SC State running out of cash

ashain@thestate.comFebruary 26, 2014 

Elzey

RUSSELL K. PACE

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S.C. State University will run out of money to pay its bills early next month, college president Thomas Elzey said Tuesday.

The 3,400-student Orangeburg school is working with vendors to buy extra time while it tries to work through a $13 million cash shortfall. The school could get some money from summer school tuition payments before July.

Elzey said he does not expect any interruption of campus services, including food, maintenance and cleaning.

The state’s only historically black public college has enough money to pay its 1,045 employees through the end of its June 30 fiscal year, Elzey said as S.C. State officials blanketed the State House on Tuesday to visit lawmakers.

Despite the immediate need to pay bills, state lawmakers are reluctant to hand S.C. State all the money needed to get the school out of its financial hole.

“We are all very supportive of the university, but there are still questions about the accuracy of their numbers,” said state Rep. Gilda Cobb-Hunter, D-Orangeburg. “From an accountability standpoint, I’ve got to have some assurance the systems and internal controls are in place to prevent this kind of occurrence.”

Cobb-Hunter also questioned why Elzey would cover salaries for all college employees rather than finding a way to pay some bills. She said the school could look at trimming some less essential – and, perhaps, higher-paying – positions.

“For me, it is more important that somebody is serving those students food and somebody is keeping those dorms clean as opposed to a VP for whatever doing whatever,” she said.

Elzey, the former chief financial officer at The Citadel, and a number of new trustees have been at S.C. State for less than a year. They did not play a role in setting its latest budget.

State Sen. Shane Massey, an Edgefield Republican who has called for an investigation of S.C. State’s finances, said he feels more comfortable about the school’s direction after speaking to Elzey on Tuesday.

“He recognizes there are problems, and he’s committed to try to address those,” Massey said. “But I expressed to him that, in the short term, that I have concerns about just granting $13 million unless there (are) some significant accountability measures in place.”

S.C. State offered a detailed expenditure report and quarterly cash-flow reports in a deficit-reduction plan given to state budget officials last week. That plan includes raising tuition, boosting fundraising, increasing enrollment, and cutting low-performing academic and athletic programs.

Also last week, the S.C. House’s main budget committee approved a deficit-monitoring team to help the school reach financial stability by July 2015.

S.C. State’s deficit grew because, for years, the school budgeted for larger class sizes, producing more income, while its enrollment was shrinking sharply.

The college already has taken a number of deficit reduction-measures, including trimming 90 positions and raising tuition this year. But the school does not have any more moves left to make to trim costs to pay bills immediately coming due, Elzey said.

In its deficit-cutting plan, the school said it also wants $12 million over a four-year period to help make it more competitive by attracting top students and faculty, boosting its graduation rate and improving academic programs.

“The state needs that university to succeed,” Sen. Massey said. “If there are things we can do to help, I want to help. (But), as I told president Elzey, help has to be more than just giving them money.”

Some help might come from the school’s 3,400 students.

“We are more than willing to defend and protect our university to make up for some mistakes made by past administrations,” student government president Akeem Brown said Tuesday from the upper balcony overlooking the main State House lobby.

The senior political science major from Orangeburg said, in recent months, he has seen a “drastic change in the morale of the faculty, staff, even the students and, of course, the administrators. … We are looking now at how do we adjust ourselves as a student body to be able to put ourselves into a position where we can give back.”

Student government is giving $15,000 to the school’s scholarship fund on Friday, he said.

S.C. State students also are ready to pitch in to help the school if contract work is suspended due to the cash shortfall, Brown said.

“This is a historic university,” he said, “and it’s still capable of producing history.”

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