Cincinnati State Trustees approve Middletown agreement

September 29, 2011

The Cincinnati State Board of Trustees has approved an agreement that could pave the way for development of a campus in Middletown.

Cincinnati State President O’dell M. Owens and members of his administrative team presented a financial plan to the Board on Tuesday (Sept. 27) that envisions a collaboration with a Boston-based company, Higher Education Partners (HEP).

Under the proposal, HEP would be responsible for build-out of the campus, lease and operating payments, equipment purchases and other operational details while the College would have primary responsibility for programming and curriculum development, staffing and academic operations.

“The board gave me a mandate. They said the College could take an educational risk in Middletown, but find someone else to carry the financial risk,’’ Dr. Owens said. “This deal fulfills that mandate.’’

Though it is non-binding, the document approved Tuesday (Sept. 28) is “an effort to lay the foundation of material and substantive terms to be included in a formal agreement’’ that will be negotiated between Cincinnati State and HEP. The expectation, according to the document, is that “the final agreement will ensure that (Cincinnati State) is subject to no direct financial risk should the collaboration experience loss. HEP will assume all capital and operational risk of the Collaboration.’’

The city of Middletown has acquired five properties in its downtown core that have been discussed as possible sites for a Cincinnati State campus. Dr. Owens said the College’s most immediate interest is in using two of those properties, the former Cincinnati Gas & Electric Building and a former senior citizens center, to house classroom and support operations.

While a variety of classes and programs will likely be offered, Cincinnati State expects to concentrate heavily on offerings of “hybrid” courses at the Middletown campus. These are blends of traditional and online classes, designed in large part to serve the needs of individuals who are trying to work and raise a family while attending college.

Among other details of the proposal:

• The Middletown campus is expected to be operational by Sept. 1, 2012.
• Cincinnati State and HEP will collaborate on such matters as designing the build- out of the campus, marketing, establishing a budget and setting up any necessary retention and remediation programs.
• Cincinnati State will be guaranteed that all its direct expenses, plus 5 percent overhead, will be covered by revenue from tuition and other income streams allocated to the Middletown campus. HEP will receive a 15 percent service fee of revenue, plus its direct costs and overhead, if net income is sufficient.
• The initial agreement is anticipated to last 10 years.

Cathy Crain, chair of the Cincinnati State board of trustees, acknowledged that the College has been deliberating – and revising – the Middletown proposal for a substantial period of time. “Sometimes,” she said, “it’s better to take many, many, many tries and get it right.’’