Sweet Briar College Closure: FAQ’s on what it may mean

Sweet Briar College is a small private liberal arts college for women located in the shadow of the Blue Ridge Mountains. It has 94 full-time faculty, 32 part-time faculty, 177 full-time staff and 47 part-time staff–and a long tradition of shared governance. On March 3rd, 2015 the President and Board of Directors declared a state of financial exigency and announced their decision to close the college at the end of August, effectively firing all faculty and staff.

WAS the faculty consulted beforehand regarding the possibility that the college might close?
NO. The faculty was shut out of usual channels of shared governance and kept entirely in the dark.

HAS Sweet Briar’s Board revealed the data on which it based its decision?
NO: The Board has claimed the relevant reports and discussions of possible mergers are proprietary or are restricted by non-disclosure agreements. Financial data and projections based on enrollment and retention patterns that have been shared with the faculty are either flawed or incomplete or both.

IS SBC is in bad financial trouble?
NO. According to an experienced auditor testifying under oath, financially SBC is in the “middle of the pack” of private, non-profit colleges in Virginia. Steps should be taken to stabilize, not close, the college.

ARE Sweet Briar’s enrollments in decline?
NO. Overall, enrollments are stable. Declines in the last couple of years are arguably attributable to the Board’s refusal to hire a professional admissions director and to a flawed recruitment strategy.

WHY did the Board think enrollment was in decline?
See Dan Gottlieb, “Enrollment, and How Moody’s Got it Wrong: The Sweet Briar Story, Part 1,” and “Enrollment, Race, and the Unfortunate Case of Dr. Sax’s Sample Bias: The Sweet Briar Story, Part 2,” at http://blog.jayorsi.com/sweet-briar/

ARE the college’s debts larger than its endowment?
NO. The unrestricted endowment is indeed smaller than the outstanding bond debt. However, the same legal procedure being used by the Board to release a portion of the restricted endowment to close the college could have been used to reduce debt, but was not.

WERE the other stakeholders (students, alumnae, donors, parents) informed about the college’s impending closure?
NO. All stakeholders heard at the same time as the faculty did.

IS Sweet Briar College closing because it is a small, rural, women’s liberal arts college?
NO: SBC is closing solely because the Board of Directors made the decision to close the college.

WHY does the Board of SBC think it can act without consulting the faculty or other stakeholders?
The Board believes, and the Virginia Attorney General agrees, that SBC is a non-profit private corporation, subject only to the Virginia Non-Stock Corporation Act which prevents a court from second-guessing ANY good-faith business decision made by them, and to the Uniform Prudential Management of Institutional Funds Act, which does not allow intervention by college stakeholders.

COULD YOUR BOARD DO THIS TO YOUR Virginia PRIVATE COLLEGE OR UNIVERSITY: If the VA circuit judge’s ruling–that private institutions of higher education are non-stock corporations–prevails, YES.
COULD THIS HAPPEN TO PRIVATE INSTITUTIONS OF HIGHER EDUCATION OUTSIDE OF VIRGINIA: It depends on your state’s laws. If your institution is financially challenged, however, there is cause for concern.