Peter Jacobs, Business Insider, March 30, 2015
Across the US, historically black colleges and universities are struggling financially–and the nation’s oldest public black college is even on the verge of financial collapse.
Historically black colleges and universities–known as HBCUs–have been part of American higher education for over 150 years. In the past few decades, though, the financial health of many schools has taken a turn for the worst.
HBCUs have struggled with unequal government funding, declining enrollment, and poor leadership.
These problems have plagued both private and public HBCUs, and have gotten worse following the financial recession at the end of the last decade, according to University of Pennsylvania education professor Marybeth Gasman–who heads the Penn Center for Minority Serving Institutions (MSIs).
Despite their difficulties, these schools have an undeniable impact on minority students–11% of African-American students are enrolled in HBCUs, even though the minority institutions only represent 3% of all colleges and universities, according to the Penn Center for MSIs’ website. Additionally, HBCUs graduate around 20% of African-Americans who earn undergraduate degrees.
Not every HBCU is in danger of closing, though. Gasman noted that even now there is still a wide range in the stability of historically black institutions.
“There are some of them that are quite strong, and have good enrollment, and then there are some that are sort of in the middle, that have to really ramp up their fundraising, and make sure their students graduate,” Gasman said. “And then there are some–probably about 15 of them–that are having a really difficult time.”
Gasman listed several HBCUs that fall into that last category, including the public South Carolina State University and private Wilberforce University.
At SCSU, the university’s accreditation is on probation and state legislators say its total debt exceeds $83 million, according to the Associated Press. The university’s trustees recently fired president Thomas Elzey, the AP reports, while South Carolina’s House and Senate have approved separate proposals to dismiss all the trustees.
Wilberforce–the oldest private HBCU in the nation–is also at risk of losing its accreditation, owing millions of dollars in debt.
Even upper-tier HBCUs are not excluded from the financial hardships. In 2013, a much publicized letter from a Howard University trustee warned that “Howard will not be here in three years if we don’t make some crucial decisions now.”
HBCUs struggle often struggle because they have fewer resources than other colleges–typically due to lower endowments and less money coming in from alumni giving, according to Gasman.
Gasman highlighted Spelman College, an all-women’s school that has an 86% graduation rate and is one of the strongest black colleges, but still can’t compete financially with a predominately white institution (PWI).
“Even though they have a nearly 50% alumni giving rate, Spelman still doesn’t have the same resources of a Wellesley or a Bryn Mawr,” she said.
PLUS loans are direct federal loans that families of students can receive if the student has maxed out their federal financial aid options. However, in fall 2011, the government tightened the criteria for the PLUS loans, and by some accounts did a poor job of informing applicants of the change.
Due to this change, many families were unexpectedly rejected from the PLUS loans program, and unable to send the students stay in college. Between 2011 and 2013, according to US News & World Report, there were 45% fewer PLUS loan recipients at HBCUs.
State-level funding for public colleges used to be based on enrollment criteria, not outcome–which is tied to factors such as graduate rate, Gasman explained. Since public HBCUs tend to enroll a greater number of low-income underprepared students, who are less likely to graduate from college, their funding has taken a hit in many states across the country.
Overall, Gasman emphasized, people need to better understand the contributions of HBCUs on a national scale, both for providing academic opportunities to African-Americans and for opening doors to higher education for a diverse range of students.
“HBCUs provide an environment for students who need to feel empowered and need to feel nurtured in their learning environment,” Gasman said.
These schools, she said, are “doing the work a lot of institutions aren’t willing to do.”