If Spelman Is Hurting, How Can Other Black Colleges Survive?

The nation’s most prestigious and financially strong black college has taken drastic measures to weather the current financial crisis. This raises ominous questions as to how black colleges with far fewer financial resources can survive the current downturn.

Spelman College in Atlanta, the historically black educational institution for women, is the most selective of all the nation’s HBCUs. Spelman also achieves the highest graduation rate among the black colleges. For many black women, the offer of admission to Spelman College is the grand prize in the college admissions sweepstakes.

Since Johnnetta Cole’s presidency in the 1990s, Spelman College has also been on firm financial footing. Camille and Bill Cosby have donated millions of dollars to Spelman College. On June 30, 2008, the Spelman College endowment had a value of $351,706,000. This was the second-largest endowment of any historically black college or university. The Spelman endowment ranked 180th among all colleges and universities in the United States.

As with other institutions there has been a severe decline in the value of the Spelman College endowment. Robert D. Flanigan Jr., treasurer and vice president for business and financial affairs at Spelman College, told JBHE that “Spelman’s endowment loss has been in line with those reported by the nation’s wealthiest institutions.” JBHE therefore assumes a loss of about 25 percent, or $88 million. The huge drop in value means that the endowment will not provide Spelman with the operating revenues that it has enjoyed in the recent past.

Further damaging the unfavorable financial climate at Spelman College is the fact that enrollment is down 3 percent this semester. This produces a drop in tuition revenue, making it even harder for Spelman to meet its budget.

As a result, Spelman is taking steps to deal with its revenue shortfall. The college is eliminating 23 staff positions. Twelve other positions that have been vacant will also be eliminated. All employees will be given a one-week, nonpaid furlough immediately after this spring’s commencement.

The college has announced cuts of $4.8 million to its operating budget for the 2009-2010 academic year. The most drastic measure is that the college’s department of education will be eliminated. Spelman students interested in obtaining teacher certification will now work through a program with Clark Atlanta University and Spelman’s other partners in the Atlanta University Center. The Spelman College Children’s Dance program and the continuing education program will be eliminated. The Edelman Child Care Center, which was a college-subsidized operation used for early child development training and research, will become a self-sustaining entity.

Of special concern to the Spelman administration is the effect of rising unemployment and tight credit markets on the financial strength of its students and their families. Beverly Daniel Tatum, president of Spelman College, has expressed grave uncertainties about the coming academic year. She states, “We are not sure how many of our new or returning students will actually be able to afford to enroll.” She added, “The demand for financial aid exceeds our supply of scholarship funds.”

As stated earlier, Spelman College is one of the financially strongest historically black colleges in the nation. In view of the financial challenges facing Spelman, the hurdles faced by many other black colleges and universities without Spelman’s economic resources may prove to be insurmountable.