Jessup University Taps Big Law Restructuring Expert as General Counsel

ROCKLIN, Calif. – October 21, 2026 – In a move that signals the intensifying financial pressures facing private higher education, Jessup University has appointed Karol K. Denniston as its new vice president of legal and general counsel. Denniston, a nationally recognized attorney with over four decades of experience in municipal debt restructuring and higher education finance, transitions to the Rocklin-based institution from the international law firm Squire Patton Boggs, where she served as a Global Projects Partner and a member of the Global Board.

“Karol brings an extraordinary combination of legal expertise, strategic insight, and extensive experience working with higher education institutions,” said Jessup University President Dr. Meghan Simpkins in a statement. “Her ability to navigate complex challenges, build consensus, and develop creative solutions will be invaluable as we strengthen our institutional foundation and position Jessup for a thriving future.”

While the appointment of a new legal chief is standard corporate housekeeping for most universities, Denniston’s specific pedigree points to a much larger narrative. Named a Leading Lawyer in municipal restructuring by The Legal 500 for four consecutive years, her career has been defined by high-stakes financial triage, including complex municipal debt negotiations and infrastructure financing. Her arrival in the C-suite of a private Christian university highlights the existential financial battles currently being waged across the higher education sector, where institutions are increasingly fighting to stabilize their balance sheets and avoid closure.

Restructuring from Within: The Balance-Sheet Triage

The financial reality at the institution is stark, reflecting the precise type of distress that requires a restructuring specialist of Denniston’s caliber. According to recent financial disclosures, the university reported revenues of $61.8 million against expenses of $85.3 million for Fiscal Year 2025, indicating a substantial operating loss. Total liabilities reached $107 million, weighing heavily against $130 million in total assets.

At the center of the university's financial puzzle is approximately $64 million in outstanding municipal bonds. The strain of these obligations became acutely visible in August 2026, when the university disclosed its inability to make a scheduled debt payment, following a previously missed payment in August 2025 that was ultimately cured. Furthermore, the institution has disclosed covenant breaches related to its debt service coverage ratio (DSCR) and days cash on hand for the 2025 fiscal year. These metrics are critical indicators monitored by bondholders and credit rating agencies to assess an entity's ability to service its debt from operating income.

The university's recent acquisition of Multnomah University in Portland, Oregon, adds another layer of complexity to its financial restructuring. While the merger brought in valuable real estate and assets worth $30.4 million for a cost of $7.7 million, auditors noted that without Multnomah’s assets, the acquiring institution would have incurred a nearly $11 million loss in the 2023-2024 fiscal year. Subsequently, in June 2024, a $15 million loan was taken out against the Multnomah property. Navigating the integration of these assets while managing the associated debt leverage will be a primary focus for the new general counsel.

From Global Board to Campus C-Suite

Denniston is no stranger to the university's specific financial architecture. Prior to accepting the full-time executive role, she spent the last two and a half years working closely with the university's leadership and Board of Trustees as external counsel, directly advising on restructuring existing bond obligations and negotiating complex financial agreements.

“I am thrilled to join Jessup and look forward to supporting the university as it responds to the many challenges facing higher education,” Denniston said regarding her appointment. “Jessup is a special university and I’m excited about the opportunity to continue to work with the Executive Management Team and the Board of Trustees.”

The decision to bring a high-priced Big Law partner in-house is a calculated strategic pivot. For an institution facing persistent covenant breaches and liquidity challenges, having a restructuring heavyweight on the executive team ensures that legal and financial risk management is integrated into daily operational decisions. It also signals to bondholders, creditors, and rating agencies that the university is taking its debt obligations seriously and is committed to finding sustainable, legally sound pathways to financial health.

A Sector-Wide Reckoning for Small Colleges

The maneuvers in Rocklin are a microcosm of a much broader, systemic crisis gripping American higher education. Over 130 private nonprofit colleges and universities announced closures or mergers between 2020 and 2025, impacting hundreds of thousands of students. Market analysts project that nearly a quarter of private, nonprofit colleges could face closure within the next decade.

Faith-based and small private colleges are particularly vulnerable to this macroeconomic storm. These institutions rely heavily on tuition revenue, making them acutely sensitive to the looming demographic cliff—a projected steep decline in the number of traditional high school graduates. Combined with inflationary pressures, rising labor costs, and an unpredictable federal student aid environment, the financial models that sustained these colleges for decades are breaking down.

In California alone, the pressures have forced the permanent closures of several small Christian colleges, with administrators citing the unsustainable expense of operating in the state alongside declining enrollment. The municipal bond market has reacted accordingly. One senior municipal bond researcher tracking the higher education sector noted that the current environment is highly volatile, suggesting that the recent spate of defaults and closures is merely the beginning of a broader wave of capitulation among heavily leveraged schools.

New Leadership and the Bridge to Sustainability

Despite the formidable headwinds, the university is actively executing a survival strategy. Denniston’s appointment coincides with a broader leadership and governance overhaul spearheaded by Dr. Simpkins, who officially began her tenure as president in July 2026.

The Board of Trustees has been reconfigured, with Rachael Gelsinger—daughter-in-law of former Intel CEO Patrick Gelsinger—stepping in as the new chair. The Gelsinger family has played a crucial role in providing immediate liquidity; in July 2026, Patrick Gelsinger and his wife provided a $2 million loan bearing a 5.5 percent interest rate to help the university address operating losses and facilitate ongoing financial restructuring.

Simultaneously, the institution launched its “Bridge to Sustainability” campaign, securing over $6 million to support enrollment initiatives and operational improvements. While board leadership has publicly stated that the university is on firmer footing today than it was a year ago, they acknowledge that significant work remains to align current financial operations with long-term strength.

With a new president charting the academic vision, a restructured board overseeing governance, and a veteran municipal debt attorney managing the liabilities, the institution is assembling the necessary machinery to navigate its fiscal crisis. Whether these bold strategic realignments can successfully outmaneuver the unforgiving macroeconomic forces reshaping higher education remains to be seen, but the appointment of Karol K. Denniston ensures that the university is armed with top-tier legal expertise for the battles ahead.