Dive Brief:
- Eastern Gateway Community College will shutter Oct. 31 following financial and legal challenges in recent years, the institution's board of trustees voted this week.
- In February, the 56-year-old public Ohio institution suspended enrollment for all students past the spring semester, and the board said Wednesday it had been on track to close June 30.
- But Ohio state officials in March gave Eastern Gateway an advance on funding for fiscal year 2025. The money came on the condition the community college offered courses over the summer, the board said.
Dive Insight:
Eastern Gateway's woes took root in 2022, when the U.S. Department of Education alleged the institution's free college initiative illegally charged students with Pell Grants more than those without.
The last-dollar program — which covered tuition costs after other financial aid had been applied for students affiliated with labor unions — provided a huge boon to the college's enrollment.
Prior to the program's 2015 launch, Eastern Gateway had 3,182 students in fall 2014, according to federal data. Five years later, its student body had exploded to 25,648, and the community college hit 45,173 enrollees in fall 2021.
But the following year, the Education Department began requiring Eastern Gateway to pay federal financial aid disbursements to students out of pocket before seeking reimbursement, under a process called Heightened Cash Monitoring 2. The agency also required the college to create a teach-out agreement for students allowing them to transfer elsewhere.
Eastern Gateway subsequently sued the Education Department in September 2022, alleging itthe agency hadn't given the college due process and had exceeded its legal authority.
In August 2023, Eastern Gateway ended the free college program as part of negotiations with the department. That fall, enrollment dropped to 15,300 students, according to The Business Journal.
College officials also dropped their lawsuit under a tentative settlement. But the damage to the college's viability had already been done.
During Wednesday’s vote to shutter the college, board members referenced the effects the Education Department dispute had on Eastern Gateway's finances.
The funding from the Ohio Department of Higher Education and the summer classes are intended to give students time to make a plan and allow those missing only a few credits the chance to graduate. The previously temporary hold on new enrollment is now permanent.
"We are trying to make sure we create a seamless transition for each and every student," Eastern Gateway Interim President John Crooks said Wednesday.
Eastern Gateway has established teach-out agreements with a dozen local institutions, and more are pending approval, according to the board. The community college's last graduation ceremony will be held in August.
Eastern Gateway's trustees also approved a resolution to sell the college's Steubenville campus to the local school system. They did not discuss plans for Eastern Gateway's other campus, roughly 75 miles north in Youngstown.
