- The Massachusetts Board of Higher Education agreed Tuesday to establish a state system to monitor the financial health of private colleges, a response to the tumultuous closing of Mount Ida College last spring and the instability of other small institutions in the state, The Boston Globe reported.
- Under the board-approved plan, state education officials will use public data to evaluate institutions' financial health, warn them of concerns and require them to create contingency plans and notify students if it appears they lack resources to operate for the next year and a half. Schools that don't comply could lose Title IV funding.
- Lobbyists for private colleges said the plan will damage colleges trying to improve their financial health, noting that some have reversed their circumstances and that Mount Ida was an isolated case of a college ignoring regulations.
Last April, Mount Ida abruptly announced it was closing and offered students automatic enrollment at the University of Massachusetts Dartmouth. Former students sued the college in November, claiming officials were aware of its mounting financial difficulties as early as 2014.
The Globe previously reported the college failed to do its due diligence around the closure, including notifying state higher education officials and charting a path for students to finish their degrees.
In a statement, Mount Ida's board attributed the closure to the "difficult" financial situation facing small private colleges across the country. Its small endowment meant it relied heavily on tuition revenue to support its operations, Inside Higher Ed reported, at a time when enrollment growth is slowing.
Last month, Fitch Ratings predicted a higher rate of college mergers, acquisitions, affiliations and closures this year, and Education Dive’s tracker of consolidation in higher education indicates a trend in small liberal arts colleges shutting their doors or merging for the advantages of scale.
The issue has been especially prominent in New England due to the concentration of small institutions. Just last week, Hampshire College announced that while it intended to keep operating, it was seeking a partner and had not yet decided whether to admit a new freshman class.
Small nonprofit colleges aren't the only institutions weighing the merits of consolidation. In Connecticut, Wisconsin and Pennsylvania, mergers have been planned or even implemented. In one of the broadest efforts, Georgia consolidated 35 public colleges into 26.