4. Mills College Financially "Very Healthy" With 100% Rating at Cha...

The rallying cry for those who believe Mills College should continue to issue 4-year degrees has become #SaveMills. Is that part of a carefully crafted PR plan to subtly lead everyone in the wrong direction? It subconsciously reinforces a message that it's all over for Mills College, Mills is history, it can't survive without huge amounts of help. We've been looking for evidence that is true. So far we can't see it - if you have some, please post it.

In 3. We Got the Mills College Receipts - From the IRS we shared the most recently available financial information in a side-by-side comparative table, from 2019 going back to 2013

In 1. Mills College is Worth Billions. Who Gets the Prize? we showed direct quotes from the most recent assessment of the college by their Accreditor, WSCUC, stating that the College was "financially sound" and "very healthy". ICYMI:
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[Source: REPORT OF THE WSCUC TEAM For Reaffirmation of Accreditation To Mills College September 10 - 12, 2019]

Charity Navigator seems to think this too, scoring the College a perfect 100/100 for Finance and Accountability:

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The Liabilities to Assets financial ratio does indeed look very healthy; but in fact it under-states the financial position of Mills College. In 2. 135 Acres Worth Less Than $300,000? we pointed out that the prized Mills College land parcel is held on the balance sheet for only $291,686 - possibly the original acquisition cost from the 1800's. The Balance Sheet shows $320 million of assets, comprised of (roughly) $180 million endowment, $107 million in buildings, $30 million cash and receivables.

As at 30 June 2019:

Total Assets: $320,513,363
Total Liabilities: $46,679,514

Debt/Asset Ratio: = 14.56%

If the land was held on the Balance Sheet as closer to market value, this Ratio changes dramatically in favor of even more financial health.

Total Assets: $2 billion
Total Liabitilies: $46,679,514
Debt/Asset Ratio: = 2.3%

Some have argued that the value of the land doesn't matter because it can't be developed. This is false, because over the history of Mills College's ownership of the land it has developed many buildings on it. Buildings can produce revenue, therefore land has value. Halls and beds can be rented out, and space for more students means more potential tuition revenues.

Some have argued that holding the land on the balance sheet at its original value is the appropriate accounting treatment because Mills College does not pay property taxes as a 501(c)3. Perhaps that is true when it comes to tax, but this isn't an audit. We are trying to determine:

Is Mills College is in such dire financial straits that it needs to be "saved"?
Is the proposed savior the best one available, with the best intentions for Mills College?

#2 is harder to answer right now, we only have rumors about the savior and know next to nothing about their intentions.

The answer to #1 seems a clear "NO". Don't just take our word for it, read the reports from Charity Navigator and the Accreditor for yourself, study the numbers, do your own research and make up your own mind.

This partial transcript from the March 17 Staff and Faculty Town Hall sheds further light on the reduction of endowment drawdown from 7% to 5% which removed $3.83 million from Mills College's annual budget. We are told the $3 million per year deficit is why the College was forced to announce they would stop issuing degrees.

[Hillman] the board did act to actually enable us to realize more benefit from the endowment to address Mills current financial agency. So Maria Can you talk about our endowment payout rates.
13:20:52 [Cammarata] Sure. So, Aaron Delmon payout rate has been.
13:20:57 It had been over 5% and in prior years and then there was a gradual decline from five to float on it from six and a quarter I believe two five and a quarter, and then eventually it got down to 5%, but the board and did approved it going to 7% so we went
13:21:13 back so f4 f5 2021 and 22. We have an approval to, to have a 7% and diamond payout rate. And so what that does is it brings into operations and additional almost $3 million.
13:21:26 They, you know, of course it's a it's a moving average, but and looking back historically as to what was a 5% on the endowment.
13:21:33 It was about $9 million, give or take, and now it's about almost 12 million so it's it gives you an extra $3 million.
13:21:41 [Hillman] Okay, thank you, Maria. So just to be clear the board of trustees acted to tap the endowment because of the covert financial exigency and the college's overall fiscal health.
13:21:57 That was not only for fiscal year 20, but for fiscal year 21 and fiscal year 22. So the board. The board has opted to increase the payout right to the payout rate that it actually the college and hit earlier in 2013 for instance.
13:22:06 That's the last time the college was at a 7% payout rate, we increase that payout. The reason that's important is, I want you to know the board is very willing to go to extraordinary lengths to support the operations of the college, and yet there's a
13:22:19 point at which going beyond that, beyond that point is isn't possible because of the legal and policy restrictions and the, the, the, the, the limit the uses of endowment funds to support operations.

From this transcript it seems that President Hillman did present a relief plan to the Board to help the College navigate out of its post-COVID financial challenges. It involved restoring the endowment payout to 7% and included the current fiscal year as well as 2022. This plan was approved. So why is there no longer any hope of continuing as "Mills College"?

The financial position has been strengthened by the Board, there is a new government in Washington, D.C. - with a Vice President from Oakland - and new stimulus funding has been approved by Congress only 2 weeks ago. The announcement that Mills College would stop issuing degrees and become something "still being figured out" was made 1 week ago. When was the last time the Board of Trustees was presented with other options to consider?

Is this plan from 2021...or 2016?

It seems that under 5 years of President Hillman's management the College's financial situation has now become untenable. Is this really all due to COVID? Or is the market not buying the products Mills is selling? Why are other womens' colleges experiencing an enrollments boom? What is Mills College doing that is different from them?

What does Mills College need to do now and in the future to survive as a degree-granting institution? [Hint: "give up" is not the answer].

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DISCUSSION OF INFORMATION IN THE PUBLIC INTEREST. PUBLIC COMMENTARY WELCOME. WE PROVIDE CITATIONS TO PRIMARY SOURCES, FOLLOW THE HYPERLINKS. ANY PERSON MENTIONED HERE IS INVITED TO SHARE THEIR SIDE OF THE STORY IN THE COMMENT SECTION. ALL IMAGES USED FOR EDUCATIONAL PURPOSES UNDER FAIR USE PROVISIONS OF THE COPYRIGHT ACT. WE ARE NOT AFFILIATED WITH ANY ORGANIZED MILLS COLLEGE GROUP, BUT WE JOIN THEM ALL IN RESISTANCE TO ANY ATTEMPTED TAKEOVER.

#MILLSFOREVER

4. Mills College Financially "Very Healthy" With 100% Rating at Charity Navigator

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