La Jolla-based National University faces questions in its drive to become a force in online education
The school declined to say whether it still has the support of big-time donor Denny Sanford.
The applause was crisp and loud two years ago when National University told supporters it was getting a $350 million gift from philanthropist Denny Sanford and that the money would help the La Jolla-based school double enrollment.
It was one of the biggest pledges in the history of higher education. But the celebration might have been premature.
News reports later popped up saying that authorities in South Dakota were investigating whether Sanford had obtained child pornography. National announced that “for the foreseeable future” it was shelving plans to rename the school Sanford National University.
Now it is unclear whether Sanford, who has homes in La Jolla and Sioux Falls, S.D., has or will give National any or all of the money.
University officials declined to answer questions about Sanford and the gift during an interview with The San Diego Union-Tribune. They also declined to discuss why National President David Andrews, who played a key role in landing the donation, resigned June 11.
Attempts to reach Sanford, his attorney, Marty Jackley, and Andrews were unsuccessful.
The Sanford donation is key to a challenging drive by the private university, which is about to turn 50, to become more of a force in online education for adult learners.
National was better equipped than most to respond when the pandemic pushed most college instruction online during the past year. But its enrollment grew by only 3,149, to 32,100.
The university is part of a larger network of accredited, nonprofit schools whose enrollment rose by 2,482 students to 50,500. The network includes City University of Seattle and Northcentral University of San Diego. A fourth school — JFK University — closed last year, tamping down enrollment. The closure occurred partly because the school was having trouble adapting in the highly competitive online industry.
In May, the American Association of University Professors issued a sharply worded report saying National executives basically set aside a long history of working with the faculty to govern National when it came to making decisions about faculty contracts, staffing and academic facilities.
Among other things, the AAUP report says, National terminated about 50 full-time faculty contracts during the pandemic even though it wasn’t in financial danger.
“The [National] board and administration’s actions have demoralized a dedicated faculty, decimated a reasonably sound institutional governance structure (despite the absence of a tenure system), and imperiled the university’s mission ‘to deliver an exceptional student experience by providing superior programs and services that are relevant and result in meaningful learning,’” the report states.
Michael Cunningham, chancellor of the National University System, as the network is known, disagrees and told the Union-Tribune that the report does not broadly represent the feelings of the faculty.
“We have for the past few years been taking all the right steps for streamlining our operation,” said Cunningham, who is now doubling as National’s acting president. “And right now our cash reserves and investments are $1.3 billion ...
“I believe that we are probably in the most enviable position of any university in the country to grow our university the right way and successfully.”
He projected that the NU System will double its enrollment to 100,000 within five years.
Donors are vital to such growth and universities yearn to have backers like Sanford, a billionaire banker who made most of his fortune by providing credit cards to high-risk customers. He owns First Premier Bank, which is headquartered in Sioux Falls.
Sanford, 85, who grew up poor in Minnesota, began making large donations in the late 1990s. A lot of his money has gone for health, science and education, with a particular focus on helping children.
In 2017, he gave $28 million to the National University System, primarily to improve teacher education. In 2019, National issued more teacher credentials than any other school in California.
The following year, he gave National $100 million to develop a program aimed at teaching civility and thoughtfulness to children.
Then in 2019, Sanford stunned the philanthropy community by announcing that he was giving $350 million to National to help it serve working adults, primarily online.
At the time, the gift was among the 15 largest donations that a U.S. college or university had announced, dating to 1967. Sanford’s donation also represents the biggest individual or family gift ever made in San Diego County, and it pushed his local giving to at least $809 million. His many beneficiaries range from the San Diego Zoo to UC San Diego.
Sanford seemed especially moved by the $350 million gift to National, saying at the time that the school planned “to at least double [in size] within a few years. How could I not support that? Adult learners are so in need in education, and they’re often neglected.”
Then in August 2020, ProPublica, an investigative news organization based in New York City, reported that Sanford “was being investigated for possible possession of child pornography, according to four people familiar with the probe.”
“Investigators with the South Dakota attorney general’s Division of Criminal Investigation obtained a search warrant as part of the probe, according to two of the people, who spoke on the condition of anonymity. They said the case was referred to the U.S. Department of Justice for further investigation,” according to the report.
The Sioux Falls Argus Leader reported at the time that an electronic device owned by Sanford “has been the center of a months-long child pornography investigation that originally started in the state late last year, according to multiple sources.”
“The investigation expanded to include other jurisdictions where Sanford has a home, including Arizona and California, and is currently pending with the U.S. Department of Justice for possible criminal action,” the newspaper reported.
Jackley, Sanford’s attorney, said at the time: “Although we know very little about any state or federal inquiry relating to Mr. Sanford, we do know that any such inquiry by those authorities responsible for investigating allegations obviously did not find information or evidence that supported or resulted in any criminal charges.”
Sanford Health, a Sioux Falls-based health network that has received more than $1 billion in donations from Sanford, said last summer that it was “deeply concerned” by the news reports. But in March, Sanford Health President and Chief Executive Bill Gassen told South Dakota Public Broadcasting: “We’re very confident in the partnership with Mr. Sanford. We took those media reports seriously and are satisfied that they were not substantiated.”
The Union-Tribune sought an update from the South Dakota attorney general’s office, which did not respond to two phone calls. South Dakota Public Broadcasting reported that no charges had been filed as of March.
Cunningham used to keep a large cardboard cut-out of Sanford’s image at National. Now he declines to talk about Sanford. Sanford is not listed in the university’s history timeline, despite having given or pledged at least $478 million in donations. And Cunningham would not say whether National will follow through with the initial plan to rename the school Sanford National University.
It’s not clear whether National will be able to double its enrollment.
Many well-known and highly regarded universities — including Purdue and Penn State — have been expanding their marketing campaigns in greater San Diego in search of students. National is not deeply known across the country. And its programs received mostly mediocre rankings in U.S. News and World Report’s 2021 review of online education. For example, National’s bachelor’s program ranked 164th. Its MBA program ranked 197th. Its masters program in criminal justice ranked 54th.
National also has yet to reduce tuition — something it said it would do. From July 2019 to June 2020, annual tuition ranged from $13,320 for undergraduates to $15,912 for graduate students and $25,380 for doctoral students, the school says.
Cunningham isn’t scaling back expectations, however. “Within five years we’ll be best in class in online learning,” he said. ◆
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