Kentucky State makes progress on paying debts, will focus on students with unpaid bills
Kentucky State University has made progress on paying down past-due debts, the school’s Board of Regents learned Thursday.
All invoices older than 60 days have been paid as of Aug. 27, chief financial officer Greg Rush said. The university still owes over $402,000 in invoices that are less than 60 days old.
“We’ve made a significant effort to pay down any past-due invoices that we were aware of,” Rush said.
By the end of this month, the university plans to have paid off every invoice older than 30 days, Rush said. There are also still a “significant number” of invoices that do not have a purchase order attached to them, amounting in over $1 million that still needs to be paid, Rush said.
The update comes several weeks after Rush told the board of regents that the university faced a budget shortfall of $15 million coming from unpaid bills, an increasing payroll and years of spending that outpaced revenue.
The university will also begin getting stricter with students who do not pay their tuition and fees, Rush said. As of Aug. 31, there is an outstanding balance of more than $5.1 million for student accounts. KSU will “work with (students) every way we can, but those balances will need to be cleared,” Rush said.
About 90 students are at risk of being dropped from the university because they have not paid their bills, he said. Going forward, KSU will take a more aggressive stance for students who do not pay their accounts, including requiring balances to be cleared before they can register for the next semester.
“We’ve got to get back to a position where we’re clearing our balances and we’re protecting the university and we’re limiting the bad debt expense,” Rush said.
KSU recently used Higher Education Emergency Relief Fund (HEERF) money to clear about $2.4 million in outstanding balances from current and former students, Rush said. The university also has $4.2 million in emergency aid to distribute, which will be available to current students and former students who were enrolled during the pandemic. There will be an application process for those funds, Rush said.
The board also heard an update on the search for a new president. KSU’s president, M. Christopher Brown II, suddenly resigned on July 20. Since then, Clara Ross Stamps has been the school’s acting president. Stamps had been a senior vice president and spokesperson at KSU.
Aaron Thompson, president of the Council on Postsecondary Education, recommended that the board use a professional search firm for the process, as well as a search committee made up of people associated with KSU and CPE. The search firm and committee would work together to create a list of finalists for the next president.
The board should plan to meet again in mid-October to finalize plans for a search committee and the search firm, Thompson said. From there, the search would begin around Dec. 1, with the goal of naming the next president by late spring 2022, Thompson said.
At the special called meeting in July, Rush said the Board of Regents had missed a number of budget warning signs in recent years, and that “this has to change and this has to change immediately.”
The university is under a hiring and salary freeze, and cuts could be coming to campus. But, “we can’t cut our way out of this,” Rush said in July.
KSU is an historically Black college in Frankfort. Its budget this year is $49.9 million. Of that, $27.1 million comes from the state’s General Fund and $16.3 million comes from tuition and fees from its student body of about 2,200, according to KSU budget documents.
Gov. Andy Beshear issued an executive order instructing the Kentucky Council of Postsecondary Education to investigate the school’s finances and recommend management changes and new goals.
KSU is under state oversight after the resignation of its president earlier this summer. Brown resigned on July 20 after four years on the job, amid growing concerns about KSU’s finances and a half-dozen pending lawsuits that accused college officials of various acts of misconduct.