CEDU Closing Shocks Lon Woodbury

The article says, "industry experts" but only quotes Lon Woodbury.

"This is a relationship-based program, and they closed this like it was a factory," a counselor at one of the schools told the Spokesman-Review newspaper in Spokane, Wash.

Brown Schools operate 11 boarding schools and educational facilities in Idaho, Texas, Vermont, Florida and California, according to its Web site. Facilities in Austin and San Marcos were sold to Psychiatric Solutions Inc. in 2003.

CEDU collapse stumps experts
Posted: Sunday, Apr 03, 2005 - 09:25:26 am PDT
By LUCY DUKES
Hagadone News Network

BONNERS FERRY -- Industry experts are working furiously to figure out why CEDU suddenly closed down and declared bankruptcy on Friday, eliminating nearly 250 jobs in Boundary County, sending 301 youth home in the middle of uncompleted treatment programs and sending the county's economy into a tailspin.

Bonners Ferry Educational Consultant Lon Woodbury, who publishes a directory of top therapeutic schools and treatment programs in the nation, said he's never seen schools close this abruptly on this scale.

"I had no idea that it was this bad," Woodbury said.

CEDU had operated Ascent, Northwest Academy, Boulder Creek Academy and Milestones in Idaho. Milestones is in Coeur d'Alene, and the other schools are located in Boundary County. CEDU has a small office in Sandpoint and closed Rocky Mountain Academy in mid-February, saying it could no longer attract quality staff and therefore could not attract students.

"Crazy things from the top" and changes in decision makers --some who lost their jobs for no outwardly apparent reason, hinted at trouble, but the schools maintained excellent reputations, said Woodbury. The unsettlement at the top did make some consultants uncomfortable referring youth to CEDU schools for treatment. Woodbury said he told parents about the changes, but also that CEDU schools had great reputations.

Some disagreed with hiring people in top CEDU positions with financial, rather than program backgrounds, said Woodbury. For example, current CEDU Chief Executive Officer Pete Talbott has a background in many organizations, many of them banking institutions, according to articles on Woodbury's Web site, struggling teens.com. Talbott replaced Naples, who also had a financial background, he said.

"I think the problem that occurred here is the financial people got ahold of the school and they were far away from the program," he said. "I don't know of any of the schools in any network that have that kind of thing."  For example, Aspen Education Group, which provides educational and treatment programs for pre-teens, adolescents, young adults, has program people making decisions, he said.

[Liz says: in well-run private, not-for-profit schools, the ultimate fiduciary responsibility resides in the board of directors (or trustees -- there are different names for the same function).  The headmaster should not be in charge of ultimate financial decisions, such as closing the school.]

"I don't think they (CEDU) allowed the program people enough say," he said.  "People gave them the benefit of the doubt because they've been around for so long."

Woodbury said he'd heard McCown and De Leeuw, the investment firm that owns CEDU, had to keep investors happy. After all, the academies are a business, he said.

CEDU employees heard they would not get payroll on Thursday and learned on Friday after 3 p.m. that CEDU was closing down all its schools.  The news shocked both employees, Woodbury and other experts.

The schools had an adequate number enrolled and the programs seemed to be running fine, he said.  The closure is not an indicator that the industry is failing, experts say.

"I think you can say it's growing," said Woodbury, whose directory has grown from a thin notebook-like handout in the early 1990s to a hardbound and detailed publication in recent years.

New schools start frequently, he said, and they offer incredible variety.  "We've grown and it's a reflection of the industry," said Woodbury.

I still don't understand why reputable, long-established academic schools, both day and boarding, are not-for-profit, but the "therapeutic" educational field is almost 100% for-profit.   I haven't yet stumbled across a good explanation, or even much awareness on the part of "educational consultants" that there's a risk in the for-profit model.

CEDU Posts

• Former CEDU Schools Reborn January 5 2007
• Update on CEDU Schools October 28 2005
• CEDU Properties Sold August 18 2005
• The Business of Troubled Teens August 18 2005
•  CEDU Closing: Buildings and Contents to be Sold May 8 2005
• CEDU Closing: On Edison Schools April 30 2005
• CEDU Closing: Pete Talbott's Resume April 27 2005
• CEDU Closing: McCown DeLeeuw Sued ByEmployees April 14 2005
• CEDU Closing: George Locker's Criticism of the CEDU Enterprise April 14 2005
• CEDU Closing: 1990 Snapshot of McCown DeLeeuw April 12 2005
• CEDU Closing: A Timeline of the CEDU Enterprise April 2005
• CEDU Closing: Letter from a Former Faculty Member April 2005
• CEDU Closing: Parents of CEDU Students Helping Economically Distressed Faculty April 7 2001
• CEDU Closing: Economic Impact on CEDU Employees Devastating April 7 2005
• CEDU Closing: 310 Employees Stiffed on Wages April  6 2005
• CEDU Closing: Who is To Blame? April 6 2005
• CEDU Closing: Running Springs Area Also Suffers Financial Impact April 6 2005
• CEDU Closing: An Alumnus Pleads, "Save CEDU!" April 4 2005
• CEDU Closing:  A Parent's Response to CEDU's Closing April 3 2005
• CEDU Closing: Bankruptcy Trustee Slams Door Shut, Then Open April 3 2005
• CEDU Closing: Parents Out Prepaid Tuition, Employees Lose Retirement. McCown Deleeuw Still Solvent April 3 2005
• CEDU Closing: King George Stays Open as Head Thinks on Feet April 3 2005
• CEDU Closing Shocks Industry Reporter April 3 2005
• CEDU Closing: Parent Company, Brown, Negotiating in Bad Faith?  April 1 2005
• CEDU Closing: More Details March 29 2005
• CEDU Closing: Brown Schools, CEDU's Parent, Files for Bankruptcy March 29 2005
• CEDU Closing: Margurite Sallee, The Brown Schools, and McCown DeLeeuw March 27 2005
• CEDU Closing: All CEDU Schools Closing Immediately March 25 2005
• CEDU Closing: Rocky Mountain Academy Folds Abruptly February 12 2005

Related Posts:

• Debunking "Tough Love" Programs April 11 2006
• Advice for Parents Seeking a Therapeutic Program for Their Children January 21, 2006
• Why The "Troubled Teen" Industry is Booming January 2, 2006
• The Road To Whatever August 25 2005
• Nonpublic School Governance April 23 2005
• Why Parents Seek and Pay for Therapeutic Boarding Schools April 14 2005
• NYT Article on the Therapeutic School Industry April 13 2005
• Therapeutic Schools: What Happens to Poor Kids April 10 2005
• Thinking of Sending Your Kid to A "Tough Love" Program?  March 30 2005

Questions Parents Should Consider Before Placing A Child

• NonPublic Schools: Part I--Overview
• NonPublic Schools--Part II Evaluating Mission, Values, & Goodness of Fit for Your Child
• NonPublic Schools--Part III Faculty and Staff Qualifications
• NonPublic Schools--Part IV: Evaluating Academic Program
• NonPublic Schools:Part V--On Accreditation
• NonPublic Schools:Part VI--More Detail on Financial Issues: IRS Status