CELESTE HEADLEE, HOST:
This is TELL ME MORE from NPR News. I'm Celeste Headlee. Michel Martin is away. Coming up, short-term jitters are leading many small investors to pull their money off of Wall Street. We're going to ask what that could mean for them and the market in the long run. That's just ahead.
But first, we talk about a financial crisis in higher education. Many of the nation's historically black colleges and universities, known as HBCUs, are facing a crisis. The economic downturn cuts in state aid and a shortage of private contributions have hit HBCUs particularly hard. Some institutions have cut programs, others have closed altogether.
Joining us to talk about the challenges facing HBCUs is Marybeth Gasman. She's a professor at the University of Pennsylvania Graduate School of Education where she studies historically black schools. And also with us Walter Kimbrough. He's the president of Dillard University. That's an HBCU in New Orleans. Welcome to both of you.
WALTER KIMBROUGH: Thanks.
MARYBETH GASMAN: Hello, Celeste.
HEADLEE: Professor Gasman, let me begin with you because you look at the broader picture and a lot of colleges and universities have lost funds in recent years, not just HBCUs. Why are these schools so financially vulnerable?
GASMAN: First, HBCUs by and large are committed to educating disadvantaged low income students, so their mission makes them a little bit more vulnerable. They're also tuition-driven and when you are tuition-driven that means that when people aren't enrolling in school or can't pay their tuition your, bottom line is affected. And then they have...
HEADLEE: Tuition driven - let me be clear here. Tuition-driven as opposed to what? Donations from alumni?
GASMAN: OK. So schools that have large endowments are able to offset the costs of operating through the money that they make off their endowments. And the next thing I was going to say is that HBCUs tend to have smaller endowments so they have a smaller safety net and they have to rely more on tuition to cover their operating budget. So that makes things a little bit more difficult for them.
HEADLEE: President Kimbrough, the school that you lead, Dillard University, also has a particularly unique financial challenge. Explain.
KIMBROUGH: Our challenge is we're in New Orleans and we're still suffering from the effects of Hurricane Katrina. And so one of the things that we're dealing with is you have these what I'm calling post-Katrina penalties in terms of the increases in the rate of insurance, paying back loans to rebuild the campus. So those are some particularly unique challenges.
And as Marybeth said, we serve a student body the average family income is $31,000 a year. Seventy-three percent are eligible for the federal Pell Grant. So you're dealing with a lot of low income students. So that adds to the stressors in terms of operating the institution.
HEADLEE: Your school borrowed $160 million from the government, right, for reconstruction from Katrina?
KIMBROUGH: Right.
HEADLEE: And you want to get that loan forgiven. Why would that be in the government's interest?
KIMBROUGH: Well, just in terms of providing education not only in this city but we have students from all across the nation that attend Dillard University. Dillard University has been a very important institution for this community and nationally in terms of producing folks.
But, you know, overall we're looking at an unprecedented natural disaster and particularly when you look at New Orleans and how those levies are situated and when there's a breach of a levy that runs right next to this campus and you have a campus that's six feet underwater completely, it's an unprecedented natural disaster.
So that's something that we as a country, we respond to natural disasters. We rebuild places that are destroyed by fires and tornados and other natural disasters so, you know, it becomes difficult to say, well, in this instance let's not worry about that institution because as a country that's what we do. We rebuild institutions, particularly anchor institutions in communities. And this is an anchor institution for what is called the Gentilly community in New Orleans that a lot of jobs, a lot of cultural education takes place in that community because of Dillard University.
HEADLEE: Well, let me ask you, Professor Gasman, HBCUs are both public and private institutions. Is there a difference in the financial situations for these schools if they decide if they are either public or private?
GASMAN: There definitely are differences but they're both hit rather hard. For the publics there have been incredible cuts in state funding across the country. And that has hit HBCUs particularly hard. It hits them even harder than it does a lot of other public institutions because HBCUs have a long, long history of being under-funded and unfairly funded by state governments.
So they don't have as much of a safety net in terms of that endowment built up over time or money invested because of past discrimination. The other thing I would say is something that they all have in common is they all need to have a more, I think, a more vibrant leadership to take them into the 20th century.
I think, you know, and I happen to admire Walter Kimbrough quite a bit because of the way that he leads and I think the fact that he is a data-driven leader and someone who is quite outspoken about the needs of HBCUs, I think that those types of leaders are needed at both public and private institutions.
It's a little bit more difficult at public institutions because you're dealing with, you know, the legislature and the politics of the state.
HEADLEE: Right.
GASMAN: So.
HEADLEE: If you're just joining us, you're listening to TELL ME MORE from NPR News. I'm Celeste Headlee. We're talking about the financial problems of many historically black colleges and universities, or HBCUs. Our guests are Dillard University president Walter Kimbrough and Marybeth Gasman, a professor at the University of Pennsylvania Graduate School of Education.
President Kimbrough, alumni giving was something that you were quite successful at while you led Philander Smith College in Arkansas. You increased alumni giving from 4 percent to almost 16 percent. Is that something that you can duplicate at Dillard? And is that something that other presidents can also use to help solve this problem?
KIMBROUGH: It can definitely done, and it must be done. So you develop a strategy where you really communicate with the alumni. Actually, I'm doing what we've been calling this - our mascot's the Blue Devil so we've been talking about this Blue Pride Rising Tour. And so I've been traveling the country to large metro areas where we have groups of alumni to give a state of the university address.
This is where we are, this is what we've done. And actually, Dillard has had higher percentages of alumni giving but some of that dropped off and then, you know, you lose contact with people, particularly after Katrina and getting records. So we're rebuilding that. And I'm out on the road talking to alumni because you've got to get that base solidified.
And I think that's a key part of what we have to do. You know, I think it's going to be very easy to do here.
HEADLEE: So, Professor Gasman, let's take that straight to you because alumni at HBCUs is, on average, about 5 percent lower than at other institutions around the country, except for places like Spellman University, who are exceptions. Why is the giving, alumni giving, lower at HBCUs on average and why is it higher at Spellman?
GASMAN: Well, alumni giving at HBCUs is lower for a couple of reasons. The first reason is that for a long time HBCUs did not engage fully their alumni because they thought that they didn't have access to funding to give. And so it's a newer tradition to be going after alumni to really deeply give in all of the time, rather than just in times of crises.
And then the other reason is that you have to really cultivate a sense of philanthropic giving and giving back when people are students. And so Spellman does a great job of that. The other institution that does that and has as high of giving rates as Spellman is Claflin University. And those two institutions, they start from the moment a student comes on campus.
And they start talking to them about the importance of giving back and why they need to support their institution. If you instill that into students, they will continue to give back because they understand why philanthropy is important. And that's why Spellman succeeds. They are masters at doing that.
HEADLEE: Well, let me ask you, President Kimbrough, because diversity seems to be kind of the elephant in the room for HBCUs. Many of them are reluctant to really open the doors to all kinds of universities but with African-American students getting higher enrollment in other universities, is it time for an historically black college and university to really focus on opening the doors to all students?
KIMBROUGH: HBCUs historically have always been open. And that's one of the things that gets lost in the conversation. A place like Howard University - when Howard opened, the first four students were four white women, so the institutions have always had a diversity of people.
When we talk about diversity, a lot of people just think of the students. We don't think about the diversity of the faculty, and HBCU faculties are very diverse. So you know, I think that becomes an opportunity as well. But the other that I have to bring up too is that HBCUs really have been very resilient too. So if you look at, for example, women's colleges - and we don't have this conversation - in 1960 there 267 women's colleges. Today there are about 45. They're only one percent - enroll only one percent of all women, and so there are a lot of them that have been going coed.
For HBCUs, they still enroll 25 percent of all African-American undergraduates, so there still is a robust number of students that want that experience. There are students from other racial backgrounds that want that HBCU experience as well, and so I think we can have a broader appeal to other students who want that experience, and that should be part of the plan. But I don't want it to - you know, people to say, well, the only way these schools are going to survive, if they diversify even more. They've always been diverse and there still is a strong segment of African-American students that want that experience.
And then it'll be interesting to see what happens after the Supreme Court looks at affirmative action because there might be a bounce in HBCU enrollment based on some of those decisions.
HEADLEE: And yet, Professor Gasman, the financial numbers for some HBCUs are pretty dire. I mean is it inevitable that some of these schools are going to have to close?
GASMAN: I think that there are probably three or four of them that are on the verge of closing. On the other hand, you know, to me they're one of the only black institutions in the country.
You know, the black church and black colleges are really indicative of kind of the strength of black history and black culture. As Walter said, they're fairly resilient. I think what it will take, though, is having sort of a niche that they are really good at. They can't be all things to all people. They have to engage their alumni beyond times of crisis - and I say this over and over because I see black college alumni kind of coming to the rescue, but what you have to do is you have to be there all the time. You have to consistently be supporting the institution.
There are some that I'm really worried about, though, but with the right leader I think they could turn themselves around. I mean, Paul Quinn College in Dallas, Texas was in that situation not too long ago and they got this really dynamic leader, Michael Sorrell, and he has been doing incredibly innovative things to change that campus, and he's very unorthodox, but he's turned it around and it's not out of the water yet, but it's really thriving in terms of its students and its curriculum and the attention that it's getting nationwide.
HEADLEE: Marybeth Gasman is a professor at the University of Pennsylvania Graduate School of Education. She joined us from that campus. And Walter Kimbrough is the president of Dillard University. He joined us from member station WWNO in New Orleans.
Thanks to both of you.
KIMBROUGH: Thank you.
GASMAN: Thank you. Transcript provided by NPR, Copyright NPR.