Meeting of the Board of Regents | January 2009
THE STATE EDUCATION DEPARTMENT / THE UNIVERSITY OF THE STATE OF NEW YORK / ALBANY, NY 12234
Renewal of Institutional Accreditation: Globe Institute of Technology
December 30, 2008
Issue for Decision
Should the Board of Regents renew Globe Institute of Technology’s institutional accreditation?
Reason(s) for Consideration
Required by State regulation
This question will come before the Higher Education Committee at its January 2009 meeting, where it will be voted on and action taken. It will then come before the full Board at its January 2009 meeting for final action.
At its December 2008 meeting, the Board of Regents extended the accreditation of Globe Institute of Technology for sixty (60) days.
At the December meeting of the Committee on Higher Education, the Regents requested that the Department examine the financial viability of the parent corporation that owns Globe Institute of Technology. Concern was expressed that the severe financial crisis may negatively impact the ability of the parent corporation to adequately support the college due to a loss of corporate assets or because other businesses owned by the parent corporation could create a financial strain on the parent corporation.
Globe’s purchaser is 878 Education, LLC, a Delaware limited liability company created for this purpose. It is wholly owned by Marev Holdings, Inc., a Delaware corporation. In turn, 81.45 percent of Marev Holdings is owned by Martin Oliner, Esq. and the balance is owned by the Oliner Family Trust, of which Mr. Oliner’s wife is the trustee.
In November 2007, the Department reviewed Marev Holdings’ federal corporate income tax returns for 2004, 2005, and 2006. It was determined that Marev had substantial net assets available to support the acquisition of Globe. Marev Holdings does not have a current corporate credit rating since they do not borrow funds to support their businesses. On the basis of that review, it was determined that the parent corporation (Marev Holdings) could support the operation of Globe Institute of Technology. In addition, the financial resources of the parent corporation are sufficient to settle any federal or State student financial aid disallowances incurred under the previous ownership of Globe.
In December 2008, the Department’s Office of Audit Services reviewed the December 31, 2007 financial statement of Marev Holding Inc. and Subsidiaries. As of that date, the Company was in a very strong financial position with significant assets and very limited liabilities in relation to its assets. The make up of the assets were primarily cash and cash equivalents. In addition, the Department has also received a letter from the accountants for Marev asserting that, based on information provided by management, there have been no material changes in the composition of the assets and liabilities from December 31, 2007 until December 16, 2008. The Company is not reliant upon borrowing to operate Globe or its other businesses. As such the tightening of the credit market will not have a material impact on the ability of the parent corporation to support Globe Institute of Technology.
Renewal of institutional accreditation is required prior to the expiration of the current term of accreditation.
The Department, the Regents Advisory Council on Institutional Accreditation, and the Commissioner have determined that Globe Institute of Technology meets the standards for institutional accreditation set forth in the Rules of the Board of Regents. Attached are the following items for your consideration:
Attachment A – Summary of Institutional Accreditation Process Followed
Attachment B – Compliance Review Report
Attachment C – The range of accreditation actions authorized in Subpart 4-1
of the Rules of the Board of Regents.
Globe Institute of Technology, New York, is a proprietary institution authorized by the Board of Regents since 1996 to confer degrees. It currently offers associate and baccalaureate degree programs in the discipline areas of business and the physical sciences. The Regents have accredited Globe since 1996. The current period of accreditation ended on December 31, 2008. At its December 2008 meeting, the Board of Regents extended the accreditation of Globe Institute of Technology for sixty (60) days.
The following recommendation for renewal of accreditation is based on the findings and recommendations of the Regents Advisory Council on Institutional Accreditation, expert peer reviewers and staff. Key findings include the following:
- The institution’s mission is clear and implemented throughout the organization, with a focus on providing career skills to students from diverse backgrounds who have been traditionally underrepresented in higher education.
- Faculty are sufficient in number and possess training and professional experience necessary to carry out teaching and other responsibilities. They are deeply involved in and supportive of student advising.
- Classrooms, laboratory spaces and equipment, and administrative and faculty office space and equipment are satisfactory.
- The new owner has invested substantial resources that are strengthening the institution; while ongoing Federal and State financial aid audits are reviewing actions taken under the previous administration, the new owner is committed to covering any disallowances that may result.
- By word and action, the institution appears committed to continuing refinements to ensure student success and the sound administration of all functions.
It is recommended that the Board of Regents renew Globe Institute of Technology’s institutional accreditation with condition, effective January 13, 2009, for a period beginning immediately and ending on January 31, 2013, subject to annual reports providing evidence of continued program and financial ability.
Timetable for Implementation
This renewal of institutional accreditation would take effect immediately and expire January 31, 2013. Following Regents action, the Department will also re-register the Institute’s programs for general purposes.
Summary of Institutional Accreditation Process Followed
Peer Review Visit. In preparation for this visit, Globe Institute of Technology prepared a self-study and supporting materials following the requirements for self-studies in the Handbook of Institutional Accreditation. On March 5-6, 2008, an evaluation team visited Globe. The team examined the self-study and other materials; met with faculty, students, the president, dean and other administrators, examined the facilities and other academic resources. The team found that Globe Institute of Technology substantially met all standards set forth in the Regents Rules and recommended accreditation for four years with condition.
Peer Review Team Recommendation: Accreditation for a period of four years with condition.
The Department transmitted the team’s draft compliance review report to Globe, providing it 30 days to prepare a written response correcting factual errors and addressing any other aspect of the report and any recommendations in it. The draft report, Globe’s response, and the Department’s preliminary recommendation for accreditation action became the final compliance review report.
Regents Advisory Council Review. As required by Subpart 4-1, the Department transmitted the final compliance review report, including its preliminary recommendation for accreditation action, for consideration by the Regents Advisory Council on Institutional Accreditation. (The Advisory Council is established in §3.12(d) of the Rules of the Board of Regents “to review applications for accreditation and renewal of accreditation pursuant to Part 4 of this Title, and such other matters as the department may ask it to review, and make recommendations to the Regents and the commissioner based on its review.”) The Department’s preliminary recommendation was:
Department’s Preliminary Recommendation: Accreditation for a period of four years with condition.
On November 14 2008, the Advisory Council met to review Globe’s application and to make a recommendation to the Board of Regents on its accreditation. In a public meeting, it met with representatives of Globe and the staff coordinator of the accreditation review. Following presentations by Globe’s President and the staff coordinator, questions, and discussion, the Advisory Council unanimously made the following recommendation to the Board of Regents on accreditation action:
Regents Advisory Council Recommendation: The Regents Advisory Council voted to recommend that the Board of Regents renew Globe Institute of Technology’s accreditation for a period of four years, ending on December 30, 2012, subject to annual reports addressing program viability and evidence of continued financial ability.
Attachment B is the Final Compliance Review Report considered by the Advisory Council, including the Summary and Preliminary Recommendation on Accreditation Action.
Commissioner’s Review. Neither Globe Institute of Technology nor the Deputy Commissioner appealed the Advisory Council’s recommendation. Therefore, pursuant to Subpart 4-1, the Commissioner adopted its recommendation as his recommendation to the Board of Regents:
Commissioner’s Recommendation: Accredit Globe Institute of Technology for a period of four years with condition ending on December 16, 2012 subject to annual reports addressing evidence of continued program and financial viability.
Attachment C sets forth the range of accreditation actions authorized in Subpart 4-1 of the Rules of the Board of Regents.