New College’s main campus was housed in several buildings in the Mission District in San Francisco. The offices at 777 Valencia, and companion buildings across the street, were home to its Humanities-based programs, including the Humanities BA, Poetics, Writing and Consciousness, Media Studies, Graduate Psychology, Experimental Performance Institute, as well as a broadcast studio and administration offices. New College of California School of Law was located at 50 Fell Street. The North Bay Campus in Culture Ecology and Sustainable was housed in Santa Rosa, California, in a building owned by the Arlene Francis Foundation, a private foundation run by Peter Gabel, former president of New College and Arlene Francis's son. The Science Institute classes were held at the Southern California University of Health Sciences, 16200 E. Amber Valley Drive in Whittier, California, within of downtown Los Angeles.
New College was beset by controversies over the course of its history, mostly related to its governing structure. Through much of its 37-year history, the school was governed by a small group consisting of former Presidents Peter Gabel and Martin Hamilton, along with others in their inner circle. Faculty, staff, alumni and students were excluded from effective roles in governance. The Board of Trustees, which was populated by friends of the inner circle, failed to exercise adequate financial, administrative or academic oversight, thus giving the inner circle free rein to govern without accountability.
This concentration of power in the hands of a small group—characterized by the absence of democratic governing structures and the lack of effective oversight by the Board—was an important factor in WASC's decisions to impose sanctions on the college through much of the school’s history. WASC actions and criticism periodically resulted in short-lived reforms that were invariably dismantled by the administration after the accrediting agency eased its scrutiny—a pattern that was repeated several times during the school’s history. The pattern itself was criticized by WASC when it sanctioned the college in July 2007, months prior to the revocation of accreditation.
Throughout the college’s history, groups of faculty, students, alumni and staff mounted challenges to the school’s autocratic governance systems, but these efforts failed to achieve lasting change. Numerous campaigns by faculty groups seeking democratic reform, often based in specific academic programs, had no more than limited, short-term influence. Unionization by the staff and some faculty—initially by the college’s staff and the Law School core faculty in 1996, followed by the Humanities BA and Poetics MA faculties several years later—led to modest economic gains, but had no significant influence on college governance. Several waves of student organizing over the course of the college’s history, addressing a variety of issues at different times, were consistent in seeking a greater voice for students in college governance. Student efforts, which sometimes included complaints to WASC, were also unable to achieve lasting change.
When WASC imposed severe sanctions against the college in July 2007, the core faculty tried to move the school toward greater democracy and accountability by forming a college-wide Faculty Council, an effort that drew praise from the accrediting agency. WASC credited the Faculty Council and the school’s new academic leadership for making improvements in the academic affairs of the college. Adjunct faculty, students and alumni also formed new organizations seeking democratic change.
In the end, the school’s financial collapse undermined possibilities of democratic reform—and sealed the fate of the college. New College lost its accreditation in February 2008 and was declared “closed” by the Department of Education effective December 20, 2007.
During the week of July 16, 2007, New College held a school-wide faculty meeting. The full time faculty formed a Core Faculty Council which met and gave a vote of no-confidence in President Martin Hamilton. The part time faculty formed an Adjunct Faculty Council, and the students formed a Student Council. Alumni and alumnae decided to form an Independent Alumni/ae Association. On August 5, 2007, President Martin Hamilton resigned.
In August, 2007, Luis Molina, a former Board member with no other experience in leading educational institutions, was made Acting President of the college. Expectations that the Board would hire a new Interim President never materialized. Francisco Leite, a former university administrator from Brazil who Martin Hamilton met while contracting an exchange program with UNAES, became Chief Financial Officer. Though initially Martin Hamilton remained on the Board after he was forced to resign as President, he, along with Peter Gabel, was ultimately forced out. The interim administrators hired an educational consultant, whose efforts drew praise from the accrediting body and the faculty, to help bring the college into compliance with accreditation standards of WASC, the Western Association of Schools and Colleges .
In October 2007, without any notice, the administration stopped paying faculty and staff. Faculty continued teaching out the semester without pay. Law School faculty continued teaching through the spring semester based on false promises that pay would be forthcoming at the start of the semester. The College presently owes its faculty and staff millions of dollars in back pay. In July 2008, the college acknowledged its debts in agreements it signed to settle wage claim disputes filed with the Department of Industrial Relations. A number of creditors of the college have prevailed in lawsuits.
Accreditation was revoked in February 2008 by the Western Association of Schools and Colleges (WASC) for numerous violations, including lack of proper governing structure, failure to keep proper student records, and lack of oversight by the Board. . WASC is the accrediting body for colleges and universities in California. At the end of 2007, after discovering improprieties in the financial aid office, the Department of Education placed the college on "heightened cash monitoring" which meant that federal financial aid funds would only be dispersed after New College's paperwork passed a review. The financial aid staff hired by Molina and Leite were unable to fix the files, which were in complete disarray, to DOE standard, and DOE investigation also revealed that the school failed to keep required records and could not account for large amounts of federal financial aid funds. As a result, DOE revoked New College's eligibility to receive federal financial aid funds.