While the COVID-19 pandemic hit all colleges and universities hard, smaller schools struggled to recover. In the wake of bailouts and federal grants that helped keep many institutions afloat, a larger threat loomed: the enrollment cliff. It’s one of the ripples of a tanking birth rate during the 2008 financial crisis—fewer babies born means fewer high school graduates means reduced enrollment. Couple this fact with the prohibitively high cost of attending a four-year university and more paths towards secure jobs in industries such as the trades, and colleges are feeling the financial stress.
Many major institutions are practically “too big to fail,” with billions of dollars in their endowments providing support year-over-year. These funds typically come from donors, with the expectation that the money will not be directly used for operating costs. Instead, it is invested, with some of the value it generates being harvested as a stable stream of income. While tuition and operating costs may fluctuate over the course of a year, endowments are supposedly more resistant to these changes.
Bennington College’s endowment hovers around $52 million. In comparison, Williams College has an endowment of about $3.7 billion (roughly 71 times the size of Bennington’s). Both schools are facing reduced enrollment, cuts to state and federal funding, and the echoes of the pandemic, but one has a stronger financial foundation to stand on. Bennington’s budget cuts have been strongly felt throughout the community, from the layoffs of 15 staff members to reduced on-campus employment, all as tuition costs continue to balloon. Yes, the college is sitting on top of $52 million, but it’s largely inaccessible. Their primary revenue comes from tuition and grants.
The question on everyone’s mind: is Bennington on the brink of collapse? The prospect seems ironic, given that the college opened its doors as a teach-out partner in the wake of the University of the Arts’ sudden closure, eventually absorbing the dance BFA program and taking on a few other non-dance students, including me (at UArts, I majored in creative writing and minored in jewelry).
Having already experienced a college closure that seemingly came out of nowhere (which, in reality, seemed to be due to some extremely generous accounting, serious debt, and financial mismanagement), watching Bennington take proactive steps to manage its fragile financial status is more reassuring than anything. UArts disclosed nothing about their financial instability, only referencing “significant, unanticipated expenses” in a communication sent to students, staff, and faculty after the initial news of the closure broke via the Philadelphia Inquirer.
Which led me to wonder: does Bennington have a cashflow issue, similar to UArts? What about expenses and liabilities? I reached out to Bennington’s Business Office to find out.
The budget, made available to faculty and staff, positions Bennington to turn a profit of $400,000 in the fall term, breaking even on an anticipated $49.5 million in expenses. The Board of Directors has plans to bring in a greater profit in the coming years through new programs (including the Masters of Arts in Clinical Mental Health Counseling), expanding revenue sources, and further fundraising. Time will tell if this financial model is sustainable, but for the moment, the administration seems confident.
A major point of contention when it comes to the financial issues is the gap in compensation between faculty and administrators. Glassdoor reports that Bennington faculty members make anywhere between $65-87k per year. Indeed reports a range of $55-96k. In comparison to Laura Walker’s 2024 salary of $534,678 with an additional $60,536 of other benefits (available through ProPublica’s Nonprofit Explorer, which publishes organizations’ tax filings and their highest-paying salaries), it feels lopsided, especially when fifteen employees of the college were laid off at the start of this year due to financial concerns.
When it comes to scouting presidential candidates for colleges, there is some consideration towards the cost of “high-end talent” and how to incentivize them to bring their skills to a rural area like Bennington. Still, in times of financial trouble, as tuition perpetually increases and wages stagnate, such a high number feels out of touch. Walker did take a pay cut between the years of 2023 and 2024 of $9,556, and the college went from operating at a $6.8 million deficit in 2023 to a $2.7 million deficit last year. Things are trending upwards, even if that upwards is still working its way out of the negatives.
It’s not that Bennington doesn’t have liabilities. The college has two major outstanding loans for a total of more than $50 million that were used for the renovation of Commons in 2019. Both are fixed-rate and relatively low interest, set to mature in more than 20 years. The loans themselves come from the USDA’s Rural Development program.
Through these loans, the college was able to secure lower interest rates than they would have from private companies. Bennington puts roughly $1 million per year towards paying them off, accounted for in their expenses. In comparison to the University of the Arts, which was suspected to have leveraged the value of their real estate against their liabilities (leading to their ultimate collapse), Bennington looks fairly responsible.
Money is tight, for sure. The lack of support staff and shifts to meal plans and health center resources make that evident. But, as the Business Office noted to me, enrollment is up (bringing an increase in tuition revenue), programs are expanding, and the administration remains confident that Bennington will survive this rough patch.
When asked for an honest assessment of Bennington’s financial standing and the sense of urgency in bringing the college back to a break-even point, Lorraine Atwood, Vice President for Finance and Administration remained confident. She acknowledged that this is a difficult time for all higher education institutions in the United States and emphasized a responsibility to improve the college’s stability. “We are starting from a position of strength,” she said. “Bennington College is a well-known and well-regarded institution with an outstanding reputation across numerous disciplines.” And while reputation doesn’t directly drive revenue, one of the most difficult problems for small institutions is getting on prospective students’ radars.
Atwood continued, saying that inquiries and applications to Bennington have increased, indicating higher rates of interest (and hopefully more students committing to the college). There is still an emphatic reliance on the support of alumni and other donors, in addition to a “faculty and staff eager to make changes.” When negotiations between the union and administration dragged during the spring to the point of a threatened strike, the “changes” Atwood references could mean any number of things.
After all, the University of the Arts announced at their 2024 commencement ceremony that they had just partnered with Mural Arts Philadelphia and accepted a larger class of freshmen than in previous years. President Kerry Walk proudly spoke of a future that never came to pass—the closure was announced within the month. As we’ve seen when it comes to smaller schools, it doesn’t take much for everything to collapse.
But Bennington has the capacity to be different. Administrators in charge of keeping the college afloat are aware of the pressure the college is under and are doing their best in a difficult situation. It’s too early to see if they’ll be successful: that only comes with hindsight. But is there reason to panic and start looking for transfer options? I don’t think so. This is not the first time Bennington has been in a period of financial stress. Most likely, it won’t be the last. But with the right decisions, things can look up.
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