Sonja Haller

The Republic | azcentral.com

Gilbert lobbied for the university for five year before it opened in October last year

Mayor John Lewis called the campus closing a 'disappointment'

Saint Xavier University, the Chicago-area-based Catholic school heralded as Gilbert’s partner in economic development and a “blessing,” has announced it is closing less than a year after it opened.​

Gilbert spent tens of millions of tax dollars to build a downtown campus for the school, but Saint Xavier University officials cited uncertain future funding in the school's home state for the decision.

"We are going through some challenges with the Illinois state budget and there is such uncertainty with what would happen in 2017," said Karla Thomas, the university's executive director of media relations. "Handling the challenge in Illinois makes it difficult and to handle a startup in Gilbert makes it more so."

The town invested about $37 million in the satellite campus that opened in the Heritage District in August 2015. The university will close after fall classes this year.

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School leaders planned to meet with students Tuesday and Wednesday to discuss their options. School officials hoped to enroll 75 students in the first year and up to 550 full-time students by its sixth year.

Student and Gilbert resident Ryan Schulte, 31, said a school official encouraged him to continue with the online program, which will remain available to Gilbert campus students.

But Schulte, who is pursuing a Master of Business Administration in health care, said he chose the new campus because it was Catholic, convenient, had a good reputation and could provide an on-campus education.

"Going to the campus and speaking with professors and other students is what I wanted and what I needed," he said.

Schulte, who runs a medical consulting business and handles business development for a psychiatric center in Chandler, added that his economics class had only one other student. Still, he found the instructors knowledgeable and full of real-world experience.

Schulte said he probably will drop a summer class he planned to take because he hasn't researched other college options and is uncertain whether credits will transfer.

"I don't think it will help me," he said. "Why take a class that in the end may not go toward the end goal of an MBA degree?"

PREVIOUSLY: Why Saint Xavier is enrolling poor, minority students

What became the 87,000-square-foot, four-story college campus in downtown Gilbert began with discussions between town and university officials five years ago.

The university was founded in 1846 by the Sisters of Mercy. Its online graduate nursing program was ranked No. 1 in the nation by U.S. News and World Report in 2014, and its business school also captured national attention. Town officials entered into an agreement with the university requiring that the campus offer degrees in nursing, business and education and grow annual enrollment.

Under the terms of a 15-year lease, the university must pay $250,000 in damages if it does not fulfill the contract.

The lease also requires the university to pay rent to the end of the agreement, or for at least six years, according to the town.

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The lease payments were to cover the cost of the campus construction paid through revenue bonds.

The town took out $37 million in bonds for the design and construction of the campus, and the building was leased under a lease-purchase agreement.

Gilbert Mayor John Lewis lauded the campus in his final state of the town address in February. He said it was “helping transform the face of our Heritage District.”

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Two years earlier, during a ceremony to announce the renaming of Vaughn Avenue west of Gilbert Road in front of the campus to “Saint Xavier Way,” he called the university not only a partner but “family” and a “blessing.”

On Tuesday, Lewis said in a statement: "The town of Gilbert is of course disappointed with Saint Xavier University’s decision with respect to its campus in downtown Gilbert. After discussions and negotiations beginning in 2011, the town and the university entered into a development agreement and 15-year lease in 2015. Saint Xavier’s expressed intentions will be considered by the town and the town will continue to focus its efforts on bringing expanded higher education opportunities to Gilbert."

Saint Xavier was expected to boost the town’s economy by about $282 million over its first 10 years, according to a town-funded study by Phoenix-based research firm Applied Economics.

The study suggested Gilbert would receive about $113,000 in sales-tax revenue from transactions made at the university over the next 10 years.

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