At a UA Faculty Senate meeting Monday afternoon, members voted 19-15 in favor of a resolution opposing the University of Arizonaβs plan to absorb UA Global Campus, an online school formerly known as Ashford University.
Faculty, some of whom have accused UA administrators of not upholding the UAβs shared governance policies since the UA got involved with UA Global Campus, also want to know the full risks associated with severing the deal entirely.
βWe, the Faculty Senate of the University of Arizona herewith disagree with the past and ongoing integration efforts of UAGC as an operating branch of the University of Arizona and disavow the consequences which harm the University of Arizonaβs academic mission, operations, reputation and financial health and request a full risk assessment of a full unwinding of the deal by September 2022,β read the resolution brought forward by Leila Hudson, a faculty senator who has been one of the more outspoken critics of the deal.
βWeβve had two years. We have respectfully requested information and we have been stonewalled,β Hudson said before the vote. βWe are going to come back in September with results we cannot predict right now. I think it is very important to tell the world that these are not the values of the University of Arizona. Even if you sold our name and our trademark to this predatory, fraudulent complex of institutions, these are not our values.β
Since 2020, when the UA announced plans to acquire the assets of the for-profit Ashford β which along with its former parent company Zovio was in the middle of a consumer protections lawsuit in California which has since resulted in Zovio owing more than $22 million in damages β numerous faculty members have spoken out against the UAβs decision to rebrand Ashford as the nonprofit UA Global Campus.
Zovio is now in a 15-year contract with UA Global Campus to provide recruitment, financial aid, technology and academic support services in exchange for 19.5% of tuition revenues.
Originally, the two schools were to remain separate entities, but in January the UA announced that it, along with the UA Foundation, had signed an addendum to the Temporary Provisional Program Participation Agreement between the U.S. Department of Education and UA Global Campus. That means that the UA is now βjointly and severally liableβ for UA Global Campusβ performance, which would put the UA on the hook if UA Global Campus shut down.
In previous Faculty Senate meetings, UA President Robert Robbins has estimated the financial liability of pulling out of the deal altogether could be as much as $1 billion. On Monday, he said it could be βnorth of $100 million,β and a UA spokesperson confirmed that the exact number is not known at this time.
Resolution βnot bindingβ
Finding out that exact number and the ramifications involved with backing out of the deal is the goal of the resolution the Faculty Senate passed Monday.
However, the resolution does not require the UA to act on anything and does not prevent Arizonaβs public flagship university from moving forward with bringing UA Global Campusβ 27,000-plus students into its operation as planned.
βWhile the Faculty Senateβs recent resolution regarding UAGC will be taken into consideration, it is not binding on President Robbins or the University of Arizona,β UA spokeswoman Pam Scott told the Arizona Daily Star in an email. βAt this time, the University of Arizona has not decided whether to conduct a risk assessment of unwinding its affiliation with UAGC. We are continuing with our planning activities to bring UAGC into the University of Arizona.β
Scott added that the steering committee responsible for formulating how UA Global Campus will be integrated into the UA βis finalizing its initial recommendationsβ and βlikely will submit those recommendations to President Robbins within the next several days.β
VA benefits reinstated
The faculty resolution comes after a month of headaches for UA Global Campus, which included a lapse in the schoolβs military benefits eligibility and Zovioβs delinquency in filing its latest earnings statements. Robbins previously stated at a news conference that he had concerns, but by Monday he reminded faculty that those issues have since been resolved.
At the end of March, the University of Arizona-affiliated online school formerly known as Ashford University, notified the 9% of students who use VA education benefits (28% of students are military-affiliated) that the California State Approving Agency for Veterans Education would no longer approve benefits after the school moved its headquarters from California to Arizona. UA Global Campus already had a pending application with the Arizona State Approving Agency, but the agency had not approved by the time the notice from California came.
That meant eligible students were at risk of not having money to pay for school or receiving housing allowances while UA Global Campus sorted out what itβs characterized in a statement as a βbureaucratic snafu.β
Within one month, however, the Arizona State Approving Agency approved the application and the VA accepted it. βAt this time there are no outstanding issuesβ with UA Global Campus, a VA spokesperson said in a statement to the Star after accepting the schoolβs application.
As a result of the quick resolution, UA Global Campus President and CEO Paul Pastorek told the Star that βwe do not expect any interruptions to student benefits, classes or costs, especially since affected students at the time will be back certified by UAGC for course tuition and fees, including the monthly housing allowance.β
Earnings, enrollment plunges
When asked if UA Global Campusβ enrollment numbers dropped as a result of the lapse in benefit eligibility, spokeswoman Linda Robertson would not supply exact numbers.
βWe had a loss of some students during that time due to an unfortunate bureaucratic snafu,β she said in an email to the Star. βWeβre in communication with these students on next steps and we anticipate many will return within the month.β
Further, Robertson said that UA Global Campus has no plans to sever its long-term contract with Zovio.
Zovioβs string of legal troubles related to defrauding students as recently as 2017 has been a repeated point of concern among faculty members.
Some of those practices, UA Senior Vice Provost Gail Burd who is also a member of UA Global Campus Board of Directors said, βhave been rectified,β through new leadership at Zovio and UA Global Campusβ new requirements for students to submit federal financial aid applications prior to enrollment. βI think (UA Global Campus) has a very good relationship with this company to make sure they are providing the services that are needed.β
But Zovioβs investors havenβt displayed that kind of confidence since the company signed its contract with UA Global Campus in 2020.
Last month, Zovio, the publicly traded company whose main client is UA Global Campus but has also acquired the coding bootcamp Fullstack Academy Inc. and the tutoring service TutorMe.com. Inc., finally submitted its final earnings report for 2021 to the U.S. Securities and Exchange Commission.
That filing indicated a 41.2% year-over-year drop in revenue compared to the fourth quarter of 2020, and a 33.7% annual drop in total revenue in 2021 compared to 2020.
β2021 presented significant challenges for Zovio,β Zovioβs new CEO Randy Hendricks said during an earnings call on April 15, noting a more than 20% enrollment drop in UA Global Campusβ enrollment last year as one of Zovioβs biggest challenges.
In addition to exploring βpotential divestitures,β Hendricks said Zovio is βadvancing a turnaround aimed at stabilizing and growing new and total enrollment at UAGC.β
The details of that plan, he said, will be made available in the coming months.
