INVESTIGATION: Is Southwest Ohio ‘overinvested’ in higher education?

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There are 90 nonprofit public and private colleges and 24 university branch campuses in Ohio, each of which has its own leaders and competes, to a degree, with one another.

Southwest Ohio has 22 colleges and four branch campuses, second only to Northeast Ohio which has 23 colleges and six branches. At least six Southwest Ohio’s colleges have struggled financially in the last decade, a sign that there may be too many schools for the region to sustain, experts told this newspaper.

LEANER TIMES IN HIGHER ED

» INITIAL REPORT: What caused area colleges to falter financially?

» THE LATEST: Thanks to alumni, Antioch College survived its own death

» EARLIER: Wright State finalizes more than $30.8 million in budget cuts

“Dayton is probably over-invested in higher education,” said Richard Vedder, an Ohio University economist and director of the Center for College Affordability. “Within an hour’s drive there are a hell of a lot of schools. You’re probably a bit over-colleged.”

The demand for a college degree has softened, and Vedder estimates it will precipitate a closure of around 500 schools in the United State over the next several years. The U.S. Department of Education lists 550 schools nationwide that they have determined to be “financially troubled.”

Colleges are facing leaner fiscal times as they’ve experienced a decline in customers, heightened competition and slashes to state and federal funding.

There are almost 600,000 students taking classes at the state’s public colleges and leaders are fearful that an expected drop of 13,000 Ohio high school grads over the next 15 years could cause further declines in enrollment.

RELATED: Sinclair College increases tuition, gives employees pay raises

Wright State University may be the largest and one of the most recent colleges in Ohio to struggle financially, but it has some company. WSU overspent by around $120 million over the last six years and is heading for state fiscal watch as Central State University recently exited it.

Wilberforce University slashed $750,000 from its payroll budget in November and in 2015 Wittenberg University cut around $6.5 million to help balance its budget. Antioch College closed in 2008 amid financial problems only to later reopen while cash-strapped Urbana University was bought in 2014 by Franklin University in Columbus.

Although each school has faced different problems, they collectively depict an industry in crisis and one that cannot rely on the reputations that have carried others.

For too long, colleges have tried to be “everything to everyone” but that “has to pass,” said Doug Fecher, the soon-to-be chairman of WSU’s board. That means sharing some operations and offerings and making sure programs offered by one school don’t overlap with another, officials said.

“We’re not Harvard,” Fecher said. “So, don’t try to be Harvard.”

‘All of them are in trouble’

Harvard has something going for it though that several Ohio universities do not. The Ivy League school has the weight of history on its side.

The length of time a college has been around can be a powerful asset, Vedder said. Colleges that have existed for a century or more are not struggling as much as recently established ones.

RELATED: Wright State hits its ‘low point’ with announcement of layoffs

Ohio State University, Miami University and the University of Dayton were all founded in the 1800s while Wright State and Cleveland State University were founded around 100 years later in the 1960s following Rhodes’ proclamation.

“These are the schools of the 60s,” Vedder said. “All of them are in trouble. None of them are vibrant blooming schools at the moment.”

Both WSU and Cleveland State have dealt with financial problems over the last several years.

The two schools, among others, have become victims of their own short lives, Vedder said. They do not have the vast donor base nor the brand recognition to carry them through tough fiscal times like Kenyon College near Columbus or Oberlin College near Cleveland both do.

“They certainly don’t have a longstanding reputation,” Vedder said. “Kenyon and Oberlin are not having these kinds of problems.”

RELATED: WSU interim president: ‘Our financial picture is grim’

Long-standing reputations have not been able to help all area colleges avoid the pitfalls of financial problems though as Wittenberg, Urbana, Antioch, Wilberforce and CSU all started in the 1800s.

In some cases, a long history can be an impediment. While history can help schools weather storms, Fecher said it can hinder schools too.

Without a bloated bureaucracy that accompanies a century of existence, Fecher said WSU should be able to adapt easier.

“I would agree with that but there’s also some advantages,” Fecher said. “We should be able to be more nimble.”

‘Downward spiral’

As local colleges struggle, two have already been to the brink of closing and back.

Antioch College in Yellow Springs closed in 2008 when the school separated from its then-parent company, the Antioch University system. The now separate college reopened in 2011 with the help of alumni who donated hundreds of thousands of dollars.

RELATED: Antioch University in Yellow Springs could move to south Dayton

Like other area schools, Antioch was the victim of financial problems, partially triggered by declining enrollment. Those challenges still exist as a new Antioch tries to find its foothold in the region.

“Creating a financial pathway…in these times is a struggle for even large research universities,” president Tom Manley said. “We really needed to build on Antioch College’s distinction…I think we’re very close to sort of nailing it down.”

Antioch has gone to great lengths to save money. After it reopened, the college started a farm to grow food and raise animals that are served in a dining hall. Rather than paying someone else to fix things, alumni do it for free, Manley said

Another area liberal arts college would have closed had it not been bailed out by a Columbus school.

Urbana University was acquired by Franklin University in 2014. Though it retains its name and sports teams, Urbana will officially become a branch campus of Franklin this summer, said David Decker, Franklin University president.

RELATED: Urbana University begins first year after rare, rapid acquisition

The finances of the acquisition have not been revealed nor has the full scope of what caused Urbana’s troubles.

Like other liberal arts colleges though, Decker said Urbana struggled to maintain its enrollment. The school partially caused its own “downward spiral” by offering discounts so deep that they eventually lost Urbana money.

“Urbana was not going to survive. It was going to go out of business,” Decker said. “We looked at it as a project.”

A ‘number of headwinds’

Schools may soon be forced to pool their expertise and share operations more often.

“I do think we will have to evolve with one another,” Fecher said. “All of us together are stronger than we are separate.”

The Southwestern Ohio Council of Higher Education is already spearheading collaboration between colleges so they can save money.

RELATED: Wilberforce University announces layoffs, pay cuts and furlough for employees

When it comes to enrollment, SOCHE is encouraging colleges to work together rather than compete for the same students, said president Sean Creighton. To target specific groups of students, SOCHE is looking to the “big-brand publics,” such as the University of Cincinnati or Ohio State, Creighton said.

“They’ve become experts in it,” Creighton said. “Certain schools are just doing a much better job at reaching specific students.”

Area colleges are also looking to share certain resources and services, officials said.

Colleges already work together through purchasing consortiums so they have more leverage when it comes to buying things. They are also required by the state to work together to make sure any new programs don’t overlap too much with neighboring colleges, officials said.

Creighton expects arrangements like that to grow over time.

RELATED: SOCHE on track to meet 2020 internship goal for students

“We’re at a point now where the business model is being so hyper-disrupted that they may have no choice,” Creighton said.

In Georgia, some public colleges have gone so far as to merge. The state has combined 14 colleges into seven since 2011, according to The Chronicle of Higher Education.

But, Dayton area leaders stopped short of saying their institutions would ever combine with other ones and Creighton said he’d like to see every area school survive.

The president of Wilberforce University, America’s oldest private historically black college, said the university will never “entertain the notion of a merger with another institution.” It would be nearly impossible, president Herman Felton said, for Wilberforce to merge with Central State across the street since CSU is public and Wilberforce is private.

RELATED: Central State taken off fiscal watch as Wright State edges toward it

Wright State should at some point consider merging with Sinclair Community College, Vedder said. But, while the two are each other’s biggest feeders of students, Fecher said he couldn’t see it ever happening.

“I think there’s a fair number of headwinds facing higher education,” Fecher said. “But, I don’t think they’re insurmountable. I don’t see (merging) as a possibility here.”