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The Art Institute of Fort Lauderdale, which is one of the campuses affected in the closures (via Wikimedia Commons)

When the Education Department started to deregulate the for-profit college industry in 2017, Dream Center Education Holdings — a Christian nonprofit with no experience in higher education — began acquiring schools. Two years later, the charity affiliated with a Pentecostal megachurch in Los Angeles has shuttered dozens of colleges and art institutes around the country with little warning.

The franchises owned by Dream Center include Argosy University, South University, and the Art Institutes. The affected schools have about 26,000 students. 40 campuses are under the control of a court-appointed receiver who accused school officials of keeping their doors open with money earmarked for federal student loans — about $13 million owed to students at 22 campuses. Fourteen other sites, mostly Art Institute locations, have a new owner who arranged the transfer through private equity executives.

Buying a chain of schools “aligns perfectly with our mission, which views education as a primary means of life transformation,” Randall Barton, the foundation’s managing director, said when Dream Center announced its plans to buy assets off the floundering Education Management Corporation (EDMC). (In 2015, the corporation, which owned the Art Institutes, paid $200 million in a settlement after an investigation into its recruiting tactics of enrolling students who had little chance of succeeding.) The decision was opposed by consumer groupsmembers of Congress, and some regional accreditors

By the end of last year, Dream Center faced eviction on at least nine campuses and owed creditors more than $40 million. The network of schools began to unravel last summer when the nonprofit announced the sudden closure of 18 Art Institutes, nine Argosy University sites, and three South University campuses.

The former Art Institute of Pittsburgh building (via Wikimedia Commons)

Earlier this month, the Art Institute of Pittsburgh abruptly shuttered — much to the surprise of the school’s 2,100 students. The historic college was founded in 1921 and purchased in the late-1960s by EDMC. It recently offered classes in animation, graphic design, interior design, culinary arts, and fashion. On March 11, students were wheeling away their books and art projects as men in hard hats began removing larger objects from the school’s campus.

“Pretty much the best times of my life were spent in that building,” Avery Hsu told the Pittsburgh Post-Gazette. “It was a fun time to be there, learn and do it yourself.” The 23-year-old culinary student was roughly two years into a four-year bachelor’s program when news of his school’s closure came.

Hsu isn’t the only one who’s been shocked by the rapid pace of Dream Center’s demise. The New York Times reports that at least one psychology doctorate student was still owed $10,000 in backpay from an Argosy school in Chicago. Unable to pay her rent for the last three months, she and her 6-year-old daughter received an eviction notice.

“I didn’t want to go home and tell my baby that Mommy may not be a doctor,” Ms. Jackson told the publication. “Now I don’t want to go home and tell her that we don’t have a home.”

In an email two weeks ago, Art Institutes system president Claude Brown told staff  that some of their campuses would be transferred to Education Principle Foundation (EPF), a nonprofit created five years ago by Colbeck Capital, which also funds Studio Enterprise, a Los Angeles company that’s also providing non-academic services to the colleges.

Zachary Small

Zachary Small was the senior writer at Hyperallergic and has written for The New York Times, The Financial Times, The Nation, The Times Literary Supplement, Artforum, and other publications. They have...

8 replies on “The Rapid Closure of Art Institutes Across America”

  1. Please define “after an investigation into its recruiting tactics of enrolling students WHO HAD LITTLE CHANCE OF SUCCEEDING”. Poor choice of language from such a progressive art oriented blog. Sounds so elitist.

    1. Hi Valerie,

      I understand it may look like a slight against students, but that phrasing is actually how the lawsuit’s allegations were defined; it’s also known as “boiler room tactics,” or fraud.

    2. Many “specialty” schools, like many art schools, for example, seem to have a selection process to get in, but when you go behind the scenes, you find out everyone who had applied is excepted, and they actually have to do recruiting to even get enough students to fill the slots to stay open. I know one major school that closed recently because it couldn’t fill the seats. It was an excellent school with great staff- just too much competition from the local universities with art departments, and a development move that was a bit scary.. Oops- I just saw an article about them in the headers above.

  2. Trump University variation on the theme of crooked for profit college scams beloved by Secretary DeVos.

    1. Which is actually not much different from the corporation of SVA and various other art school scams.

  3. I went to the Art Institute of Seattle for awhile in the 1990’s. That school was rife with toxic masculinity to the point of suffocation and the experience was horrible. I’m glad to see this fake art school die. It was the worst experience ever. The teaching was substandard and they treated their students like kindergarteners. Horrible place.

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