College President Robin Baker planned to discuss the incident with the student body at the Christian college in Newburgh Wednesday.
"We are a faith community driven by the teachings of Christ," Baker told The (Portland) Oregonian. "We have to express love toward each other so it was a great disappointment that anything like this would happen."
The effigy was discovered Tuesday morning hanging by a strand of fishing line in the campus quad.
The newspaper said the effigy had a sign on it referring to "Act Six," a new campus program that offers scholarships to minority students.