Effort to suspend S.C. State is delayed

South Carolina State University in Orangeburg. Lawmakers on Tuesday postponed action on a proposal to close the historically black college because of mounting debts.

State lawmakers temporarily halted an attempt Tuesday to shut down the financially troubled South Carolina State University for at least three semesters.

The House Ways and Means Higher Education Subcommittee voted 3-1 Tuesday to suspend operations at the state’s only public historically black college, a move that would mean laying off the school’s employees and transferring academically eligible students. The goal would be to use the savings to repay the school’s mounting debt.

Rep. Gilda Cobb-Hunter, D-Orangeburg, cast the lone vote against the plan.

After lawmakers decided to sleep on it before taking further action on S.C. State’s future, school President Thomas Elzey held a news conference at the Orangeburg campus, vowing to keep the school open.

“I want to make one thing clear — South Carolina State will not close,” Elzey said late Tuesday, flanked by more than 200 students and faculty members shouting, “Kill the bill!”

Elzey, whose voice trembled at times, said the financial woes of S.C. State didn’t happen overnight so it was “unrealistic for anyone to expect for them to go away overnight.”

The subcommittee’s proposal calls for suspending all S.C. State operations and programs as of July 1 through the 2015-16 school year. The school would be able to resume classes in January 2017, at the earliest, with new faculty and leadership, said Rep. Jim Merrill, subcommittee chairman.

Elzey and the school’s current board of trustees would be terminated, along with the entire faculty and staff. The state would pay for students with a grade point average of 2.5 or higher to attend other state universities. Where those students would go and what would happen to those with lower GPAs remained unclear Tuesday.

Subcommittee members were unhappy with a recent S.C. State spending plan, which didn’t include enough cost-cutting, Merrill said.

“Something clearly has to be done,” Merrill said. “We couldn’t in good conscience recommend another investment of multimillion(s) ... when there’s no plan on the table.”

Later Tuesday, members of the House Ways and Means Proviso Subcommittee opted to postpone further discussions about the school’s fate until Wednesday.

“We should all sleep on this tonight,” Charleston Republican Rep. Chip Limehouse said, adding that S.C. State needs a viable plan to move forward. Instead of shutting it down for two years, he proposed eliminating the school’s governing board and allowing the General Assembly to appoint its president.

Plans to suspend the school drew immediate opposition. Sen. John Matthews, D-Orangeburg, said the education subcommittee took an “irresponsible position” that places the university in an embarrassing situation.

“I think they’re trying to embarrass the institution,” Matthews said. “Because in my assessment, I don’t think it’s going to go anywhere. It puts the institution in a worse position. And it accomplishes nothing — but a headline.”

State Reps. Leon Stavrinakis and Wendell Gilliard, both Charleston Democrats, promised to fight the move.

“Closing S.C. State University, our state’s historical black college, is not an option and we will NOT let it happen,” Stavrinakis tweeted at #saveSCstate.

“If we allow anything to happen to S.C. State University that would go against the great historical institution, then we should all shut down shop and go home,” Gilliard said in a statement. “That would include the governor.”

S.C. State has faced huge ongoing financial problems in the wake of past corruption convictions of its board chairman and others, allegations of mismanagement involving millions of dollars, the firing of presidents and top administrators and other serious problems.

Closing the school would cause it lose its accreditation and harm its students’ ability to receive federal financial aid, said Belle Wheelan, president of the Southern Association of Colleges and Schools’ Commission on Colleges.

A school has to be in operation to retain its accreditation, and students aren’t eligible to receive financial aid at unaccredited schools. The university would have to reapply after it reopened, and accreditation usually takes two years, Wheelan said.

But Merrill said the school’s accreditation already is in peril.

The accrediting agency put S.C. State on probation last summer for matters “concerning governing board conflicts of interest and board/administration structure, as well as financial stability and controls.”

Meanwhile, Elzey’s job could be on the line after he came to S.C. State from The Citadel in June 2013 to rescue it from its financial spiral. When he arrived, he said, he discovered school officials were masking the severity of their financial situation, including a cash flow deficit of $13.5 million.

Since then, the school has sought state financial help to pay its immediate debts.

In December, the state granted the school a $12 million loan. That came after the state already had given S.C. State a $6 million loan to help pay outstanding bills from vendors and to meet payroll. That loan must be repaid by June.

However, Elzey has told lawmakers the school doesn’t have the money to repay it this year, partly due to plummeting enrollment.

From fall 2010 to fall 2014, the school’s student head count shrank by more than 1,000 students, a steep drop for a college with a student body of 3,331. This fall, enrollment fell 339 students short of what school leaders expected, creating a nearly $2 million shortfall.

Elzey has said the Orangeburg school owes $17.5 million in all which includes $10 million in outstanding bills and the state loan.

The school’s most recent request for more money upset lawmakers, Merrill said.

However, the possibility of shutting down S.C. State is a long way from reality. The subcommittee’s recommendation would have to be approved by the entire House Ways and Means committee before being brought to the House for a vote. The plan would also have to be approved by the Senate.

School leaders have been crafting a plan to save the 118-year-old school, a critical education hub for students from disadvantaged backgrounds. The plan includes asking for the added state help.

S.C. State was hoping to seek about $50 million over five years to cover what its leaders are calling “restabilization costs.”

Without that money? “It could create a downward spiral for the university,” Elzey told The Post and Courier in December. “And I don’t want that.”

Merrill, however, remained skeptical. “It’s a large plan that is a little short on specifics,” Merrill said.

Elzey has said that money would be used primarily to boost enrollment, improve recruitment, provide scholarships and other needs-based funding, and pay for technology upgrades and infrastructure needs.

“No one takes any pleasure whatsoever in trying to recommend this move. The days of kicking the can down the road are surely over,” Merrill said.

Amanda Kerr and Jeremy Borden contributed this report. Reach Jennifer Hawes at 937-5563 or follow her on Twitter at @JenBerryHawes.