Native American College Calls Off Its Fall Schedule

By Jodi S. Cohen, Chicago Tribune

Sep. 30–For more than 30 years, a tiny college on the city’s Northwest Side trained future Native American leaders, students who used their skills to help a population that has struggled with poverty and a lack of educational opportunity.

But now that training ground is gone. NAES College canceled fall classes after its accreditation was stripped in June amid allegations of financial mismanagement, questionable spending and weak oversight by its governing board.

It was only the second time in a decade that the Higher Learning Commission has taken such a step.

As the college’s finances deteriorated, its former president borrowed more than $95,000 for personal use and the school spent more than $1.2 million in grants and funds designated for specific purposes on salaries and other operating expenses, according to interviews and financial audits. The college also is fighting a government lawsuit alleging the school owes more than $200,000 for misusing a job-training grant.

For students such as Melanie Cloud, 27, the closing leaves her with few attractive options for an Indian-based college education. The closest tribal college is hundreds of miles away and, like most tribal schools, offers only a two-year degree.

“There is no school that offered what NAES did. It was small and there was more time for them to teach me,” said Cloud, who, as assistant to the president, had to break the news to other students. “We have students calling to register and I feel bad because I have to tell them … we won’t have classes. You have to start registering at other places.”

NAES began this month to offer free GED classes and non-credit, fee-based courses in the Ojibwe language, beadwork and Native American cooking.

After unsuccessful attempts to merge or affiliate with two universities, officials hope next week to announce a partnership with another college, said Dorene Wiese, the new NAES president. That partnership would allow students to resume taking college credit courses in January at the college’s two-story building, but their bachelor’s degrees would come from the other institution.

Wiese hopes that the college will one day regain accreditation to offer classes on its own. Without it, students can’t receive federal financial aid or recognized degrees through the college.

Started in Chicago in 1974 to serve urban Native Americans who lived far from any reservation-based colleges, the institution had about 100 students last year at three campuses in the West Ridge neighborhood, Minnesota and on the Menomonee Reservation in Wisconsin.The college’s one degree–a bachelor’s in public policy–combined a liberal arts curriculum with an emphasis on tribal knowledge, traditions and community development. Tuition was about $6,000 a year.

Operating on an annual budget of about $1 million, the college spent five years on probation until 2001 because finances were in disarray, said Steven Crow, executive director of the Chicago-based Higher Learning Commission, one of seven regional accrediting bodies in the country.

Financial problems worsened in recent years, exacerbated by dwindling government grants as well as stock market losses, Wiese said. That prompted the accrediting group to put the college on notice in October 2003.

NAES officials had a year to convince the group that the institution should keep its accreditation. Faith Smith, the college’s co-founder and then-president, said she resigned in August 2004.

A few months later, the new president, Wiese, said she gave a detailed plan to the accrediting agency to merge with another college, raise tuition and recruit more students. Wiese said she also obtained bank financing to help pay off debts.

“We were never allowed to implement the new plan … The board did ask the president to resign, they did hire a new president and did create a new strategic plan,” she said. “Yet, [the commission] did not think it was sufficient.

“When we started over a year ago to try to fix some of these things, we sincerely believed we would be given that opportunity and we were not.”

Instead, the accrediting group decided it was too little, too late.

A team from the agency visited the college for about two days in December, and by June, the group’s decision to revoke the college’s accreditation became final. The college’s net assets had declined to $668,000 in June 2004 from $1.4 million in June 2002 as expenses outstripped revenues.

Administrators never made major changes necessary for long-term survival, Crow said. He also said the five-member governing board did not appear sufficiently in control.

“It was a board that did almost all of its work through e-mail and it was a board that depended almost entirely on the president for the accuracy of the information it was receiving,” he said, a claim that Wiese disputes.

Board chair David Beaulieu, director of the Center for Indian Education at Arizona State University, and other board members did not return calls.

Crow said that the commission did not have any problems with the college’s curriculum.

As the college struggled, audits and a federal lawsuit have revealed insider loans and questionable spending.

An audit conducted for the college last year showed that Smith, the longtime president, had borrowed $95,101 from the college. Wiese said the college’s personnel policy allowed employees to take out loans from the college, and that NAES is attempting to collect the money.

Smith, a Field Museum board member, said she is waiting to hear from college officials about how much she owes.

“There were needs that I had that had to be taken care of,” said Smith, who earned about $70,000 as president. “I did ask for the opportunity to reconcile that amount.”

Meanwhile, the college faces a federal lawsuit alleging it misappropriated a U.S. Department of Labor grant that was intended to provide training and other services to Native Americans facing barriers to employment.

The U.S. attorney sued the college in federal court last year to recover about $200,000, alleging problems with how the grant was spent in the 1990s.

A 1996 audit by the Labor Department found that the college prematurely used the money and spent some of the funds on staff salaries. Students also were charged tuition when their tuition was being paid by the grant.

College officials deny liability and said the government filed the lawsuit after the statute of limitations had ended, court documents show.

College faculty members, students and alumni said that while the college was small, its loss will leave a void. About 70 percent of students graduated, significantly higher than the retention rate for Native American students at mainstream colleges and universities, Wiese said.

Since the college’s founding, about 270 students have obtained degrees there. George Strack, 57, who graduated in 2003, said NAES was the first college where he felt comfortable.

“I hope this is just a temporary setback. The community and people across the country who cared about NAES College will come together” and figure out a way to get it back, he said. “It would be a huge loss to the leadership of the Indian community in Chicago.”

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