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Central State University: what happened? - financial crisis in Central State University, Ohio

by Mark Fisher , June 27, 2007

WILBERFORCE, OHIO -- Dr. Herman B. Smith Jr. stepped onto Central State University's campus in early 1995 with hope, ambition and a clear idea of the task he faced.

The school was an estimated $5 million in debt, but a $4 million bailout package from the state would stimulate a resurgence. Besides, Smith had wrestled with similar crises at three historically Black colleges and universities (HBCUs) in the South, and he was hand-nicked for his new job by Ohio's governor and its top higher-education official. His brand of medicine would succeed where others failed.

But Central State was a different breed of patient and the extent of its disease had not been diagnosed. The school's accumulated debt when Smith arrived was actually close to $11.6 million, an audit report later revealed. The undetected financial instability sabotaged Smith's rescue effort. After fifteen months, he was fired.

In a telephone interview from his home in Atlanta, Smith said he was "grossly, sadly and unjustifiably mistreated" and called his tenure at CSU "Mission Impossible."

For decades, CSU has lived on a cycle of financial crises and government bailouts -- a cycle that exasperated its supporters and frustrated state officials either unwilling or unable to find a permanent solution. Despite repeated promises to straighten out the school's finances, CSU's trustees and administration continued spending more than the school took in.

The school's current crisis contains a potentially lethal blend of financial and political minefields. The exact amount of its multimillion-dollar debt is unknown. Most of its dormitories have been declared uninhabitable and have been vandalized, apparently by students. The state auditor and inspector general are investigating potential wrongdoing. And some lawmakers have suggested closing or merging the school.

Next Six Months Are Pivotal

The next six months are pivotal as Ohio's elected officials hammer out how much money CSU will receive over the next two years. The school's survival as Ohio's only public HBCU hinges on that funding. But lawmakers say before they make any decisions on the future of CSU, they want to know the answer to one seemingly simple question: What happened at Central State?

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