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The Massachusetts Board of Higher Education finds itself in a dilemma.
On Tuesday it approved an ambitious plan to monitor the financial situation of the state's private nonprofit colleges. Now, it has to weigh the survival of those colleges against the interests of students.
The Department of Higher Education's priorities are clear: protect the students from enrolling in colleges that might not last through their graduation. If they did not know it before the abrupt closure of Mount Ida College last year, they know it now.
"You know, Mount Ida showed a glaring gap in our inability to deal with students' needs," said Commissioner of Higher Education Carlos Santiago after the board's meeting at Framingham State University Tuesday. Santiago praises two other colleges, Newbury College and Hampshire College, for coming forward with warnings that they are in financial trouble.
"But not all institutions want to be very forthcoming," Santiago said. "The last thing they want to do is go to a regulator and say: 'We're having financial difficulties. Can you come and help?' So I think what we want to do is to strike a balance."
The key, Santiago said, is maintaining confidentiality so that disclosing a college's financial information doesn't hasten its closure.
"How do you get the institution to have enough trust and confidence that the information they're providing you you're not simply going to put it on a spreadsheet and send it out?" Santiago asked.
But if the information is kept confidential, students could apply to colleges that may not be able to graduate them.
Nick Ducoff, co-founder of Edmit, a Boston startup that compiles information on how much colleges are willing to give in financial aid, says a private company could provide information about colleges' financial health.
"I also think there's a place in the market for a consumer information site that can be focused on providing information for the consumer without any of those constraints that the department or board may have, so that there's not that conflict," Ducoff said.
The Board of Higher Education wants to start monitoring colleges' financial situation by this fall. If it identifies that a college is in trouble, it would monitor that college to make sure it can stay open through the current academic year and the next one. If not, it would force the college to make plans for transferring its students to other colleges and for announcing its closure.
"I understand that colleges are worried about one particular scenario: A college that is not actually yet sufficiently fragile that action should be taken gets identified publicly and that families step away from that school and cause the failure of that school," said Board of Higher Education Chairman Chris Gabrieli. He said by the time a college would have to disclose it's in financial trouble, the school would already be in a dire situation.
"We're only asking that a school be able to stay open for the next coming year, so I think that is the minimal standard," Gabrieli said.
That may not be enough for students and parents.
Holly Orff's daughter got the admission letter from Newbury College last fall only to find out days later that the college would be closing. She's now scrambling to find another college for the fall.
"I'd like to know ahead of time, like way, way ahead of time," said Orff.
Orff does not think she and her daughter got nearly enough warning that Newbury College was in dire financial straits. She believes applicants should know a college can survive the next four years.
This segment aired on January 23, 2019.
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