Siena Heights "University, a small 3rd or 4th tier school in SE Michigan will close up after 2025-2026.
University of Indiana is cutting 20+ programs of study. Going forward the board has established specific enrollment numbers needed in individual programs to avoid termination.
I am sure exceptions will be argued and some very reasonably. But it's a sign of the times that these types of decisions are receiving very specific board edicts. Normally that would simply fall within the president's role and judgment, right? It's fair to judge Valpo's board in this 2025 lens.
There are several Indiana publics that have announced cuts to 400+ degree programs. https://www.indystar.com/story/news/politics/2025/06/30/indiana-colleges-cut-merge-400-degree-programs-ahead-of-new-state-law/84422023007/
This could be a real opportunity for Valpo to say, “Hey, your atmospheric science program is going away, but we’ve got a pretty swell meteorology department…” Hope the new VP is looking at this as a potential transfer boon.
https://www.latimes.com/california/story/2025-07-15/usc-budget-deficit-layoffs
How can a school with so much money be $200M in the red? They must be throwing money at non-essential employees...
USC was pampered for years as being a school that got public school levels of funding despite being a private institution. I would assume recent cutbacks on student programs is to blame for this turnaround. Although, USC has been at a deficit for some years now. The cuts to federal grants for research and such certainly didn't help their efforts. Also just goes to show that even the most successful of private schools can face a financial straights
While USC might have been hiring an unnecessary level of staff, I would suggest that much of their problems may stem from:
-Reduction of research grant revenue (a big deal at a large private like USC). Then, couple this with what they might have been using from grants to cover overhead costs. From my knowledge, many universities were using 25-40% of grants towards overhead (building, maintenance, etc). The federal government intends to limit this to 15%.
-Reduction of international students paying 100%+ of listed tuition. USC has had a high number of international students.
-Larger portions of capital projects being funded by operating budgets (instead of donations).
-Retaining legacy programs with very few students relative to faculty/staff for that program.
-Inflation over the last 2-4 years - especially tied to labor and the high cost of living in LA.
Of course, overly optimistic revenue forecasting can lead to hiring staff that were not as necessary as assumed.
Some on this board have consistently made it seem like Valpo's professors and staff were at wits end due to the sweeping and seemingly thoughtless cuts and changes. To put this in some perspective, I found the following in the USC article on cuts:
"Staff morale is in tatters"
We'd be hard pressed to find an institution of any ilk where necessary changes and reductions haven't been painful.
@vu84v2 - your assessment was 100% correct , particularly the decrease in international students which makes USC unique. However, this school can gather boatloads of cash and they will survive. This may be a sky is falling situation.
@vu84v2 - your assessment was 100% correct , particularly the decrease in international students which makes USC unique. However, this school can gather boatloads of cash and they will survive. This may be a sky is falling situation.
Unfortunately, the sky is falling, though in different ways with different universities. The prominent research universities are especially dependent upon international enrollments, and they are taking a terrible hit on that right now.
Few, if any, colleges and universities are feeling safe and secure. The challenges may be demographic, political, financial, or a combination thereof. There's no magic business model for success, because the entire enterprise is facing a blitzkrieg convergence of threats.
Among elite universities, even schools that have not been deeply embroiled with the current Administration are feeling it. For example, the University of Chicago is freezing admissions for virtually all doctoral programs this year, with some major evaluations to come. That's a dramatic move for a university deeply committed to its graduate programs.
One thing I've learned since doing a bit more research is that many of the complaints you hear about Valpo from faculty and staff now seems to be ubiquitous amongst many universities faculty and staff. It's something to think about how enrollment states became the thing to focus on. Schools can have no issue with enrollment and still be having significant financial problems either due to the multitude of attacks and challenges they are facing or due to other choices (like UofCs apparent tendency to overspend for years). Smaller, enrollment dependent schools like Valpo are experiencing them differently, but schools with large enrollments or even rising enrollments are not immune to all these financial hits either.
The biggest difference between the big university factors and the smaller ones is temporary vs. endless. The smaller ones (below 10,000 students) are facing structural deficits and existential threats within a decade.
By contrast the large powerful ones face challenges that are political and likely to be temporary. Their lost income sources of 2025-2028 could snap back into place as soon as the Democrats win in 2028 or 2032. In the meanwhile they can ride out the storm with massive endowments.
Today, the news told us that the average college endowment gained 10.9% in the fiscal year July 2024=June 2025. This is fortunate for colleges in light of the typical deficits they running. Colleges use a philosophy for endowments similar to retirement planning by limiting themselves to 4% per year use of their "savings."
But Valpo decided under Heckler to buy 2-3 luxury condos on mortgages (bond issues.) Now they can't sell them (there isn't a big real estate market for academic buildings.) This year, Valpo essentially faced the expiration of a variable rate mortgage term. The new mortgage rate went up to 9% from 6%. To pay the former mortgage at 6% Valpo was taking extra money from their retirement funds.
So now what? I hope that someone coming to campus this month for interviews is wearing a cape.
I know I am repeating this from a prior post, but endowment is not simply a large pot of money (~$300M for Valpo) of which a university typically takes 5% (not 4%) each year for any use. Only the non-restricted portion - which is a minority of the endowment - can be used this way. The majority of the endowment is comprised of a set of separatet agreements associated with targeted purposes. For each of these, the university first lets the balance grow to where it can take 5% in a given year for the targeted purpose without the balance going below the original principal.
Also, the main reason endowments are increasing, on average, is returns from investing the funds. Thus, using endowed funds would be reduced if the market were to go down unless the university were to decide to let endowed funds for targeted uses drop below the original principal.
Those do indeed seem like key details.
In either case we are scooping big chunks out of any usable endowment money and we are still not patching the budget deficits in full. The board scooped out 7.5% last year.
