Iowa Wesleyan University to Close
Credit: Image Credit: Iowa Wesleyan University - Iowa Wesleyan University is set to close later this spring, even after enrollment growth.
- Officials cited financial challenges for the closure, including a rejected request for relief funding and a drop in philanthropic giving.
- Iowa Republican Gov. Kim Reynolds said in a statement that an independent accounting firm “highlighted that while enrollment at Iowa Wesleyan has grown over the past three years, their financial health has continued to deteriorate over the same period.”
- The school has entered into agreements with other nearby universities to allow students to complete their education at a similar cost.
Iowa Wesleyan University will close at the end of May after 181 years of operation due to financial challenges despite “unprecedented enrollment growth,” school officials announced Tuesday.
“It is with deep sadness that we announce the Board of Trustees has made the heartbreaking decision to close our beloved Iowa Wesleyan after 181 years as an educational pillar in this community,” Iowa Wesleyan University President Christine Plunkett said in a release.
“Our focus is now on assuring our over 850 students have a smooth transition to another educational opportunity.”
The school has partnered with William Penn University, Upper Iowa University, the University of Dubuque, and Culver-Stockton College to allow students to complete their degrees on time and at a “comparable cost” to Iowa Wesleyan, according to the release, and additional agreements may be added.
Iowa Wesleyan struggled with pressures from inflation, resulting in increased operating costs, according to the release. The university also saw a drop in philanthropic giving.
The university asked for $12 million in federal American Rescue Plan Act relief funding earlier this year, but that proposal was rejected by Iowa Republican Gov. Kim Reynolds. Robert Miller, the chair of the Iowa Wesleyan Board of Trustees, said school officials are “disappointed in the lack of state support for this effort.”
Miller noted that the school’s metrics were trending in the right direction. Enrollment and retention increased following the pandemic, according to the release, but “is still not yet at a threshold needed for financial stability.”
The governor’s office didn’t receive Iowa Wesleyan’s request until Feb. 3 of this year and added that the state hired an independent accounting firm to analyze the school’s finances and assess the funding request, Reynolds said in a statement.
“The firm reported that Iowa Wesleyan had a $26.1 million loan from the USDA, using their campus as collateral, that could be recalled in full as early as November 2023,” Reynolds said in the statement.
“Additionally, Iowa Wesleyan’s auditor cited ongoing concerns about the university’s fiscal health, stating ‘significant operating losses and reduced liquidity raise substantial doubt about its ability to continue as a going concern.'”
Reynolds added that the accounting firm “also highlighted that while enrollment at Iowa Wesleyan has grown over the past three years, their financial health has continued to deteriorate over the same period.”
“Based on this and other factors, the independent accounting firm determined that providing one-time, federal funds would not solve the systemic financial issues plaguing the university,” Reynolds said in the statement.
Dozens of colleges have closed or merged in the past five years, BestColleges previously reported, a trend that was exacerbated by the COVID-19 pandemic.