AveWatch is reporting an interesting article from the Chronicle of Higher Education which lists Ave Maria School of Law as a private institution which has failed the U.S. Department of Education's financial-responsibility test. I'm not a subscriber to the Chronicle, so does anyone have any insight as to how the test is calculated and what that means for Ave Maria Law School? (The schools listed with AMSL at AveWatch don't inspire much confidence. I don't see any law schools, and is AMSL really comparable in financial responsibility to the "Acupuncture and Integrative Medicine College" in Berkeley, California? Yikes.)

UPDATE: All 114 schools which failed the test are listed here. AMSL is at the bottom, the 6th worst out of the 114. Ouch. An explanatory note from the site:

All private colleges that award federal student aid must participate in the Department of Education's financial-responsibility test, which is based on information from their audited financial statements. The department develops a composite score on a scale of 3.0 to minus 1.0, based on financial ratios that measure factors such as net worth, operating losses, and the relationship of assets to liabilities. Institutions with scores of 1.5 to 3 pass. In addition to extra monitoring for all institutions that "fail," those with scores below 1.0 are required to post a letter of credit with the department equal to 10 percent of the federal student aid that goes to their students annually.

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