The school closed for a period during the Great Depression. Alarmed at the increasing anti-Semitism and political suppression by the Nazi Party of Germany at the time of Kristallnacht, Quakers of Iowa proposed in 1939 to receive refugees from Germany and house them at the Scattergood School. From 1939 through 1943, they operated what they called the 'Scattergood Hostel,' accepting a total of 185 refugees and helping them to resettle in the United States. After 1943 refugees were unable to leave Germany.