By Paul Campos / Lawyers, Guns & Money/ Dec 12,  2013

The new dean at TJSL has apparently been brought in to clean up the mess created by his predecessor, and he’s not being too shy about the fact:

I do not know how Thomas Jefferson became the whipping boy for critics of legal education. We must, however, be honest with ourselves; many of our troubles are the result of our own missteps, our own failure to plan, and our own failure to address problems in a timely fashion. My immediate plan and promise to you is that we will take aggressive and transparent action to confront these challenges. Since July 1, we have taken what I think are positive, though at times painful, steps to address the most critical challenges, whether self-imposed or systemic. Let me give you three examples.

First, while a general decline in enrollment is a systemic problem, we did not help the situation by allowing an unsustainable growth in the administrative structure of the school or building a facility as grand as ours. But, as you may have seen in press reports, the law school made severe cuts to its budget in response to the nationwide decline in applications. The reports did not paint the full nature of those cuts. For fiscal year 2014, the law school made cuts, totaling $4,798,081. Among other things, we layed-off 12 staff members, eliminated many more unfilled open positions, cut staff salaries by a minimum of 5%, cut faculty salaries by a minimum of 8%. In spite of these cuts, I am proud to say that 100% of the faculty contributed to this year’s annual fund.

Skimming TJSL’s tax filings for FY2012, it appears the new dean has cut the school’s operating budget by nearly 10%. As of 18 months ago TJSL’s balance sheet looked pretty shaky: the school appears to be almost 100% dependent on tuition, with a bit of rental income thrown in (if it has an endowment I can’t find it in its financials).

The school’s only significant asset is an extremely expensive and very heavily leveraged new law building: the institution’s net worth, as of 18 months ago, was equivalent to about five months of its current operating costs. Its bonds have been downgraded to junk status. (Per S&P, “management does not anticipate meeting the [school’s] financial covenants until 2018.”)

Even by today’s grisly standards, employment outcomes for TJSL grads are almost unbelievably bad: a glance at its NALP report suggests that perhaps a quarter of the 2012 graduating class got real legal jobs, very loosely defined (21 of 260 graduates were reported to be making salaries of $56,750 or more nine months after graduation). Almost all these jobs were with tiny law firms (ten or fewer attorneys); only seven graduates got government positions, four as PDs and three as DAs. More than a third of the class was simply unemployed nine months after graduation.

TJSL doesn’t give out much in the way of tuition discounts, with the average student paying around 85% of the school’s $47,300 nominal sticker price (current nine-month cost of attendance is estimated at $72,000 by the school). If you include accrued interest the 98% of the 2012 graduating class with law school debt had just under $200,000 in such debt. This doesn’t include undergraduate debt (Again, the federal government will loan $216,000 over three years to anyone TJSL chooses to admit, assuming that person has not already defaulted on other loans.)

Obviously, even the most mild reform in the absurd process by which higher education in general, and post-graduate education in particular, is funded in America would put TJSL out of business immediately. (The school’s enrollment is shrinking very rapidly, with the last three first year classes featuring 440, 387, and 265 students respectively, despite moving to a quasi-open enrollment policy. While the school traditionally admitted about 45% of applicants, that number was up to 73% in 2012. And since a very large number of TJSL students transfer or flunk out after their first year, graduating classes tend to be only about two thirds the size of entering classes). Even without any reform, it may well be the first ABA law school to keel over, in which case the votaries of “the market” will undoubtedly celebrate another triumph of their mysterious god.