Another one bites the dust!

From the Washington Post:

University of the Arts [in Philadelphia] announced May 31 the school would shut down for good on June 7, citing significant, unanticipated expenses that “came to light very suddenly,” according to a statement from President Kerry Walk, who resigned four days later.

How is it that such extreme existential risks came to light very suddenly? One can imagine a sudden roof leak or failure of the HVAC system, but something that would sink the whole institution suggests a serious breach of the governing board’s fiduciary duty or misconduct on the part of administrators that borders on the criminal.

Not unlike the Fontbonne University example a couple of months earlier, the UArts case is remarkable for how quickly the unwinding went down. We are reminded of Hemingway’s famous quote in The Sun Also Rises (1926):

“How did you go bankrupt?” Bill asked.

“Two ways,” Mike said. “Gradually and then suddenly.”

 The gradual part is what bothers us. Why must we let things slide to the point where collapse seems sudden for so many stakeholders? Would a more humane—not to mention capital-preserving—approach be to exercise the dissolution clause in the institutional bylaws and liquidate in an orderly manner while there are still assets to contribute to a like-missioned institution?