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Grand Canyon University denied switch to nonprofit status

PHOENIX — Grand Canyon University will not be granted nonprofit status in Arizona, the school’s president told a gathering of students and faculty on Friday.

President Brian Mueller said the Higher Learning Commission shot down the school’s request in part because GCU intended to outsource some of its services, such as marketing.

Mueller said he was deeply puzzled by the commission’s decision and called it “disappointing.”

“This had the potential of a tremendously beneficial new era,” he said. “This is clearly where higher education is going in this country. There are a number of traditional non-profit universities that are outsourcing key administrative roles and that’s what we were proposing: An almost identical model.”

The school switched to a for-profit model in 2004 to pay off millions in debt. It began to mull a switch back to nonprofit status in October 2014.

A return to nonprofit status would mean more access to revenues streams for the school, including donations, grants and tax breaks.

Despite the commission’s decision, Mueller said he does not expect an increase in the school’s $17,000 tuition.

“The university would have benefited tremendously from this and we’re going to be harmed as a result of not getting it,” he said.

Mueller said GCU has not decided if it will appeal the decision.

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