Noted evangelist Jerry Falwell died May 15 at 73. He was a prominent televangelist, a powerful conservative political leader, and the founder of Liberty University in Lynchburg, Va. How do you found a university?
First, raise a lot of money. Without a pile of cash on hand, you won’t be able to pay faculty and staff, or buy land, buildings, and textbooks. Many universities—Vanderbilt, Stanford, Carnegie Mellon—were started by moguls rich enough to pay the bills themselves. Others relied on foundations to jumpstart their endowment: Olin College in Massachusetts, for example, draws its funding from the Olin Foundation. In most cases, the endowment is overseen by a board of trustees. The majority of colleges are not-for-profit institutions, with all the usual exemptions from income and property taxes. Donors can also write off contributions. In exchange, schools have to reinvest earnings and follow prohibitions against political activism. But recent decades have seen a surge in for-profit colleges like University of Phoenix and DeVry University. Instead of donors, these colleges have investors.
Before a college can start accepting students, it needs a degree-granting license. Each state has its own process, but usually you need to submit your university’s curriculum to a committee for review. Some of the most relaxed states—Virginia, Colorado, and Wyoming—don’t require so much as a site visit. In tough-as-nails Maine, inspectors visit your campus, all other university presidents must be notified of your application, and a state legislator must introduce a bill to grant your school a license. Without a license, you’re not allowed to advertise your school as a degree-granting institution.
Separate but similar is the accreditation process. Institutional accreditation, granted by regional commissions across the country, certifies that a school meets a minimum standard for recognition by the Department of Education. Without it, a school isn’t eligible to receive federal funding nor can its students get Pell grants, and its credits may not transfer to other schools. In most cases, you also need government recognition to get .edu affixed to your school’s URL. Some organizations, including Teach for America, hire only people who graduated from accredited schools. (Accreditation standards also protect students from enrolling in “diploma mills.”) As part of the review, a school must provide syllabuses for every course, plus biographies of the faculty. You can begin this accreditation process only after your school has graduated its first student. The whole thing usually takes at least a year and costs as much as $30,000. You might also want to get specialized accreditation for a particular program or department in your university. For example, if you wanted to open a culinary school, you’d want to get accreditation from the American Culinary Federation. (See here for a list of programmatic accrediting agencies.)
There are also accrediting associations for religious schools. Schools approved by agencies like the Worldwide Accreditation Commission of Christian Education Institutions might teach Christian counseling rather than clinical psychology, for example. Some religious schools have only religious accreditation, while others, including Liberty and Pat Robertson’s Regent University, qualify for both religious and regional accreditation. *
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Explainer thanks Gary Hull of Founders College, Richard Miller of Olin College, and Cheryl Rinn of Christian Leadership University.