Kentucky State University projects a steep enrollment decline after a new state law forces the institution to disenroll students who owe the university money for extended periods. The university estimates spring enrollment will drop about 20%, citing Senate Bill 185 among multiple contributing factors. SB 185 gives the state significant financial control of the historically Black university and requires it to meet a minimum enrollment target while maintaining employee levels during a period of financial exigency. The law also constrains the number of academic areas the institution can offer, limiting offerings to more than a threshold number of fields with some exceptions. While Kentucky State says the law’s funding support is unprecedented and expects it will help with future stabilization—potentially as part of a transformation into a polytechnic institution—the immediate student-impact mechanism is the disenrollment rule. That means financial holds and repayment requirements can directly affect enrollment counts, persistence, and revenue. The development underscores how state governance and financial compliance requirements can rapidly reshape student enrollment outcomes, requiring institutions to redesign billing communications, payment plans, and persistence strategies to prevent avoidable loss of enrolled students.