DBU announces plans to close; campus president blames Obama

DBU majority owner and President James R. Gessner said the Obama administration disliked private sector colleges and intentionally worked to put them out of business.

Duluth Business University will close after 126 years, which DBU said is a period of service longer than any other college or university in the Twin Ports.

The decision came seven months after the U.S. Department of Education stopped recognizing the Accrediting Council for Independent Colleges and Schools, which accredited DBU and 265 other colleges. The government's action came after allegations emerged nationwide that some for-profit colleges used predatory practices to recruit and provide loans to students who later found their certificates had little career value. DBU had the option of seeking oversight from a new accreditor, which it did, but during the months when its accreditation was uncertain, enrollment declined. Success under a new business plan was unlikely, said owner and President James R. Gessner, so DBU withdrew its application.

“We’ve seen months of declines in applications. Our leads went down, our student population went down and our revenue went down,” said Gessner, who had led the school for 52 years. “It got to the point where it was too late. There was no realistic reason to believe that anything we could do would change that trend.”

DBU had as many as 350 students in 16 programs and 80 employees when it built its 27,500 square-foot building in 2004. It now has 73 students in eight programs and a handful of staff. Forty-three students are in the veterinary technician program.

Gessner said DBU would begin working individually with all students to develop “teach out” plans to help them finish their educations, at DBU or elsewhere. The school offers diplomas for bachelor’s degrees and other programs that typically take nine months to four years to complete. Students will remain eligible for financial aid until June 2018, when the school expects to close for good. Its building and campus already are being listed for sale by Titanium Partners in Duluth.

“We have been trying to make it work, but some things are out of our control,” Gessner said in a news release, referring to the loss of ACICS, the former regulator. The federal withdrawal of recognition for ACICS was based on what he and other administrators believe was a preference by the Department of Education for non-profit colleges and universities versus for-profit schools like DBU. According to the ACICS website, more than 250 college campuses formerly overseen by ACICS have closed in the past 26 months, some immediately.

“Our goal is to get all of our students into the best situation possible,” Gessner said. “We don’t want to suddenly close and leave our students or our community that way. We’re doing everything we can to help our students.”

The school was founded in 1891 to teach shorthand, accounting and other office skills. It now offers programs in business administration, healthcare management, human services, massage therapy, medical assisting, veterinary technology and medical billing and coding.

“The majority of students who go to this school stay in this region,” Gessner said. “We will miss Duluth, and Duluth will miss DBU.”