Gary Stocker analyzes Hannibal-LaGrange University's finances using federal data on nine Missouri colleges. All nine saw enrollment and revenue drop over six years. HLGU spends far less per student on instruction and support than peers, and recently laid off 15% of faculty.
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Today's news that Hannibal-LaGrange University in eastern Missouri will remain open this fall despite a troubling fiscal assessment this past March. On the other hand, leaders at the college announced today that 15% of the faculty have lost their jobs. Others report that student morale at the college is suffering. Hi, my name is Gary Stocker. For the past 5 years, I have been researching the financial health and viability of private colleges in the United States. In 2020, I created and released the College Viability App that I'm going to share with you today to compare the financial challenges of Hannibal-LaGrange University and 8 other private Missouri colleges. So let's go to the data. And the data, by the way, is from the National Center for Education Statistics. What you're seeing here is the 6-year summary of changes from the 2022 College Viability App. You can see on the left-hand side that I've listed 9 private colleges in Missouri, each of which has had an enrollment decrease like Hannibal-LaGrange in the last 6 reported years to the National Center for Education Statistics. So let's do a quick comparison of these colleges, both the good and the bad, to show what has happened. I'm going to focus on these middle 2 columns for FTE enrollment, which stands for full-time equivalent, and tuition and fees before I show some of the other links on the application. And we can see, of course, each of the 9 has lost enrollment over the last 6 years. Businesses will on occasion lose business from time to time, but to lose it over 6 consecutive years is a concerning component, and we see that for each of these 9 colleges. In the next section, I want to look at the tuition and fees, and we can see that 7 of the 9 colleges have lost tuition and fee revenue over the last 6 reported years. Again, that can happen from time to time, but to have a consistent pattern of losses of a primary, if not absolute, source of income is concerning. It's one thing to look at enrollment, but let's look at the graduation rates. And these are going to be the undergrad graduation rates, and let's start with the 4-year graduation rate. And we're going to see that none of them are particularly strong. Some are absolutely abysmal, in terms of how many students, what percentage of students graduate within 4 years. None of them are above 50%. Some are just distressingly low. But let's take it one step further, because now colleges also report a 6-year undergraduate graduation rate. Let's sort that for the year 2020. And we can see that some come close to the threshold that I use, which is a 70% graduation rate over 6 years. And again, a definition of that is for every 100 students who started at a college, for example, Fontbonne here, 66 graduated from Fontbonne within 6 years. Now, some may still be in college, some may have transferred and graduated elsewhere, but this provides a comparison. And I offer a comparison of a college's systems and processes in place to graduate students, which is their primary responsibility. I have clicked over to percent admitted for these 9 colleges and sorted for the year 2020, and you can see most of them, about half of them, accept almost all the students that apply. Culver-Stockton, Westminster, Fontbonne, not very selective at all. They are accepting applications, probably pure speculation on my part, just to fill seats. When you look at colleges like Avila, they're a little bit more selective, but as you'll see, they have revenue issues as well. Park University, you have to wonder about their capacity to capture and report the data in the National Center for Education Statistics data rates. I'm now gonna click on yield, and this kind of gets techie, kind of inside baseball. And let me again sort for 2020. And yield is effectively an indication of a college's popularity. And here's how you define that. For every 100 students that a college accepts, yield shows what number of those actually enroll at that college. So we can see in this case, Hannibal-LaGrange stands out and that their yield at 41%, while not particularly strong, is better than all the other colleges in this sample. I can again offer speculation. Hannibal-LaGrange is a faith-based college. They probably have a little bit more loyalty from those who applied. Maybe, maybe not, but that's one of the reasons that could be behind that. But the rest have relatively low numbers, and when you get into the teens, as you see in the bottom, that's just not a good indication that the market or the individual students view these colleges as ones they really want to go to. And then finally, I want to look at some of the comparisons down below, and I'm going to click on the institutional support. Per FTE, and that simply means per student, per full-time enrolled student. And we can see as we sort these that Westminster spends about $9,000 per student in administrative costs. Define that any way you want. These terms can be defined differently by different colleges, so that explains some of the reason for the differences. But a simple comparison— Westminster at $9,000 and Avila University at $2,400— that's a big discrepancy. I'm not sure I would be that concerned with a discrepancy of $500 per student that we see between Drury and Stevens, but again, it's a comparison that you can use. We can see Hannibal-LaGrange is toward the bottom of our list, which is both a good and a bad thing. It means they are probably managing their overhead reasonably well, but that's still a relatively low number compared to others in this sample. Let's take a look at academic support. And again, well, I've already sorted this for 2020. And again, we can see Westminster is high at $3,000 and change per student in academic support expenses. And we can see that Hannibal-LaGrange, since this is the focus of this report, is really low, about 4 or 5 times lower than what we see at Westminster. In the absolute, it probably doesn't mean that much, but as a comparison, it can be an indicator of the way an organization is forced to or has chosen to budget its funds. And lastly, something similar, that's similar to academic support, I want to look at instruction expense per FTE. Again, I've sorted it by 2020, and we can see Stephens College at almost $14,000 per student, as we look at Hannibal-LaGrange, about a third of that. So again, the absolute values are important to know, but the disparities, the differences, are ones for significant focus as you're looking at why colleges struggle and how they invest their financial resources to support their students both academically and in other areas of the college experience. I don't do predictions. I don't do guesses. I just provide simple comparisons of data that colleges themselves have provided to the federal government and information from the auditors that colleges have hired to prepare their financial statements. It's all publicly available information. So what does this report tell us? While there are many other private colleges with similar financial, enrollment, and outcome profiles, it is the pattern, the overall pattern, that's disturbing. How many other private colleges like Hannibal-LaGrange University are on the verge of a financial cliff, are on the verge of laying off faculty and staff and cutting back courses and majors How many faculty and staff and students will experience the trauma we have seen play out at Hannibal-LaGrange and many other private colleges in recent years? Here's my reasonable speculation. There are many more Hannibal-LaGrange stories waiting to unfold. College finances and the market pressures on tuition discounts and tuition revenue are creating an unsustainable future for too many private colleges. Mergers and closures will become an increasingly frequent story. If you would like to do your own comparison of private colleges, I will include a trial link to the 2022 College Viability App below. You deserve a quality college education. I simply want to give you the information to help you make the best possible college decision that includes comparisons of private colleges' financial health and viability. You will have already looked or will be looking at majors and the campus and the faculty and the online offerings and the amenities. Let's add a comparison of a college's finances to a decision-making process. Mm-hmm.
