Paine College wants to earn trust back in accreditation fight



As Paine College fights to keep its accreditation, it knows it needs to earn back the trust of some donors with sound fiscal management, and that has already begun, the chairman-elect of the board of trustees said.

The Southern Association of Colleges and Schools’ Com­mission on Colleges recommended Thursday that Paine be removed from its membership for failing to meet three standards: financial resources and stability; financial stability; and control of sponsored research/external funds. A public disclosure statement about the commission’s findings will be posted next week that will offer more detail, said Dr. Pamela Cravey, the commission’s coordinator of communications and external affairs.

Paine will have 10 days to file an appeal after it receives a written letter of the findings. College officials have already said they plan to mount a vigorous appeal with new financial information they could not give the commission last week.

During the appeal, which could take months, Paine’s status as accredited but on probation will be unchanged. The accreditation is important because the school is not eligible to participate in federal education programs without it and 95 percent of the school’s students receive financial aid.

The written findings will spell out some things not clear at the moment, such as why the school is still considered in violation of the standard on control of external funding, said Atlanta attorney Michael Thurmond, the chairman-elect. He thinks it relates back to an incident in December when a college official drew down federal funds at an inappropriate time and failed to disperse them within a few days, as the rules dictated. But the college’s auditor could find no evidence it happened more than once, Thurmond said.

“Of the 25 transactions audited, this was the only occurrence,” he said. “It was inadvertent. We thought that one was clearly addressed” with the commission.

Beyond that, the school knows it will have to demonstrate financial stability and good resource management as part of its appeal, Thurmond said.

It is also important for the public image of the college that it show responsible management, something Paine has not done in the past and was rightly questioned about, he said.

“The issues raised by SACS in my mind, many of them were very legitimate,” Thur­mond said. For instance, beginning July 1 the college will have its first balanced budget in 14 years and the board has adopted a policy to live within its revenues, which come primarily from tuition, he said.

“That is unique to Paine College because for 14 years that is not how we operated,” Thurmond said. “We relied basically on deficit spending, which ultimately led us to where we are right here.”

For years Paine drew down money from its endowments, an average of $1 million a year, to supplement its budget, he said.

“You can do that until you exhaust those resources, which is really what happened,” Thurmond said.

The board has since adopted a policy to live within its means, which is “a culture change for Paine College,” he said. “The fact that we are going to end this year with a modest surplus is another signal, I think.”

As late as April, Paine had been projected to have a $3.5 million year-end deficit, but
aggressive fundraising has turned that around.

Alone among historically black colleges, Paine was founded by both a predominantly white and a predominantly black religious organizations. While that support was reaffirmed by both churches recently in terms of $1.35 million in pledges and financial support, some other donors might have withheld support because of concerns about Paine’s financial management, Thurmond acknowledged.

“It’s a threshold issue when you talk about rebuilding trust so that people who are contributing to the college and people who may want to contribute to the college will feel comfortable that their contributions are being managed in a proper and most efficient way,” he said. “To me, that becomes a threshold issue in terms of demonstrating that we have the capability, the skill set and the willingness to be good stewards of the dollars that come within our control.”

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