Simon's Rock, Burlington College Among Schools Being Federally Monitored For Finances
Update: On March 31, the U.S. Department of Education released a financial watch list with some 560 institutions. On April 3 the department removed 12 institutions from its heightened cash monitoring list including Bard College at Simon's Rock and Sterling College. The department's changes can be reviewed here.
The U.S. Department of Education has included a number of regional schools among roughly 560 institutions on a financial watch list.The Federal Student Aid office within the education department recently released the list of schools under its heightened cash monitoring or HCM process. According to the department, this allows for additional oversight for financial and federal compliance issues. Put simply, being on the list means the federal government is closely watching institutions to ensure they are properly using federal student aid.
Included on the list is Bard College at Simon’s Rock in Great Barrington. Following multiple requests for comment, the school sent this statement from Provost Peter Laipson:
“In the last year, Simon’s Rock has made significant progress in addressing this issue, including boosting our recruiting and admission efforts and developing communications initiatives aimed broadening the awareness of the college and its mission,” Laipson said in a statement emailed to WAMC. “We firmly believe that these efforts will result in a stronger financial position for the institution.”
The nonprofit early college institution with about 400 students has a $17.5 million endowment and yearly tuition of $47,400, according to its website. The education department lists the school as HCM-1 for financial responsibility reasons. HCM-1 generally involves a less stringent monitoring system than HCM-2.
Burlington College in Vermont also finds itself on the HCM-1 list for financial responsibility. Carol Moore took over as president two months ago. She says the college’s 2010 purchase under then-president Jane Sanders of 27 acres of land and two buildings bordering Lake Champlain delivered an $11 million debt load, lowering the school’s financial composite score with the education department from 2.3 to 0.5. 3.0 is the strongest rating.
“There was a lot of turbulence on campus that probably stemmed from the finances, but also there was some unrest between faculty and students and the president at the time,” Moore said. “There was a great transition of people coming and going at the institution. So we have not gotten back to that solid ratio.”
Having led Lyndon State College for 13 years, Moore says she was brought out of retirement to right the ship after the sudden resignation of president Christina Plunkett. In February the school sold about 20 of the 27 acres to a developer. Moore expects the school to finalize the sale of one of the two buildings to the same company for student housing. The school is currently $4.2 million in debt; Moore says the next sale will drop that figure to $2 million.
“We have a relatively new CFO [Chief Financial Officer,]” Moore said. “We’ve put in place a number of systems for monitoring our cash flow. We’ve basically frozen spending at the moment. Now we’re preparing our budget which is a conservative budget which will include a quarter of million dollars of reserves.”
Moore says Burlington College has a roughly $4 million annual budget, with an endowment of less than $1 million. After recent peak new student enrollments of 127 and 108 in 2012 and 2013, Moore says the turmoil, financial struggles and negative press dropped that number to the mid-80s in 2014. With a total enrollment around 200, Moore is hopeful applications will increase, saying the private institution is financially stable.
“We’re ready to rebuild the college and get back in the good graces of the public image,” said Moore.”
Vermont’s Sterling College and New England Culinary Institute are also on the list as well as Connecticut’s Lincoln technical schools in Hartford, New Britain and Southington.
Lincoln Educational Services President and CEO Scott Shaw says the organization’s current financial composite ratio doesn’t reflect specific operations at the Connecticut schools.
“It’s with regards to all the schools within our organization,” Shaw said. “Just with the downturn we had to shut down some schools in 2013. When we shut the schools we had to take some accounting charges, many of them non-cash. Once we took those charges the result was when you calculated the ratio that the government uses at the end of the year we ended up being at 1.4 instead of 1.5. Just by being below 1.5 you end up on this list.”
Shaw says the organization shut down five schools across Ohio and Kentucky because of declining populations making them no longer sustainable. He says being on the list doesn’t affect the operations of the organizations remaining 30 schools in 15 states. He expects to be above the 1.5 ratio next year.
Eight eastern Massachusetts institutions are also listed. No Capital Region institutions are on the list. Sanford-Brown Institute in White Plains and Utica’s Saint Elizabeth Medical Center are also listed.