In many cases, state regulators have either failed to recognize warning signs or neglected to take early action in order to prevent school closures, according to new research.
New America’s report, “Anticipating and Managing Precipitous College Closures,” analyzed dozens of non-profit and for-profit institutions’ closures, the reasoning behind them and how they were handled.
“It’s really about when [closures] do happen, how regulators and institutions can get ahead of it and plan for it [in] as orderly and as least destructive of a transition as possible for those students who have spent time, money and emotional energy to these institutions that no longer will be able to give them the education that they had signed up for,” said Amy Laitinen, director for higher education with the Education Policy program at New America.
The report laid out six main policy recommendations for higher education institutions and regulators to follow in order to minimize the harm to students, including ways to identify warning signs and risk factors; improve the quality of teach-out plans and agreements; ensure accessible student records; provide more communication transparency; increase take-up of closed school loan discharge; and protect taxpayers by anticipating the various risk factors.
Between the school years of 2008–09 and 2016–17, more than 300 degree-granting colleges and universities in the U.S. closed their doors, New America said.
“There is a guidebook for this, there is a way to make these closures less painful because we’ve learned a lot from a lot of painful closures in particular over the years,” said Clare McCann, deputy director for federal higher education policy with New America’s Education Policy program.
In order to identify early signs of school closures, the report suggested monitoring both enrollment and financial changes. According to the research, the Department of Education’s financial composite score only predicted half of the closures since the 2010-11 academic year.
