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Struggling New College may close one campus

San Francisco Business Times - by Sarah Duxbury

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Facing the most serious crisis in its 36 years, New College of California is selling one of its San Francisco buildings and is poised to close its North Bay campus for at least a semester amid plummeting enrollment and allegations of financial mismanagement.

Adding to its difficulties, the school has missed a payroll, bounced financial aid checks to students, is in danger of losing its accreditation and is without a president.

New College's board was likely to vote on the proposal to close the Santa Rosa campus by the end of this week, said Luis Molina, the school's acting president.

"The North Bay campus is simply responding to the crisis of New College in San Francisco," said Richard Heinberg, a New College core faculty member. "We have done the only thing we can -- cancel our incoming cohort of students."

Troubles have continued to mount for New College in recent months.

In July, the Western Association of Schools & Colleges put the progressive San Francisco-based college on probation, notifying the school that it was at risk of losing its accreditation unless it made massive changes to its administrative, financial and academic systems. WASC will announce in February if New College will remain fully accredited.

With the school's status in question, and with it the ability to offer federal financial aid, New College's enrollment and revenue have dropped 40 percent. For the 2007-2008 fiscal year, the school cut back to a $12 million budget, down from its usual $16 million. Nevertheless, it has serious financial troubles since almost all its revenue comes from tuition.

New College is one month in arrears on payroll, and it recently bounced work study and financial aid checks to students. Those financial wrongs will be righted by the end of next week, Molina said, once the Department of Education releases federal financial aid funds owed to the university.

Nevertheless, staff and even faculty can expect another round of layoffs once the current semester ends; about 15 people have been laid off since July.

"The sad reality is there will be more layoffs at the college as we try to balance the budget," Molina said.



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