How Cheyney U. Was Pulled Back From the Brink

Cheyney University has survived a threat to its accreditation. For now.

That threat could have been existential: In 2017 the university’s accreditor, the Middle States Commission on Higher Education, issued a “show cause” order to the historically black college after it had faced years of financial troubles, compounded by falling enrollments and mismanagement.

The show-cause order required the Pennsylvania institution to give reasons why it should not lose its status and access to the federal student aid that comes with accreditation. Without such access, the university would most likely have closed. Instead, the accreditor has now agreed to fully restore the university’s accreditation — meaning it is not on probation or subject to a show-cause order.

While it is rare for the review process to result in a public college’s losing its accreditation — or for such colleges to close — an adverse decision can still bring significant risk. Earlier this year, for example, Bennett College in North Carolina lost an appeal to save its accreditation after being placed on probation, usually the step before a show-cause order. That blow came after the college surpassed a $5-million fund-raising goal — eventually raising nearly twice that amount. The college remains accredited pending a lawsuit and its own efforts to gain approval from another agency.

In Cheyney’s case, the accreditor, and the state and federal governments, went to unusual lengths to preserve the university, one of 14 institutions in the Pennsylvania State System of Higher Education, or Passhe. Despite the university’s troubles, the state and the accreditor had some incentive to preserve the institution. The accreditor avoided a lengthy legal battle that would have been costly, even if it won in court. Politically, the governor and state system avoided the difficult decision to allow a minority-serving institution to fail.

Here are some of the steps that various authorities took to save Cheyney.

Debt Relief

Gov. Thomas W. Wolf, a Democrat, has promised to forgive some $40 million the university owes to the state system, according to The Philadelphia Inquirer, though officials have not yet figured out where that money will come from.

The state had already agreed to forgive the debt if Cheyney balanced its budget for three consecutive years, according to a university spokesman. The governor’s action speeds up the timeline after just one balanced budget and projected surpluses over the next two years.

A Passhe spokesman confirmed the amount of debt but declined to answer questions about the arrangement. Neither the governor’s office nor the university responded to requests for comment.

The university also must finalize an agreement to repay at least $14 million to the U.S. Department of Education, according to news sources. The university was found to have mismanaged federal student-aid dollars over several years.

A spokeswoman for the Education Department said it is the agency’s policy “not to comment about ongoing institutional program reviews or investigations — including the acknowledgment that one exists — until the outcomes have been officially conveyed to the institution.”

Middle States will require a report in March to show that debts to the federal and state governments are being repaid.

Steps Toward Sustainability

The university must also send a report to the accrediting agency in September to prove that its operations are financially sustainable. Aaron A. Walton, who took office as president of Cheyney in June 2017, has cut expenses, including the football program and some academic programs, turning an estimated $7.5-million deficit into a $2-million surplus.

The university is also seeking to improve enrollment, which fell from nearly 1,600 in the fall of 2010 to 469 in 2018, according to data from the state system.

There has already been some evidence of a modest uptick. A news report from KYW Newsradio said enrollment had increased by more than 30 percent after the university readmitted about 150 students who had been dismissed for academic problems. The students completed remedial courses at community colleges, the university president told the radio station.

Cheyney still has work to do, and it faces large challenges, including the decline of high-school graduates across the region, increased competition for black students from predominantly white colleges, and the difficulty of keeping tuition low without the benefit of substantially more money from the state.

The accrediting commission will evaluate the university again during the 2022 academic year.

Eric Kelderman writes about money and accountability in higher education, including such areas as state policy, accreditation, and legal affairs. You can find him on Twitter @etkeld, or email him at eric.kelderman@chronicle.com.