Liberty U: 100K Students, $1B Assets

[Martin Eisenstadt]

Liberty University online students nearly tripled in five years

By: Liz Barry | The News & Advance
Published: July 22, 2012 Updated: July 22, 2012 - 2:19 PM

From morning to night, the Liberty University Online call center in Lynchburg buzzes as an army of about 220 workers fields queries from prospective students across the U.S. and overseas.

Housed in Green Hall on Liberty's main campus, the call center rivals the size of a football field and is packed with gray cubicles. It's the nerve center for Liberty's rapidly growing online program, and for countless students, it's the first contact they'll have with the university.

Among Virginia's brick-and-mortar institutions, Liberty has emerged as a pioneer in distance education.

Enrollment at Liberty University Online surpassed 82,000 students this year, bringing the university's combined residential and online headcount to more than 100,000. The number of students taking online classes is nearly triple the enrollment of 27,500 just five years ago.

Many of LU's residential and online students also receive federal financial aid, like those at most colleges and universities. LU students received about $445 million in federal financial aid money for fiscal 2009-2010, for example, helping fuel the growth.

The online success has bolstered Liberty's finances and powered a sharp revenue increase. Liberty reported a surplus of $203 million in 2010-11, according to the university's most recently available IRS 990 tax form.

Chancellor Jerry Falwell Jr. said that surplus continues to rise.

"Liberty is operating like a for-profit school -- but without some of the pitfalls," he said, pointing to LU's comparatively high graduation rates and low student loan default rates.

"That's sort of the secret as to why Liberty's finances have done what they've done."

A longtime proponent of distance education, Liberty revamped its online program in 2003 when it began emphasizing degree programs instead of individual courses, LU officials said.

It currently offers more than 160 online degree programs, ranging from aeronautics to nursing.

"I know that has tremendously increased our retention and our students continuing to re-enroll to get a degree," said Neal Askew, LU's executive vice president.

Shortly before 2007, LU Online reached a critical mass of 20,000 students, and began to generate more revenue for the university.

With the infrastructure in place, Liberty was poised for rapid enrollment growth. Compared to its residential program, which requires additional dormitory and classroom space to accommodate more students, distance learning proved much more cost-efficient to expand.

"Now all you have to do is add a phone, a laptop and a person and you can pick up another 500 students," Askew said.

LU Online caters to non-traditional students. The average age is about 35; many already have college credits but need to complete their degree, Falwell said.

"There are so many people who weren't successful the first time around, whether it was finances or family health problems. Now they're 35 years old, they've gotten stabilized -- they want to get that degree and they want a better job," Falwell said.

"It's just a huge market"

Liberty's online programs are accredited by the Southern Association of Colleges and Schools (SACS), the Southeast's main accrediting body. To maintain its accreditation, Liberty must meet standards that cover everything from academic quality to financial stability.

This summer, SACS reaffirmed Liberty's accreditation during a five-year interim review.

Most students can complete their degree program entirely through the Internet, without stepping foot on Liberty's campus or meeting a professor face-to-face.

The average online student completes about 15 credit hours, or a semester's worth of classes, in one year. Each class is eight weeks long, and students can complete coursework on their own schedules.

Currently, about 50 percent of LU Online students are pursuing undergraduate degrees. The other half are in graduate programs ranging from business to theology, said Ron Godwin, LU's provost and senior vice president for academic affairs. For example, LU Online currently has more than 1,000 doctoral candidates in education.

"The graduate programs are currently growing faster," Godwin said.

Liberty Online maintains an average class size of 25 students. One-on-one help is encouraged and even monitored through software that tracks the number of contacts a professor has with students each week, said Godwin.

Liberty currently employs about 1,800 online professors, the majority of whom are part-time and hold teaching jobs at other schools, said Godwin. On-campus, Liberty employs about 500 professors, and more than half also teach online.

Liberty's online instructors are not required to have terminal degrees in their fields, but must meet accrediting standards, Godwin said.

Having a campus is a major draw for Liberty"s online students who want the convenience of studying from home while taking part in a larger community. On a student"s diploma, Liberty makes no distinction between degrees earned through online or residential programs.

"The online program wouldn't have grown so much if it weren't for a burgeoning residential program," Falwell said. "That's one of the things that attracts students to Liberty -- It's a real place where they can say, 'I got my degree from that school.'"

Tuition for LU Online is less expensive than the residential program. For example, it costs about $4,900 to take a semester of courses through LU Online, and about $9,000 on campus.

Each year, the administration sets target enrollment numbers for its online programs. For now, the growth shows no signs of stopping.

"There will come a year when we say, 'OK, let's shoot for fewer students,'" Falwell said. "Because the market has changed. . . and there just aren't that many people interested."

Godwin chimed in: "But through a recession, it hasn't happened so far."

Liberty University's net assets headed for $1 billion, thanks to online
Liz Barry | The News & Advance
Published: July 22, 2012 Updated: July 22, 2012 - 2:15 PM

Liberty University's net assets have sustained a fivefold increase -- from $150 million to $860 million -- over the past six years, driven by the rapid expansion of Liberty's online programs.

While colleges across the country have struggled to make ends meet during the economic downturn, Liberty's financial picture has grown stronger by the year, according to an examination of Liberty's IRS 990 tax forms by The News & Advance.

In a nutshell, Liberty's net assets show how much the university in Lynchburg is worth after subtracting its debt and other liabilities.

In 2006-07, the university's net assets were $150 million, according to the 990 tax form, which non-profits must file annually with the IRS. Driven by a growing student body and influx of tuition dollars, Liberty's net assets grew to $637 million by 2010-11, the most recent 990 available from the IRS.

As of June, Liberty officials said the school had about $860 million in net assets and expects that number to exceed $1 billion by year's end -- a major milestone for the university.

"We've grown so fast that we can't spend it fast enough," LU Chancellor Jerry Falwell Jr. said.

Since Liberty is a non-profit, any surplus it generates must be invested back into the school. However, Falwell said there is no strict timeline about when Liberty must use the money; part of Liberty's strategy is to build an endowment that will secure the long-term stability of the school.

""We want to continue to improve the university and stay on the cutting edge, but we also want to put money away for the future," Falwell said.

For now, Liberty is focused on revitalizing campus and improving its academic programs, Falwell said.

Over past year, Liberty began pouring more than $220 million into construction projects that promise to transform campus over the next decade. Old buildings are being torn down and replaced with Jeffersonian architecture; makeshift dorms will be replaced with high-rise residence halls.

This summer, the campus is a full-fledged construction zone.

Behind Williams Stadium, a fleet of bulldozers is paving the way for a new baseball stadium. By DeMoss Hall, Liberty's main academic building, crews are building the foundation of the $50 million Jerry Falwell Library.

Across the border in Campbell County, construction has begun on a medical school.

Liberty's recent growth was tempered by years of financial struggle. During those years, university leaders resolved to run the school like a business -- an approach Falwell said is partly responsible for LU's current success.

"We had no choice but to be frugal for a long time," said Falwell, LU's vice chancellor until the death of his father, Jerry Falwell Sr., in 2007. "Those years...forced us to treat students like customers because we know the school's survival depended on whether those students showed up the next year. And so we did treat them like customers and we still do."

The turning point came around 2006-07, when Liberty's online enrollment first surpassed 20,000, Falwell said.

In 2007, Liberty also benefitted from $29 million in proceeds from the life insurance policy of Falwell Sr.

"Building the online program was expensive, but once we reached a certain enrollment number, it actually began to make money for the university," Falwell said.

Online enrollment surpassed 82,000 this year, bringing the university's total headcount to more than 100,000 students. The residential program has experienced more modest gains, expanding from about 9,500 in 2006-07 to 12,500 this year.

This growth in both programs has caused a spike in revenue from tuition and fees, which account for the largest chunk of Liberty's revenue. In 2010-11, for example, Liberty earned more than $535 million in tuition and fees, which in turn comprised about 85 percent of Liberty's total revenue, according to the 990 tax form. The rest comes from sources like room and board, campus concessions and student fees.

A key part of Liberty's strategy to attract students is keeping tuition affordable.

"We've kept our tuition in the lower 25 percent for all private schools for residential. Online, we're lower than most of the for-profit," Falwell said. The cost for a semester of online courses is about $4,900, and for on-campus, $9,000.

Liberty's workforce has more than doubled from about 2,700 in 2006-07 to 6,100 today. The current workforce includes about 1,700 who live outside the Lynchburg region. Many are professors for LU Online.

The growth has allowed Liberty to take on big projects, such as building a school of health sciences and an osteopathic medical school.

In January, Liberty completed its second bond sale on Wall Street to help fund these projects. The university received an "AA" bond rating from Standard & Poor's and an "A1" rating from Moody's Investors Service, its fifth-highest grade.

By building its financial standing, Liberty is working to guarantee its future and stability, Falwell said.

"Back when we were having a hard time, financially, it was also hard to get accreditation reaffirmed. It was hard to keep our programs. It was hard to attract top-quality students because they weren't sure if we were going to be here the next year," Falwell said.

Until recently, Liberty's assets were mostly sitting in cash reserves.

Over the past year, Liberty has worked with an assets management firm in New York City, Permanens Capital, to lay the groundwork for converting those cash reserves into low-risk investments. Permanens chief investment officer John Regan said that since Liberty is a young school, the administration is not bound to a "legacy way of doing things."

"Falwell is a very prudent chancellor of the university and he's very aware that with the growth Liberty's had, you really have to protect it," Regan said.

Since 2008, Regan has specialized in helping universities manage their assets. He previously managed Cornell University's endowment in the role of senior investment officer, and is now reaching out to other schools.

In a climate where universities are struggling to make ends meet, Regan said Liberty appears to be a pioneer in combining residential and online education.

"I'm fascinated with Liberty's model. . ." Regan said. "I will tell you that even the top universities are still trying to figure out this online thing. It's amazing that Liberty is this far along."

Liberty leaders are optimistic about the university's future, and don't foresee enrollment numbers slowing anytime soon, especially with online programs.

"I think the only thing that would ever cause us to decrease in numbers...is if education becomes downgraded, where people don't want to receive higher education," said Neal Askew, LU's executive vice president. "I don't think that's going to happen. I think our market is totally growing and not subsiding worldwide. I don't think we can saturate the market."

Falwell said there"s a balance between spending money to grow the university and saving for less prosperous times.

"You need a big reserve to operate a university because we may go through years where we've got no surplus in the future," Falwell said.

"You don't go out and spend it all, but that doesn't mean you've made a profit. It means you've guaranteed the future of the university."

[Don Dresden]

Despite attacks by perverts and stalking anti-Christian bigots like degenerate George Gollin, Liberty continues to grow. People are voting with their wallets against the secular, leftist higher ed establishment.

Virginia's Liberty transforms into evangelical mega-university
By Nick Anderson,
Published: March 4, 2013

LYNCHBURG, Va. -- The small Baptist college that television preacher Jerry Falwell founded here in 1971 has capitalized on the online education boom to become an evangelical mega-university with global reach.

In the almost six years since Falwell's death, Liberty University has doubled its student head count -- twice.

Total enrollment now exceeds 74,000, with nearly 62,000 working toward degrees online in fields such as psychology, business, education, criminal justice and, of course, religion. That makes Liberty the largest university in Virginia -- with more than double the number of students at No. 2 George Mason -- and the largest private, nonprofit university in the country. With a slogan of "training champions for Christ," Liberty also is the nation's largest university with a religious affiliation.

The surging enrollment for a bastion of Christian conservatism in the central Virginia foothills highlights the school as a market leader at the crossroads of religion and higher education. Liberty figured out how to recruit masses of students via the Internet years before elite universities began ballyhooed experiments with free online courses.

Turbocharged growth inevitably raises questions about quality, and Liberty’s academic reputation has not risen as fast as its enrollment. About 47 percent of its first-time, full-time students graduate within six years, federal data show, below the national average of 58 percent. Liberty officials say such statistics reflect an admissions policy geared more toward opportunity than exclusivity.

"We believe that Liberty will redefine what is considered an academically prestigious university in the future," said Jerry Falwell Jr., the university's chancellor and president. The school, he said, aims to be judged by how many students it educates and how well it educates them rather than how many it turns away.

Liberty's expansion has yielded a river of money. The university ended 2012 with more than $1 billion in net assets for the first time, counting cash, property, investments and other holdings. That is 10 times what the school had in 2006, putting Liberty in the same financial league as universities such as Pepperdine, Georgetown and Tulane.

Flush with cash, Liberty is building a huge, $50 million library, replacing old dormitories and angling to place its Flames football team in a conference eligible for NCAA bowl games.

"It's grown from being a small Bible school towards the goal of being a full-service university," Falwell said in an interview. He said he aims to carry out his father's vision: "To create for evangelical Christians what Notre Dame is for Catholics and Brigham Young is for Mormons."

Falwell, 50, acknowledged that Liberty's image continues to be influenced by the legacy of his late father's political activism. The elder Falwell, who died in May 2007, was a polarizing figure -- beloved on the right, despised on the left.

But his son said Liberty has turned a page.

"We're not the Moral Majority anymore," Falwell said, referring to the religious conservative movement his father founded. "We're not a church. Our mission is to educate."