Message from the Chair of CNR Board of Trustees
Through the monumental efforts of the entire community, The College of New Rochelle has survived and continues to meet the difficult challenges on the road back to financial stability.
On May 23, 2017, the College granted degrees to 997 deserving graduates. This special day did not seem possible last September, when the College was confronted with an unexpected and unprecedented financial crisis. Yet, thanks to our community’s profound commitment to our students, relentless fundraising, strategic cost reductions, immense generosity, and personal sacrifice, we were able to define a path forward to a sustainable future.
It has been consistently stated that while we have a path forward, it is narrow and littered with hurdles. It has been communicated that moving forward would require unwavering discipline and regrettable sacrifice. This included unavoidable layoffs in November and June. The necessity to layoff even one person was the most challenging and painful hurdle of all. The mere thought of laying off tenured faculty added even more angst to the requirement. No one approached this decision lightly. But the stark financial realities facing the College mandated these reductions, and dictated that the reductions be shared across all areas of the College, including tenured faculty.
We have been forced to make extremely difficult choices. As indicated by our audited statements, and contrary to some reports in the press, there were no “reserve” funds to prevent the layoff of tenured faculty – or any faculty. To believe otherwise simply defies logic.
The College’s decisions were not carried out arbitrarily or capriciously. Every effort was made to pursue viable alternatives to layoffs and to limit their numbers. Extensive consideration was given over many months to ensuring that CNR will be able to continue providing the quality education and support services expected by our students. Ultimately, the Board determined that this was only possible if tenured faculty shared in the pain of layoffs so that the burden was not disproportionately borne by non-tenured faculty and staff.
The Board and senior leadership respect and support the academic freedom to express all viewpoints and understand that this ideal serves as the foundation of an educational institution. However, the sudden and unforeseen financial crisis that faced CNR had nothing to do with academic views or freedoms of expression – the crisis threatened the existence of the College.
We share the concerns of the entire community regarding layoffs. We hope, however, that all members of our community will continue to make the necessary sacrifices to support CNR at this time. Division and derision are counterproductive. We are all fighting for the same cause: the quality education of our students. The recent past has taught us that we can succeed if we strive together.
The Board has taken the critical steps mandated in order to secure the College’s future. The operational efficiencies gained from recent restructuring efforts, plus cost reductions, new fiscal controls, and renegotiated lender and creditor arrangements, have been paramount. These efficiencies coupled with future funding sources, including grants and donations, and steady enrollment, will provide the necessary financial resources for the College. Although there are still remaining challenges to be addressed, we are moving forward.
Finally, I reaffirm the Board’s foremost responsibility to the students and their families who have invested their resources and their futures in the quality academic programming that the College provides. We have carefully implemented these critical changes solely for the purpose of preserving the mission of The College of New Rochelle. We will continue to protect, respect and reflect our Ursuline heritage for the benefit of all.
We truly wish this could have been accomplished without any personnel reductions and we sincerely regret the hardship this has placed upon those who have served CNR. Now that this painful hurdle is behind us, however, The College of New Rochelle can and will continue to move forward. Thanks to all of you, I remain steadfast in my belief that CNR will emerge from the challenges of the last year as a stronger, better and more stable institution.
Chair, Board of Trustees
Statement Regarding College Restructuring
As you know, over the last nine months the College has been implementing a financial restructuring plan designed to assure its long-term future. This exhaustive process has involved a careful analysis of every facet of our operations to determine where expenses can be reduced while the quality and value of the student experience is maintained.
To date we have identified and implemented cost reductions in virtually every operational area. As a result, we have made significant progress and our financial outlook is steadily improving. However, in order to rebuild our financial foundation, further cost savings must be realized. Achieving the additional operating cost reductions has made it necessary to eliminate 32 faculty and staff positions.
We have taken this painful step only after exhausting all other options. We fully recognize that our faculty and staff are at the heart of our teaching and learning experience. We have carefully evaluated each position that is being eliminated to assure the minimum impact on the overall quality of the student experience.
Payroll and benefits are the College’s largest area of expense, yet it’s the most difficult to reduce because it involves the lives of individuals who devote their time and energy to our students and campus. Regrettably, we are left with no choice if we are to achieve financial stability.
As we move toward our fall semester, we do not anticipate any further layoffs. Enrollment for the fall remains steady and we are optimistic that thanks to the efforts, sacrifice and understanding of our College community, we can ensure that the College’s 113-year legacy will continue into the future.
See FAQ below for further information about the current situation.
March 2017 Message from CNR Chair of the Board
Statement Regarding Audited Financial Statements
As we continue to make steady progress in moving the College forward, we are pleased to share that we met a major milestone on March 31 with the completion of the College’s audited financial statements for the fiscal year 2016 (July 1, 2015 – June 30, 2016). The audited financial statements were completed by the College’s new auditing firm Freed Maxick and subsequently provided to the College’s regulators. In the spirit of transparency, we have made copies of the audited financial statement available on reserve in Gill Library (circulation desk) at the New Rochelle Campus. Thank you.
CNR's Journey Continues
On November 23, 2016, the Board shared the welcome news that the College had identified a path forward that would allow it to move beyond its current financial challenges towards a more positive future. An essential next step in that path forward was the completion and filing by March 31, 2017 of a financial audit for fiscal year 2016 (July 1, 2015 - June 30, 2016).
I am pleased to report that the audit was completed on time by the College’s new auditing firm and, in its opinion, the audited financial statements fairly present the financial position of the College for fiscal year 2016. Not surprisingly under the circumstances, there was a significant net deficit which is consistent with the information uncovered by the College’s consultants and investigators this past fall. Because of the strides made by the entire community to stabilize CNR since that time, the College will continue on its remarkable path forward.
Since September 2016, the College and its Chief Restructuring Officer have carefully evaluated the assets and liabilities of CNR and formulated a financial plan to stabilize, restructure, and manage CNR’s operations. Specifically, the College has taken the following steps to address the College’s financial and operational challenges:
- Appointed the Provost and Senior Vice President for Academic Affairs as Interim-President of the College;
- Appointed the Vice President for Enrollment Management as Executive Vice President of Strategy and Planning;
- Hired a new Vice President for Finance and Administration with over 20 years of finance and operations experience;
- Hired a new Controller with significant accounting experience;
- Initiated a Presidential Search Committee to identify candidates to be the next President of the College;
- Expense Reductions
- Developed and implemented a comprehensive expense reduction program in the fiscal year 2017;
- Developed and has plans to implement an additional expense reduction plan in fiscal year 2018;
- Negotiated discounts with vendors and identified opportunities to outsource functions as appropriate to cut expenses and address potential deferred maintenance;
- Analyzed current lease obligations and corresponding enrollments to determine whether the College can either sublease a portion of the space that we are not currently utilizing or relocate the student population to another CNR site;
- Initiated a “WeAreCNR” fundraising campaign to raise unrestricted gifts to help support the operations of the College;
- Created a task force of alumnae/i and friends (the “Task Force”) to expand communication efforts and encourage financial support to reach the significant milestone needed to maintain CNR’s operations. Importantly in a time of constrained resources, alumnae/i are a vital source of volunteer talent and professional manpower to support recruitment, fund raising and other activities;
- Asset Review and Control
- Received significant, unrestricted cash related to gifts and other sources, including an unrestricted gift of $5 million from an anonymous alumnae donor;
- Approved the sale of five off-campus residential properties not essential to operations of the College;
- Secured a $2 million working capital line of credit from an historical donor;
- Refinanced a current $6 million line of credit obligation into a 5 year term loan obligation;
- Implemented new financial controls and processes
While there are still challenges ahead, these measures and others are part of a comprehensive plan to continue the College’s mission for the 2017/18 academic year and beyond.
The Board has begun a series of meetings with groups of students, faculty, staff, and alumnae/i to discuss recommendations, questions and concerns regarding the financial plan and CNR’s future. A “Community Conversation” will also be scheduled within the coming weeks. We value your voices and look forward to your input.
I remain steadfast in my belief that CNR will emerge from our challenges better and stronger than before. This is due in no small part to both the considerable sacrifices and extraordinary commitment and support of our alumnae/i, students, parents, faculty, staff, administrators, trustees, and friends. Thanks to each of you, we will continue to move forward.
Chair, Board of Trustees
March 2017 Message from CNR Chair of the Board
A season has passed since the November 21 Board of Trustees meeting that many called the “Thanksgiving Miracle.” On that day, the Board feared it had exhausted every path to viability. Through the monumental efforts of the entire community, however, CNR was given the opportunity to not only survive, but to thrive. No single act saved CNR. Profound commitment to our students, relentless fundraising, strategic cost reductions, immense generosity and personal sacrifice saved CNR. So did unavoidable layoffs at the time and inevitable layoffs projected for the future. Undoubtedly, a regrettable but unavoidable price was paid for the survival of the College. It was a noble reflection of CNR.
While we collectively won the fight for CNR last fall, we did not emerge unscarred or healed. There was a great deal of community angst caused by the layoffs that occurred in November and it persists due to the additional layoffs that must occur this spring. No one wants to lose a job and no one ever wants to cause a job to be lost. But the stark financial realities mandate these reductions.
We must make extremely difficult choices, especially when it comes to the layoff of tenured faculty. The Board respects that this is sacrosanct in the academic world. In this matter, however, we may have no choice. With specific attention to recent articles in the press, please know that as a result of our respect for the ideals that the principle of tenure represents, we will limit the number of tenured faculty layoffs to the fewest possible. In fact, as a group, the impact on tenured faculty will be, by far, substantially less than the impact on staff and non-tenured faculty. Nonetheless, unless the tenured faculty shares in the indisputable pain of layoffs, even in the small proportion that the budget demands, CNR will close. Again, to be clear, staff and cost reductions, including the few tenured positions that must be sacrificed, are necessary to save the educations of over 3,000 students and more than 300 jobs. These cuts are mandatory to save The College of New Rochelle.
The tenured faculty’s attorney asserts, through the press, that the College “won’t” follow the financial exigency guidelines set forth in the Faculty Handbook. This suggests willful disregard and nothing can be further from the truth. The College has attempted to follow the guidelines to every extent possible. Notice of the financial crisis was provided in October 2016. The College’s financial information has been given to the faculty’s consultant, who is currently being paid by the College. This exchange started in December but has been deemed insufficient by the faculty to prove that we are in financial exigency. Yet it is indisputable that we are in deep financial crisis. It is also indisputable that the suggested timelines set forth in the Handbook are simply impossible for the College to follow in this extraordinary circumstance. Critical cuts must be made by the end of this fiscal year. We don’t have the luxury of time.
We fully understand the much-publicized concerns of the tenured faculty. But this is not an “us against them” fight. This is a battle for the survival of CNR for all members of the CNR Community, not just a few. We should all be fighting for the same cause, the education of our students. No one wins with public finger-pointing. Most of all, the College loses.
Precious time is ill-spent trying to correct misrepresentations that have been made in public forums. Once written or uttered, they are lost to perpetuity. However, we must address two of the more blatant misrepresentations concerning the creation of new sports teams and certain retention bonuses. They can cause irreparable harm.
As to our new sports teams, the CNR Athletic Program is a Division III program and as such, cannot award athletic scholarships. More to the point, sports teams are revenue generators because the programs attract a broader group of students. They increase enrollment and, as importantly for CNR, school spirit. On a financial level, these programs strengthen the College’s financial standing, as the tuition revenues minus expenses amounts to a positive number. These teams were created as revenue and student life enhancers, not budget deficits. To attack this decision is not only destructive, it is uninformed.
As to the retention bonuses, we cannot and will not discuss the private compensation packages of individual employees, but we can emphatically state that we are not paying $400,000 in retention bonuses. That said, we are grateful that we were able to retain Dr. Dorothy Escribano as Interim President and Kevin Cavanagh as Executive Vice President of Strategy and Planning. Both agreed to maintain their positions as Provost and Vice President of Enrollment Management, respectively, and to assume two new additional jobs and executive responsibilities at the height of the school’s crisis. If they had not done so, we would be having a very different conversation about the future of CNR. Their leadership has continuously been recognized and appreciated by state and federal regulators and accreditation agencies. These two mission critical employees have given these agencies confidence about the leadership, integrity and stability of our beloved institution. While they and others have contributed to the College immeasurably, the size of the reported retention bonuses is incorrect, overstated and grossly inflated.
I am disheartened that some individuals are encouraging negative press. This does not threaten the Board or force us to change what must be done. Rather, it threatens CNR’s enrollment and fundraising – two pillars of our future success. It is a poor reflection of our community and it hurts CNR.
With that thought, I will devote the balance of this message to positive news. The Board has taken new critical steps to secure the future. At the March 2 Board meeting, we passed a balanced budget for FY 2018. The operational efficiencies gained from recent restructuring efforts, plus the pending cost reductions, new fiscal controls and renegotiated lender and creditor arrangements, are paramount. These efficiencies coupled with future funding sources, including grants and donations, and steady enrollment, will provide the financial resources to support the College’s mission for years to come.
Further, we are pleased to announce that a Presidential Search Committee has been approved by the Board. This is another critical step to secure CNR’s future. The committee will work with a professional search firm to oversee a national search for a qualified, capable and visionary leader. I look forward to announcing the complete Presidential Search Committee after today’s election by the Council of Faculty. The engagement of this committee will represent the faith of the CNR Community in the long term, vibrant future of the College.
The Board respects and supports all stakeholders, from administrators to students, and we want to work together to secure the future of CNR. In that spirit, on Saturday, I met with the Alumnae/i Association Board. We had an honest and open dialogue about ways to move CNR forward. On Tuesday, the trustees and I look forward to meeting with the Governance Chairs. As we have offered over the course of the last four months, we welcome their input for alternative ideas to avoid layoffs and to move CNR forward in a positive spirit.
Finally, I reaffirm the Board’s foremost responsibility to the students and their families who have invested their resources and their futures in the unparalleled academic programming that the College provides. We have made and will continue to implement critical changes to preserve the mission of The College of New Rochelle. We will continue to protect, respect and reflect our Ursuline heritage for the benefit of all.
I am steadfast in my belief that CNR will emerge from our challenges better and stronger. We are battling for the survival of CNR, not for the survival of a few individuals. We ask everyone to stand with us, united in the interest to do not only what is necessary, but to do what is right. That is the truest reflection of CNR.
Chair, Board of Trustees
CNR Response to Journal News Article (Feb. 1, 2017)
We were disappointed to read the recent story “Shake-up on College of New Rochelle board of trustees” on Lohud.com.
The positive announcement last week by The College of New Rochelle about the addition of two, new, highly qualified individuals to the Board of Trustees was mostly lost because of the misplaced focus of the article on a few other members of the Board who recently left – implying they did so for negative reasons. The trustees who left the Board did so only after working tirelessly through the fall to address the College’s financial challenges and bring a measure of stability under difficult circumstances.
CNR has a strong, talented and dedicated Board that is deeply committed to assuring the long-term future of the College. Over the last five months, our trustees have devoted countless hours to helping the College continue its mission. We are grateful for the invaluable service of those trustees who recently left and we look forward to the positive contributions of our newest colleagues.
Although work remains to be done, the College is steadily overcoming past challenges and moving forward through the unified efforts of alumnae/i, faculty, staff, students, administrators, trustees, and community supporters.
CNR is an important part of the City of New Rochelle. We ask that the reporting by The Journal News also include the positive efforts by so many to assure that CNR continues to deliver the strong educational and cultural programs that serve our diverse student body and the greater community.
Gwen Adolph, Chair
The College of New Rochelle Board of Trustees
Message from CNR Chair of the Board
As we embark on the spring semester, The College of New Rochelle is entering a season of new beginnings. Thanks to the united efforts of alumni, faculty, staff, students, administrators, trustees, and community supporters, we are steadily overcoming past challenges and carefully securing the future. We are sharing new ideas and setting new goals. And yes – we are including wonderful new people.
We are also celebrating new achievements. Our phenomenal fundraising success—raising more than $8 million in a very short period of time—along with cost reductions and the liquidation of some College assets have helped us to stabilize the College. Though there is still a great deal of work to be done, we are much more confident about our steps toward the CNR of tomorrow.
Last week, Kevin Cavanagh, our Executive Vice President for Strategy and Planning, was a guest on a local weekly radio program hosted by CNR Professor Dr. Amy Bass. Kevin shared much about the positive outlook for CNR and I encourage you to listen to the recording, which is posted on our website.
Other developments in recent months include:
- The College has completed its investigation of its previously undisclosed financial obligations and the matter has been referred to the United States Attorney’s office.
- Our restructuring team is working on a five-year plan that balances current expenses with the revenues projected for fiscal years 2018-2022. We are also continuing to reduce the College’s debt.
- The College is also implementing a number of new campus-wide internal controls and procedures. As each department is reviewed, changes are being applied to increase efficiency, security, and cost effectiveness.
- Five houses owned by the College on the periphery of the campus, which housed offices and personnel, were auctioned in December to raise much needed revenue. The auction exceeded expectations. Information about the net proceeds will be shared when the closings are complete.
- A Presidential Search is a Board priority and the search process will begin in February. It will include representatives from the faculty, staff, alumni, administration, student body, and the Board.
Board & Governance
- On January 11, 2017, two accomplished alumnae—Christine LaSala and Marlene Melone Tutera—were elected to serve as Trustees. Their professional experience and perspectives will further enhance the immense talent and expertise of the existing Board.
- At the same meeting, the Board established a Governance Committee to review its Bylaws, structure, policies, processes, and procedures, and make recommendations to provide for effective and efficient governance. The committee, which will be led by Trustee and alumna Mary Sommer, will ensure the Board pursues shared governance and best practices. New trustees will be nominated within the coming months who reflect the deliberations and recommendations of the committee.
- Enrollment continues to be a primary focus and a source of growing optimism. Compared to last spring, we have enrollment increases in the School of Arts & Sciences, School of Nursing & Healthcare Professions, and the Graduate School. While the School of New Resources enrollment is down, as has been the trend over the last few years, we are hopeful that a strong Spring II term, which begins in late February, will help close the gap. We anticipate that the expanded opportunities now available to District Council 37 Union members and the upcoming opening of our new Harlem campus will be bright spots for future enrollment success.
As we move further into the spring semester, I look forward to sharing monthly updates about our strides forward. I look forward to reporting how CNR is changing and improving. Most of all, I look forward to celebrating your stories of progress and success.
Thank you for your continued support and commitment to The College of New Rochelle.
Gwen Adolph, Chair
Board of Trustees
The College of New Rochelle Announces Two Alumnae Elected to Board of Trustees
The College of New Rochelle today announced the election of two alumnae to the Board – Christine LaSala and Marlene Melone Tutera. Gwen Adolph, Chair of the Board of Trustees, said the two new board members bring valuable knowledge and insight.
“We are so pleased to welcome such dedicated alumnae as Christine LaSala and Marlene Tutera to our Board of Trustees, both of whom bring a wealth of professional experience and strong commitment to the College’s mission,” Adolph said. “We look forward to having their voices at the table as we work as a Board to further strengthen The College of New Rochelle.”
Christine LaSala has 40 years of management, client leadership and financial experience in the insurance industry including experience as an underwriter and an insurance broker working with large corporate and public institution clients designing their risk management programs. She recently retired as the Chair of Willis Towers Watson North America. In that role, LaSala worked closely with the leadership of Willis Towers Watson, focusing on business development and aligning WTW’s global resources to deliver services and solutions to its global clients. LaSala currently serves on the Board of Directors of Beazley Group.
Prior to joining Willis, LaSala was President and CEO of the WTC Captive Insurance Company, a not-for-profit corporation providing liability insurance to the City of New York and over 100 private contractors against claims arising from their rescue, recovery and debris removal work at the World Trade Center site in the aftermath of the 9/11 terrorist attack. She was also the acting Head of School at the Children’s Storefront, a tuition-free, independent school in Harlem, where she served as president of the Storefront’s Board of Trustees from 1997 until 2012.
In addition to the Storefront board, she is on the Enterprise Risk Management Advisory Board for Johns Hopkins Carey School of Business. LaSala was named to the YWCA Academy of Women Achievers in 1980, Woman of the Year by the Association of Professional Insurance Women in 1997, and was a David Rockefeller Fellow in 1994-1995. LaSala was recognized by CNR with the Angela Merici Award in 2002 and the College’s Women of Achievement Award in 2007. In addition to being a graduate of The College of New Rochelle, she studied finance at Fordham University. She resides in New York City.
"I am very happy to be rejoining the College's Board of Trustees at a time when CNR faces both significant challenges and transformational opportunity,” LaSala said. “I look forward to working with the Board and the broader CNR Community to help meet the challenges and realize the opportunities."
Marlene Melone Tutera, a New Rochelle resident, is currently the President of the College’s Alumnae/i Association. Tutera began her career at CNR, holding various roles throughout her tenure, including Residence Director, Director of the Media Center, Director of Housing, and Director of Alumnae/i Relations.
Tutera has been involved as a volunteer in the New Rochelle Public Education system for 32 years, as the president of the citywide Parent Teachers Association, chair of numerous events, and one of the founders of the New Rochelle Fund for Excellence. In 2001, she received the Award for Dedication and Service to New Rochelle High School, and in 2002, she received the Huguenot Citizen of the Year Award, again for service to the high school, and in particular dedication to its athletics department.
Having recently retired from 22 years of teaching at the JCC Early Childhood Center, Tutera has served on the Board of the New Rochelle Fund for Excellence, a nonprofit organization for 11 years committed to providing important enrichment programs that encourage students to excel. She is the past president of the Museum of Art & Culture located in New Rochelle High School, the only Regents-chartered museum that exists in any school in New York State. She now serves on the Board of the New Rochelle Day Nursery.
She is the recipient of the Jeanne Torigian Neville Award for going above and beyond to make a difference and the New Rochelle Fund for Educational Excellence Foundation Award and is a Meals on Wheels Honoree. She has also been recognized by CNR with various awards over the years, including the Ursula Laurus Citation in 1981 and the Angela Merici Award in 2006 in recognition of her long-time support.
"As President of the Alumnae/i Association, I welcome this opportunity to join the Board of Trustees whose primary goal is to ensure that The College of New Rochelle remains strong,” Tutera said. “I look forward to representing our alumnae/i in our plans for a path forward that honors our tradition and embraces our ever-changing world."
The College of New Rochelle Announces $5 Million Donation from Anonymous Benefactor
The Board of Trustees of The College of New Rochelle announced today that an anonymous benefactor recently donated $5 million to the “We Are CNR” fundraising campaign launched to ensure the College’s future.
The $5 million donation, along with another $1.8 million in donations came as the Board was facing a financial crisis which emerged earlier this fall. The We Are CNR campaign was launched to secure the necessary funding to support the College in the short term while a long term restructuring plan is finalized. The We Are CNR campaign has included both online and person-to-person outreach as well as a series of videos featuring faculty, students and alumnae/i sharing what CNR means to them. For more information about the “We Are CNR campaign,” visit www.cnr.edu/weareCnr.
“In addition to the generous support of our alumnae, faculty, staff, students and friends, we had 100 percent participation from our Board and our Executive Team in helping us to reach this goal. The result was a sense of community and commitment to make CNR successful, at a time when we had all but run out of options to save this institution we love,” said Gwen Adolph, Chair of the Board of Trustees.
“We are humbled and grateful for the generosity of those who have donated and continue to donate, as well as the ongoing support we are receiving from alumnae and others in our hour of need. Although we have more work to do, I am pleased to say that the College will remain in business and continue moving forward.”
Adolph said the Board and College administrators will restructure the College and reduce costs while seeking additional funding to stabilize the College’s finances and meet past and current obligations. Staff reductions have already begun, and more are expected, as the College right-sizes its financial standing for the future.
“We are very grateful that we can continue to provide a quality education for students today and into the future,” said Dr. Dorothy Escribano, interim president.
In other positive news for CNR, applications for incoming students remain steady. This follows the enrollment of the largest freshman class in decades – and the first to admit men to the College’s School of Arts & Sciences in its history.
“We were motivated throughout this effort with the unshakeable belief that The College of New Rochelle was worth fighting for,” said Adolph. “Our work is not done. But this $5 million donation and additional financial support we have received allows us to continue this fight and to continue to provide a profound education in the Ursuline tradition to future generations of students who follow in the footsteps of the more than 50,000 alumnae/i who have come before them.”
Thanksgiving Comes Early For The College of New Rochelle
The past several weeks have been a time of unparalleled challenge at The College of New Rochelle. Thank you for your patience as The Board of Trustees and the Administration have worked to secure a path forward.
We are pleased to share the positive news that through a variety of measures, most notably the generous gifts from alumni and friends of the College, we believe that we have secured sufficient resources and developed a financial plan to continue the mission of The College of New Rochelle for the next semester and beyond.
There is still much to be done by all members of the CNR community to create the best future for the College, but at this time we simply want to thank you – faculty, staff, students, alumni and friends – for your momentous support.
The Board and Administration will continue to work to secure and improve CNR. We will continue our funding efforts and make necessary changes in institutional operations. We look forward to sharing more positive news with you in the weeks and months ahead.
Have a wonderful Thanksgiving.
Gwen Adolph, Chair, The Board of Trustees
Dorothy Escribano, Interim President
Preliminary Report from the Special Committee of The College of New Rochelle Board of Trustees
The Board of Trustees engaged a team of professionals to assess the current condition and future viability of The College of New Rochelle (CNR). The review is still in progress, but preliminary findings indicate that there is a path forward for the College to remain a stand-alone institution. It will require significant cost-cutting and a significant amount of outside funding; however, it is the primary goal of the Board.
In early September 2016 the Board of Trustees of The College of New Rochelle (CNR) was notified that approximately $20 million in payroll taxes were not paid for eight quarters, beginning in 2014. This finding resulted in an immediate investigation led by a Special Committee of Trustees. A Chief Restructuring Officer (CRO) from Grassi & Associates was engaged to restructure and manage CNR’s finances; the forensic accounting firm PKF O’Connor Davies was engaged to review the school’s financial records and practices; and the external law firm Pepper Hamilton LLP was engaged to conduct an investigation of all facts for legal ramifications.
The goal of the investigation is to determine how and why the payroll taxes went unpaid, who was responsible for the non-payment, if any funds were diverted from CNR, and if there were any other undiscovered related issues. The investigation is not complete, but the Special Committee did not want to delay any longer sharing preliminary findings with the CNR Community.
To date, the investigation has determined that the CNR’s controller failed to file the required tax returns and pay the taxes due. Related matters are still being investigated. It has further established that CNR’s senior management at that time did not provide accurate information to the Board about the College’s finances. The financial information that was provided to the Board was incorrect, incomplete, and lacked transparency. Additionally, an independent external auditing firm audited CNR’s financial statements for recent years and found no material issues. The Board was permitted to rely upon these audits.
The investigation has also revealed other significant debts, liabilities, and depletion of assets including the unrestricted endowment. The additional debts and liabilities total $11.2 million.
Based upon the discovery of the College’s true financial status, the Board has taken critical steps to stabilize the institution. These include the appointment of Interim President Dorothy Escribano and Executive Vice President Kevin Cavanagh, the institution of mandatory new financial controls, and the identification of essential cost-cutting opportunities. It has also noted the need to revamp overall practices and procedures as the College moves into the future.
Because the tax liability was undisclosed for so long, the Trustees do not have the normal course of time to address the College’s financial stress. This is an urgent matter. CNR needs a significant amount of outside funding to meet its immediate needs. The Board is diligently examining all feasible options to protect the students and preserve the school’s mission. This effort includes discussions about various possible options with other institutions. The very last resort is closing the College and placing students in other schools.
Statement by Gwen Adolph, Chairperson, Board of Trustees of The College of New Rochelle
The Board of Trustees of The College of New Rochelle has accepted the resignation of Judith Huntington as President. The Trustees named Provost and Senior Vice President for Academic Affairs Dr. Dorothy Escribano as Interim President. Kevin Cavanagh, the College’s Vice President of Enrollment Management, has agreed to serve as Executive Vice President of Strategy and Planning.
Around the beginning of the school year, the Trustees were advised of significant unmet financial obligations that had accrued over a period of time. The Trustees took immediate action and appointed a Special Committee of Trustees to oversee an investigation into the matter. The Trustees also engaged a Chief Restructuring Officer to restructure and manage the College’s finances and hired a forensic accountant and outside law firm to perform the investigation, which is ongoing.
Our foremost responsibility is to the students and their families who have invested their resources and their futures in the quality academic programming that the College has provided. We have made these changes because we are looking in new directions to protect and preserve the mission of The College of New Rochelle. It is our commitment to work as hard as we can to see that those students have the opportunity to complete their education so they can take advantage of life’s opportunities.
We are examining all of our options as we work to meet the financial challenges and protect the interests of our students and the CNR Community. We anticipate providing more details regarding this matter when the investigation is complete.
In the meantime, we have prepared the following FAQ – Frequently Asked Questions – concerning the difficult issues we face. We will regularly update the FAQ as information becomes available.