Perry orders regents to fix TSU finances By POLLY ROSS HUGHES AND MATTHEW TRESAUGUE

AUSTIN — Startled by the depth of Texas Southern University's multimillion-dollar financial woes, Gov. Rick Perry has ordered its board of regents to start making "tough decisions" to fix the problems or resign.

"It can't be a Mickey Mouse deal," Perry spokesman Robert Black told the Houston Chronicle on Thursday. "It can't be a Band-Aid."

In private meetings last week, Perry demanded that TSU's regents come up with a concrete plan within 30-45 days to start fixing problems plaguing the university's finances this year.

Next week, the terms of three of TSU's nine regents expire, giving Perry the opportunity to name new members.

Perry also plans to announce a blue-ribbon panel that will develop a long-term plan for TSU, including defining its academic mission.

One fear, which the governor's office said it hopes to avoid, is that TSU would be merged into another university.

Houston Democrats Sen. Rodney Ellis and Rep. Garnet Coleman underscored the importance of protecting the historically black university and keeping it independent. They noted its long history in shaping Houston's black middle class.

"TSU is in the neighborhood where I grew up. It isn't just an institution I represent," Coleman said. "It's more than that. TSU represents some of the best of black Texas and black Houston."

Ellis said he is a graduate of the university, along with political notables including the late U.S. Reps. Barbara Jordan and Mickey Leland and lawyer and former U.S. Congressman Craig Washington.

Ellis, complaining that Texas' two historically black universities have been underfunded since their inception, said he hopes Perry's actions will prove positive for TSU.

"I'm glad he's stepping up to the plate," he said. "Let's hope he's correcting that historical wrong."

Yet, with TSU asking the Legislature for millions in emergency funds and financial help while its money matters are "in shambles," Black said, lawmakers are apt to lose patience.

"It can't be the same old, same old. They're going to have to make the hard decisions to correct these issues," he said.

Troubling report

The governor's action follows a report, prepared by TSU's interim chief financial officer, Carin Barth, outlining overspending, missing purchase orders and poor financial projections.

Problems include flooded basements in several buildings and an athletic program $2 million over budget this year, the report said.

Barth also noted inadequate fees or occupancy rates to pay the debt service for new dormitories, a shuttle system and parking lots.

"I think the governor was surprised by the breadth and depth of — once you peel back the onion — how much trouble this institution is in,"
Black said.

"That's why he was very frank with the regents. They are his regents.
He was not happy with them," he continued.

The regents fired once-popular President Priscilla Slade in June on the grounds that she misspent $286,000 of the school's money to furnish and landscape her house. Slade and three former aides face criminal charges.

Coleman, in particular, said he has traced most of the financial problems cited by the governor to Slade's tenure.

Campus leaders are seeking an emergency appropriation of roughly $25 million, mostly for repairs to neglected buildings.

There is water in the basement of three buildings and the 4-year-old recreation center is structurally flawed, with visible cracks in the floor and pool because of rising soil.

"I don't blame him," Regent David Diaz said of Perry's mandate. "I'm not happy either. Nobody is happy."

"We agree with the governor that systemic problems at TSU must be fixed," Regent Earnest Gibson III said.

Pushing for state funding

Regent Bill King said the university can save money through better accounting practices and monitoring of cost overruns. But that will not be enough to close the projected shortfall, he said.

"In the short term, we're going to need more funding from the Legislature," King said.

Without the extra help, campus leaders may face tough choices, such as whether to cut some programs. Diaz and King said the money-losing athletics department should be looked at closely. The department spent
$6.2 million last year, about $2 million over budget, which is heavily subsidized by student fees.

"It's an onerous financial burden," King said.

The governor's office made it clear to regents that there are several options for TSU's future, starting with a viable, autonomous institution. The possibilities include placing it under another university system.

"I don't think anyone, including the governor, wants to see anything but option No. 1 as our fate," Regent Belinda Griffin said.

"We've got a lot of work to do, and we've got to do it in a short amount of time."

Mixed reactions

The news drew mixed responses from students who welcomed the greater oversight but feared the historically black university could lose its independence.

"That's really going to change the makeup of TSU. Any decision like this should come from inside and not from outside the campus," said Ernest Orieh, 26, a senior management major.

Herman Coachman, 22, and another student, Delvin Sanders, 23, both said mismanagement has been a problem.

"What are they doing with all the money they're getting?" Coachman asked.

Sanders said: "Things are still shaky. ... You can tell something is not up to par."

Chronicle reporters Rosanna Ruiz and Armando Villafranca contributed to this report from Houston.

polly.hughes@chron.com , matthew.treseague@chron.com

 
http://www.chron.com/disp/story.mpl/metropolitan/4501057.html


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This message has been edited. Last edited by: THE DREAMER,

Athletic Program... go bye- bye?

More.

"Overspending, missing purchase orders, poor financial projections (inadequate fees or occupancy rates to pay the debt service for new dormitories, a shuttle system and parking lots)
and poor accounting practices and monitoring of cost overruns"=financial mismanagement, pure and simple

"The athletics department spent $6.2 million last year, about $2 million over budget; former president spent $286,000 of the school's money to furnish and landscape her house" =perceived wrong priorities when viewed against the need to repair neglected buildings.

"Asking the Legislature for $25 million in emergency funds and financial help while its money matters are "in shambles"=an institution living way beyond its financial means in the face of woeful underfunding by the state legislature in the first place.

"TSU's nine regents:" This body's apparent ineffective oversight or inability to carry out its oversight responsibilities may be a substantial contributing factor.

Governor "plans to announce a blue-ribbon panel that will develop a long-term plan for TSU, including defining its academic mission." This does not bode well for TSU's future as an autonomous institution, especially if the TSU nation chooses to stand passively on the sidelines and allow the politicans to "do their thing."

This message has been edited. Last edited by: DrBlackbeard,

Much more to this story.

I bet certain forces are trying to merge TSU with UH.?????

More drama @ the top.

Tuesday, March 27, 2007
Texas Southern U. Needs Revamped Board and Should Get Emergency Aid, Panel Finds

By PAUL FAIN/Chronicle of Higher Education

A panel convened by Gov. Rick Perry of Texas to review severe financial and governance woes at Texas Southern University has found that the university needs a "reconstituted" governing board, strict oversight by the state auditor, and a modified mission that focuses on undergraduates, according to a report released on Monday.
The university, in Houston, faces a financial crisis and cannot make debt payments for its transportation system, construction projects, and athletics programs. It has asked for $25-million in emergency appropriations from the state
The 11-member advisory committee, which Governor Perry, a Republican, appointed in January, said the Texas Legislature should grant the portion of the university's request allowable by law but suggested that those appropriations be made on the condition that the panel's suggestions be put in place.
"Our recommendations focus on fixing the fiscal flaws that have undermined the ability of TSU to deliver a quality education," former State Rep. Glenn Lewis, a Democrat and chairman of the advisory panel, said in a written statement. He said the report provides a plan that "preserves the institution's autonomy while also refocusing on stricter oversight of the institution's taxpayer and tuition dollars."
While the report recommends that the governor should "reconstitute the Board of Regents," it does not specifically say who or how many among the 10 regents should be replaced. It does appear to call for at least some firings, however. The panel blamed the board for failures in management oversight and in leading fund-raising efforts, saying both of those shortcomings had led to a "disingenuous culture" at the university.
"The lack of confidence in the current sitting board," the report says, "will make it impossible for it to lead the university out of the current management dilemma."
Mr. Lewis, in an interview with the Associated Press, said some board members may not have served long enough to be considered culpable for the university's problems.
The board plans to release its own detailed recommendations for fixing the university's problems within a week, a university spokeswoman said.
Belinda M. Griffin, the board's chair, said in a written statement that the board concurs with the intent of the panel's report.
"We have reviewed the recommendations of the advisory committee," she said, adding that the report provides a "solid framework for re-engineering and restructuring our fiscal and managerial operations."
The financial unraveling at Texas Southern, a historically black university with an enrollment of 11,900, came to light last year when an audit commissioned by the regents found that its president at the time, Priscilla D. Slade, had improperly spent $647,949 in university money on personal expenses over seven years (The Chronicle, April 19, 2006).
Ms. Slade, who was fired by the board last April, has contested the audit's findings. She faces a trial in August on two criminal charges of misspending university money. Two other former university employees face related charges.
The advisory panel had debated possible recommendations to fold Texas Southern into one of the state's public university systems or place it under a conservatorship, but those ideas were rejected.
"The inclusion of Texas Southern into a university system was seen by the local TSU community and many local politicians as a very tangible negative within the urban and African-American communities," says the report. "TSU has great symbolic importance; its incorporation into a system would be seen by many as a failure by the African-American community itself."
The continued independence of the public university will require the "strictest financial oversight," the report says, including financial reviews by the state auditor "for the foreseeable future" and the production of quarterly progress reports for the governor's office and other state lawmakers.
The newly reconstituted board should take the lead in more clearly defining the university's mission, the report says, considering that Texas Southern's current commitment to an "open-access philosophy" is incompatible with its simultaneous aspiration to be a nationally recognized research university.
Citing six-year graduation rates that are below 17 percent, the report says: "The leadership of TSU should consider modifying its mission to focus on improving undergraduate education and graduation rates and focusing on a targeted number of graduate programs, mostly at the professional level."
The panel's report describes the serious budget shortfalls faced by the university, which are exacerbated by unpaid bills from previous years.
"There are over $1.7-million of past payables without any purchase orders and $900,000 of payables with purchase orders above the budget," the report said.
In addition, the panel found $4.5-million in continuing construction and maintenance projects that are not covered in the university's budget, as well as a projected $1.7-million shortfall this year in the university transportation program that is $34-million in debt. On Monday a private developer shuttered a newly built parking garage at the university and discontinued its shuttle-bus system, citing unpaid bills, the Houston Chronicle reported.

http://www.governor.state.tx.us/divisions/press/pressre...files/tsu_report.pdf