Concordia University Portland

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  1. HotChalk Inc.
  2. Queer-Straight Alliance
  3. Presidential succession
  4. The Squeeze
  5. Closure and fallout
  6. Footnotes

HotChalk Inc.

Concordia University Portland hired HotChalk in 2009 to build an online Master of Education program and within several years became one of the nation’s largest providers of M.Ed.’s. Graduate student enrollment at CUP increased from 800 students in 2009 to over 6,000 in 2014; over 5,200 were exclusively enrolled in online courses.[1] That same year, CUP paid HotChalk $62.7 million for “recruitment services” on $173.2 million in total revenue.[2]

In 2015, federal prosecutors accused CUP and HotChalk of student recruitment violations and substantially misrepresenting their online programs.[3] The complaint alleged that HotChalk instructed its recruiters to offer prospective students iPads, textbooks, and limited availability “scholarships”, and was paid 75% of tuition for each student it enrolled at CUP. An investigation by The Oregonian found numerous people who claimed to work for CUP and HotChalk simultaneously.[4] CUP and HotChalk agreed to pay $1 million to settle the claims but admitted no wrongdoing, and their business relationship was allowed to continue.[5]

Enrollment in the M.Ed. quickly dropped from its peak in 2014-2015, but then stabilized. At the time of its closure in 2020, interim president Tom Ries said CUP’s total enrollment was about 5,400 students.[6]

Queer-Straight Alliance

Ernesto Dominguez founded the Queer-Straight Alliance as a student at CUP in 2014. Students reported CUP administrators cancelled QSA events, tore down its posters, and pressured the club to change its name.[7] A 2017 CUP Title IX review concluded that “the university was in violation of the student nondiscrimination policy, specifically in relation the [sic] PRIDE club representing our LGBTQ students.”[8]

In the months following, QSA and CUP administrators could not agree on acceptable charter language, and the QSA announced it would shut down.[9] CUP then reversed its stance and said it would approve the QSA charter “as proposed”.[10] CUP also opened an Gender and Sexuality Resource Center in March of 2018 and committed to a series of sex and gender discrimination trainings.[11]

Lutheran Church–Missouri Synod president Matthew Harrison told his own account these events in a speech in 2018[12]:

relevant clip runs 1:19:46-1:21:55

Presidential succession

In July of 2018, after serving 35 years as president of CUP, Charles Schlimpert retired and was succeeded by Johnnie Driessner as interim president.[13, 14] The CUP board of regents launched a national search for a permanent successor.[15]

President Schlimpert had originally planned to retire in the summer of 2017 but agreed to extend his tenure after the LCMS asked CUP to consider spinning off as an independent university.[16]

In December 2018, the CUP presidential Search Committee published a list of 25 candidates who had accepted nominations to serve as CUP’s permanent president.[17] At this point, per LCMS bylaws then in effect*, CUP’s board of regents would have submitted a “short list” of candidates to the president of the Concordia University System, who would have then convened a “prior approval panel” to give final authorization on the candidates.[18] Months passed, however, and CUP did not get another permanent president.

On multiple occasions, senior LCMS and CUS administrators spoke candidly about preventing a permanent appointment at CUP until it got its Lutheran Identity Statement in line with the Lutheran Identity Standards adopted at the 2016 LCMS Convention.[19, 20, 21]

relevant clip runs 2:01:31-2:02:35

When Johnnie Driessner’s 18-month term as interim president expired in January 2020, Tom Ries was named the next interim president.[22]

The Squeeze

In 2019 and early 2020, the LCMS was applying and receiving pressure to shut down the Queer-Straight Alliance at CUP[23, 24]:

relevant clip runs 41:02-43:17

At the same time, lower enrollment in online programs combined with the increasingly burdensome revenue-sharing terms in the HotChalk contract were putting the squeeze on CUP financially.[6] It stopped offering degrees in history, English, and biology, but assured students and faculty that it was a part of a strategic reorientation around popular programs like nursing, business administration, and the M.Ed.[25]

These issues all came to a head in November 2019, when at the same meeting in which it orchestrated a $9.2 million rescue of CUP, the LCMS board of directors said it would not again approve any financial assistance until CUP “substantively addressed” the Gender and Sexuality Resource Center on campus.[26]

Closure and fallout

On February 10, 2020, six weeks after coming on as interim president, Tom Ries announced that CUP would close at the end of the spring semester.[27]

Before the end of the day on February 10, a class action lawsuit was filed on behalf of students alleging that CUP collected spring semester tuition under false pretenses.[28] Thousands of students could not complete their degrees, including many who had transferred to CUP following other private university closures in the region.[29]

“Think Out Loud” interview with CUP student Lauren Harris and attorney Michael Fuller

Two months later, HotChalk Inc. sued CUP for $302 million, alleging fraud and claiming CUP recorded new property deeds giving the LCMS a security interest in the campus days before February 10.[30] In January 2021, a Multnomah County Circuit Court denied CUP’s motion to surrender assets to the Lutheran Church Extension Fund, which had assumed a $9.2 million position in CUP under the authorization of the LCMS board of directors at a November 2019 board meeting.[26] A jury trial is scheduled for October 2021.

Concordia University–St. Paul absorbed CUP’s Accelerated Bachelor of Science in Nursing program.[31] Originally, it made an agreement to take “ownership control” of School of Law in Boise, too, but that deal fell apart in the summer of 2020.[32]

The Oregon Justice Department’s charitable organizations division has opened an investigation into the collapse of CUP, which is ongoing.[33]

In November 2020, online ed company Noodle announced it had acquired “key assets” of HotChalk, including its snappy marketing agency, Creative Communication Associates. HotChalk CEO Rob Wrubel joined Noodle as Chief Marketing Officer.[34]

On June 29, 2021, the Lutheran Church Extension Fund bought the CUP campus at auction for $3 million.[35, 36]

One day before, the University of Idaho College of Law announced it would take over the lease of CUP’s former law school campus in Boise, which the LCEF acquired with a $4.1 million credit bid in March of 2021. The deal pays the LCEF $600,000 annually–going up every five years–with the option to buy. [37]

Footnotes

1] CUP IPEDS data; H/t to Phil Hill for the student enrollment analysis.
2] Concordia University Portland. “2014 Form 990.” ProPublica. See Part 7, Section B.1 (p. 8) for fees paid to HotChalk and Part 1, line 12 (p. 1) for total revenue.
3] US District Court of Arizona. “Calisesi vs. HotChalk Incorporated.” 2:13-cv-01150.
4] The Oregonian. “Concordia gained thousands of new students — and a federal inquiry.” Molly Young. October 21, 2016.
5] The Oregonian. “In higher ed, a regulatory web can complicate oversight.” Molly Young. October 21, 2016.
6] The Oregonian. “Concordia University’s online vision hid grim reality.” Jeff Manning and Molly Young. February 28, 2020.
7] Willamette Week. “A Club for Queer Students Is Forced to Shutter at a Portland Christian College.” Katie Shepherd. January 17, 2018.
8] Concordia University Portland. “Title IX and Equity Review News and Notes.” August 2017 edition.
9] PSU Vanguard. “Concordia University Queer Straight Alliance grieves during final meeting.” Anna Williams. January 16, 2018.
10] Concordia University Portland. “President’s Letter.” January 19, 2018.
11] Concordia University Portland. “President’s Letter–Updated.” March 16, 2018.
12] Matthew Harrison. “LCMS Synod Report: June 14, 2018.” Indiana District-LCMS (Vimeo channel). 1:19:46-1:21:55
13] Concordia University Portland. “Schlimpert Announces Retirement Date, Leadership Transition Process.”
14] Concordia University Portland. “CU Portland Launches Search for Next President.” July 16, 2018.
15] CUP Board of Regents. “CUP Presidential Search.”
16] CUP Board of Regents. Message. May 26, 2017.
17] Gloria Edwards. “Letter to LCMS Congregations.” December 14, 2018.
18] LCMS. “Handbook: Constitution, Bylaws, Articles of Incorporation.” 2016. May 2017 Edition. 3.10.6.6.2(c-f), p. 166
19] LCMS Board of Directors. “Minutes.” September 12-13, 2019. p. 3
20] Matthew Harrison. “July 21, 2019 – Morning Session.” TheLCMS (YouTube channel). 2:01:31-2:02:35
21] Dean Wenthe. “2020 LCA ‘Lutheran Higher Education Today’ by Mr. Mark Stern, Esq.” Lutheran Concerns Association (Vimeo channel). 46:45-49:00
22] CUP. “Concordia University–Portland Announces Interim President.” December 20, 2019.
23] Charles Hendrickson. “July 22, 2019 – Morning Sesssion.” TheLCMS (YouTube channel). 41:02-43:17.
24] “2020 LCA ‘Lutheran Higher Education Today’ by Mr. Mark Stern, Esq.” 43:23-46:43
25] Oregon Public Broadcasting. “Concordia: Behind The Closure Of Oregon’s Largest Private University.” Rob Manning. February 24, 2020.
26] LCMS Board of Directors. “Minutes.” November 21, 2019. p. 30
27] CUP. “Concordia University – Portland Ceases Operations After Spring 2020 Semester.” February 10, 2020.
28] The Oregonian. “Concordia students to file suit over Portland university’s closure.” Jayati Ramakrishnan. February 10, 2020.
29] Think Out Loud. “Concordia Students Suing The University After Its Announced Closure.” February 18, 2020.
30] The Oregonian. “Concordia University parent sued for $302 million.” Jeff Manning. April 21, 2020.
31] CSP. “Concordia St. Paul Continues Portland Accelerated Nursing Program.” June 9, 2020.
32] Idaho Statesman. “Concordia law students ask for help from Idaho, Oregon attorneys general.” John Sowell. August 7, 2020.
33] The Oregonian. “Oregon Justice Department investigating collapse of Concordia.” Jeff Manning. May 27, 2020.
34] PR Newswire. “Noodle Grows Network Through Acquisition of HotChalk.” November 20, 2020.
35] Oregon Public Broadcasting. “Concordia University Portland campus sold to church fund lender.” Meerah Powell. June 29, 2021.
36] The Oregonian. “Financial arm of parent church buys Concordia University campus in foreclosure sale.” Jeff Manning. June 30, 2021.
37] BoiseDev. “UI will lease former Concordia campus for law school.” Betsy Russell. June 28, 2021.
*This process was later altered by 2019 Resolution 7-0A4, which “advanced” the prior approval process and gave the LCMS board of directors control over who got on the list of nominees before congregations could see who had been nominated.