It's hard to imagine a roller-coaster ride scarier that the one Waldorf College has taken in the 10 years since it switched from offering two-year degrees to a baccalaureate curriculum. Founded in 1903—primarily to fill a vacant hotel facing the Winnebago County Courthouse here—Waldorf was as much as $20-million in debt by the end of 2008, and the recession had caught up with local donors who had been keeping the Lutheran liberal-arts college alive. It was a few months away from sending its 558 students home for good when a for-profit online university expressed an interest in buying it.
The buyer was Columbia Southern University, which enrolls about 23,000 students, many of them in the military. Based in Orange Beach, Ala., Columbia Southern is a family-owned company that wanted to diversify. After lengthy negotiations, it took over Waldorf's debts and sent in a new president and admissions director in January 2010. It also restructured the board, keeping four members and adding four outsiders and three family members. And it spun off a $600,000 Waldorf Lutheran College Foundation to handle alumni affairs, the campus ministry, and a handful of scholarships.
Some college employees expected the worst, assuming that Columbia Southern was chiefly interested in buying the college's accreditation and would ax programs that didn't fit its online model.
But the company put money into Waldorf's existing programs without cutting any. Faculty members, who had been making just over $43,000 a year on average, got a 3-percent raise right away, a 4-percent raise in August, and another 3-percent this year. Retirement benefits and program budgets were restored, new carpet and fresh paint appeared, and the admissions staff grew from four people to 10.
Other changes struck closer to Waldorf's liberal-arts identity. The college began offering online degrees in business, psychology, and criminal-justice and fire-science administration. And Waldorf's faculty members were moved from traditional tenure to a system in which professors start with three-year contracts and then move to contracts lasting five years. Seven of the college's 40 faculty members left during the 2008-9 academic year, when the deal was being worked out.
"The giving up of traditional tenure was a real tough battle," said David Damm, a communications professor. "We came up with the term-tenure idea as a compromise. They were willing to go with it."
Robert AuFrance, an associate professor of theater who is the Faculty Senate president, said he was among those who were fearful at first. "But we're a year and a half out, and we're still encouraged to be rigorous. They made it clear we're not a facade, we're the anchor."
Even so, the change of ownership has brought a higher level of scrutiny from the college's accreditor, the Higher Learning Commission of the North Central Association of Colleges and Schools. The commission has itself had been under pressure to take a harder line against buyers of colleges that hoped to have accreditation included in the package.
In 2009, Waldorf assembled materials for a provisional accreditation review, and it has worked closely with the accreditor since then, said Robert A. Alsop, a longtime English professor who in April was named Waldorf's next president. "What they want to see is that you are the same college after the transition."
Not long after the accrediting commission signed off on Columbia Southern's purchase of Waldorf, commission members rejected an investment group's bid to buy Dana College, in Nebraska, and keep its accreditation.
Robert G. Mayes Jr., Columbia Southern's President, sees the acquisition differently: "The more diversified you are, the more chance you have of meeting students' different needs and desires." He said Columbia Southern, which is accredited by the Distance Education and Training Council, serves mostly adults seeking to improve their careers—some of whom would prefer courses backed by a traditional institution.
"They have great people," he said of Waldorf. "They just didn't have the resources. We knew this had to be a school that would evolve, not transform overnight, but we also didn't feel this was going to take five or 10 years to turn around."
He hopes that by 2012, Waldorf will have overcome its deficits, but says the campus may never be highly profitable. In coming years he wants Waldorf to do a better job of tapping into online and other markets. In the meantime, the college has lowered its sticker price by $1,800, from $26,500 in 2009 to $24,700 next year, although Iowa students will qualify for $1,915 less in state aid because Waldorf is now a for-profit institution.
There "is certainly still a sense of urgency about finding ways to be sustainable," Mr. Alsop said, so the college is reviving an old program that offered a three-year bachelor's degree even as faculty members try to figure out "how you create a Waldorf College sense of community for people in vastly different time zones."
Meanwhile, attracting students to Forest City, population 4,500, remains difficult. The college started last year with 613 residential students and 221 students online. "We can be a campus of 850 to 900 students," Mr. Alsop said. "That would be a much more efficient use of our resources."
(Excerpted from the May 29, 2011 edition of The Chronicle of Higher Education, article by By Lawrence Biemiller.)
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