Stephen Jones Reveals Depth of BJU’s Financial Woes to Faculty: “Almost Like Re-Founding The School”

BJU President Stephen Jones had a sober message for faculty and staff at last Friday’s regularly-scheduled faculty meeting: the school is unable to give Christmas bonuses to staff this year because of “the financial position the Lord has put us in right now.”

According to a tip we received from a person present at the meeting,  Jones and other administrators have been “praying earnestly” about BJU’s finances, with Jones specifically noting that SACS requires any applicant school to show a $1,000,000 balance of income from the preceding year in order to apply. If BJU can’t meet this requirement before applying to SACS, Jones said Friday they’ll have to wait three years before attempting again.

BJU doesn’t make the details of its finances known, so piecing together what decisions put it in this situation is difficult. Two things we’ve learned in the last few days: BJU lost hundreds of thousands of dollars last year on its new sports program, and its enrollment continues to drop.

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32 thoughts on “Stephen Jones Reveals Depth of BJU’s Financial Woes to Faculty: “Almost Like Re-Founding The School”

  1. Mark Smith

    To illustrate the absurdity of regional accreditation, what does having a spare million on hand have to do with teaching English or Accounting better than an unaffiliated school?

    1. BMus, MM, BJU

      You say this now. But have fun getting into grad school with a worthless degree from an unaccredited university. I’m working on my doctorate now, but the university I’m at had to get special permission from the scholarship committee before they accepted me!

      -Signed, a guy who was invited to Yale before they saw his BJU ‘credentials’

      1. formerfundy1992

        Yeh, I graduated from BJ in the early 90s. I have tried and tried and tried to get into grad school. And every time having to pay application fees, etc. just to be turned down… I have actually had folks snicker when I reveal the name of my undergrad school. They then extend their condolences and suggest I get a real bachelor’s degree. One university in SC has finally started a master’s sort-of in my degree field. They did go ahead and let me in… again.. with a lot of snickering.

    2. MSK

      Mark, we’ve been through this before, but since you never lived through it, maybe we need to rehearse it for your benefit.

      What’s really absurd is a school that demanded everyone bow to its rules (even the stupid ones; ESPECIALLY the stupid ones), refused for decades to bow to the rules of the game it chose to play.

      What’s pathetic is a school with a dedicated pipeline of students (this is found money! No need to even recruit or offer scholarships!) that has alienated so many, its pipeline has dried up to the point where the school is on the verge of insolvency. If they had simply done right, and treated people right, for all these years, surely they would have a large endowment by now.

      And what’s beyond the pale is for such a school to try to lay the blame for its financial woes off on God, as if God forced them to be so pigheaded for so many years. As I said somewhere else, quoting Agatha Christie from “The Moving Finger,” “There’s too much tendency to attribute to God the evils that man does of his own free will.”

      The Lord didn’t put them in their current financial position. They did that to themselves. Some of us warned them 20 years ago that this day was coming, but they refused to listen, and now the predicted end is almost here.

    1. David Shaffer

      It means that the school is less likely to close in the middle of the night and the President flee to another state, which is exactly the circumstances as to how Bob Jones College left Florida.

    1. David Shaffer

      It requires cash, period. Of course, they could sell paintings but I’m betting that isn’t gonna happen.

      1. puzzlephile

        Mark asked a legitimate question and no one has answered it yet. Of course it requires cash to pay a decent wage. And, it could even keep the school from closing up shop in the middle of the night. But this still doesn’t address Mark’s question.

        1. MSK

          Puzzlephile,

          I think that the question probably HAS been answered.

          If you were an accrediting agency, putting your stamp of approval on a school, wouldn’t you want to know that their financial position was solid? I don’t KNOW any of this, but I suspect that an accrediting agency would not serve its customers well by granting status to an institution that was in danger of folding up overnight (as Pillsbury did a few years ago, and as Bob Jones College did way back in the day).

          While you may agree that a college doesn’t need “spare” cash to pay a decent wage, consider the fact that BJU does NOT pay a decent wage, and STILL might not have enough “spare” cash to satisfy this VERY modest requirement of SACS.

          And even if SACS is unreasonable to demand profitability/sustainability from prospective accredited schools, I bet Mark didn’t get a more solid answer to his question for two reasons:

          1. We don’t know (hard to believe, I know!).

          2. It doesn’t matter. If SACS requires it, and BJU wants to be accredited, they must meet the requirement.

          1. puzzlephile

            MSK, you may be right that we simply don’t know the answer to Mark’s question. However, I’m not sure that paying a decent wage is all that relevant to accreditation. If a school can meet the academic requirements, then it shouldn’t matter if all the professors work for free! Shujeans mentioned that paying a decent wage is needed to recruit qualified faculty, but this is clearly not always the case, especially at a Christian school where faculty may have motivations other than money. There are many who will work for far less than they could earn elsewhere.

            1. MSK

              Yes, people can teach for free, with altruistic motives…

              For a while…

              But witness what is going on at BJU right now. Sooner or later, it crumbles.

              Ultimately, you get what you pay for. Because people gotta eat and pay their mortgage and save for retirement.

              There is an accounting assumption called the “Going Concern Assumption.” In short, under normal circumstances, you assume that the institution plans to remain operational for the long haul. Attached to this assumption are expectations related to financial behavior and financial results, which enable the evaluator (especially tax evaluators or investors or customers) to make subsequent assumptions about the value of the institution, and to make informed decisions whether to invest in it or buy its product.

              So, while “having a million dollars in the bank” might not have much to do with whether the teachers can teach reading, writing, and arithmetic TODAY, it is a valid indicator of whether the teachers will still be around to teach TOMORROW. An institution that cannot raise enough revenue to pay its reasonable expenses and retain some earnings for future investment is not a reliable repository for MY money. And an institution that cannot or will not pay a reasonable wage to its staff cannot expect to remain operational once its victims (AKA employees) realize that they can serve God effectively AND make a reasonable salary…somewhere else. It will only survive as long as it remains a closed society along the lines of the “The Village” movie produced in 2004 (a movie that IMMEDIATELY made me think of BJU). And if it remains a closed society, I suspect it cannot reasonably expect to receive regional accreditation.

                    1. Bobmo

                      I have no idea why they require the $1 million. But I agree that it doesn’t seem pertinent (unless they want to maintain a certain status level, rather than a strictly academic one).

                    2. MSK

                      Well…

                      In that case, I bet my answer isn’t so far from correct, even if I don’t really know.

                      Based on what I know of investments and approval processes, anyway.

                      The number seems arbitrary (and low), but in a seat-of-the-pants kind of way, it makes sense. If I am going to put my stamp of approval on a school, certifying that it is a solid place that can provide a good education, knowing that people all across the fruited plain are depending on my to help them make informed decisions, I would want to know that the school is capable of operating profitably.

                      I would be happy to hear from anyone who KNOWS!

  2. puzzled

    I hear so many contradictory financial numbers coming from the BJU camp that I’m extremely confused. A President’s Advisory Council member recently informed me that the school runs a nearly $200 million annual operating budget which is covered only 10% by tuition, and he further claimed that this tuition/expense discrepancy is no secret and has been the case for decades. Dr. Bob III stated during Bible Conference last year that the school’s operating costs during the semester run to $300,000 per day.

    1. Waldo

      I’m a student, and I remember hearing Bob III say tuition doesn’t cover operating funds much at all. I don’t remember figures, but 10% would fit within the way he described it.

  3. Karl

    Both of these claims are so much bull****.

    BJU has never run a budget of $200 million. You can look up the federally reported data yourself here: http://nces.ed.gov/ipeds/datacenter/InstitutionByName.aspx

    In 2011, for example, BJU, Inc. (which includes BJU Press) had total revenues of less than $120 million, of which about $40 million was tuition and fees.

    Bob III fudges numbers, too. If you divide the total reported expenses for 2011 by the number of days in the year ($116,519,98/365) you come up with $320,000, pretty close to what he said. But–and here’s the ginormous BUT–that includes expenses for the Press and other non-education-related endeavors that traditionally made money for BJU, Inc. Actual education expenses make up about half of the cost of running that empire.

    Why would anyone give to a for-profit business to help defray their expenses? Would you give to Walmart just because they whined that it costs $300 million a day to run their corporation?

  4. formerfundy1992

    Since, as Stephen said, they are essentially starting over founding a new college… I wonder…. Who do they have to replace Bibb Graves to ensure funding from the KKK? Or will it be another equally heinous, dangerous hate group?

  5. Cardon

    Only a guess, but I’m pretty sure the “$1 million” is a rounded number and not the actual number. “Contingency funds” are required because accreditation agencies are vouching for the ability of an institution to provide an investing student with an academic experience that is of sufficient quality that other institutions will accept it. This means the accredited institution has to show it has the ability to deal with unplanned events and continue to operate at the same level of quality. This is different from operating funds, of course (salaries, upkeep, materials, etc.). Contingency funds would cover unexpected and unbudgeted events that could render the institution unable to provide quality academic offerings for students for some period. The $1 million (if that is the number — it is quite low) would have to be in a separate account, not earmarked for anything other than contingencies, etc.

    The really serious news here is that If it’s true they can’t show they have this amount available with an operating budget of their size, they are in pretty dire financial straits and must have been doing some really creative accounting along the way. This is actually pretty hard to believe if taken at plain face value..

    1. bjunews Post author

      Thanks for the information, Cardon! That’s definitely a tidbit we wondered about–the source didn’t provide any more details so we just posted what they reported. Good to know!

  6. A James

    This is an old post, I know. Updating some info for future reference…it is my understanding that the university needs to be in the black for 3 consecutive years to be eligible for applying.

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