Eastern Gateway Seeks More Money to Pay Obligations

YOUNGSTOWN, Ohio – Eastern Gateway Community College is requesting more funding to pay its bills before it dissolves.

Eastern Gateway trustees Wednesday approved a resolution authorizing the college to request supplemental appropriations as needed.

The college, which enrolled students for the summer semester and will receive fiscal year 2025 state share of instruction funding because of that enrollment, will dissolve Oct. 31.

The U.S. Department of Education, however, has continued to withhold reimbursements to the college for Pell Grants, Eastern Gateway Trustee Chairman James Gasior said, reading from the resolution.

The college also had requested to be on the July 8 Ohio Controlling Board agenda to request the full-year advance of its SSI to address its obligations. The request wasn’t on the Controlling Board agenda.

The board chairman read from the resolution that the college’s “current known and estimated debts and liabilities are substantial,” and because it’s under fiscal watch, Eastern Gateway needs approval from the Ohio Department of Higher Education to pay expenses.

He said trustees believe the expenses should be prioritized as follows and paid within 36 days: $2.6 million in payroll related expenses; $3.5 million in student reimbursements; and $3.1 million in vendor payments, which includes about $61,000 in legal services.

Gasior said trustees understand Eastern Gateway’s financial situation. 

“And as trustees, we feel strongly that as long as we continue, these obligations, particularly to loyal faculty, to cabinet members, to employees – those obligations should be met,” he said. “Obligations to students should be met, and obligations to our vendors,” including the legal team.

In other business, the board approved the resignation of John Crooks, interim president since July 2023. He’s leaving to take a post at another community college. Arthur Daly, senior vice president and chief development officer, will become the new interim president.

Trustees thanked Crooks, Daly and the other administrative cabinet members for their work during a difficult time for the college.

“I’m sure there’s been countless hours of sleepless nights and many hours trying to navigate through very difficult times,” Gasior said.

The college was established in 1968 as Jefferson County Technical Institute in Steubenville. It expanded in 2009 to Youngstown and became Eastern Gateway Community College. It operates a campus downtown, as well as its main campus in Steubenville. It briefly had a campus in downtown Warren as well.

The college has faced struggles in recent years connected to its free college benefit program. That program allowed union members to attend Eastern Gateway and earn degrees at no cost to them. Students from across the country took advantage of the program, attending mostly online.

Enrollment grew from about 4,000 to roughly 40,000.

But in 2021, the Higher Learning Commission, an accrediting body, placed Eastern Gateway on probation. In 2022, the U.S. Department of Education placed the college on Heightened Cash Monitoring 2, meaning the college had to use its own resources to credit student accounts and wait for federal student aid reimbursements from the federal department. The college hasn’t received all of the reimbursements it believes it’s due.

Also in 2022, U.S. DOE ordered the college to end the free college program, saying Eastern Gateway was charging students who received Pell grants more than those who didn’t.

The college sued the department. The two sides settled the case in August 2023, ending the free college program, and enrollment dropped.

Copyright 2024 The Business Journal, Youngstown, Ohio.