Financial and enrollment challenges doomed Grace University.
The Omaha institution, which planned to celebrate its 75th year in 2018 by moving to the old Dana College campus in Blair, will instead shut its doors on South Ninth Street forever in May.
Chief Executive Officer Bill Bauhard announced the decision to students, faculty and staff during a regular midmorning gathering in the campus chapel Tuesday.
“After much prayer, and with a genuine heaviness of heart, the board of trustees believed that making this difficult decision was necessary due to the financial struggles and significant decline in new undergraduate student enrollment over the past few years,” he said.
Grace’s enrollment this academic year is fewer than 300 students, including a freshman class of 33 and a sophomore class not much larger. Total enrollment last year — including more than 100 graduating seniors — was a bit more than 400.
“It’s difficult if you graduate 100 and fill back with less than half that many,’’ Bauhard said in an interview. “When you looked at the financials, we’re obviously under considerable stress.”
Bauhard said Grace’s story is far from over. He acknowledged that the 2017-18 academic year is the last chapter in the school’s history, but all classes, sports, theater productions and other campus activities will continue.
“Let’s make this the greatest chapter,’’ he said.
The university will work with students to ensure the completion of their degrees through specific arrangements with other institutions, or through normal transfer procedures, Bauhard said. Specifics of those transitional plans are pending approvals by educational regulatory agencies.
“This is not an emergency closing,’’ Bauhard said. “We will do this with integrity.’’
Freshman Bopeep Harrison, 19, who grew up in Portland, Oregon, but attended Burke High School his senior year, said the announcement rattled him. Grace is accredited by the national Higher Learning Commission, but Harrison said he worries about how many of his class credits will transfer to other institutions. Grace features a biblically integrated curriculum.
Harrison, who planned to redshirt on the basketball team this season, said some students and faculty members cried during Bauhard’s announcement.
“The teachers knew they would be out of job and the students would have to try to transfer,’’ he said.
Andre Frazier, a 23-year-old senior psychology major and basketball player from Los Angeles, said he would be a semester short of graduating this spring. He said he faces a decision finding a way to finance another semester of college if he can’t transfer to somewhere that would provide an athletic scholarship.
In March, Grace announced plans to relocate to a fraction of the 150-acre former Dana campus. The move was to be part of a proposed $92 million redevelopment of that campus that included creating intergenerational, mixed-use facilities and jobs to help people coming out of foster care, those with mental disorders, low-income elderly, military veterans and others.
Frank Krejci, an Omaha developer, bought the Dana campus for $3.5 million in 2013. He decided to donate it to Shada’s project. Plans for the Frank and Jane Krejci Learning and Life Community still include a 60-bed skilled nursing facility, a new home for Christ Lutheran Church, a film studio for Digg Site Productions of Fremont and a 150-unit, intergenerational housing development.
Blair City Administrator Rod Storm said the university’s closing is a blow to the project in the city of 8,000 just north of Omaha.
“We were looking forward to having a college that would bring young, vibrant students back to Blair as an anchor for the redevelopment, but we’ll continue to work to try to make the campus a vital part of our community again,’’ he said.
Ed Shada, the Omaha banker who was putting together the redevelopment project, said he was sorry to see the university close but wasn’t surprised.
“There were signs,’’ he said. “It would have been great to have Grace, and I’m sorry to see Grace go, but I never counted on one tenant. To me, the endgame is how to take care of the vulnerable.’’
Shada, chief executive of Project Homeless Connect Omaha, said he expects to announce a “more sustainable’’ alternative redevelopment plan shortly.
Bauhard said the university has no external debt or creditors. Last January, Grace agreed to sell a large piece of its campus midway between the Old Market and the Henry Doorly Zoo & Aquarium to the Omaha Public Schools. The agreement included the condition that the university would have full use of the property through May 2018. Grace later announced its plan to move to Blair.
“We have the financial strength to complete this school year and take care of the things that need to be taken care of,’’ Bauhard said.
Carlon Tschetter, chairman of the board of trustees and a church pastor in Yukon, Oklahoma, said Grace’s efforts to increase enrollment this fall were unsuccessful. He thanked administrators, faculty and staff who served the school over the years.
“We especially thank our current students who, despite the recent institutional challenges, have supported GU by continuing to pursue their educational goals with us,’’ he said. “We are also grateful for the many donors whose generosity has also assisted the university over the years.’’
Harrison, the Grace freshman, said he now has one goal: “To get the best grades possible to help transfer to another school.”
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Correction: A previous version of this story incorrectly reported the year Grace University was founded.
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Grace University timeline:
» Campus is at 1311 S. 9th Street.
» Grace Bible Institute established June 1, 1943, in Omaha to provide college-level education that would be fundamental in doctrine, spiritual in emphasis and interdenominational in scope.
» Eighteen students registered on first day in September 1943. Five more arrived a few days later. Classes were held at the former Presbyterian Theological Seminary.
» Enrollment reached 331 in 1949.
» Name changed to Grace College of the Bible in 1976.
» Name changed to Grace University in 1994. School consisted of Grace College of the Bible, Grace College of Graduate Studies and Grace College of Continuing Education.
» More than 9,000 students have studied at the university.
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