Dive Brief:
- Saint Augustine’s University is cutting half its workforce — 67 staff positions and 69 faculty positions — to reduce costs by $17 million and stabilize its financial position, the institution said in a release Saturday.
- The university — a private, historically black institution in North Carolina — has also nixed “several” programs with low enrollment, it said. Additionally, it is working to pay off outstanding balances with vendors.
- The Southern Association of Colleges and Schools Commission on Colleges put Saint Augustine’s on probation in July. The move likely saved the university by reversing an earlier decision to withdraw accreditation entirely. SACSCOC’s board plans to vote on next steps for the university in December.
Dive Insight:
University leadership framed the decision to cut its employee numbers by 50% as necessary to achieve financial stability.
“While difficult, we acknowledge the seriousness of our financial challenges, and these measures are crucial for our long-term sustainability,” Interim President Marcus Burgess said in a statement. “We are committed to transforming SAU into a financially stable institution that prioritizes the success of our students and stakeholders.”
Saint Augustine’s posted a $6.4 million total operating deficit for the fiscal year that ended this July and racked up a nearly $9.1 million deficit the year before, according to its latest financials.
Among its many fiscal challenges, net tuition and fee revenue fell by roughly half to $7.9 million between 2022 and 2024. Revenue declines have forced the university to grapple with multimillion-dollar deficits even as operating expenses fell from $42.1 million in 2022 to $27.3 million in 2024.
On top of those challenges, Saint Augustine’s delayed the start of its fall semester after Tropical Storm Debby ravaged North Carolina and damaged campus facilities.
Losing its accreditation could have spelled financial disaster, as it would have rendered the university ineligible to receive federal Title IV financial aid.
In the university’s latest financials, an independent auditor cited the potential accreditation loss and liquidity pressures before adding a warning that the university might not be able to continue as a “going concern.” Auditors add such warnings when organizations face substantial risk of being unable to meet their financial obligations or being forced to liquidate.
A SACSCOC arbitration committee reinstated the university’s accreditation after the accreditor’s board voted to remove it last December. At the time of the reversal in July, Brian Boulware, chair of the university’s board of trustees, called the decision a “pivotal moment for SAU’s redemption and renewal.”
But the university remains on probation and must shore up its finances to be in full compliance.
“By addressing our challenges head-on, we are not just complying with accreditation standards; we are laying the groundwork for a resilient institution that prioritizes the needs of our community,” Mark Yates, the university’s chief operating officer, said in a Saturday statement.
The university pointed to several milestones it has hit, including reinstating pay and health insurance for employees, after the U.S. Department of Labor opened an investigation earlier this year into Saint Augustine’s.
It also secured an agreement with a venture capital firm to guarantee its operations for the 2024-25 academic year. The financing takes the form of a loan of up to $30 million that carries a 24% interest rate, which one lending expert called predatory.
It also said donation levels have remained consistent, and it has received 700 applications from prospective students for fall 2025, “signaling strong interest in its academic offerings.”
