$12 million in 24 days: Northland College tries avoiding closure with ambitious fundraising goal
Twelve million dollars in 24 days.
That's the fundraising challenge for one of Wisconsin's smallest private colleges. If the $12 million goal isn't met by April 3, Northland College in Ashland will shutter its doors at the end of the school year.
"We are committed to doing everything we can to achieve that goal," Northland College President Chad Dayton told the Milwaukee Journal Sentinel. "If we collectively didn't think that this was possible, we would not have embarked on this initiative."
Higher education is facing immense financial strain. That's especially true at private institutions, which receive no state money and are heavily reliant on tuition.
Tax filings show Northland College operated in the red for nine of the last 10 years, with losses ranging from roughly $700,000 to $3.4 million. A recent audit underscored the school's perilous financial position.
If Northland closed, Ashland ? a city of about 8,000 on the shore of Lake Superior ? would lose its only local four-year university. The environmentally focused liberal arts institution has been around since 1892. It's fighting to find a way to survive.
Northland's unusual public plea made ahead of closure decision
A string of other Wisconsin colleges recently announced closures, often with little warning about their dire financial straits: UW-Platteville Richland. Cardinal Stritch University. UW-Milwaukee at Washington County. UW-Oshkosh Fond du Lac. UW-Green Bay Marinette. UW-Milwaukee at Waukesha.
More: Cardinal Stritch University couldn’t survive. What about other small, private Wisconsin colleges?
The public plea to save Northland is more unusual. The school has shown its hand in the hopes alumni and donors may give more money if they understand the precarious position their alma mater faces.
"The Board (of Trustees) made a unanimous decision that this institution is important enough, special enough and has an important enough legacy that this effort was worth undertaking in advance of closing quietly," Dayton said.
Part of the reason behind the April 3 deadline, he said, is to provide time for current and prospective students to find a new school to enroll if the fundraising goal isn't met.
Northland College says $12 million would help move to new business model
If raised, the $12 million would allow Northland College to operate next school year and transition to a more sustainable business model, Dayton said.
What would the new model look like? Dayton said the work has already begun and involves faculty committees, administrators, and the Board of Trustees. He declind to provide more specific details.
College's enrollment and endowment data show signs of struggle
Northland College reported between 500 and 600 students over the last decade. This school year, however, enrollment is 439 students, according to Dayton's office.
Another challenge is its tiny size. Experts consider schools with student bodies of 1,000 or fewer to be the most vulnerable to closure based on economies of scale.
Cash-strapped schools often tap their endowment to plug budget holes. The strategy helps in the short term but can drain reserves and limits schools' ability to engage in longer-term, strategic planning.
In 2015, Northland College's endowment was about $25 million, according to federal education data. That fell to $6.2 million in 2022.
Audit confirms financial problems
Auditors flagged Northland's "ability to continue" as a "going concern" in a 2022 report.
The audit noted Northland had to substantially increase its long-term debt and take out loans because of cash flow problems. The report cited some measures the college has taken to stabilize its budget, including consolidating program offerings, focusing faculty resources on teaching and increasing section sizes.
Northland is under federal financial monitoring
Another bad sign: Northland isn't meeting the the composite financial index score requirements defined by the U.S. Department of Education.
The agency annually calculates the overall financial health of private institutions participating in federal student aid programs based on schools’ audited financial statements. The scores range from -1.0 to 3.0, with schools scored 1.5 or higher considered financially responsible.
The latest data for 2020-21 shows Northland College scored 1.3.
The federal education department can also monitor schools’ cash management as a way to provide additional oversight. Northland has been under cash monitoring since September 2022.
Closure would be loss for Ashland community
The college brings economic value to the region, employing 52 faculty members, 84 staff members and around 36 contracted employees.
But the benefits go beyond that, said Ashland Mayor Matthew MacKenzie.
Professors conduct research, often environmentally focused. Local students have access to a four-year degree. The next nearest university, UW-Superior, is more than an hour's drive away.
"We’d hate to lose all of that," he said. "(Northland) keeps us younger. It makes us think about things younger people are interested in."
MacKenzie called the college's fundraising goal ambitious but feasible.
"It’s amazing what people can do when they set their mind to it," he said. "If you can find the right (donor), I think it’s totally doable."
Contact Kelly Meyerhofer at [email protected]. Follow her on Twitter at@KellyMeyerhofer.
This article originally appeared on Milwaukee Journal Sentinel: Northland College tries raising $12 million to avoid closure
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