Ave Maria Law Says Its Financial Health Not Cause for Concern
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Published on Monday, 08 June 2009 22:02
The Ave Maria School of Law says that it "should not be a cause for concern" that the school is one of 114 institutions that the Chronicle of Higher Education says are cited for particularly shaky finances by the U.S. Department of Education. The law school's ranking, according to The Chronicle, means it must post special letters of credit with the department equal to 10 percent of financial aid awarded.
Ave Maria University does not appear on the list of 114 schools although another new Catholic school, Southern Catholic College in the Atlanta area, is included.
The law school said in a statement that a low score on a Department of Education financial-strength test is "typical of recently founded institutions."
The Chronicle says that scores are based on three ratios that take into account a variety of factors including debt, expenses relative to income, and overall resources.
"Ave Maria School of Law has a low asset-to-debt ratio," the school's statement said. "We fully anticipate that this situation will reverse itself over time as we increase net tuition revenue and build endowment." The statement also said that the Department of Education recently recertified the law school to participate in federal financial aid programs.
The Pittsburgh Post-Gazette, in a story written about a Pennsylvania school that also was on the list, quoted the Department of Education as saying, "While we are always concerned when any school fails to meet a performance standard, a school with a failing composite score generally presents little additional risk to students or to federal funds as these school seldom close."
The Chronicle of Higher Education said that the financial-stability test was based on data submitted in June, 2008, so it does not take into account extensive material submitted to the state of Florida late in 2008 as part of the law school's successful application for a license to operate in Florida. That material, available here along with a story from the Naples Daily News, included a pledge by law school founder Tom Monaghan to offset any law school financial deficits until 2017.
The law school also announced Monday that another Michigan law school, the Thomas M. Cooley Law School, will occupy the Ann Arbor, Mich. premises being vacated by Ave Maria School of Law's relocation to Naples. Cooley has three other campuses in Michigan that will remain open. Terms of the business arrangement between Cooley and Ave Maria were not disclosed.
