Panel Upgrades USIU’s Academic Rating to ‘Probation’ : Education: The previous ‘show-cause’ rating had threatened the financially strapped university with loss of accreditation.

The academic status of beleaguered United States International University has been upgraded to “probation” by the federally sanctioned accrediting body for California institutions.

The Accrediting Commission for four-year institutions of the Western Assn. of Schools and Colleges moved the university from its previous, more serious category of “show-cause.” That rating, pending since June, 1989, threatened USIU with loss of accreditation without major changes in its academic and financial positions.

Without official accreditation, USIU would not qualify for federal student loans for scholarships, and its academic degrees would have less value to employers or to other schools considering transfer students from the university.

The WASC, in a statement Monday, praised USIU for correcting several deficiencies in meeting association standards, and in particular noted the university’s successful completion of a financial reorganization.

The university is nearing final court approval of a proposed two-year plan to take it out of bankruptcy and put the campus back on its feet financially and academically. The university filed for bankruptcy in December, 1990, after finding no alternative after its many years of spending more than it took in through tuition.

The accrediting commission praised acting USIU President Kenneth McLennan “for his extraordinary leadership of the university since the beginning of 1990.” McLennan, a retired Marine general, replaced USIU’s iconoclastic founder, William Rust, who was forcibly retired from control of the school in early 1990.

Rust had a vision of an international school which, although carried out in some ways--such as attracting an internationally diverse group of students--left USIU short of funds by not providing for a permanent endowment nor for standard academic checks and balances such as tenure and regular peer review.

The commission added Monday that the reorganization plan “holds the promise that the university will have the financial resources to remain an accredited institution.” The plan does not affect separate campuses in Mexico City and Nairobi, Kenya, which are not under the bankruptcy filing.

The commission warned, however, that probation remains a serious category and said the university still needs to show improvements in its doctoral level instruction, in the number of full-time professors, in its library resources, in overall academic program quality, and in better long-range academic planning and establishment of priorities.

McLennan expressed pleasure Monday with the commission’s upgrading. He promised that USIU will address specific concerns during the coming academic year. The commission will again review the university’s status in February.

The 38-year-old university expects final approval of its bankruptcy plan from the federal bankruptcy court in late August, after which it would sell its London campus as well as undeveloped property on its main Scripps Ranch campus in order to raise money to pay a debt estimated at $14 million to $25 million.

The university has operated in the black since its bankruptcy filing. It slashed monthly expenses by $403,000 through suspension of its intercollegiate athletic program and several fine arts majors, as well as by laying off 64 employees. It now has 2,070 students, 56% of them in graduate programs.