Oldest US boarding school, Maryland’s West Nottingham Academy, has plan to emerge from bankruptcy
West Nottingham Academy, the Cecil County boarding school that is the nation’s oldest, has a court-approved plan to emerge from bankruptcy.
The school, founded in 1744, filed for Chapter 11 bankruptcy protection last year, the culmination of years of financial distress that threatened to shutter the campus and led to a sudden change in ownership that alarmed some alumni.
West Nottingham received approval last month for a plan to pay off about $7 million in debts, which will take about five or six years, said Kiran Kulkarni, the Toronto-based businessman who took over the school last year.
“We put together a seven-year business plan,” Kulkarni said. “It’s doable.”
Kulkarni, his brother and an associate took over West Nottingham’s Board of Trustees in February 2023, after years in which revenues and donations had fallen and previous school leaders years had sought to sell the school.
It took a particularly hard hit during the COVID pandemic, experiencing a drop in international enrollments due to travel restrictions and the shutting of embassies, which conduct the interviews necessary to receive F-1 student visas. About 40% of the school’s roughly 85 students are from abroad, Kulkarni said.
Filings in U.S. Bankruptcy Court in Baltimore detail the dire straits West Nottingham was in.
“In early 2023, all restricted endowment funds had been drawn down and donations had run completely dry,” according to one filing. “By early February 2023, the Debtor had no funds to feed students, pay salaries, or pay utility bills to warm the dormitories and keep the lights on.”
The Kulkarni family’s charitable foundation, Casa Laxmi, and a related entity provided $854,000 to keep the school open for the remainder of the year, according to the document.
Casa Laxmi has committed $2 million that, along with tuition payments, will keep the school operating and on schedule resolving its debt, Kulkarni said
The school has raised its tuition, tightened its standards for scholarships and streamlined business operations, he said. According to the school’s website, tuition ranges from about $18,000 for day students to $73,000 for international boarding students.
Kulkarni said he hopes to increase enrollment and eventually add lower grades to the school, which currently offers 9th through 12th grades.
With its finances more stable, Kulkarni said the school can focus on “transforming” education. “How do we become unique?” he said. West Nottingham has been integrating artificial intelligence into every facet of the school, for example, as part of an effort to distinguish itself, he said.
“Our integration of AI represents a progressive approach to education that aligns with our mission to nurture intellectually curious and globally minded individuals,” Sandra D. Wirth, the head of the school, said in a statement.
Kulkarni said the approval of the bankruptcy plan will allow the school to address its delinquency in registering as a charity with the Maryland Secretary of State and filing its IRS Form 990 for a tax-exempt organization. The last document filed with the state was for year 2020, and the last with the IRS was for the fiscal year that ended in June 2021.
“The biggest challenge,” he said, “was nothing was up to date in the books.”