Close to a year ago, we were discussing the closure of Marymount California University, which had attempted to merge with St Leo University. Everything was a go, but it was nixed, in a major plot twist, by the accreditor:
To be clear, they’ll still have five satellite campuses scattered across the country and a (by all accounts) robust online program plus their main campus in Florida, but St Leo has been a model of slow but steady growth through expansion for better than two decades, so this is a huge shift in not just strategy but identity—and really, that’s the sort of shift that makes me wonder if there’s more of a fiscal crisis underlying it than the blandness of the announcement lets on.
My reasoning: Their endowment has been overall flat the past several years ($62.2M in 2016, $68.2M in 2020, $64.6M in 2022), but given how high the average rate of investment returns for college endowments was over that time period, and that I think the drop from 2020 to 2022 doesn’t include the entirety of the down year for endowments that the full calendar year 2022 was (and definitely does include 2021, which was a solid up year), yeah, we’re probably looking at a sizable structural deficit.
And if there’s a structural deficit, an endowment of less than 9 figures means you don’t have a lot of time, and so you get crisis-level action.