SCSU’s stability questioned as Elzey seeks financial bailout from state leaders

2014-03-06T05:00:00Z 2014-12-06T15:08:54Z SCSU’s stability questioned as Elzey seeks financial bailout from state leaders The Times and Democrat

As South Carolina State University President Thomas Elzey made his pitch for a state bailout Wednesday, he was questioned about whether he has the support needed to correct the institution’s financial problems.

S.C. State had 10 presidents in its first hundred years, Sen. John Courson said during a meeting of the Senate’s Higher Education Budget Subcommittee.

“For the last 10 years, I think we’ve had nine, including interim presidents, which indicates instability and disorder in the government component,” the Columbia Republican said.

This is something the General Assembly is concerned about, he said. “One would hope if you get it straight that you plan on staying there for a while.”

Courson, who chairs the subcommittee, showed his support for the university by giving Elzey a personal check for $1,000.

Elzey met with both the subcommittee and the State Budget and Control Board in his effort to find $13.6 million to pay the institution’s bills through June. He has reported that the university has some vendor bills past due for 90 days or more.

By April, services will be cut off in some areas and students will feel the pinch, he said.

Elzey told the Budget and Control Board, “Our situation is pretty difficult.

“If we do not receive some form of assistance in the next month or so, it will put us in a very difficult position.”

However, Elzey noted that funds are available for the payroll through June.

The best choice for the university would be an appropriation, he said. A loan would put the institution into a very precarious position and would have an impact on its accreditation through the Southern Association of Colleges and Schools.

If the assistance in either form is forthcoming, the university will be very transparent and will make timely reports on the funds, Elzey said.

“We will let you know if there is a problem,” he said.

Elzey also promised legislators a balanced budget for 2014-15.

“Next year, we will operate on what we take in,” he said.

Gov. Nikki Haley said that poor financial decisions by the university cannot continue.

“We have to make sure whatever we do, we don’t fall into that same trap again,” she said. “We can’t paint over it and say, ‘Oh, if we get this money it’ll fix everything.’ I don’t think that’s the case.”

Comptroller Richard Eckstrom suggested bringing the university under the state’s accountability system. He also said that the question of assisting the university must be decided by the legislature.

Elzey, who took over leadership of the university on June 15, said he agreed with Haley that some very poor choices were made in the past.

“When I walked in the door, I found there were a huge amount of things that were kept under the table,” he said.

The university’s financial problems came about for various reasons, including a 49 percent reduction in state funding over the past few years. But a steady decline in enrollment was the main problem.

However, the university didn’t have an admissions director or a financial aid director to deal with the problem, Elzey said. He had to put vice presidents in place to deal with the problem.

He also hired a vice president to do fund raising and a communications director. That has led to a large increase in donations. Additionally, applications are up by 50 percent over this time last year, he said.

He and Chief Financial Officer James Openshaw are working very hard to meet all the challenges, Elzey said.

“We accept responsibility for what we need to do and how we need to do it,” he said.

Sen. Hugh Leatherman, head of the Senate Finance Committee, asked Elzey what made S.C. State different from the other state education institutions that also lost funding, but handled their finances much better.

Elzey noted that 97 percent of the university’s students qualify for some form of need-based financial aid. Additionally, criteria for getting Pell Plus loans have changed and the number of students getting those loans has decreased by 50 percent.

Leatherman, a Florence Republican, said that over the past three decades at least three S.C. State presidents had appeared before the board asking for money. He questioned how Elzey would show he will do better at handling the university than the presidents that came before him.

“No one has ever been more supportive of South Carolina State than me,” he said. “But I’m at the point now of where I’m not sure what to believe.”

Leatherman also asked Elzey how he’d handle the situation if the assistance didn’t come through.

Elzey said he’d have conversations with the vendors.

“What it comes down to is folks want to get paid,” he said.

He also noted that downsizing could occur if the anticipated enrollment increase doesn’t come through.

Elzey said he has other possible actions under consideration that he isn’t ready to speak about at this time.

Rep. Brian White, head of the House Ways and Means Committee, said he has concerns about how the university would pay the bill if the assistance came in the form of a loan.

But the Anderson Republican said his main concern is supplying a quality education to students who have committed their education to S.C. State.

“They made a commitment and we need to make a commitment too,” he said. “We as a state and a board need to guarantee them that education.”

Haley noted that the S.C. State Board members and the delegation did not attend the Budget and Control Board meeting. It made it appear that they are not supportive of the president. Additionally, the delegation is divided, she said.

“That’s the issue we all have,” she told Elzey. “I’m concerned for you. It doesn’t look as if they’re going to have your back.”

Sen. John Matthews, D-Bowman, noted that he was at the Finance Committee meeting.

“I thought the president made a good case,” he said. “It was logical and showed why the university is having a shortfall.”

According to Matthews, every member of the Orangeburg County delegation is 100 percent behind S.C. State.

“We’re going to do what we can to make sure that S.C. State College comes out of this in a fashion the university and the students can be proud of,“ he said. Matthews graduated from S.C. State before it became a university.

Matthews said he’s confident that the General Assembly will provide assistance to the university.

There are several options the legislature can take, he said.

“At this point, we’re looking at what those options are. We’re trying to build a consensus,” he said.

Contact the writer: 803-533-5529

Copyright 2015 The Times and Democrat. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

(23) Comments

  1. Planner
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    Planner - May 12, 2014 1:10 pm
    As a parent of a recent graduate of SCSU, I found the whole experience one huge disappointment prolonged over four agonizing years! The lack of money is the symptom, but not the malady. How does this university grow enrollment back to the 9000-10,000 student population that is necessary for it to operate in the black. I don't think that it can. Then what?!
  2. mackyboy1983
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    mackyboy1983 - March 12, 2014 11:46 am
    Sell it to Claflin. Problem solved.
  3. darkfree
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    darkfree - March 07, 2014 6:46 pm
    The fox is still guarding the henhouse at this State University.
  4. shinton06
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    shinton06 - March 07, 2014 5:10 pm
    is placed on warning again. Warrick hired a VP in Institutional Advancement who raised $100.000. That is nothing when donors, coporations, private sectors give that much just alone. You do the math and ask yourself would Warrick have been the better fit since you revisted this in your comment about why she wasn't hired.
  5. shinton06
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    shinton06 - March 07, 2014 5:08 pm
    however they have held VP capacity of some sort. The salary of Elzey is not the issue here. so it would be absurb to think that financial woes is the caused of his salary. As I stated and I will digress after this. Elzey came in June 2013. He inherited this! He is making an effort to make it right. Do you honestly believe that Warrick would have done this? Warrick invited her firend President of SACS to speak for commencment. I am sure some dialogue was convered among them. A month later SCSU
  6. shinton06
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    shinton06 - March 07, 2014 5:04 pm
    Critical Thinker good post! TTB Warrick knew when she signed her contract she was only Interim with no tenure. Where were you when we discussed this months ago back in January-April 2013. Warrick was not the best candidate and that's why she was not hired. Elzey has been in higher education and has had VP positions. Warrick was never a President coming in as an Interim so to address Elzey has never been a President Warrick was either, either was Cooper, Hugine. Many Presidents are not Presidents
  7. RedInk
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    RedInk - March 07, 2014 3:38 pm
    What happens if the gov't doesn't come through? The deficit rolls over. Next year, maybe it's bigger, maybe smaller, but it'll still be huge. Then what?
  8. Critical Thinker
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    Critical Thinker - March 07, 2014 2:00 pm
    SCSU will get a bailout. Students educations are at risk. The SC Legislature won't punish students. The question; How to give a bailout due to failed management while gaining confidence that the situation will improve. The answer; No money without sate appointed oversight. Period. An Ombudsman should be appointed. Mismanagement and board conflicts have damaged the institution to the point of embarrrasssment. The focus must turn to the well being of students and the protection of taxpayers
  9. TTB
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    TTB - March 07, 2014 8:35 am
    Jynx46 & shinton06 you both have not answered the questions on the salaries of the president and the folks that he bought in with him. If he says he saved 4 million than please tell how. It was in the paper about the 67k. When you have money problems you don't spend. Why did the board hire him and agree to his large salary? BTW the students of SCSU rallied behind Warrick, why was she not made president. Please go on the state website and look at the salaries. Then make comments.
  10. shinton06
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    shinton06 - March 07, 2014 5:20 am
    They do not have the best interest for HBCUs. President Elzey did not inherit this! He just got here. It will be a year in June and He has had the most critics! He can't do it alone. He can't do it in a year. Quit complaining and give some financial support to the College or offer some lead donors and private sectors to the College.
  11. shinton06
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    shinton06 - March 07, 2014 5:16 am
    articles, The (State of SC) is much to blame as well. I will not get into that. Now that the financial woes have been identified I am interested to see how the (State of SC) will respond. Let's move this Institution. I have also notice no one commented on this past weekend maybe 3 at the least. As soon as the negative hit good old T/D commentaries come out the woods to write. SCSU in my opinion needs to leave SACS! SACS is a bully accreditation and a demise for HBCUs.
  12. shinton06
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    shinton06 - March 07, 2014 5:12 am
    I'm confuse how SCSU has had 9 Presidents in the last 10 years. From 2003-2004 It was Hugine, Cooper and now Elzey. Hugine terminated by the BOT, Cooper resigned (at will) and now newly inaugurated Elzey. There were only 2 Interim McIntyer and Warrick and 1 Acting Teal. Where does 9 Presidents come from as stated in the article from Sen. John Courson. If I am correct, President Elzey acknowledge the financial matters before he began. He knew. TTB are you keeping up. As I stated in other
  13. Jynx46
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    Jynx46 - March 06, 2014 10:50 pm
    Erica1 how much have you contributed to SCSU this year?
  14. Jynx46
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    Jynx46 - March 06, 2014 10:48 pm
    TTB Elzey is SC States President whether you like it or not. So why not rally behind him? Whether you realize it or not SCSU has one foot in the grave and the other on a banana peel. Financially and as far as SACS. If Elzey fails.. SCSU fails. I would guarantee that State would loose its accreditation just because of that (lack of institutional control). So it would be suicide to try and replace another president. BTW TTB, your post reeks with immature ill-informed messiness.
  15. Jynx46
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    Jynx46 - March 06, 2014 10:39 pm
    TTB was Hugine, Davis, Warrick, Smith, and others ever Presidents before taking over SCSU? Where did anyone ever state that Elzey didnt know SCSU had money problems before he took the job? Haven't you been paying attention that Elzey has identified where the shortages originate? (thus looking over the books?) Haven't Elzey reduced Warricks 9 million overall deficit to 4 million? So its obvious his spending isn't the problem. Again, havent you been paying attention that enrollment is the issue?
  16. TTB
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    TTB - March 06, 2014 8:01 pm
    The board members of SCSU hired a man with NO experience as a president and pay him the highest salary of any of the past presidents? It has been in the media for years SCSU had money problems. Why the new president just finding out. Did he not look over the books when he arrived? He is a finance guy. How much has the president spent? Look into his spending. What are the salaries of the folks he brought in? Get the right person to move the university foward. Lets not lose another HBCU
  17. Erica1
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    Erica1 - March 06, 2014 12:56 pm
    The 1000 dollars was actually a gesture and round about way of making fun of scsu and its president. here we go againg begging to the master. John Matthews has never passed A bill or law. smh help us Lord
  18. iDog76
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    iDog76 - March 06, 2014 11:18 am
    Raising $13m dollars in Orangeburg would be quite miraculous. Go for it.
  19. Orangeburg Native
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    Orangeburg Native - March 06, 2014 8:56 am
    Alumni will need to jump in with both feet and raise the funds. As a alumni of both SCSU and USC, I get a call every week from USC asking for donations. Get on the phone, State and start asking now! It is sink or swim.
  20. SCGuardian
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    SCGuardian - March 06, 2014 8:17 am
    "Haley noted that the S.C. State Board members and the delegation did not attend the Budget and Control Board meeting. It made it appear that they are not supportive of the president. Additionally, the delegation is divided, she said."

    Same old, same old. Seems that the BOT is muddy-headed once again. However, it is rumored that our Prez has a "Golden Parachute" attached to his Contract. To do or not to do is the question now.
  21. daibit
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    daibit - March 06, 2014 8:07 am
    All of the people that have left SCSU..... and no longer works there....left a big old bill for SCSC.....For the New President to CLEAN UP....And make it right again....
  22. BarkingDog
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    BarkingDog - March 06, 2014 6:00 am
    I am disappointed that one of my favorite senators just thinks you should wipe the slate clean. It's not realistic and we can't do this in our everyday lives!
  23. BarkingDog
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    BarkingDog - March 06, 2014 5:56 am
    Taking one man at his word who does not under academics and higher education and who has spent funds rather freely not adding up the costs since his arrival is high risk.

    A plan to support this appropriation should provide now actuarial results. #justsaying
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