Birmingham-Southern College, a private Christian institution, will close in May after failing to secure a tailored state loan program despite years of financial struggles. This decision marks the end of the college’s fight for survival, highlighting deep financial issues and legislative challenges.
What We Know:
- After 168 years, Birmingham-Southern College announced it will close on May 31, following a decision by college officials due to unresolved financial difficulties and the failure of a state loan program revision.
- The Alabama State Treasurer, Young Boozer III, rejected the college’s application for the loan last fall, citing insufficient collateral and labeling the institution a “terrible credit risk.”
- Efforts to amend the legislation to reduce the Treasurer’s role in the loan process faced significant opposition and were not expected to succeed.
- The Board of Trustees unanimously voted to close the college, describing it as a tragic loss for the students, employees, alumni, and the broader Birmingham and Alabama communities.
- College officials emphasized Birmingham-Southern’s economic impact, claiming $90 million annually for Alabama and $68 million for Birmingham.
- President Daniel B. Coleman stated all options to secure the loan were exhausted, including an unsuccessful lawsuit aimed at compelling the Treasurer to grant the loan.
- Birmingham Mayor Randall Woodfin expressed his heartbreak over the closure, acknowledging the efforts to keep the college open.
- The college has faced financial difficulties for years, operating at a deficit for eight out of the last ten years and experiencing a significant drop in enrollment from over 1,500 students in 2010 to 731 in the last year.
- Past financial mismanagement included a major Pell Grant miscalculation in 2010, leading to budget cuts, layoffs, and a high turnover of college presidents.
- The college had heavily drawn on its once robust endowment for building projects and operating costs, which dwindled from over $110 million to approximately $51 million by 2022.
- Despite efforts to secure funding through a state loan and boost support from donors, the college announced it could close as early as May 2023, ultimately extending its operation slightly beyond its predicted closure date.
- Alabama State University is reaching out to students of Birmingham-Southern College, which will close on May 31 after 168 years.
- Administrative and academic leaders at ASU are inviting undergraduate and graduate students at BSC to consider coming to Alabama State.
“Our University and its Board of Trustees are greatly concerned about the hundreds of students at Birmingham-Southern College who will soon be without a school to attend, and we are saddened that many of its students are in a quandary on how and where to complete their college education,” Alabama State University President Dr. Quinton Ross said.
This closure not only marks the end of an era for Birmingham-Southern College but also reflects broader challenges faced by small, private institutions in maintaining financial stability and securing governmental support.
