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ASU Trustees Approve Operations Agreement for New Campus in Mexico

2 min read

The Arkansas State University Board of Trustees on Friday approved an updated 10-year collaboration agreement with a nonprofit partner of A-State that is building a $100 million, 800,000-SF campus in Queretaro, Mexico. It is set to open for classes in August.

A-State formed a partnership with Mexican businessman Ricardo Gonzalez and other investors to create the nonprofit, called Arkansas State University Campus Queretaro, or A-State CQ.

A-State System President Chuck Welch said in a news release that the new agreement outlines more specifics about the operations than the previous one signed in 2014, including length of the agreement, termination clauses, indemnity clauses and clarification language regarding ownership of curriculum and trademarks.

“As our legal counsel told us, this provides all the protections our university would want and assurances our partner would want,” Welch said in the release. “When the original agreement was written, we had not turned a single shovel of dirt. We developed an agreement about what could be, and now this is about what is.”

This will be the first American residential campus in Mexico and the first to award degrees recognized in both the United States and Mexico, A-State said.

Welch said cumulative revenue for the university could total $140 million over 20 years, assuming flat enrollment after 10 years. Projected annual revenue with 2,100 students is $1.39 million. With 5,100 students, it’s $8.87 million.

A-State trustees will approve tuition rates for students attending classes on the campus in Mexico, while the nonprofit will be responsible for all of the operational costs.

Payments to A-State, according to the release, will now be based on a commission rate with built-in inflation factors instead of the previously planned flat amount per student. Welch said the cumulative effect “is a tremendous increase in revenue potential for us” and does not change the timetable of payment.

The university also said state funds are not being used to build or operate the new campus. All of its startup personnel and travel costs are reimbursed with funds from private gifts.

Belinda Salazar, operations director for A-State CQ, said in the release that work on marketing plans continues with a large database of students who want to enroll. She said 10 buildings are under construction now, four residence hall buildings will be added next year, and a second academic building will be added in year three to support a projected 5,000 students.

Welch said the search for a chancellor is under way. Applications will be accepted through mid-April, and finalists will be brought to campus in May. The goal is to hire a chancellor by June 1.

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