The middle class is shrinking. Those in power have run up enormous debts on public credit while shoveling most of the money into private pockets. The corporations that have benefitted from this borrowing binge, meanwhile, leverage the global trade system to transfer their profits beyond the reach of national governments.

Meanwhile, we have been told lies by Democrats and by Republicans, divided into artificial camps and led into debates that are either irrelevant or so dramatically scripted that we fail to realize every choice leads to the same result: the dismantling of the social framework that defined and sustained the opportunity of the last century. National mobilization of resources has given way to radical individualism under a narrative that, in the wealthiest nation in the world, we must always expect less.

In this tumultuous time, we search for a way forward - a new Square Deal for the American people.

Friday, March 6, 2015

Saving Sweet Briar

At the end of February, the Board of Directors of Sweet Briar College -- a women's college located in Amherst, Virginia -- voted to close the school at the end of the year.  The decision was announced to shocked students, faculty, staff, and alumnae a few days later.  There was shock and outrage, which the Washington Post described with regards to current students as "almost a collective howl, as hundreds of young women began sobbing all at once."

Within a few hours, Vixen students and graduates began to gather on Facebook to discuss what could be done.  By the end of the day, a core group of alumnae with appropriate professional credentials were working to form Saving Sweet Briar as a 501(c)(3) nonprofit organization.  Three days after the announcement of the closure, they announced the retention of a Richmond law firm with the goal of stopping the closure, and presumably wresting control of Sweet Briar from its current Board.

As this has happened, Sweet Briar alumnae and their friends and families have rallied to pledge money in support of the school.  As of this writing, pledges totaling more than $1.7 million have been raised in less than 72 hours, with over 2000 people signing up to donate money.  The goal of $20 million was set on the basis of covering both projected legal expenses and the anticipated operating shortfall of the school should it remain open for a 2015-16 school year.

Saving Sweet Briar is moving fast because it must move fast.  All current Sweet Briar students need to know quickly whether they can stay or must plan to transfer.  A wide array of schools are stepping up to help them transfer, even though many deadlines have passed, and not doing so could jeopardize their studies in the fall.  For those trying to save Sweet Briar, meanwhile, every student who transfers represents a substantial loss, not only in tuition revenues but also in the campus community.  Too few students and the school becomes non-viable regardless of the success of any legal challenge.

To many observers, the way in which the closure was abruptly announced appears to have been engineered precisely to bring about this outcome, in which efforts to save the school are greatly hampered by transfers and enrollment cancellations, so that the closure is a fait accompli.  More than a few alumnae have jumped to conclusions regarding the motivations of the current Board and leveled emotional accusations of malfeasance, particularly because Sweet Briar has an endowment of approximately $94 million.  Delays in accessing from the Sweet Briar campus network prompted concern that the College was actively censoring the site (which was not the case).

It is not surprising that alumnae and students given so little notice that their alma mater was in financial trouble would react this way.  However, such accusations are almost certainly wrong.  Sweet Briar is facing challenges that most small liberal arts colleges located in rural areas are facing: fewer people wanting to study in rural environments, fewer people wanting to study liberal arts, and fewer people wanting to enroll without substantial financial aid (the "discount rate").  Additionally, as a women's college, Sweet Briar faces the added pressure of fewer young women wanting to study on all-female campuses.

Data provided by Sweet Briar College
Published Here on InsideHigherEd
The endowment has stayed somewhat stable over the past five years, but those five years have been an uninterrupted bull market during which one might reasonably have expected the value to grow.  That it did not demonstrates that the proceeds of fundraising and existing investments have been going to cover operating costs, and it suggests that the school will have to draw more deeply on its endowment principal when the bull market comes to an end (as they all do).  In evaluating the conditions facing Sweet Briar, the  Directors -- all of whom are themselves Sweet Briar alumnae, by the way -- doubtless took all of this into account. 

Does this mean that people working to save Sweet Briar are fools?  No.

Every day, in boardrooms across America, teams of smart people look at objective data and make projections based on their experience and expertise, and they are wrong about as often as they are right.  The mergers of America Online with Time Warner and Hewlett-Packard with Compaq come to mind, but there are thousands of instances in which very smart people equipped with good data were simply wrong. 

Does that mean that the people working to save Sweet Briar will succeed?  Again, no.

Setting aside the matter of their legal challenge, which I will assume for the sake argument is going to succeed and deliver them control of the school (mostly because I have no idea what the jurisprudence on the matter is under Virginia law), anyone who takes over Sweet Briar and attempts to operate it is going to inherit the same challenges that existed before the vote:
  1. More prospective students need to apply.
  2. More accepted applicants need to enroll.
  3. More enrollees need to pay a greater share of tuition or more endowment funds need to cover the higher discount rates to cover enrollment.
A successful campaign to #SaveSweetBriar will result in greater interest in application, but that will not change the other two factors.  Enrollment is partly a function of prestige and partly a function of cost, which together form the value proposition of the school. 

There is reason for optimism.  Simply by announcing the closure, the Directors of Sweet Briar fundamentally changed the equation in two meaningful ways:
  1. Alumnae who may well have been uninterested in donating to their school five days ago are now lining up to pledge support; and
  2. Sweet Briar is receiving considerable publicity around the campaign to save the school.
A successful campaign to keep the school open for 2015-16 would send a strong signal that the Sweet Briar alumnae network is engaged and committed to the success of its school, something that many prospective students take into account when calculating the value propositions of each school they consider attending.  That Sweet Briar is a women's college is in this case an asset to the cause, because the key participants in the campaign are role models.

That would not immediately address the discount rate dilemma, of course.  However, as mentioned previously, discounts are not a standalone dilemma; they exist in relation to endowment funds available to sustain them.  A campaign to raise $20 million by June 30 is not a lightweight undertaking, and it will be possible only if a substantial number of Sweet Briar graduates and their friends decide that Sweet Briar is genuinely worth saving.  That decision is unlikely to be a commitment that lasts for only one year, so it may be possible to underwrite the costs of the College as other changes are put in place.

One thing that Vixens hoping to save their school should not imagine is that the success of this campaign in the near-term means a return to campus life as it existed on March 3, the day before the closure was announced.  Sweet Briar will need to undergo substantial changes to preserve its culture and character as an women's liberal arts campus.  Costs will need to be cut, and serious questions will have to be asked and answered regarding the viability of some programs.  Alumnae will need to be more willing to make unrestricted contributions to the endowment, and that commitment will likely have to last for 20-25 years to build up the reserves necessary to say that Sweet Briar has truly been saved.

It will be difficult.  It will be challenging.  But these are Sweet Briar women.  Anything is possible.


Full Disclosure:  The author is married to a graduate of the Sweet Briar Class of 2001, and owes his marriage and the existence of their four-year old daughter not only to their meeting on campus in 1997, but also to the SBC Alumnae Office forwarding a letter to her in 2003 that led to their getting back in touch the next year.  Sweet Briar is also the sister college of his own alma mater, Hampden-Sydney College, and it is the author's opinion that the disappearance of Sweet Briar poses a substantial threat to the social life and campus culture of Hampden-Sydney.  All analysis and commentary in this article is therefore necessarily biased to some extent by the author's personal interests in Saving Sweet Briar.

1 comment:

  1. I married a Sweet Briar grad ('02) too. Great school, and I wish it were referred to as an Arts, Sciences, and Engineering college because that's really what it is in this day and age. Liberal Arts is a term that has negative connotations for some, though I don't think it should. SBC is one of only two women's colleges in the US that has an accredited engineering program and is graduating about four times as many women as projected when originally established. Their mathematics and science programs put graduates into some of the best graduate schools in the country. I'm not trying to be disagreeable or anything, just trying to get the word out to people who may hold an image of the school that does not comport with what it currently is. Thank you for your article.