MOSCOW, Idaho — May 18, 2023 — This afternoon, the Idaho State Board of Education, sitting as the Board of Regents of the University of Idaho, granted approval for the creation of a not-for-profit entity that will acquire the operations of the University of Phoenix. This represents an historic opportunity to improve access to higher education, broaden U of I’s reach to nontraditional adult learners and complete University of Phoenix’s efforts of the past several years to move away from its for-profit model into a not-for-profit model and further enhance its focus on student success.
U of I’s affiliation with University of Phoenix unites the two institutions’ missions to serve students and diversifies the programmatic portfolios of both but will retain a separate operational structure with each having its own president and leadership team.
University of Phoenix serves primarily working adults. U of I will remain Idaho’s land-grant, residential university serving primarily traditional learners.
“The political landscape in Idaho leaves public universities vulnerable. Meanwhile, for-profit universities are taking a hit on a national scale,” said U of I President Scott Green. “By affiliating with University of Phoenix, we bring together the best of both systems and build on our common desire to educate students.”
As part of the affiliation, after it is accomplished, the not-for-profit University of Phoenix will make an annual supplemental education funding payment of $10 million to U of I. That annual payment is expected to grow over time.
Beyond the financial support, the affiliation also provides U of I with a robust technology infrastructure that can be adapted for U of I as well as statewide online programs. The student information system University of Phoenix has built for enrollment and student support is comprehensive and well-tested.
The demand for online programs for adult learners continues to grow each year. This affiliation allows U of I to serve this audience as well as place-bound Idahoans who deserve access to higher education. By working together, the institutions can better meet the needs of all learners wanting to expand their education.
“As an alumnus of the University of Idaho, I know and appreciate the value of a Vandal education,” Green said. “This affiliation only strengthens our ability to continue delivering on that promise of value to our students.”
Public institutions affiliating with for-profit universities is not new. In recent years, Purdue affiliated with Kaplan University and University of Arizona affiliated with Ashford University.
After the completion of the transaction, the president of University of Phoenix, Chris Lynne, will report to the fiduciary board of the not-for-profit board that is being created for the purchase.
“Since John Sperling founded University of Phoenix in 1976, our mission has been to provide accessible, career-relevant education to underrepresented adult learners,” Lynne said. “The university has focused on student outcomes, support and upskilling, as well as understanding and reacting to marketplace trends from employers, and innovating ways to make online higher education more accessible and achievable. We are excited to build on the great legacy of our institution by working with University of Idaho, one of our nation’s leading public universities.”
The $550 million acquisition agreement will be funded by a mix of taxable and non-taxable bonds issued by the new not-for-profit. This money is separate from any U of I budgets, funding lines or state appropriations.
The acquisition is contingent on accreditor and other necessary regulatory approvals. There are possibilities for future integration, but there are no specific plans at this point.