Dive Brief:

• The University of San Francisco plans to acquire the San Francisco Art Institute, a prestigious but cash-strapped fine arts school, officials at the two private nonprofit institutions announced this week. 
• Trustees at the Jesuit university and the institute approved a plan to explore how they would merge their undergraduate and graduate programs. Under the arrangement, the U of San Francisco would take control of the institute's assets, which include its property and art and film collections.
• The institute has long been floundering financially and had previously explored a merger with the U of San Francisco that fizzled after the coronavirus pandemic began. 

Dive Insight:

Many art schools are on financially shaky ground, in part because they generally started as community-based arts centers that took on more staff and expenses as they began granting degrees, reported Gagosian Quarterly, an arts-centered publication. Several art colleges across the country have closed or merged into other institutions in recent years, such as the Memphis College of Art, which closed in 2020, and the New Hampshire Institute of Art, which became part of New England College in 2019.

The San Francisco Art Institute was founded in 1871, and the U of San Francisco was founded in 1855.

The institute's troubles peaked in March 2020, after the initial deal to merge with U of San Francisco fell through. Institute leaders announced that month the institution would not enroll a new class in fall 2020 and that it was planning massive layoffs.

That fall, the institute enrolled just 26 undergraduates and 15 graduate students, according to federal data. U of San Francisco enrolled more than 5,800 undergraduates and 4,200 graduate students.

The school was saved from a foreclosure after the University of California system regents in October 2020 bought its nearly $20 million in debt from a private bank. The institute controversially had considered selling off a valuable mural by renowned Mexican painter Diego Rivera in order to help balance its budget. 

Leaders at the U of San Francisco and the institute have discussed "at various times" over the last decade a potential merger, they said in a statement. 

After a period of due diligence, in which the university will examine the institute's finances, curriculum and accreditation, they would combine operations and programming into a new entity known as the San Francisco Art Institute at the University of San Francisco. 

Officials said the review should be completed in time for the integrated institution to launch in the fall.

"Combining the efforts of faculty, staff, and administration from the two institutions during this period of due diligence provides us with greater capacity to build an extraordinary, transformative, social justice-oriented arts education within our liberal arts and Jesuit tradition that will benefit the Bay Area, the nation, and the world," U of San Francisco President Paul Fitzgerald said in a statement.

Current students at the institute would receive the same academic and other support that the university provides, officials said. Well-known alumni of the institute include Ansel Adams, Kathryn Bigelow and Annie Leibovitz.