S.C. State facing $4 million deficit

ORANGEBURG -- South Carolina State University board members were stunned Thursday to learn about a projected $4 million budget shortfall, a deficit so severe that one trustee said the school was on life support.

Joe Pearman, interim vice president for finance and facilities, told the Board of Trustees' Finance Committee about the projected shortfall. University leaders had hoped to have a $2.5 million surplus by June 30, the end of the school's fiscal year. Instead it will fall short about $4 million.

Pearman told committee members that he expected a shortfall of about $3 million, which he attributed largely to the school's drop in tuition revenue from declining student enrollment. It also would have to cover a $750,000 shortfall from the school's dining hall.

The Finance Committee and university President George Cooper will meet again at 10 a.m. Monday to continue discussing plans to deal with the shortfall. The full board will meet Feb. 16.

In a presentation to the committee, board member Maurice Washington said enrollment dropped from 4,933 students in June 2008 to 4,362 students in June 2011.

He also said the deficit could be even worse than Pearman predicted. Pearman's estimate assumes certain income, such as summer school tuition and graduation and application fees. Some of that income may not materialize, Washington said.

The school isn't bankrupt, he said, "but it's on life support."

The university must take quick and drastic actions to deal with the shortfall and get the school back on a positive path, Washington said.

One action he suggested was opting out of the costly Division I athletic program.

Trustee John Corbitt said the university has several "sacred cows" that are expensive and might need to be cut back. They include the school's band and the Felton Laboratory School.

Board member Tony Grant said he supported meeting with the president and having more discussions on how to deal with the shortfall before taking action. Such decisions could have far-reaching implications, he said. "We're affecting lives and the life of this institution."

Cooper said he has a plan to deal with the problem. It involves eliminating vacant positions, laying off some employees and cutting some salaries.