TRANSFER STUDENTS: More than 300 students were left in the lurch after the Sawyer School shut down suddenly in December. Some students, including McKayla Ivins and Daniel Johnson, pictured above, transferred to Lincoln Technical Institute.
Why the Sawyer School closed without notice at the end of December remains a mystery three months later to the state and 302 Rhode Island students who have been left to find new schools or career paths.
The few details that have emerged since hint at hidden financial issues, including $800,000 in owed federal taxes and a steep drop in federal student aid, from $7.4 million received for the 2011-2012 school year to $2.3 million for the 2012-2013 year, according to the U.S. Department of Education.
When the Sawyer School closed its Rhode Island and Connecticut campuses without warning, it was also appealing a $1.4 million judgment against it by DOE concerning problems with its management of federal financial aid.
While that potential liability was known to the state prior to the school closing, it was not enough to raise red flags about the school’s finances, said Mike Trainor, spokesman for the R.I. Office of Higher Education.
When state officials last August and September reviewed the school’s annual financial audit, the New York firm that did the audit determined the disputed money was not a “likely liability,” according to Trainor. And even if it did wind up having to pay DOE the $1.4 million, the state review at the time determined the school was in a strong enough financial position to easily absorb it, he said.
State and federal authorities have said little about pending investigations.
The R.I. State Police Financial Crimes Unit is reviewing financial, student and other documents, said state police spokesman Maj. Michael Winquist.
The Federal Bureau of Investigation was investigating Sawyer School after it shut down, Trainor said, but the agency would neither confirm nor deny an investigation last week.
For the 302 Rhode Island students and the estimated 1,200 students in Connecticut left in the lurch when schools operated by Academic Enterprises Inc. abruptly closed, solving the mystery of what happened is for investigators, and state and federal officials. Many of the former students have been busy rethinking and restarting their educational and career plans.