Years ago, Occidental College opted not to use admissions to chase money. The decision came with a cost.
One day in 2012, an admissions director at Occidental College got a surprising email. William “Rick” Singer proposed that the school reconsider an application from an academically challenged daughter of a wealthy family.
He wanted the school to overturn her rejection, and he suggested the parents would give the school money above and beyond tuition.
“Are you kidding?” an incredulous Mr. Singer wrote about her not being admitted. “We can create a win-win for both of us.”
Vince Cuseo, the admissions official at the small California liberal-arts school, gave a simple response: No.
Mr. Singer, the admitted mastermind of what federal prosecutors have called the largest admissions-cheating scandal in the country, had reason to be hopeful. He had made inroads into brand-name colleges and universities around the country scores of times, exploiting higher education’s focus on
Mr. Singer’s illegal operation has spawned criminal charges against 52 people, 29 of whom have pleaded guilty or plan to. It has also further highlighted the role of money in admissions, and the often wide gulf between high ideals of meritocracy and mercenary business practices.
Occidental, a small, private liberal-arts college in Los Angeles, has charted a different path. Two generations ago, it opted out of the chase for well-heeled students and put its money into scholarships for less well-off minorities.
Those decisions, however, have come at a cost. Occidental’s $434 million endowment is roughly $70 million smaller than what it might have been had the school prioritized prestige and wealth, according to Amos Himmelstein, the school’s vice president for planning and finance. While the school boasts beautiful beaux arts architecture and is building a new aquatic center, the infrastructure hasn’t kept up with improvements made by its peers, he says.
Vince Cuseo rejected a proposal from college consultant Rick Springer in 2012 to admit an academically challenged daughter of a wealthy family. PHOTO: MATTHEW SCOTT GRANGER FOR THE WALL STREET JOURNAL
The question, Mr. Cuseo says, is at what price “are you willing to sell your soul”?
The once-booming age-old business model of higher education faces tremendous pressure due to demographic changes, disruptive technology and the tightest labor market in half a century.
As a result, colleges and universities face rising incentives to cut corners or outright lie to boost rankings. They are also under pressure to use legal backdoor strategies to attract affluent students and donations to boost bottom lines.
Mr. Singer exploited these forces to create what he called his side door strategy, in which he bribed college coaches to tag clients’ children as walk-on athletes even though they didn’t play the sport. He also rigged SAT and ACT scores.
Occidental has largely resisted these temptations. A turning point for the school came in the 1980s, as Los Angeles transformed into one of the nation’s most diverse cities. Occidental trustees, many local business owners themselves, felt there weren’t enough educated minorities to fill jobs. Occidental reworked its curriculum and enrollment practices to draw more black and Latino students, said Eric Newhall, a retired Occidental English professor who headed the school’s faculty council at the time.
The school emerged as one of the nation’s most racially and socioeconomically integrated private schools, long before many universities were prioritizing diversity.
One concern across the school quickly arose: If it turned away wealthy white students, who would pay the bills? The question divided the school, said Mary Weismantel, a young professor at Occidental in the 1980s who now teaches at Northwestern University.
Today, Occidental is 49% nonwhite and attracts fewer wealthy students than the vast majority of its peers. It also boasts one of the highest percentage of poor and working-class students receiving Pell Grants and has one of the highest rates of economic mobility of its peers, according to Harvard economist Raj Chetty and Occidental.
But financial stress has followed. In 1995 Occidental’s endowment ranked 120th in the nation. By last year it was 208th.
Occidental resisted pressure to use legal backdoor strategies to attract affluent students and donations to boost the college’s bottom line. PHOTO: MATTHEW SCOTT GRANGER FOR THE WALL STREET JOURNAL
The school has lost ground partly because of its commitment to enroll poor and working-class students who need grants. Occidental’s need-blind enrollment program climbed from 11% of the budget in the mid-1980s to 24% by 1993. That December, then-President John Slaughter said the increase in financial spending “has escaped the boundaries of reasonableness,” according to an alumni publication.
The school eventually had to dip into its endowment to pay the bills. And today, while it maintains a strong reputation and a middling $434 million endowment, it still faces underlying fiscal issues. In September, Moody’s Investors Service revised the outlook on Occidental’s $84 million in debt outstanding to negative from stable, citing the school’s “commitment to affordability” and lagging fundraising.
These headwinds mean dormitories are cramped and nearly half are without air conditioning. The steel lawn-irrigation system installed in the 1930s is thoroughly rusted out. The campus is pretty and tranquil, but amenities pale when compared with those offered elsewhere: lazy rivers, palatial fitness centers, climbing gyms, high-tech libraries and swanky apartment-style dorms.
“Does that influence incoming freshman? I think it does,” said one prominent alumni, who has been active in fundraising. “The sad reality is that colleges that have leveraged white wealthy students have really prospered.”
Unlike other schools, it doesn’t heavily prioritize athletes or legacies in admissions.
Occidental fields 21 varsity teams but offers little credit in the admissions process for athletic prowess, according to school officials. The idea isn’t to be the best but to stay competitive, said Mr. Cuseo, now the vice president for enrollment and dean of admissions. In 2017 the school had to cancel the last four games of the football season because there weren’t enough healthy players. The team has since rebuilt.
In September, a study analyzing admission data at Harvard showed 43% of white students are either athletes, legacies or were children of donors or faculty. A similar count at Occidental was 18%, school spokesman Jim Tranquada said.
Occidental also resists gaming the rankings. Perhaps the most widespread strategy to manufacture an appearance of selectivity is lowering the bar for applicants in order to attract more. That generates more rejections, making a school appear more selective. Occidental hasn’t done this.
“There are a lot of things you can do that are pretty simple, and I’ve been in faculty meetings where it’s been discussed,” said Occidental Professor John McCormack. “But it’s just not who we are.”
In 2004, Mr. Singer assembled an advisory board for his then company CollegeSource, which at the time had a legitimate division. The board included five prominent higher-education figures, including Ted Mitchell, then president of Occidental.
Mr. Mitchell, who left Occidental in 2005, has said he was an unpaid adviser to Mr. Singer’s venture 15 years ago to provide counseling to low-income students.
The prominent Occidental alumnus who also knew Mr. Singer recalls hearing Mr. Singer call Occidental “dumb” for having what he portrayed as too thick of a wall between admissions and fundraising departments.
Mr. Cuseo says he has never felt pressure to take any of the students if they don’t meet school standards. Five years ago, the development office recommended he look at an applicant whose prominent and widely known name made his “eyes kind of open up,” he says.
Yet, “it was pretty darn clear that the student didn’t deserve to be admitted to Occidental,” he says. The school rejected the teen.
Mr. Cuseo said the email from Mr. Singer in 2012 was extremely unusual. An upset Mr. Singer requested a meeting to discuss helping his client’s child “find her way to becoming a student at Occidental” after she had been rejected. Mr. Singer also criticized Occidental’s admission policies.
The College Board, the New York based nonprofit that oversees the SAT, said it has worried about income inequality influencing test results for years. White students scored an average of 177 points higher than black students and 133 points higher than Hispanic students in 2018 results. Asian students scored 100 points higher than white students. The children of wealthy and college-educated parents outperformed their classmates.
“There are a number of amazing students who may have scored less [on the SAT] but have accomplished more,” said David Coleman, chief executive of the College Board. “We can’t sit on our hands and ignore the disparities of wealth reflected in the SAT.”
.. Yale University is one of the schools that has tried using applicants’ adversity scores. Yale has pushed to increase socioeconomic diversity and, over several years, has nearly doubled the number of low-income and first-generation-to-attend-college students to about 20% of newly admitted students, said Jeremiah Quinlan, the dean of undergraduate admissions at Yale.
.. The new score—which falls on a scale of one through 100—will pop up on something called the Environmental Context Dashboard, which shows several indicators of relative poverty, wealth and opportunity as well as a student’s SAT score compared with those of their classmates. On the dashboard, the score is called “Overall Disadvantage Level.”
An adversity score of 50 is average. Anything above it designates hardship, below it privilege.
The College Board declined to say how it calculates the adversity score or weighs the factors that go into it. The data that informs the score comes from public records such as the U.S. Census as well as some sources proprietary to the College Board, Mr. Coleman said.
.. The College Board began developing the tool in 2015 because colleges were asking for more objective data on students’ backgrounds, said Ms. Betterton. Several college admissions officers said they worry the Supreme Court may disallow race-based affirmative action. If that happens, the value of the tool would rise, they said.“The purpose is to get to race without using race,” said Anthony Carnevale, director of Georgetown University’s Center on Education and the Workforce. Mr. Carnevale formerly worked for the College Board and oversaw the Strivers program.
.. The dashboard may also be an advantage in a tight competition for market share with the ACT, another college-admissions exam. A spokesman for the ACT said it is “investing significant resources” in a comparable tool that is expected to be announced later this year.
At Florida State University, the adversity scores helped the school boost nonwhite enrollment to 42% from 37% in the incoming freshman class, said John Barnhill, assistant vice president for academic affairs at Florida State University. He said he expects pushback from parents whose children go to well-to-do high schools as well as guidance counselors there.
“If I am going to make room for more of the [poor and minority] students we want to admit and I have a finite number of spaces, then someone has to suffer and that will be privileged kids on the bubble,” he said.
Charges involve cheating on college entrance exams, efforts to bribe coaches; Actresses Felicity Huffman, Lori Loughlin among those indicted
In one instance, prosecutors said, the head women’s soccer coach at Yale accepted a $400,000 bribe in exchange for admitting a candidate as a recruited athlete. The student didn’t even play competitive soccer, according to prosecutors. After the student was admitted, her parents paid a college admissions consultant $1.2 million.
The consultant, William Singer, is expected to plead guilty to racketeering and other crimes Tuesday afternoon. He allegedly facilitated the fraud through Newport Beach, Calif.-based the Edge College & Career Network LLC.
Mr. Singer allegedly accepted payments in exchange for arranging that some of the teens could sit for the SAT or ACT college-entrance exams with extra time by getting doctor’s notes detailing learning disabilities or other issues, and that they take the tests with proctors who had been bribed to either correct wrong answers or take the test on the student’s behalf. Parents paid Mr. Singer between $15,000 and $75,000 for the test help, according to prosecutors.
Mr. Singer also allegedly helped parents work with coaches to claim admission spots reserved for recruited athletes, staging photos of the teens playing sports or photo-shopping images of the teens’ faces onto stock photos of young athletes.
Prosecutors alleged that charitable organizations were used as fronts for the bribery payments, which figured into the tens or hundreds of thousands in certain cases. Parents made the payments in the form of donations to his nonprofit organization, Key Worldwide Foundation
Other high-profile parents named in the case include Gordon Caplan, co-chairman of New York City law firm Willkie Farr.
Also charged was Bill McGlashan, founder and managing partner of TPG Growth, the arm of the private-equity firm that invests in fast-growing companies, including Airbnb Inc. and Uber Technologies Inc. With $13.2 billion in assets, TPG’s growth business has played a prominent role in the firm’s strategy since the financial crisis, and Mr. McGlashan’s star has risen at the firm.
But a growing movement of nonprofit talent hunters and advisers is seeking to raise the ambitions of disadvantaged students and connect them with premier colleges, attacking a widespread problem researchers call “undermatching.” Some are helping eye-catching numbers of students land at colleges with low admission rates, including Georgetown University in Washington.
.. Most disadvantaged students with strong academic credentials “just don’t get why it is that they should be interested in applying to a selective college,” said Caroline M. Hoxby, a Stanford University economist. They take one look at the sticker price of private colleges, often exceeding $60,000 a year, and write them off. They don’t realize financial aid can put schools with small class sizes and high graduation rates within their reach. Instead, Hoxby said, these students focus on community colleges or others they see as accessible, inexpensive and convenient.
.. in a 2012 study that at least 25,000 low-income students a year, and probably 35,000, rank in the top 10 percent on SAT or ACT admission test scores and have at least an A-minus average. Most of them, Hoxby and Avery found, do not apply to any selective college — rendering them effectively invisible to admissions officers.
.. The Hoxby-Avery study rang alarms. It suggested selective colleges were overlooking legions of deserving students.
