Dive Brief:
- Alderson Broaddus University, in West Virginia, filed for Chapter 7 bankruptcy Thursday, as the beleaguered Baptist college winds down operations following years of financial turmoil.
- The university has between $1 million and $10 million in assets, but holds between $10 million and $50 million in liabilities, according to court documents.
- Last week, Alderson Broaddus announced its intention to close when it voluntarily gave up its accreditation with the Higher Learning Commission, effective Dec. 31, the agency said. The university's website was also taken down this week.
Dive Insight:
Alderson Broaddus, like many small and religious institutions, has seen steady enrollment declines in recent years. In fall 2022, it had fewer than 800 students, down from about 1,150 seven years earlier, according to federal data. The corresponding loss of income led the university to struggle financially.
In one example, Alderson Broaddus's utility company threatened to cut its power in July over nearly $776,000 in unpaid bills. While they eventually reached a repayment agreement, the university was unable to resolve issues with other creditors, who number between 100 and 199, according to its bankruptcy filing.
The road to Alderson Broaddus' closure has been messy. It lost approval from West Virginia to operate at the beginning of August, despite an effort by the state's governor to intercede.
Students and employees are suing the university, alleging it hid its imminent closure from them.
Alderson Broaddus said Thursday it expects to receive more than $1 million in pandemic-related tax credits from the IRS — but the money didn't come in time to keep Alderson Broaddus running.
Students can request copies of their transcripts from the nearby West Virginia Wesleyan College, one of two colleges with which Alderson Broaddus has established teach-out agreements. The other is with Davis & Elkins College, also in West Virginia.
The Higher Learning Commission also said students who hold federal loans might be eligible to seek a closed-school student loan discharge.
