Like many an ambitious institution, Taylor University had grand plans when it took over struggling Summit Christian College's campus in Fort Wayne, Ind., in 1992. Taylor, an evangelical institution in Upland, Ind., had its sights set on creating an outpost in the state's second largest city, 50-odd miles away, and it poured millions of dollars into building an undergraduate program as well as M.B.A. and online programs there.

But after 16 years in which Taylor subsidized the Fort Wayne campus to the tune of an average of $1 million a year, the university announced Monday that its Board of Trustees had voted to close the campus's traditional undergraduate program after this year, while sustaining the M.B.A. and online programs. More than 300 students, 40 faculty members and nearly 90 staff members will be affected.

At a time when the national economic picture is ugly, it'd be logical to read the Taylor situation as an example of another institution affected by the downturn. But it would be wrong, too, except in the broadest terms, said Eugene B. Habecker, the university's president.

"It would be unfair to say that [the national economic picture] had no influence whatsoever," Habecker said of the board's decision. "But if you start with the reality that we don't have a viable business strategy in place, that alone was enough. Then when you look at the external reality, and realize it would only get worse, that just exacerbated things."

The situation at Taylor is more about how an institution wrestles with what to do with a struggling campus or program than it is a story about the economic downturn. Taking over the campus that previously housed Fort Wayne Bible College and then Summit Christian made all the sense in the world to Taylor officials a decade and a half ago, given the "vision to have a place in a large metropolitian center" and the partnership with a "Christian college that shared our belief system and academic goals," said Jim Garringer, director of media relations at Taylor.

The university created a traditional undergraduate program that grew to 23 disciplines and established a successful master's in business and an online operation that has grown to 600 students. It also spent several million dollars on a new commons building, a new library and, just two years ago, a new residence hall.

But despite numerous attempts at new approaches and curriculums designed to attract students, enrollment fell by about 10 percent a year in the last several years, from a headcount of 587 five years ago to 429. The Fort Wayne campus, with an annual budget of about $12 million, has been a problem with which the trustees have been "wrestling ... for at least 10 years," said Habecker, who became Taylor's president four years ago.

He brought in as the campus's chancellor with a Ph.D. in management, Duane Kilty, and in June, after a board meeting, they hired Noel-Levitz to help Taylor try to identify a "more vibrant business strategy" that would provide a path to sustainability for the Fort Wayne campus. "But the long and the short of it is that [the plan] came nowhere close to providing the kind of financial robustness we had been anticipating," said Habecker. "We still don't have a viable business model."

At its October meeting, the board debated (and prayed over, Habecker said) its various alternatives, given the substantial investments it had made in the Fort Wayne campus and the painful impact shuttering the undergraduate program was sure to have on the dozens of faculty and staff members and the hundreds of students. "That's why we tried to keep it going as long as we could," said Habecker.

But a $1 million a year subsidy for a program with declining enrollments and no viable business plan is a luxury that few institutions with an endowment the size of Taylor's ($76 million in 2007) can afford in the best of economic times, which these most definitely aren't.

So now Taylor officials are focusing on helping students try to transfer to the university's main campus or to other institutions and helping faculty and staff members land on their feet. They plan to sustain the M.B.A. program (which is jointly sponsored in Fort Wayne and Indianapolis), the online operations, and the Christian radio ministry that has its headquarters on the Fort Wayne campus.