post, the institution filled several staff vacancies. This might be from HLC. The institution filled several staff vacancies and has demonstrated the ability to develop a functioning, resourced budget and finance team. This is the bridge too far for credibility, way too far for credibility. They hired some employees.

And that demonstrates fiscal responsibility.

this was on video, you would see my head shaking back and forth. So again, the accrediting agencies and their iDotters and T-Crossers continue to ignore the outputs, the financial ones, the graduation outcomes, financially and academically weak colleges. And of course, to the Harris-Stowe State University Data We Go National Center, Education Statistics, iPads Database,

Gary (10:52.0)
2015 to 2022, graduation rates in 2022, I had that wrong before. It was 22%, so a little bit above 20%, nothing right home about. In 2015, as reported in the IPEDS database, nine years ago, was 2%, two out of 100. Not two out of 10, two out of 100. In 2022, their six-year graduation rate wasn't any better.

Their normal was flat, it was up 34 students, all right, up a little bit from 2015 to 2022. The state appropriations, however, were up a lot, 2.5 million. So if you'd like to do the math on that, it's 2.5 million divided by 34 students. It's a $70,000 some odd number. The retention rate while up 20 points, credit is due, while up 20 points since 2015 is still at a really meager 67 % in 2022.

Tuition and fee revenue was also flat up less than 500,000. That's over eight years. Do the math on that. And there were many data points, many data points, not even reported that, that, that, that, that, that, that, that, that, that, that, that, that, that,

player in the overall higher education scheme. However, as the weekend progressed on this LinkedIn post, I saw what was probably an orchestrated group at a boy or at a girl for the university's president.

Gary (12:36.202)
They're trying to make, like I said before, a morsel of data, even bad data, into a feast of a trend. And that's just not what's going on. Accreditors, please, please move beyond your history of dotting I's and crossing T's. Students need, students and families need timely financial and academic communications before choosing a college. And you're failing them. You're failing them miserably.

And then Hannibal Lagrange University, this was the next to last sentence in the story. And I actually dropped a LinkedIn post on this one last week. In both cases, Harris-Stowe and Hannibal Lagrange, the Higher Learning Commission is papering over poor financial health and viability history. And the question is why? The question is why?

Gary (13:28.85)
Again, staying in St. Louis this week, Blythe Bernhardt in the St. Louis Post Dispatch, and Blythe has done a phenomenal series on the public schools here in St. Louis. This one, though, addressed, the headline read, several St. Louis colleges make watch lists for financial risks. Okay, you normally think I would jump all over a story like this.

And the headline read, I guess the second headline read, unprecedented college closures. I don't even say that. Students advised to investigate school finances. Well, I am into that. And this from this, the story was about an organization called the Scholarship Foundation of St. Louis. was earlier this month on November 6th. And the Scholarship Foundation of St. Louis uses Forbes data. Forbes publishes a high school financial, college financial.

health grade for private colleges about every year, not always every year. And they also use something called the Department of Education Financial Responsibility Score. Outdated, not even good anymore because it's so dated, the data it uses doesn't even reflect an organization's ability to have the cash to meet payroll or keep the lights on. So here's what happened. Instead of doing the real data capture, like I do at College of Viability and like folks like Matt Hendricks do at Prospective Data Science and other places,

Instead of doing the real data capture and analysis work, the scholarship foundation of St. Louis is lazy and using someone else's work to score media headlines. And this is not the first time they've done that. And I actually reached out to them the last time they had a headline like this and offered them free access. Here's all the data. You do with it what you want. Free access to the 2024 College Viability app I got.

crickets. they had colleges, the scholarship foundation had colleges on this risk list that I would have never included. And it is patently unfair to colleges to attach them to a vague headline like this. And they listed the colleges names with no data behind them. regular listeners, regular readers of my content know I will certainly challenge, always and certainly.

Gary (15:45.694)
challenge a college's individual financial health and viability, but I do it with real data and with in-depth reporting and analysis, none of, neither of which, the folks at the St. Louis, the Scholarship Foundation of St. Louis chose to do. And if they want a headline, here's a tip, Scholarship Foundation of St. Louis, if you want a headline, maybe you should focus on the many, many, many public and private colleges.

that don't graduate students in anything close to the traditional four years. Page four. Let's regulate colleges like businesses. And the sub headline reads, is no reason not to subject universities to existing consumer protection statutes laws. And this was last week, November 15th by Mr. Presumed Mr. I had that wrong, my apologies. Mr. Roger Miners and Mr. Andrew Morris.

And Mr. Miners is the Chair of Economics in Law at the University of Texas Arlington. And Mr. Morris, it's got to be doctor. Both of them got to be doctors. My apologies, gentlemen. Dr. Miners. Dr. Morris is a professor in the Bush School of Government and Public Service at Texas A University. Now, Drs. Miners and Morris make a detailed case that colleges don't, do not, but should offer the same consumer protection

that other industries are required by law to provide. Of course, there'll be a link to this story for the many, many details. There will be a link to the story in the show notes. A couple of points, though, from the story. Had the cost of food or housing or clothing or cell phones risen as much as the cost of college, there would be investigations, doctors, miners and more suggest. And they had a chart attached to this, only health care. You've seen this before, probably. Only health care rose.

Only health care costs rose faster than those in higher education. And the second point I want to bring up is colleges benefit, colleges do benefit from the lack of legal accountability that should apply to the sellers of such costly services, college education. And Drs. Morris and Miners concluded their article with this quote, and I'm going to read it exactly. When providers misrepresent,

Gary (18:10.356)
the costs or advantages of investing in higher education, our approach would to make all purchasers of higher education eligible for relief, not just those who borrowed to pay for their purchases. All right, fair enough. Cars for a long time have had lemon laws. I assume they're still in effect. And if they don't work, if a car doesn't work, a dealer has some obligation to fix it. I don't know what that obligation is yet.

No such protection exists in higher education. And I understand that a college education is a much more complex endeavor than buying a car. But just for the sake of example, if a college doesn't graduate, say 40%, that's a pathetically low number, if a college doesn't graduate 40 % of its students for a period of five years, 10 years, a year, doesn't that suggest, doesn't that suggest something is wrong?

With a car, I mean college.

It all goes back to financial health. If a college doesn't have the resources to provide needed support to academically or even socially struggling students, graduation rates, I argue, reflect that.

And if a college has had declining enrollments for something like five to 10 years, something like that, it is highly unlikely that they can turn it around in a year or two. Matt Hendricks at Prospective Data Science suggests it takes at least four to five years to turn a college's enrollment trend around. And he's right. And to those colleges who cite one year's bump through whatever qualifications they offer to their enrollment.

Gary (19:55.11)
not getting any pom-pom cheers from my part. It takes at least four to five years to turn a college's enrollment trend around. We talk about that a lot on the College Financial Health Show every Tuesday morning with Matt Hendricks. And so let's wrap this episode up. And baseball season has ended. And there's basketball season across high school and college and professional sports.

As basketball season heads into full swing, there's an old adage that I have heard many times, and I was a basketball official back in the day. There's an adage I've heard that, and how the game is officiated. It is called, no harm, no foul. And essentially, if progress towards some spot on the floor by a basketball player is still possible, no matter what the level of contact, no foul is called. It's not as common in shooting because in shooting situations, it's an immediate impact.

on a team score, right, a background. I'm beginning to believe that the unspoken, I'm beginning to believe that the unspoken motto of accrediting agencies is something like that, something like no harm, no foul, maybe a version, something like no public news, no probation foul. It's not as smooth as no harm, no foul, but you get the point, you get the point. The public news causes harm.

to these agencies because they haven't done their job. And probation is their whistleblowing weapon. You don't go to the free throw line or get the ball out of bounds or whatever. And you, of course, heard me many, many times challenge the five current regional accreditors. And I know they can be nationalized, still call them regional. But the only national ones I'm aware of are newly created organizations seeking to replace the regional ones. And the definition, an accredited institution,

gives a student some assurance of receiving a quality education and gaining recognition by other colleges and employers that the course credits and degrees earn have some value. One of the standards for all their crediting agencies is financial health. There are others, of course. Most of those are all eye-doting and T-crossing exercises.

Gary (22:22.61)
If a college hasn't defaulted on bonds, missed a payroll, or is being sued by vendors, these accrediting agencies consistently fail to give students, faculty, and staff and communities fair warning, any warning in most cases, that a college is in dire financial straits. And on the quality education, there are countless, I've talked about this so many times,

Countless public and private colleges that don't graduate even half of their students in four years.

Now, know, those of you thinking this through, so, hey, you know, conflict of interest, conflict of interest. Well, maybe it's certainly possible. It certainly appears like that because the colleges pay the accrediting agencies to accredit them. I'm still pondering that. And those of you that think through again, we'll go to college basketball, back to college basketball. The host college typically pays the referees for its games. I'm going to a college game tonight. It'll be the referees, the three referees will be paid by the hosting college.

And one could argue that there exists a potential conflict of interest in that scenario. Because the college is paying them, maybe the home team gets a benefit. What? Well, some people believe that. Here's the difference. Agree or disagree, it is clear. It's obvious when sports officials are missing fouls or violations. They all miss them, and they'll be the first ones to tell you that. They do a fine job. They do an excellent job overall. But no such immediacy exists.

for accrediting agencies. The accreditation term is about four years, five years, 10, I can check. A long time, it's not like a basketball game, but there's immediate response. These organizations provide what I think is an antiquated form of quality assurance that relies mostly on inputs and the eye dotting and T-crossing that I've talked about many times before. And trust me, trust me, higher education.

Gary (24:27.114)
Higher education data entrepreneurs like Matt Hendricks and many others will be on the leading edge and the first movers to hold colleges more immediately accountable for at least poor financial health and poor graduation outcomes. Until next week, which is actually Thanksgiving week, at College Viability, I'm Gary Stocker. Thanks. Thank you so much as always for making time to listen or watch.

I'll be back next week. Until then, take care.