Financially challenged Fisk will turn to fundraising, students to raise $8.4M by July

On Dec. 3, Fisk University fought to stay alive.

Staring down the barrel of the Southern Association of Colleges and Schools’ Commission on Colleges, Fisk president Hazel O’Leary and other senior staff members argued that the school was on the right track financially.

SACS issued warnings to Fisk twice in the previous year, sending a clear message that they needed to make significant improvements in financial stability and control if they were to earn reaccreditation for another decade.

Fisk failed to show enough tangible improvement after a year, so SACS required the school to make a presentation on their progress — and why they should be spared from the certain death that would come with the loss of accreditation.

O’Leary and her staff spoke about approaches the school must take: more fundraising efforts, an aggressive push to increase enrollment and the continued academic excellence Fisk is known for among historically black colleges and universities (HBCUs).

It worked. The display of “good cause,” helped the school retain its accreditation for another year. But now Fisk is under probation, and a special committee from SACS will be keeping a close eye on the university.

In the meantime, O’Leary and her staff still have several hurdles to overcome to stay viable and have a shot at getting reaccredited next year.

 

 

On a hill in East Tennessee, about 200 miles from Fisk, sits Knoxville College, overlooking Mechanicsville. In the early 1990s, Knoxville College — another historically black school — had an enrollment of more than 1,000 students.

But financial strife and debt struck the university hard. In 1997, SACS stripped their accreditation. According to the Knoxville News Sentinel, enrollment in 2008 dipped to just 66 students.

Knoxville College is an example of an HBCU that was crushed by loss of accreditation — a template Fisk doesn’t want to follow.

“We are celebrating our 145th year. It is not my intention on my watch that that should be the end,” O’Leary said.

Fisk has a clear set of goals laid out that they believe will lead them to meeting the accreditation standard. First, they need cash — $8.4 million by June 30, 2012, to be exact.

According to O’Leary, that money will come primarily from two sources: students and fundraising.

Fisk’s tuition is nearly $18,000 per year. Add in room and board, among other fees, and the cost can be upwards of $25,000. However, 91 percent of the student population receives financial aid and scholarships.

“Over the last five years, we’ve been awarded $48 million in grants. To keep that going is important for us, because many of these grants pay for some portion of tuitions for young people that want to come here and study those areas,” O’Leary said.

In spite of the cloud of SACS hanging over the university, Fisk is still able to recruit students nationally, according to Jason Meriwether, vice president of student engagement and enrollment management.

There’s actually been an enrollment boom recently. At this year’s homecoming open house in November, Fisk had 232 prospective students — 100 from Chicago — on campus. Last year, the number was in the 20s.

“The reasons we were able to increase attendance at our open house was by really leveraging our relationships, looking at high schools who had students who attended Fisk, who produced while they were here and graduated to go on to graduate school or an employment opportunity,” Meriwether said.

Over the past three years, approximately 71 percent of prospective students who attended open house events at Fisk ended up enrolling at the university, according to the admissions department.

But in addition to bringing more students to campus, Fisk also has to keep the ones they have. Meriwether said some students couldn’t afford the financial burden of Fisk after their first two years.

“Fisk loses more kids in junior and senior year, because they can’t afford Fisk anymore. They don’t leave over dissatisfaction with the school or academic programs,” Meriwether said.

“Our challenge is to make sure we leverage our financial aid so our students who come here perform well academically and we can help them bridge the gap to continue to pay for Fisk.”

The other half of the equation is fundraising — and that’s where most of the $8.4 million will have to come from.

“Fisk is a market leader among HBCU in annual fundraising. But it doesn’t help to have raised $5.1 million in the annual fund every year if the kids who are coming here can’t really afford it and need larger scholarships,” O’Leary said.

That financial quandary has forced Fisk to operate in the red. During six out of the past nine years, Fisk’s expenses have outweighed their revenues, according to Internal Revenue Service filings by the school. Overall, the school has been operating at an average deficit of roughly a million dollars per year over the past nine years.

And now the endowment needs to beef up in order to cover the gap between revenues and expenses.

“Where’s the money? Where do we go? What friends have we cultivated?” O’Leary said were the questions Fisk is in the process of asking.

The school also hired a new staff member for institutional advancement who has helped raise half a billion dollars over her 35-year career. 

The next step for Fisk is completing a feasibility study, then moving full steam ahead on a new capital campaign.

 

 

Then, there’s the art. Discussion about Fisk’s finances — or the university in general — can’t really take place without mentioning the multimillion-dollar collection of art donated by Georgia O’Keeffe in 1949.

The Alfred Stieglitz Collection is an unprecedented accumulation of modern art. It includes pieces by Pablo Picasso, Paul Cezanne and other contemporaries. O’Keeffe, Stieglitz’s wife, donated the works to the university in hopes that generations of African-Americans would have access to the collection.

The financial figures surrounding the collection are astonishing. Fisk’s eight art collections currently account for a whopping 63 percent of the school’s total assets, according to IRS filings. The collections, including the Stieglitz were valued at $14 million in 2002, but since then, appraisals have placed the value at $31 million, $41 million and now $68 million.

While facing a financial crisis, but sitting on a potential gold mine, the Fisk Board of Trustees approved plans to sell several pieces of artwork to help their bottom line. But the state attorney general wouldn’t have it, citing contractual language from O’Keeffe’s donation that stipulates against breaking up or moving the Stieglitz collection.

The result has been an ongoing, half-decade-long court battle. Most recently, Fisk devised a plan to share the art collection with the Crystal Bridges Museum in Bentonville, Ark., rotating the art between Fisk and Arkansas every two years.

The $30 million deal would be a welcome boost to Fisk’s endowment — and O’Leary said the deal is a win-win.

“There’s been a twisted interpretation that says Fisk has sold its art and it’s going away to this strange place in western Arkansas,” O’Leary said.

“We’re sharing this collection, and it will benefit not only people in Middle Tennessee and the young people at Fisk, but the people who are now traveling to a world-class museum in Arkansas where a collection of early American art will be there to see.”

But the issue has also become divisive.

Last year, Lucius T. Outlaw Jr., a Fisk alum and professor at Vanderbilt, penned a letter to the Board of Trustees asking O’Leary to step down.

According to Outlaw, and 18 co-signers of the letter, the art collection deal could backfire on the university’s fundraising efforts.

“The present effort to gain court approval to contravene the terms of such a commitment [to house the art collection] … erodes the faith and trust that must be invested in Fisk University, in the institution’s stewards and senior administrators, to gain the confidence of those able and willing to make substantial contributions to ensuring Fisk’s future as a viable and flourishing institution of higher education,” the letter reads.

Outlaw and the spokeswoman for the Task Force for the Rescue and Rehabilitation of Fisk wouldn’t comment when contacted by The City Paper.

Fisk recently won an appeals court ruling that struck down a requirement that would have reserved $20 million of the share deal for preservation of the collection. The appeals court remanded the case for further proceedings.

Beyond the financial spreadsheets and court documents, though, there’s still a historic university and a tradition that hopes to move forward.

“For every time you hear about Fisk being beleaguered or cash-strapped or other words you see in the news, every time you get that out, if you could get a story out about two of our kids. If we could just do that, that’s the real and true Fisk,” Meriwether said.

But the real and true Fisk — the students, alumni and faculty that make up the history of the school — will be tasked with pulling the school out of its financial troubles. And they have a year to do it.