Report turned in, LR college staying silent

Arkansas Baptist keeps lid on accreditation submission

Thursday, August 21, 2014

Arkansas Baptist College submitted a report to answer concerns raised by a national accrediting organization -- but the college said it won't release the document to the public, leaving students and civic leaders who championed the college's neighborhood revitalization efforts uncertain about the college's future.

The Higher Learning Commission -- which accredits the 1,000-student private Little Rock campus -- notified the historically black college in March that its accreditation was in jeopardy.

The accreditation agency had advised students interested in pursuing a higher degree or transferring to another university to verify whether that institution accepts credits earned from a college currently on accreditation notice status.

The college faced a deadline Monday to provide evidence that it effectively addressed concerns that the commission identified in a three-month review.

John Hausaman, a representative with the Higher Learning Commission, said Wednesday that his agency cannot comment on ongoing reviews and cannot release such reports. But an individual college could release a report if it so chose.

Gary Streit, special assistant to college President Fitz Hill, verified Wednesday that the report had been submitted "early." However, Streit said he could not speak about the contents.

"That's Dr. Hill's place, not mine, to speak to it. I'm just an agent," Streit said.

Attempts to contact Hill were unsuccessful as of late Wednesday and a request through LaCresha Newton, the college's chief of staff, for an interview with Hill was denied. Newton said Hill was "not available for a phone interview."

Newton would not release a copy of the report and directed any questions either to the college's attorney or the Higher Learning Commission.

She wrote in an email that the attorney "was unavailable at the moment. I will certainly pass on your information so he can contact you."

Asked to provide the attorney's name, Newton did not reply.

Beth Coulson, chairman of the college's board, also declined to release the report until she could "ask Fitz," speaking of Hill.

When asked why a board chairman -- whose board hires the president and acts as a supervisor of that position -- could not release the report to the public, Coulson replied, "I guess I could, but that's not the way I do things."

Shane Broadway, director of the Arkansas Department of Higher Education, said Wednesday that his agency was not provided with a copy of the report from the college or the Higher Learning Commission.

Broadway became involved in October -- even though the Higher Education Department does not have regulatory power over the private college -- because the state agency received numerous calls from students who had not received financial-aid checks from Arkansas Baptist College last year.

The Higher Learning Commission began its investigation after the commission received complaints "regarding the college's handling of its financial obligations, including, but not limited to, its meeting of payroll obligations, handling of federal financial aid, maintenance of existing college buildings and technology, and related concerns."

After its investigation, the commission cited concerns about whether the college can meet its financial obligations and questioned the effectiveness of its leadership to fulfill the institution's mission. The commission cited the college, saying it failed to enforce its policies on "self-dealing and lacks appropriate mechanisms to do so." The term "self-dealing" refers to school employees or board members who benefit financially from the college through business or financial interests.

"When we have struggles, it's natural for the accreditation unit to inquire," Coulson said. "We are happy to provide information to anyone. We answered all their questions in full faith on our report."

Newton said in an email Wednesday that the college has "provided them with all requested information and continue to fully cooperate. There is no expectation of any punitive action toward ABC as a result of the process and the information we provided to the Commission."

Streit -- a former Higher Learning Commission peer reviewer who was hired specifically to help the college -- said in a phone interview Wednesday that submission of the college's report was "really step one of a three-step process."

A review team with the Higher Learning Commission will conduct a "focused visit" in October to validate the contents of the report and an outside forensic audit. In February, the commission will decide if the college can be removed from notice status or if further action -- up to loss of accreditation -- is necessary.

Streit said that placing a college on "notice status" is the least of the sanctions.

"It's basically a warning. Probation is the next step. If an institution is placed on probation, they're given a time period to come back into compliance," Streit said. "The probability of going from notice to revocation of accreditation is not very likely."

The college has been hit with a string of civil lawsuits this year demanding money for unpaid bills. One lawsuit, filed in July in Pulaski County Circuit Court claimed that Arkansas Baptist College twice bounced a $157,016.68 check for furniture it purchased from Southwest Contract in Temple, Texas.

In March, Pulaski County Circuit Judge Mackie Pierce found the college in contempt after officials failed to comply with a court order to produce financial records in a lawsuit filed last summer. Little Rock-based RRE Reserves, which owns several apartment complexes that Arkansas Baptist College leased for student housing, filed a suit claiming that the college owes $72,108.82 in back rent and utility payments.

Arkansas Baptist College turned over the documents April 7.

The Arkansas Department of Workforce Services filed a lien July 2 on all of the college's real and personal property because of $131,437.15 in unpaid unemployment insurance contributions, interest and penalties.

Becky Heflin, spokesman for the Department of Workforce Services, said Wednesday that the debt still remains unpaid. She said could not release information about whether the college was past due on other obligations with the department.

A lawsuit filed in Pulaski County Circuit Court on May 13 claims the college did not repay a $132,325.67 loan from GreatAmerica Financial Services Corp., a national commercial equipment finance company based in Iowa.

The Iowa District Court issued a judgment Feb. 18 against the college and awarded GreatAmerica $138,008.02 in relief. Attorneys representing the company filed a writ of garnishment in Pulaski County Circuit Court for the college's account with First Security Bank on May 30.

First Security Bank filed a response with the court on Aug. 13 stating that the bank was "unable to locate funds in a deposit account in the name of Arkansas Baptist College."

Newton did not respond to a question from an Arkansas Democrat-Gazette reporter about whether the college moved funds from the bank to avoid the garnishment.

Hill has said in previous Arkansas Democrat-Gazette interviews that the college isn't facing financial problems, but has a "cash-flow" problem created when the U.S. Department of Education placed the college on Heightened Cash Monitoring Status last year.

Typically colleges receive federal student aid funds on an "advance pay" or "direct reimbursement" basis from the U.S. Department of Education. Once an educational institution has been placed on "Heightened Cash Monitoring 2," the funds are released to the school after it has made the disbursement to the student or parent borrower, and the school must submit manual reports. The process significantly slows the affected college's cash-flow.

Coulson said Wednesday that the college will have "very exciting financial news" in the next 30 days. She would not elaborate on the details, however.

"I think we are definitely on the upward swing. Lots of students have enrolled. We will have well over 1,000 this fall," Coulson said. She added that she has "100 percent faith" in Hill's leadership.

When asked for current enrollment numbers, Newton said the college did not have a final count, but the information would be released as the closing period ends for the fall enrollment.

"Currently, we are at full capacity in our residence halls and we are excited about offering our students new services this fall," Newton said in an email. "Our students and their families know that their education is our highest priority and we will fulfill that mission. We have no indication that any pending action by any organization will prevent us from meeting the needs of our students."

Metro on 08/21/2014