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Welcome to the podcast. We call it TWICV. It is our effort to provide a fast-paced, entertaining, and alternative voice to the propaganda and hype flowing out of colleges in America today.
This week in College Viability is a proud affilate of The EdUP Experience podcast network.
Gary Stocker (00:00:00)
It is Monday, July 20th, 2026. Yes, time again for yet another podcast episode of This Week in College Viability News and Commentary. Hi, everybody. Gary Stalker sitting in front of the blue. Always blue. Yeti microphone does a such a good job of recording the audio and using the Riverside.fm software to record today's podcast. And where are we going on this warm Monday in Colorado Springs? 3. ⁓
San Francisco Bay Area Colleges are now under a serious, serious warning from their creditors, I'll have details. A northern Wisconsin college, Northland, spent down its endowment before it closed. Some donors think it broke the law. I've got a specific story on that one. And Moody's the creditor Moody's the financial rating agency cuts Brown University's outlook to negative.
Citing a $1.7 billion debt load. It also notes the $8.8 billion in assets that they have in terms of an endowment. And Dr. Robert Kelchon always has good stuff at the University of Tennessee, ⁓ has a piece on is your college losing money? And he's got a database to go with it. I'll talk briefly about that. ⁓ And AI, Artificial Intelligence, ⁓ is pushing the expected rise in college closures. And let's say, and I was part of that interview.
With Sean Soleil ⁓ at the Washington Times. And keep in mind the 2026 College Majors Completion app. I've got versions for academic leaders and for students and families. You gotta know which programs, which majors are doing well and which are not. And for college academic leaders, we've got five years worth of data. For students and families, we have a single year worth of data. Students and families, make sure you don't choose a college where they're not v graduating, completing very many folks.
In the majors you are interested in. It is that kind of major is ripe for closures. So where do we go as we always start? ⁓ Is layoffs and cutbacks. And I gosh, in mid-July I don't have any layoffs and cutbacks. Somebody stopped the presses. Maybe I missed them? No, I don't think so. I usually put them in there. Or they were so insignificant I didn't put them in. But no layoffs and cutbacks or closures this week. Gotta be a record. Page two.
Gary Stocker (00:02:25)
The three Bay Area Colleges, Nanette Asimov had this story on the in the San Francisco Chronicle ⁓ on july sixteenth. And the three colleges are Dominican University in South San Rafael, St. Mary's College in Moraga, and the third one is the Academy of Art University in San Francisco, and it's had its warning from Instacreditor earlier this year. Interestingly, ⁓ the creditors gave each college two years. Not even close to tough love.
Two years to repair their financial their problems, financial and otherwise, by better aligning expenses with revenue for the most part. And in the case of the Academy of Art, University doing a better job of helping students graduate on time, how many times, how many, many times have I talked about both of those? Financial health and pathetically low four-year graduation rates ⁓ and and at least the accreditors in California, although they're giving them two years.
I already said, hey, you gotta do better. And then ⁓ in conjunction with that, Nicola Pitchford, who is the president at Dominican, said this, and I quote, Dominicans' undergraduate enrollment undergraduate enrollment has declined nearly 12% since 2021. She said that's the equivalent of about 150 full-time students. Pitchford went on to say, undergraduate tuition is $54,441 this year. ⁓ And then she adds, and she adds.
But nearly all students receive significant financial aid. ⁓ And ⁓ this is how desperate, this is how desperate colleges are to convince the public that they provide a quality education by having a high price tag, even though hardly any of them stick by it. They share that ridiculously high tuition price. And then in the next second, in the very next second,
Talk about how they provide financial aid to their students. And you and I both know that discount rate, they call it scholarships, they call it financial aid, and I guess it kind of is. The discounts ⁓ are in most cases in excess of 50%. ⁓ So that $54,000 on this price at Dominican, probably, I don't know this for a fact, probably somewhere in the center of $27,000. And again, I've talked about this before. It's colleges use that Shivas Regal, Shivas Regova effect.
Gary Stocker (00:04:52)
They're it was a it's an alcohol alcoholic beverage. And colleges think a high price convinces students and families it's a good product or service.
I'm here to tell ya that's not necessarily the case.
And then I want to go to Wisconsin. And Northam College, that closed last year sometime, spent down its endowment before it closed. Some donors think it broke the law. That's a headline from Danielle Cating ⁓ on July 16th at Wisconsin Public Radio. Now, probably didn't break the law. That's a pretty judicious, pretty judicious interpretation. ⁓ What this is, ⁓ is this is another case.
This is another case of a college in financial trouble ⁓ taking what appears to be legal. I'll be honest, that's what the reporting says, ⁓ but it might be ethically marginal. Ethically marginal advantage of restricted endowments. Now, restricted endowments, of course, are dedicated endowments to a specific scholarship. The Gary Stalker College Viability Scholarship will be an example of a restricted endowment. It's designed just for students studying the financial health of colleges. As opposed to unrestricted endowments.
Which are essentially cash. That's a gross generalization, but that's effectively what they are. So the story is about a young man whose name is Bjorn Norgaard, who had volunteered for a local nonprofit group about ten, fifteen years ago. In two thousand eleven he was killed.
Gary Stocker (00:06:24)
He was 23 year old, 23 years old, and he was killed in a hit and run crash while he was skiing ⁓ at a at night ⁓ at a resort somewhere, so an area somewhere in Wisconsin. So with family and friends, and I think others, Norgard's father created a scholarship at Northam College in his son's name, to honor his son, of course. Two years later, ⁓ Mr. Norgard set up the Brother Bear Endowment Fund to provide financial support.
Northland students for various activities. Right. That's the setup. What we wanted to do, he said, was to honor Bjorn's adventurous spirit by providing funds ⁓ so that kids could honor theirs, Mr. Norgaard said. ⁓ And the family donated somewhere in the vicinity 156, $156,000 between the two endowed funds. But now, but now most of that money is gone as reported in this story.
As Northland College went through its financial turmoil, they ended up using most of those funds and others as well, not just this one, most of those funds to effectively keep the lights on to me payroll.
And that's sad as it can be that this father's intention to honor the memory of his son.
Gary Stocker (00:07:43)
Was subverted, I guess is the word I'm going to use, by a college that needed the money to keep the lights on to stay alive, to not close. And they ended up ended up closing. But here's the real story. And it's not just Northern College, don't get me wrong. What they did, probably legal, ethically, maybe ⁓ tough recall to make. But time after time, we see colleges in dire financial straits grab at funds that were meant for other uses. You're seeing the endowment.
And I can't say that it's not legal. Some states may rule differently, but I gotta be careful here. But how how how do you think Bjorn, the late Bjorn Norgard's father, feels knowing that his efforts to memorialize his son have been subverted to the ordinary operational needs of a college? And this is where we should also worry about colleges in financial peril.
It's leaders scramble in almost every case. It's leaders scramble to find any source of revenue to keep the college open. They don't want the college to close on their watch. And ⁓ it in my mind, it's easy to see a scenario where donors, philanthropists, in whatever form or fashion, ⁓ may start asking for their money back now ⁓ for these financially challenged colleges, or ask to so tighten the requirements for the use of those funds.
to make sure colleges don't misspend those gifts beyond the original Tim. They don't misspend them just to keep the lights on.
Onward. La Sierra University, California. Has heard from its accreditor. All right, let's go to the data. La Sierra Univers La Sierra University, California. And Matt Hendricks College Financial Compass 14. La Sierra College, La Sierra University, in 15 of the key measures that Matt tracks. La Sierra University was flagged for 14 of those 15. And folks, this is so easy to see.
Gary Stocker (00:09:49)
And and not just in Matt's apps, in our own college viability inspection report and other tools that are being developed. It's so easy to see.
And I I guess my question here is how can a college in such dire financial position like La Sierra University, fourteen or fifteen key measures were flagged being outside the range of other private colleges? How can they even hope to provide a decent college education? There are hundreds, hundreds, ⁓ hundreds and hundreds of colleges with sufficient finances to provide that quality education. Why does La Sierra think they need to be among them when there are such
Terrible financial shape by comparison. ⁓ And that's why we have the College Viability App, the 2026 College Majors Completion App, the College Viability Inspection Report, and the soon-to-be-released My College Decision Lens. These are all tools for students. ⁓ These are all tools that help students and families make a more informed decision about their college education so that the La Sierra Universities of the World.
as we show in the college viability inspection report, has red marks, has red indicators, those aren't good.
Page three. And you know I don't do politics, I don't do sex, I don't do religion on the show.
Gary Stocker (00:11:16)
But the headline reads from the Center for American Progress. This was on July 14th. The Trump administration moves to tighten grip on colleges. New rules, Center for the Center for American Progress says new rules would gut key student protections on program quality and give the federal government leverage to exert ideological control over American higher education. Well, that's political.
Gary Stocker (00:11:42)
Here's the story though. ⁓ What the essence of this is, is that the education department's new draft I guess it is the status it says now, the department's draft regulatory language would make it easier for inexperienced, untrained organizations to become a college creditor.
And effectively that would create ⁓ new gatekeepers, new financial gatekeepers to billions and billions of dollars in federal student aid. The revised proposal no longer requires, and this is from the story from the Center for American Progress, the revised proposal no longer requires the same level of hands-on accrediting, accrediting history before application.
Gary Stocker (00:12:29)
Here's what's going on. Here's the bottom line. Accreditation was already weak with this with the six regional accreditors and the specialized accreditors I talked about last week. Accreditation accreditors were already weak, despite what the Center for American Progress says. Current accreditors are nothing more than I daughters and T crossers, with little, if any, required demonstration of success.
Then show me you wrote something down.
And that lack of demonstrated success applies to both academics and financial health as well. And this will this will become probably more than it is. This will become an even steeper race to the bottom. All accreditors need the fees paid by the colleges they accredited. Yes, right again. Accreditors' fees, accreditors' revenue comes from fees, the colleges they accredited.
Talk about conflict of interest. And without those fees, these accreditors have no business. So accreditors, ⁓ logically, accreditors will have to create standards, whether they're current ones or new ones. They'll have to create standards that make it easier and less expensive for colleges. And that's that's not the case here at College Viability. We are not an accreditor. Our revenue comes from those who buy our apps.
We don't have a revenue conflict of interest, my credit our creditors do. And they will tell you no, it's not a conflict of interest. We've got systems and processes in place to prevent that. Okay. ⁓ Buy that if you will.
Gary Stocker (00:14:15)
But you gotta know in those quiet meetings when they're doing accreditation reviews, that at least somewhere in the back of their minds, if they're talking about a college that needs to be had their accreditation remove removed, that there's a loss of revenue attached to that for that accreditation agency.
Gary Stocker (00:14:35)
Here at College Viability, we give you ⁓ financial data, graduation rates. ⁓ Talked about that. Matter of fact, I had a LinkedIn post last week, over 24,000, some odd ⁓ views, because I challenge the graduation rates of too many colleges, or many colleges, and other data that lets students and families make the decision. Make it an informed decision. And as I've shared so many times.
It's the same type of service you get from ⁓ organizations, magazines like consumer reports for washing machines and dishwashers and you name it, and Kelly Blue Book for Cars. Moody's. ⁓ Moody's cuts Brown University Outlook to negative, citing a one point seven billion debt load. This is from Robert Farrington in the College Investor on July ninth.
And Moody's did it because of the weak operating performance that could persist for several years as expenses and financial aid commitments to students rise faster than revenues. All right, that's all I have in terms of the story itself. And this is not a closure, ⁓ this is not a closure scenario. Brown's not going anywhere. This is an industry indicator. Keep in mind that very few colleges can afford the ratings, the financial the financial ratings review ⁓ that Brown can afford through Moody's.
Or SP or Fitches. Brown has an $8.8 billion endowment and eleven thousand plus students.
But they also have debt almost million, not quite two billion in debt. And that's why Moody's did what Moody's does say, hey, that's not good. So so here's here's here's the summary point. If an Ivy like Brown, if an Ivy College like Brown, with all of its assets, eight point billion, what did I say, eight billion dollars, eight point eight billion dollars in cash and investments, is given a negative rating by Moody's, can we make a logical assumption?
Gary Stocker (00:16:37)
That the hundreds and hundreds of colleges without Brown's financial resources but are not reviewed by standard employs or Fitchers or Moody's might also be in trouble. They just don't get that officially stated by one of the rating agencies. Yeah, I think that's the case. And Dr. Robert Kelchon, Bob Kelchin.
Does some really good data work at the University of Tennessee ⁓ and publishes some really good stuff. ⁓ And I it was last week, I guess it was, yeah. Last week his headline read ⁓ on social media posts, I think it was LinkedIn, is your college losing money? And search this database, and he created a database at the University of Tennessee, Knoxville, to see how your institution, your college, stacks up. I'm gonna summarize what he said. He looked at more than 2,700.
Colleges, five hundred and forty plus public four year, eleven hundred plus public two year, and a thousand plus private nonprofits in all fifty states in Washington, DC. The criteria was they had to award awarded fifty or more undergraduate credentials in the in the in the calendar year twenty twenty sorry, fiscal year twenty twenty three, twenty twenty four. And had to consistently reported financial data for the last ten years from twenty fifteen through twenty twenty four.
He writes that over that decade you can get a handle on institutional finance, health or no health, by seeing how many years out of ten, this is what Matt Hendricks does on his college finance, ⁓ on his college financial compass, how many years out of ten your college or institution posted operating losses, enrollment losses, appropriation losses for public colleges, and endowment losses for private colleges. Out of ten years, how many were their losses in one of those three categories?
The red alerts, Dr. Kelson says, are to look for those who have losses in six or more of the last 10 reported years.
Gary Stocker (00:18:37)
Therefore, it goes on to say that Kelchon foresees ⁓ a more challenging period for higher education budgets. All right, that's pretty pretty obvious. Federal funding is down, ⁓ reach cuts research funding, ⁓ the new federal earnings metric, all combined to make it a tougher, tougher, tougher business for colleges. He does note, and I'm not sure I'm on the same page with this, but that's ⁓ he does such good work that I'm okay with that. There are two bits of good news ⁓ for the sector.
The first is, Dr. Kjellchen says, is that the last few years have been a time for all but the most struggling institutions to recover and plot a strategy for going forward. And that's an important qualification, all but the most struggling. And the second is that higher education is becoming more serious about making budget cuts before situations become incredibly dire.
And so Dr. Kelch and Bob, ⁓ Robert, I like your stuff. Really good stuff. Along with Greg Pillar's stuff, yours is the first I read. But I'm gonna make the argument that too many colleges, too many colleges have neither taken advantage of time ⁓ to recover ⁓ or make plans, or shown any capacity to balance their budgets. And especially the balance the budget piece.
comes from the weekly show I do with Matt Hendricks, the College Financial Health Show. And if you've watched that show, you need to watch it. If you haven't watched that show, excuse me, if you haven't watched that show, you need to watch it to see what we do. ⁓ But week after week, not every week, but almost every week, colleges that were reviewed just simply show no capacity ⁓ to balance their budgets. And it shows up in the financial statements ⁓ and it shows up in the comparisons that Matt develops in his college financial compass tool. Page four. There's a new report.
Defines institutional size matters to prospective students. It's not the dominant factor, but it matters. And this comes from PR Newswire and it comes from the Center for Higher Education, ⁓ Mergers and Acquisitions, KEMA, C-H-E-M A. I was part of the study, ⁓ and it notes that while institutional size plays a role, it's not the primary role. The report found that most prospective students prefer medium to large size institutions. 67% favored medium size.
Gary Stocker (00:20:58)
with a thousand to almost ten thousand students, forty-two percent preferred large ten thousand to twenty thousand students, and only fourteen percent they wanted said they wanted very large institutions with greater than twenty thousand or more students.
The report says larger institutions, and this this kind of ties in with where I think the market's moving. The report says larger institutions appear to be competing effectively, maybe more effectively, across multiple dimensions that students value, including cost, program options, academic quality, flexibility, and career opportunities. And I'll sarcastically add football games on Saturday afternoon. And I share this like I like I've done so many times.
The market is moving to big. We don't see it yet today. That's an anecdotal observation, but it's happening. Sean Slay, he drops me out regularly asking for comments and this story on AI pushing the expected rise in college closures. This was ⁓ last Monday on July 13th. ⁓ And and and ⁓ he does such a good job of researching and talking to so many sources. Sean Slay quoted many, many sources to support this headline.
That AI is pushing the expected rise in college closures. Agree or disagree ⁓ with the premise, with the headline. AI provides all of us ⁓ with access to precise information that search engines don't always do, ⁓ and arguably more effectively and efficiently than ⁓ too many college professors do. And here's an example. I've started taking Spanish lessons as a guidance.
And let's do the wrap. And this is from Kyle Saunders again. ⁓
Gary Stocker (00:22:48)
I find so many good writers. Kyle Saunders is one of those. This is from July ninth, so it's couple weeks old. And here's the headline. Why employers no longer trust college degrees, ⁓ grade inflation, the SAT revival, and the rise of hiring guests?
Harvard caps its A's. 1400 professors want the SAT back, and employers have already built their own tests. This is where the college degrees signal actually went. So here's what Kyle Saunders wrote. Suppose you graduate this spring with a 4.0 from the most famous university in America. Harvard. And you apply for a job at a software company owned by Vista Equity Partners. I think that's a real company.
Before anyone at Vista Equity Partners reads your resume with much interest, you will sit at Vista Equity Partners criteria, cognitive, aptitude test. 50 questions, 15 minutes. You'll also complete a personality profile. Everyone does. Even when Vista buys a company, every employer from the new company and every applicant takes the test. So far, about 125,000 test takers.
For 6,000 hires. And if your score, ⁓ if your score comes back looking too good, Vista Equity Partners may ask you to sit again in a room with someone watching. And and and Mr. Saunders, Kyle Sanders notes that a reader pointed me out to Vista pointed him to Vista. And he goes on to say, Kyle Sanders goes on to say, I really haven't found a better image than this story for where higher education actually
Stan's. A private equity firm looks at a Harvard transcript, the most probably the most famous college in America.
Gary Stocker (00:24:42)
Harvard Transcript, the most expensive quality signal American civilization produces.
and declines to believe it.
Welcome to higher education in 2026. Hey, ⁓ let's do it again next week. So July 20th plus 7th is July 27th. Thanks as always for listening to this. Make sure you're not a podcast hog. Share the podcast link with your college ⁓ colleagues, with your friends, family, and neighbors, ⁓ and get the word out. Listen to a different perspective on where this higher education industry is headed. I'm Gary Stalker at College Viability. We'll be back next week.