Alliance University, formerly Nyack College, is closing as of August 31st. The board decided last night, and informed staff, faculty, students today of their decision. The school has been around 140 years.
Colleges and universities are facing a demographic cliff along with leadership unprepared to deal with it. Alliance university was also burdened by some leadership mistakes and a massive debt.
EAB, an educational consulting firm, warned in 2020, “With dire predictions for fall freshmen enrollments making headlines, colleges and universities are bracing for the financial shock to come.” Bracing for a much feared “demographic cliff, “—a steep drop-off in potential first-time full-time freshmen projected to arrive in 2025-2026.” But there have been signs that the cliff was coming faster than expected — “even elite institutions ended up admitting more students from applicant pools and waitlists just to meet tuition revenue goals.” Students are delaying enrollment in colleges, dropping out of high schools in higher numbers, However, this spring elite institutions have record applications. Worried about expenses and jobs, students are preferring a bigger bang for their buck. They are looking for high-prestige, high-quality, and highly prestigious programs. This may cause a dramatic gap in survival rates between the elite schools and everyone else.
The Alliance University’s announcement today read:
“‘We must learn to live on the heavenly side and look at things from above. To contemplate all things as God sees them, as Christ beholds them, overcomes sin, defies Satan, dissolves perplexities, lifts us above trials, separates us from the world and conquers fear of death.’ – A. B. Simpson
On the afternoon of Monday, June 26, Alliance University received notice from the Middle States Commission on Higher Education that its accreditation is being withdrawn as of December 31, 2023.
We were surprised by the Middle States’ decision and have worked hard all week to evaluate the different options available to us as an institution. The administration learned of Middle States’ decision on Monday afternoon, and the Board of Trustees met Tuesday evening and again Thursday afternoon.
After carefully evaluating all the options and the current financial situation, the Board has made the difficult decision to wind down on-campus and online educational offerings as of August 31, 2023. Alliance University will not offer courses for the Fall semester. This news is a tremendous loss for us who love Alliance University and the people here. We are all grieving.
For over 140 years, we have prepared and equipped tens of thousands of men and women to serve Christ around the globe. Founded in 1882. …
Finally, we have been notified that the Board of Directors for the Christian and Missionary Alliance is exploring the possibility of continuing the Alliance Theological Seminary program. They are considering a number of options. “
The university president Rajan Mathews originally had maintained before the board meeting that they would appeal the decision and that their enrollment and finances looked better.
In recent years, Alliance has operated under a significant debt burden, surpassing $90 million in fiscal 2020.
In late 2020, Alliance sold its campus in Nyack for $45.5 million and used the $28 million in gains from the transaction to pay down some of its debt, according to its latest audit.
In fiscal 2022, the college had $59.6 million in liabilities, most of which stemmed from its $51.6 million mortgage on its New York City campus. Despite the recent campus sale, its liabilities still totaled $54.9 million in fiscal 2022. Further, the university was losing money every year. The president claimed that their losses were narrowing, from $10 million in 2021-2022 to at least $3-4 million in 2022-2023. In other words, their liabilities are or will soon be larger than their assets. Both the Middle States accrediting agency and the U.S. Department of Education have been alarmed by the deteriorating financial situation of the university. The U.S. Department of Education placed restrictions on Alliance’s federal student aid funding late last year, a significant blow.
President Rajan Mathews says that increasing debts are due to closing unprofitable academic programs, cutting staff, increased fundraising, and seeing more revenue due to higher enrollment levels.
Federal data shows the university’s enrollment has also plummeted in recent years. In fall 2021, the college had 1,863 students, down 42.9% from a decade earlier.
The Middle States accrediting organization warned Alliance University that it would impose additional penalties if it violated any aspects of the agreement to set up a transfer program for students.
There will be an attempt by the Christian Missionary Alliance denomination to keep the Seminary going.
Note: thanks for some insights from Timothy Morgan.
