Mergers and Acquisitions in Higher Ed: the Case of Mills College, California (Guest Post)

San Francisco Bay on May 30, 2024

by Unspecified Employee

Q: Why does a large university, such as Northeastern, merge with various small colleges, such as Mills College or Marymount Manhattan College or New College of the Humanities? 

A: Because it can.

And because these agreements, while they are announced as mergers, are basically giveaways, and usually come with a big pile of assets that are handed over to Northeastern with few questions asked. 

For instance, when Northeastern merged with Mills College in 2022, they got what their CFO called a fully undergraduate enabled blank slate with $650 million in assets--for more or less nothing more than the agreement to respect tenure for about twenty-five remaining faculty, most of them close to retirement. And for that it got a $250 million or so endowment: a mix of scholarship funds, endowed chairs for faculty, named lecture series, etc. Also included were 135 acres of land in a major metropolitan area, much of it undeveloped. It included a number of dorms that could house around a thousand or so students, a recently updated theater, a recently restored concert hall with frescoes by artist Raymond Boynton depicting an array of mythological scenes, a number of recently built LEED certified buildings, an art museum adorned with the words “Ars Longa, Vita Brevis”  from Hippocrates, a beautifully preserved Mansard building included in the National Register of Historic Places, a street that has been declared as among the nation’s hundred most beautiful, and a Julia Morgan designed campanil. And Northeastern also got a bunch of musical instruments including over twenty grand pianos and a number of historically significant synthesizers, a library with a rare book collection that included a probable leaf from a Gutenberg Bible, all the art in the art museum, a book arts studio, a woodworking studio, a ceramics studio, a number of science labs with their microscopes and their cadavers. A swimming pool was included, a nice one. And a soccer field, a bit run down but still functionable. Also many many computers, desk chairs, coffee makers. A fine presidential house. A number of lovely small houses for faculty built in the Spanish Eclectic style. A very sweet farm. All the things that make a college a college.

It is not like there were no costs when Northeastern was given this $650 million. 

Mills had significant debt, around $30 million was the rumor, that had to be paid off. And some deferred maintenance too. So shortly after the merger Northeastern invested in some brightly colored Adirondack chairs for the meadow, some signage, many gallons of paint, and they turned the fountains back on. They also provided iPads to the faculty with cell service for a year so they finally had working WiFi, then new computers the next year, and eventually a six percent raise. (Mills faculty salaries had been frozen for many years and were unusually low; this raise did not really bring them up to national norms, or compensate in any way for cost of living increases, but it was something.)  

Then the campus was easily monetized. 

Within the year, Northeastern had over a thousand students enrolled to sit in those Adirondack chairs. These students, part of the Global Scholars Program, paid full tuition. So very quickly, the campus was bringing in $81 million in tuition a year. 

The next year, another five hundred students arrived on campus. These were four-year students who were directly admitted to Northeastern, a mixture of graduate and undergraduate students. Assuming a fifty percent discount on tuition and housing, that would be another $20 million. 

Basically, the blank slate was very quickly generating $100 million a year in tuition. 

But really, the CFO’s blank slate comment should probably not be taken too seriously. It is not worth getting all righteous about. It isn’t his job to sugarcoat the merger and he isn’t working for the public relations office. 

But what is interesting about this blank slate comment is that Mills College was, of course, not blank at all. It was occupied by a number of committed faculty, staff, and students. All had different fates. 

The students either left or finished their degrees with Northeastern. Those that stayed got a Northeastern degree at Mills prices.

The staff that decided to remain were protected for a few years. Then many were retained or offered the option to move to Boston. 

But the fate of the faculty was more complicated. Even though Northeastern very quickly figured out how to bring in around a thousand and a half first year students, it has been unable to figure out what to do with the faculty. 

Northeastern, as part of the MOU that was negotiated by the former Mills president and board of trustees, was obligated “to honor and abide by the terms of tenure.” 

But full-time faculty who were not tenured, even though many of them had been an integral part of Mills for many years, had a more mixed fate. The Provost of Northeastern when the merger was announced claimed that the MOU meant that “all full-time non-tenure-track faculty will be teaching with Northeastern following the merger.” But for how long was left unclear. 

Quickly Northeastern moved the Mills full-time-non-tenure-track faculty out of the union with the promise of their “one faculty” model. They then decided that these faculty were actually not part of the “one faculty” and were not guaranteed either the protections in the faculty handbook or multiyear contracts, which allowed them to begin the process of not renewing many of them. There were around thirty of these faculty at the time of the merger; about half of them remain two years in. 

For both tenured and non-tenure track faculty there are conflicting faculty governance issues and no clear path forward to resolving them. The faculty handbook at Northeastern claims that “the University will impose no limitations upon the freedom of faculty members in the exposition of the subjects they teach, either in the classroom or elsewhere.” A fairly standard statement. But this very basic precept has not been one that Northeastern has been willing to meaningfully extend to Mills faculty. 

Right now Mills faculty are tenured under this entity called “Mills College at Northeastern University” (which according to the MOU should exist for the next hundred years). But when the merger happened, Northeastern shut down all of Mills’s classes and degree programs, so the faculty of Mills College now teach courses that the other colleges within Northeastern offer on the Oakland campus. Many to most of the remaining Mills College faculty do not teach in their area of expertise. Just one example: a professor with expertise in African American literature was recently teaching an introduction to criminology course.

Many faculty are likely to be unable to teach in their area of expertise again because that area is “owned” by a Boston college. 

For example, Mills had an internationally renowned music program. It was a well-resourced legacy department with millions in endowment support whose courses were taught by established faculty, a program so prominent that several scholarly books were written about it. Three faculty remain, so there is capacity to offer twelve music classes a year on the Oakland campus. But Northeastern has been unwilling to offer the Music major on the Oakland campus and has decided to allow at most two to three music electives to be offered each semester. (This is happening even though the endowment funds more than cover the salaries of the remaining faculty.)  

These are difficult issues that challenge faculty governance and autonomy in all sorts of ways. To say that Mills music faculty cannot develop courses or programs in music denies the autonomy of Mills faculty.

But even if the Boston Music Department was willing to let Mills faculty develop courses, something they have not been willing to do, the Mills faculty would still be excluded from the decision making processes of those departments. To fix that and foist Mills faculty on pre-existing Boston departments as tenured members risks violating the autonomy of Boston departments to do their own hires. Yet to have say two Music departments in one university with different classes and different requirements is absurd. 

There is no easy way out of these conundrums. And the result has been a sort of stalemate where Mills faculty are in a holding pattern. Because the campus only houses freshmen, everyone is limited to teaching service classes such as first-year writing. Most are barely teaching in their fields. And some have been forced into doing low-level administrative work to fill out their workloads.

Mills College is not Northeastern's only acquisition. It fixed this mess in its in-process merger with Marymount Manhattan College by not respecting tenure and giving all faculty, tenured or not, a one-year contract. This deal, and really here the president and the board of trustees of Marymount Manhattan College should feel deep shame, basically preserves nothing of the mission of Marymount Manhattan College. 

The Marymount Manhattan merger has come with some vague promises that Northeastern will grow Marymount Manhattan’s creative and performing arts programs. But what are Marymount Manhattan’s programs without their faculty? 

Faculty have been promised consideration for any open positions, but without any commitment to there being any open positions. And, as anyone knows, all “consideration” means is the ability to apply for jobs, something that anyone can do at any time. 

This means that there is a good chance that the current Marymount Manhattan faculty are working extra hours for no extra pay, to oversee the teach-out, the very thing that will allow Northeastern will discard them once they’ve done this work. 

Abby Fiorella, chair of the Board of Trustees of Marymount Manhattan College, claims this merger will ensure "the long-term preservation of our mission, our values, and our college." But how can this be true when the merger essentially abandons the college's name, mission, and faculty? 

There is another way to think about this issue. Who “owns” a college? The answer is sort of no one. They aren’t corporations really. And while their assets can be bought and sold, the college itself can not. For many reasons, a college isn't a collection of buildings. If it is anything, it is an organic entity composed of a distinct educational mission, long-standing traditions, and a community of alumni. A board of trustees working with a dedicated faculty and staff are tasked to maintain these traditions and fulfill the mission. 

While a college's mission and traditions naturally evolve over time, these changes typically happen gradually and intentionally, guided by the trustees, faculty, and staff who understand and care about the institution's core values. Simply maintaining the physical campus as classroom space for another university does not preserve Marymount Manhattan College. 

Right now, around a hundred colleges are closing each year and this number is expected to rise. Mergers are way better than closures. They should be encouraged. It does not help anyone, especially students, to just let colleges fail. It also does not help anyone anywhere to just abandon faculty and with them their years of expertise. 

It might be that more oversight and regulatory control is needed as it does not look like big universities are going to do the right thing voluntarily, even things--like protecting tenure, cultivating the exchange of ideas, and utilizing the expertise of a skilled workforce--that would be in their best interest. 

Sadly, the accrediting agencies seem not adequate to this task. The Mills College case illustrates this problem. When accreditors visited post-merger, their response to faculty concerns about governance was that they were lucky even to be employed. 

It was a true statement. They are lucky. But in a fair world, mergers should not be allowed to arbitrarily eliminate faculty and staff positions. At minimum, the assets that the acquiring universities obtain for free in these mergers should be used to offer generous buyout packages to faculty and to meaningfully integrate those that remain before these assets drop to the bottom line of the acquiring university. 

Really though, to be done right, mergers (and not closures called mergers, which is sort of what the Marymount Manhattan College deal seems to be) should involve substantial faculty involvement. Meaningful faculty involvement that is; not the usual meetings that administrators like to hold so they can claim faculty were consulted. 

Northeastern’s tendency so far has been to go in the opposite direction. Trustees are not allowed to discuss the merger with faculty until it is settled. And then right before a merger is announced, they impose gag orders between employees of both institutions (even though it seems likely that this practice contradicts Northeastern Faculty Senate Bylaws regarding faculty authority over issues related to faculty). The gag orders are indicative of the administration’s fear: genuine faculty solidarity across institutions could challenge their ability to structure mergers primarily as asset transfers. And sadly the gag orders seem to be working, with long term consequences. Over two years later, Mills faculty remain embattled, isolated, and paid less than their Boston equivalents. 

The future of higher education mergers does not have to follow this pattern of treating colleges as mere collections of assets to be acquired and faculty as inconvenient obligations to be managed away. A better model would recognize that the true value of any academic institution is not its physical assets, but instead is the expertise, dedication, and institutional knowledge of its faculty and staff. 

When universities like Northeastern acquire smaller colleges without meaningfully integrating their faculty and staff or preserving their academic missions, they gain short-term financial benefits. But ultimately, they diminish the very thing that makes universities meaningful: their role as centers of teaching, learning, and scholarly discourse. 

As more colleges face financial pressures in the coming years, we need a framework for mergers that prioritizes academic integrity and faculty governance. Without such reforms, the losers are not just displaced faculty members, but the entire academic enterprise itself.