Dive Brief:
- The University of the Arts, in Philadelphia, plans to close June 7 after an unexpected shortfall of cash to run its operations, according to a message on its website.
- With the abrupt closure, the university is canceling scheduled summer classes. Its transfer partners include Temple University, Drexel University and Moore College of Art and Design.
- “Under extraordinary circumstances, we diligently assessed the urgent crisis presented and pathways to keep the institution open,” the university’s board said in a statement Sunday. “Despite our best efforts, we could not ultimately identify a viable path for the institution to remain open and in the service of its mission.
Dive Insight:
In a Friday letter to campus, top officials said the university’s cash position has steadily weakened and that it could not cover “significant, unanticipated expenses,” though they did not offer details. Its dire cash position then “came to light very suddenly,” UArts President Kerry Walk and Judson Aaron, board chair, said.
“We know that the news of UArts’ closure comes as a shock. Like you, we are struggling to make sense of the present moment,” they said in their letter. “But like many institutions of higher learning, UArts has been in a fragile financial state, with many years of declining enrollments, declining revenues, and increasing expenses.”
Last Thursday, the Middle States Commission on Higher Education moved to require the University of the Arts to submit a teach-out plan for students to finish their education elsewhere — a sign the accreditor saw the institution as being at risk of closure in the near term.
The next day, MSCHE pulled accreditation from the university, effective Saturday, citing receipt of a closure notice from the institution and violations of multiple requirements.
MSCHE’s notice came out before the university communicated its closure plans to students and campus stakeholders.
“We know that this makes hearing the news of UArts’ abrupt closure even worse,” UArts’ Walk and Aaron said in their letter.
The university traces its history back to 1876, when it was founded as an arts college tied to the Philadelphia Museum of Art. It broke off from the museum in 1964, and in 1985 it merged with Philadelphia College of Performing Arts, whose own history stretches back to 1870.
UArts touts two dozen bachelor’s programs and 20 minors open to all students.
Between 2017 and 2022, fall enrollment at the university fell more than 29% to 1,313 students, per federal data. It declined by more than 44% since 2010.
By the end of fiscal 2023, University of the Arts faced a $12 million deficit between its total operating revenues and its expenses, according to its latest audit. Tuition by far makes up the bulk of its revenue.
The university also carried $45 million in long-term debt, made up of bonds backed by the institution’s revenue and which it issued to pay for capital projects over the years.
The university is one of a handful to announce a closure in recent weeks. That cohort includes another arts college just over 30 miles to the southwest — the Delaware College of Art and Design, which announced in late May that it would wind down its operations and stop offering classes in the fall.