Tennessee State University finds itself at a critical juncture as state officials repeatedly urge its leaders to take the extreme measure of declaring financial exigency. This measure, triggered only by an imminent financial crisis when all other options are exhausted, would grant the historically Black public university greater flexibility in laying off employees, including tenured faculty. A six-page document within the university's bylaws details the process, which could take months or even longer. For instance, Memphis-based Christian Brothers University declared financial exigency in 2023 due to years of declining enrollment and mounting budget deficits. Despite budget and staff cuts, the situation remained unresolved on the private Catholic university's website.

TSU President's Stance on Financial Exigency

TSU interim President Dwayne Tucker, who assumed his post on Monday, initially plans to explore all possible avenues to stabilize the school's troubled finances without declaring financial exigency. With decades of business experience, including turning around financial struggles at large companies, Tucker temporarily stepped away from his role as the CEO of LEAD Public Schools to lead TSU. He also resigned from the TSU board, where he had served since April. His term lasts until June 30, and the TSU board plans to resume its search for a permanent president in January, aiming to appoint a new leader starting on July 1. Currently, the school has sufficient funds to cover through April barring any significant changes, according to Tucker.On his first official day on the job, Lieutenant Governor Randy McNally pressed Tucker on declaring financial exigency during a State Building Commission meeting. Tucker emphasized that he was not ready to make a hasty decision and instead plans to thoroughly review every department and program at TSU to identify areas where costs can be reduced or adjusted."I'm not trying to make an excuse," Tucker said. "At the end of the day, we all need to be accountable to the state and to Tennessee State University."The commission agreed to hear from Tucker again about his plan at its next meeting on February 13, with the understanding that Tucker will collaborate closely with commission members as needed.

Steps to Declare Financial Exigency at TSU

TSU's bylaws define financial exigency as a formal declaration by the TSU board indicating that the university is facing an immediate financial crisis due to a current or projected shortfall in funds for the entire campus. This shortfall must prevent the school from maintaining its essential programs and activities to achieve its educational goals. Moreover, the budget shortfall must be severe enough to be balanced only through "extraordinary means" such as terminating employees, including tenured faculty. Although tenured faculty appointments are usually indefinite, they can be terminated in exceptional circumstances like financial exigency, program discontinuation, or ethical issues.Before declaring financial exigency, several steps must be taken:The president must provide documentation demonstrating that all other measures to reduce the university's expenditures and increase revenues have been exhausted.The president must share all analyses and documentation showing the university is in an imminent financial crisis with the entire TSU faculty or its representative body, along with representatives of all other campus personnel.The university must offer ample opportunities for discussion and seek advice from faculty, staff, and all other campus personnel.If the president remains convinced that financial exigency is the best course of action, he will recommend to the TSU board chair to declare it.Working with the president, the chair must then submit a statement to the board that includes a description of the university's current and projected fiscal condition and an analysis of the factors contributing to the immediate financial crisis, among other items.

Consequences of Declaring Financial Exigency at TSU

If the board formally declares financial exigency, it is the president's responsibility to initiate a plan to reduce TSU's budget. The bylaws outline a lengthy process involving a special committee composed of individuals representing all employees. This committee will have the opportunity to provide input on how to make budget cuts and layoffs.The plan formulated by the committee will outline guidelines for selecting employees for termination, considering factors such as tenure status, rank, seniority, and performance evaluations.There will be an appeal process for those who are terminated. The positions left open after a termination due to financial exigency cannot be filled for three years without first offering them to the terminated person, with limited exceptions.

Accessing the Financial Exigency Rules

Curious about all the details of the financial exigency plan? Here is the entire document.A quick note before you delve into it: Although this document is on the Tennessee State University website, it contains language that seems to have been carried over from when the university was under the governance of the Tennessee Board of Regents. However, TSU now operates under its own independent board. This means that the roles assigned to the Tennessee Board of Regents and its chancellor in the document now belong to the TSU Board of Trustees and its board chair.