Dive Brief:
- Keystone College has completed its merger with the nonprofit Washington Institute for Education and Research, the private Pennsylvania institution announced Monday.
- The transaction, which has been approved by the college’s accreditor as well as state and federal regulators, makes Keystone a subsidiary of WIER, though the college will “continue operations under its current name and educational mission,” the institution said.
- The announcement comes after a tumultuous year that brought a failed deal, a brush with closure, program and workforce cuts, and the threat of accreditation loss.
Dive Insight:
Monday's’s announcement caps off a long, fraught process for Keystone, which sought out a partner to help stabilize its finances and operations.
“I am pleased to report that the merger transaction between Keystone and WIER was concluded on Friday, May 30, finally joining the College with its strategic partner after nearly a three-year journey that at times threatened the future of the College,” Keystone President John Pullo said in a June 2 message to the college’s community.
Just a few months ago, Keystone was fighting to hold on to its accreditation, which is necessary to draw federal student aid funds. In November, the Middle States Commission on Higher Education voted to revoke the college’s accreditation. Keystone appealed the move in January, citing its then-pending merger with WIER after having reached an agreement with the nonprofit in August 2024.
In late February, MSCHE deemed the appeal moot, noting that Keystone’s merger request paperwork — which wasn’t available prior to the accreditation body’s November vote — included “significant” new information relevant to its financial compliance.
In March 2024, an earlier deal with WIER had fallen apart. That prompted MSCHE to require Keystone to file “substantive change request for institutional closure” paperwork.
Shortly after, MSCHE said in April that the Keystone was at serious risk of closure and issued a show-cause order — usually the final warning before accreditation is withdrawn — directing the college to prove compliance with its standards.
MSCHE’s show-cause order to Keystone remains open, and the college has a Sept. 2 deadline to file a detailed report demonstrating its compliance. That is now also the date for Keystone to file a detailed merger report that is to include a “comprehensive financial planning process, multi-year budget, annual independent audit” and an improvement plan for the college.
While MSCHE has approved the merger request, the accreditor reserves the right to rescind approval if “any developments reveal additional information that might have affected the Commission's decision,” according to the organization.
Keystone faced mounting financial struggles as its enrollment declined in recent years. Between 2018 and 2023, fall enrollment fell by 26.2% to 1,051 students, according to federal data. The college's latest audit shows a $6.1 million total operating loss for fiscal 2024, on top of a $5.3 million loss the year before.
WEIR of late has helped keep Keystone’s operations afloat through grant funding and has a plan to reduce its debt by as much as $12.5 million, according to the audit.
The nonprofit was founded in 2023 by Ahmed Alwani, an investor and businessman in northern Virginia, who also started a nonpartisan think tank focused on global policy.
The merger agreement makes the nonprofit the “sole member” of Keystone but leaves the college’s governing board in charge of academic and administrative affairs.
“When I was first introduced to Keystone, I realized that it was a special place with a rich history in serving students for whom a college education changes their entire family’s trajectory,” Alwani said in a statement Monday.
He added, “While we are dedicated to enhancing that mission, we are equally driven to being innovative with respect to the educational opportunities needed for today’s students in all areas, including online, international, and certifications.”
