TSU failed to honor scholarships as finances crumbled
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Photo: courtesy of Tennessee State University
The financial crisis at Tennessee State University has grown so grim that the institution needed an emergency infusion of more than $32 million from the state government to keep doors open this year.
Why it matters: The historically Black university is a pivotal gateway to economic opportunity for many of the state's first-generation college students. But financial mismanagement put those students' educations in jeopardy.
- TSU ultimately failed to honor students' scholarships, officials said.
State of play: Poor decision-making by the university's former leadership "put the institution in a crippled position," interim president Ronald Johnson said this month at a meeting of the state building commission.
- In an effort to regain the university's financial footing, new leaders at TSU have laid off more than 100 employees and cut millions in spending. But the worst is not over.
- More layoffs and cuts are likely as the university scrambles to avoid insolvency.
- State comptroller Jason Mumpower said the university might have to sell its Avon Williams Campus in downtown Nashville.
Catch up quick: The Nov. 14 commission meeting was the first public indication of how dire TSU's troubles have become, but its shoddy finances have faced criticism for a while.
- Lawmakers booted all of TSU's board members early this year, saying they failed to serve as a check against administrators' bad decisions.
- Former president Glenda Glover left amid the scrutiny. A new slate of board members brought Johnson on this summer because of his experience helping struggling universities.
Zoom in: A key factor contributing to the crisis was past university leaders' decision to use $37 million in one-time pandemic aid for robust scholarships to incoming students.
- That caused TSU's enrollment to skyrocket, at least temporarily. The surge of new students in 2022-23 led to a tidal wave of new costs.
- When the money ran out, officials said, TSU was caught flat-footed.
"Promises were made in terms of the students receiving what they thought was a four-year free ride, but then turned out not to be," Johnson said.
- "Some students wound up in debt; others left."
- The subsequent nosedive in enrollment and tuition revenue exacerbated financial problems.
What they're saying: Tre Hargett, Tennessee's secretary of state, called that "the saddest thing of this whole situation."
- "They were told, 'You've got a full ride at Tennessee State University,'" he said.
- "Then to have the rug yanked out from under them with no plan at all for what's going to happen in years two or three or four, that is the most heartbreaking."
The intrigue: House Speaker Cameron Sexton blasted the previous board's decision to pay Glover $800,000 as an adviser after she stepped down in June.
- "We just went through all this presentation about how bad the finances [were], and … she was the leader of the institution during all this time," Sexton said.
- "Why would you keep her on as someone who would advise you?"
What's next: The commission asked TSU's new leaders to report on their cost-cutting progress in December. The TSU board meets next week.
- "There is no reason for you to feel like the pressure has been relieved," Mumpower told Johnson and his team.
- "The previous administration and trustees have driven this university to a breaking point, and it is up to you to reorganize, reorient and lead a rebirth of this university."