Facing Financial Headwinds, HBCUs Reach For New Ideas To Stay Afloat

Tennessee State University, one of the Nashville’s four historically black colleges and universities, is struggling with infrastructure issues. Most recently, after months of power outages kept students in the dark and without hot water, some launched a petition demanding a partial tuition refund. But the incident reveals the broader challenges facing these historic institutions.

The tradition of Tennessee’s historically black colleges and universities runs deep. At Tennessee State’s recent homecoming pep rally, that pride was palpable as the school’s top-rated marching played.

The fact is, while HBCUs enroll only 10% of African American college students, they’re responsible for much more. They’ve awarded a quarter of the STEM degrees earned by African Americans. They’ve trained half of the nation’s black teachers and doctors. And a 2015 Gallup poll found that black HBCU graduates are more likely to thrive professionally and financially.

And in recent years the schools have been celebrated in popular culture. The now-famous Beyoncé performance at Coachella was a highly produced homage to HBCUs.

But times are difficult for these historic institutions.

“It all boils back to we got to get some money,” says Dwight Beard, the president of TSU’s local alumni chapter and a member of its foundation board. “We got to get more money and we need more support. And that is one of our major problems.”

According to a recent annual report for the school, alumni giving has dropped to its lowest point since the 1930s. And TSU has an endowment of just $52 million. For scale, Vanderbilt has $6.4 billion.

Part of the issue is the rising cost of college. Plus, 70% of HBCU students qualify for Pell Grants, meaning they are low income and they often graduate saddled with debt. At TSU, for example, 87% of graduates have student loans.

In recent years, TSU has admitted more students from outside the U.S., those who can pay full tuition. But Beard says the school needs to find other ways to increase revenue.

“It’s no easy answer, but we all have to improve,” Beard says. “We all have to find new strategies, and we all have to turn up the volume and do a better job in what we do.”

Tennessee State University didn’t make anyone available for an interview.

But it’s something Fisk University, another historically black college in Nashville, has been focusing on. After financial struggles repeatedly put the school on probation by its accreditors, the school has been working to rewrite the narrative.

Jens Frederickson, Fisk’s vice president of institutional advancement, says the school made a huge push in the last few years to build relationships with companies like Google, HCA and others. Their pitch: help fund the pipeline of high-caliber minority applicants.

“We were very deliberate about targeting big multi-nationals here and saying, ‘Listen, we have all these remarkable students, but we also need you to get behind them,'” Frederickson says.

Between that and targeting more alumni, last year Fisk raised a record $10.7 million, far higher than they expected. And its enrollment has surged, from 705 students in 2017 to now around 900.

But it’s not cheap keeping up the infrastructure of such storied and historic institutions.

TSU is 106 years old, Fisk is nearly 50 years older. And while repairing things like electrical wiring and leaking roofs is needed, it’s far more expensive than people realize, Frederickson says.

“When people say, ‘I want to give $100,000 to that’, we’ve sort of started discouraging that because then the expectation is that it’s fixed,” he says. “And it’s not fixed with $100K, right. It’s fixed with $5 or $6 million.”

Right now, he says, Fisk is focusing on what it can offer to African American students that other institutions simply can’t: a shared history and pride that empowers them to take on life after graduation.

And Dwight Beard, who has 43 family members who have attended TSU, feels the same way about his alma mater.

“We would be devastated without it,” he says, “because of all the great history and legacy and the great things it’s doing.”

But the fact remains, it will take more money to keep TSU, and other HBCUs, a competitive choice for students.