Evangel cuts 40 positions, part of effort to reduce spending by $10M

Michael Kolstad: Losing staff positions needed but “breaks your heart.”

Evangel University has eliminated 40 positions – 13% of its faculty and staff – as part of an ongoing effort to cut at least $10 million in operating expenses by the end of the next fiscal year. 

Most of 24 staff positions were cut by layoff, or not renewing annual contracts, while most of the 16 faculty positions were dropped through attrition, or not filling jobs vacated by retirements and resignations. 

The cost cuts are far-reaching going into the upcoming year from restructuring its online program and reducing athletic scholarships to bumping up class sizes and dropping automatic tuition breaks for employees’ children. 

President Mike Rakes, ending his fourth year at the helm, said Evangel has overcome challenges but still faces compounding economic and operational pressures. 

“When I came in, Evangel was, just like it had been since 2008, always in the red, always fighting for the big donation to see them through,” he said, in an interview with Springfield Business Journal in May. 

He added: “I knew coming in what we were facing. How much is spent has always been more than we charge students.” 

Evangel reported a fall headcount of 2,741 students, an increase of 4.6% over the prior year. The estimated tuition and fees for the 2026-27 year are nearly $32,000. 

Rakes said the goal of the changes is for Evangel to operate “completely in the black” by July 2027. 

Barbara Gellman-Danley, president of the Higher Learning Commission, said higher education as an industry is in a precarious spot, and private campuses, like Evangel, have it tougher than most because they cannot access local and state funding. The HLC accredits Evangel, Missouri State University and many other institutions.  

“In most cases, unless they’re really doing something off, the public institutions have backups, they have protections,” she said. “The private institutions have tuition that they’re dependent on.” 

Gellman-Danley said public scrutiny, competition and faculty and staff turnover is ramping up amid political and global pressures, disruptions in the state and federal funding streams and the arrival of the “demographic cliff” – a sharp decline in the number of college-age students due to declining birth rates since the Great Recession.  

“It’s an inflection point because you have [college] presidents turning over more often, a lot of federal and state changes that are impacting higher education, a lot of burnout from students,” she said. “I’m not sure it wasn’t there before, but we are hearing about it now.” 

More than a decade ago, Evangel landed on a federal watch list of institutions with shaky financial stability, which was created by the U.S. Department of Education. Evangel has been subject to additional oversight called “heightened cash monitoring” since 2015. 

“I can’t speak about individual institutions, so I’ll say, in general, what that means is we found out you can’t pay your payroll. Well, if you can’t pay your payroll, you probably are having problems delivering your services to students,” Gellman-Danley said, adding: “It’s not a sanction, it’s public transparency.” 

There is no indication Evangel has ever failed to meet payroll, but university officials confirmed there is a need to have more money on hand to cover day-to-day expenses. 

“They’re wanting us to have more cash in the bank,” Rakes said of the USDE. “Our cash flow is what we’re wanting to increase by July of 2027.” 

The university has shown progress, according to the federal database, but remains on the watch list. 

Fixing the issues 
Michael Kolstad, Evangel’s executive vice president and chief of staff, said federal relief aid during and after the pandemic allowed colleges to postpone tough decisions.  

He said campuses are fighting over a smaller pool of students, dealing with increased costs, and trying to respond to public questions about whether higher education is “worth it.” 

“We’re all in the same boat,” he said. “It’s just really forcing us to get our houses in order.” 

Rakes said when he arrived there was a “structural deficit” in how Evangel operated with little margin for error. The first step was to track all the money coming in and going out. 

“In the discovery phase, we were like ‘OK, where is the hole in the bucket? Where is the problem?” he said. 

The discussion phase that followed explored short-term and long-term options. “Rather than try to Band-Aid it, we needed to fix it,” he said. 

Tough budget cuts started in earnest this spring and will continue through the coming school year. 

Kolstad said Evangel is in no danger of closing its doors and the belt-tightening will put the campus in a stronger position for whatever challenges are coming. 

“We’ve got to make these decisions now before it really does get desperate. Evangel is in a good place, even though sometimes from the outside it may not look like we are,” he said. “It’s just that we’re having to make some really hard decisions now for the future.” 

Despite the difficulties at hand, there have been bright spots. Evangel’s fall headcount has grown steadily in recent years and deposits for the coming year are outpacing this time last year.  

Rakes has helped raise more than $134 million in donations and grants during his first four years to grow scholarships, strengthen the endowment, and build or rejuvenate facilities – all of which help recruit students.  

Flood Hall, a new student dormitory, is scheduled to be done in June. 

He said one-time funds cannot be used to cover ongoing expenses. 

“People care about certain projects,” he said. “They don’t want to help pay your bills.” 

Eliminating 40 positions 
Evangel said it had 105 faculty and 200 staff positions this past year. Personnel make up roughly 80% of most higher education budgets, including Evangel’s $53 million spending play for FY26, and so reducing positions was needed to save money, Kolstad said. 

“You just hate it, especially for the people who have been impacted … it just breaks your heart,” he said. “But at the end of the day, it’s what can we do to make Evangel be here for the next generation because we believe missionally, we still have a lot of work to do.” 

He said Evangel employed an estimated 200 staff positions this year and 24 were cut – seven through attrition, meaning either resignation or retirement – and the other 17 were not offered a contract for the 2026-27 year. 

Of 105 faculty members, 16 positions were cut across campus. 

Evangel reported to the federal government that its average salaries for instructional staff in 2024-25 were $48,805. 

Paul Lewis, a faculty member who was not offered a contract for the 2026-27 year, said he worries about the institution’s growing reliance on adjunct instructors. 

“My concern is that the quality of the education will not be there,” said Lewis, professor of historical theology and intercultural studies at the embedded seminary. “My hope is that they will try to keep the quality up.” 

Another shift was restructuring the College of Online Learning. Kolstad said online options will now be fully integrated into traditional academic areas to give students more flexibility. 

“Prior, you were either in an all-seated or an all-online program, but we didn’t have a lot of offerings that allowed a seated student to take some online classes and vice-versa,” he said. 

Kolstad said that change, which involved cutting two jobs, reduced redundancy and will save money. He said most staff cuts are done at this point. 

“We’ve about landed this part of the plane and can start moving forward,” Kolstad said. “If we have to start making adjustments – did we cut too deep, did we not cut deep enough – we can have those types of conversations over the next few months.” 

Rakes said a smaller faculty means the average class size will go up slightly and most professors will have a higher teaching load.  

Kolstad said by the end of FY27, Evangel wants to “cut $10 to $12 million” to be leaner and nimbler. He said the current operating budget is $42 million.  

“We’re also evaluating how we do things,” he said.  

Cutting popular benefit 
Two months ago, Evangel dropped automatic tuition breaks for students who are the children of faculty and staff. The benefit was available to all employees, but the level of discount – up to 90% – was based on length of service.  

A review of benchmark institutions showed Evangel set up the perk differently. Many other institutions required students to fill out a Free Application for Federal Student Aid, known as a FAFSA, and other financial aid forms to see if they qualified for state subsidies or federal grants. 

Rakes said Evangel provided the benefit upfront before FAFSA or scholarships and so the annual cost to the university was more than $1 million a year. He said typically, up to 10 students a year – or 40 at any given time – benefitted from the perk. 

Rakes said faculty members were “devastated” by the decision and acknowledged the rollout was not handled properly. 

“They felt disrespected,” he said. 

He said all tuition discounts, including breaks for partners like Convoy of Hope employees, were reviewed and most remain in place.  

“Evangel is restructuring how that support is delivered so it fits within a more sustainable, consistent and transparent tuition discounting system,” he said. “This allows us to honor our employees, care for our families and at the same time manage the university’s financial model with greater clarity and long-term responsibility.” 

Rakes said the university is exploring the creation of a scholarship fund that will help offset tuition costs not covered by federal aid or scholarships. 

He said the university’s Board of Trustees plans to discuss the option, to help employees receive the highest tuition discount possible, during its biannual meeting Oct. 13-14. Anything finalized at that time will be widely shared with the campus.  

Scrutinizing 70 majors 
In the coming year, Evangel will scrutinize its 70 majors to identify the ones that are growing. Majors, especially those with fewer than 10 students annually, may be cut or merged. 

Kolstad offered an example. He said there are hardly any math majors, but there are quite a few majoring in math education, and the paths are closely aligned.  

“You can sometimes get students to move over,” he said. 

Gellman-Danley, of the Higher Learning Commission, said institutions that thrive in a difficult landscape tend to invest in programs that set them apart. 

“If something is a fad that comes along, you have to really consider if it’s right for your institution,” she said. “Just focus, figure out what you can be really strong at, build on that.” 

Rakes said only 17% of Evangel graduates are going into ministry or “compassion work” such as missionary, church or nonprofit jobs.  

Evangel’s top five traditional undergraduate programs include healthcare and nursing, business management, biology on the pre-med track, psychology and elementary education. 

Rakes said survival requires taking a hard look at what employers want and offering a practical, consumer-focused approach within a faith-driven institution. 

“A lot of institutions, especially Christian institutions, are more worried about preserving what they have rather than getting kids ready for the marketplace. Our job is to get kids ready for the marketplace,” he said. “Yes, we want them to have the Evangel ethos, and they’ll get that, but we’re getting them ready.”