In March the trustees of MacMurray College, in Illinois, made the difficult decision to close the 174-year-old institution at the end of the semester. The college had “no viable financial path forward amid declining enrollments, rising competitive costs, and a small endowment,” according to a statement on the college’s website.
In April, as the college prepared to close for good, it applied for and received nearly $745,000 from the federal Paycheck Protection Program, a part of the Cares Act designed to keep businesses and their employees from going under as a result of the pandemic. Businesses and nonprofit organizations that applied could get money to cover up to eight weeks of salaries, as well as “interest on mortgages, rent, and utilities.”
A spokesman for MacMurray said the college had followed all the rules in applying for the money, and had used it “only for payroll costs, employee benefits, and employer payroll taxes.” The program was meant to keep employees on payrolls, the spokesman said in an email, and it allowed the college to avoid firing or furloughing any workers through May. A smaller group of workers were even paid through June, he wrote.
While a central goal of the program was to prevent layoffs, colleges facing certain closure probably aren’t the type of institution envisioned by lawmakers as ideal beneficiaries. A Chronicle analysis reveals that MacMurray is one of at least several colleges facing closure or ceasing usual operations that have obtained Paycheck Protection money, offered in the form of a loan that is forgivable if certain conditions are met. (The Chronicle received a loan under the Paycheck Protection Program.)
Several other colleges that announced plans to close or merge after the spring semester have also received money from the program. The Chronicle asked each college for comment. In cases where no response is recorded, the institution did not respond to the request.
Holy Family College, in Manitowoc, Wis., announced in May that it would close at the end of August. The college received $350,000 to $1 million.
Pine Manor College, a Massachusetts institution that is being acquired by Boston College, received $1 million to $2 million. A spokesman for Boston College said in an email that none of the money had gone to Boston College employees.
Similarly, Marlboro College, a Vermont institution that is being acquired by Emerson College, in Boston, got $350,000 to $1 million from the program. A spokeswoman for Emerson directed questions to officials at Marlboro, who did not respond by the time of publication.
A Lifeline for Colleges on the Edge
The federal dollars may be a lifeline for some colleges that haven’t yet closed permanently. Notre Dame de Namur University, in California, is not accepting any new students for the fall and is committed to staying open only through 2021, according to its website. The college is getting as much as $5 million from the loan program.
The future is even less certain at Ohio Valley University, in West Virginia, which received $350,000 to $1 million from the federal program. The college, which enrolled just 233 students this past spring, announced it could not pay its debts more than a year ago, and is on probation from its accrediting agency over its poor financial health and academic outcomes.
Pacific Union College, a California institution that got a federal loan of up to $5 million, was placed on notice by its accreditor in March and required to “develop a contingency plan, including a teach-out in the event that the college does not meet enrollment projections for fall 2020.”
Wells College, in Aurora, N.Y., is on probation from its accreditor, and its president has warned that the college may close for good if it cannot open the campus for instruction this fall. The college has received up to $2 million from the loan program.
The San Francisco Art Institute, which pared its operations this spring and suspended enrolling new students in degree programs, is getting as much as $2 million from the Paycheck Protection Program.
Two colleges suffering the economic fallout from scandal also received federal Paycheck Protection money. The Art Institute of Atlanta was one of the colleges that belonged to the failed Dream Center Education Holdings before that company collapsed, in early 2019. The college, now owned by an investment firm, received $1 million to $2 million in Paycheck Protection money.
Olivet University, a California institution that this year pleaded guilty as part of a $35-million money-laundering scheme, got up to $1 million from the federal loan program.
In one case, the federal money went to a campus that in many ways has not operated as a college for several years. Saint Joseph’s College, in Indiana, voluntarily withdrew from accreditation and stopped offering its degree programs after the spring of 2017. Nearly three years later, the campus received about $180,000 from the federal Paycheck Protection Program.
The campus, in Rensselaer, Ind., isn’t entirely empty, said William J. Carroll, the college’s executive director. Staff members maintain the grounds and buildings for the nonprofit organization that owns the campus. In addition, about 15 students are taking certificate programs in health care that started in June, he said.
Carroll, who runs a consulting business called Hunter Global Education, also provided a document outlining a plan to reopen the campus by the fall of 2021 and offer bachelor’s degrees two years later.
“We’re an up-and-running business,” he said.
