Bill vacating TSU’s board of trustees signed by Gov. Bill Lee
NASHVILLE, Tenn. (WKRN) — The bill to slash Tennessee State University’s Board of Trustees is headed toward law, as Gov. Bill Lee signed the measure.
The move comes after several new audits from the Tennessee Comptroller’s office were released Thursday alleging severe mismanagement of the university. The House passed the measure shortly thereafter.
“This has been going on for years now,” House Republican Caucus Chair Jeremy Faison (R-Cosby) said. “The grace that has been given has actually been turned around and shoved back in our face from that very board. We had to take a stand.”
Up until Thursday, the House and Senate had differing versions of the bill, with the House’s only vacating three members.
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But House Republicans’ first move during session was to pull their version and join the Senate’s to vacate the board entirely. The vote went along near-party lines, with two Republicans (Fritts, Hurt) joining all Democrats.
“I think the disappointing part for us is there were members of the Democrat [sic] Caucus that we talked to, and I know they didn’t vote for it, but their vote doesn’t reflect where they were behind the scenes,” Speaker of the House Cameron Sexton (R-Crossville) said.
Democrats say House Republicans went back on their word after the two sides brokered a compromise on the issue.
“I was told when session started that there would be a substitute and conforming to the Senate bill,” Rep. Harold Love Jr. (D-Nashville) said.
Love, a TSU grad, pointed out the fact that the state’s only public HBCU is also undergoing a presidential search while trying to correct some of the issues in the various audits.
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“Many of us had worked to try and find a resolution that did not end up in all 10 of Tennessee State University’s board members being vacated. However, that was done today,” Love said. “We are deeply concerned, of course, about the effect it’ll have upon the administration, students and the direction the school is trying to go in, to rectify some of the concerns that were raised in the audits.”
But Senate Republicans warned last week they wouldn’t come off their amendment and the board would cease to exist entirely if lawmakers didn’t take any sort of action.
“You would think that people who are put in a position of being responsible for the overall oversight and leadership of the university would recognize that and would say, ‘Maybe it’s time for me to move on and let leadership take the lead,’” Sen. Bo Watson (R-Hixson) said last Thursday.
They also noted the Comptroller released a new audit of TSU Thursday, finding several issues but nothing illegal – something the university noted in a statement today. In part, they wrote, “TSU is pleased but not surprised by the report’s conclusions. In addition to the overall conclusion that there was no fraud or malfeasance, the report contains over 50 references that there was no fraud or malfeasance.”
“When you get an audit that has 60 findings and 30 recommendations or whatever the numbers are, and you celebrate the fact that there’s a lot of mismanagement but fortunately there’s nothing illegal done, that speaks for itself,” Watson said.
The university released two statements Thursday, one in response to the most recent audit and another to the passing of the legislation. In full, the first reads:
Today, the Comptroller’s Office released two audits of Tennessee State University which were conducted simultaneously. A forensic audit was conducted by the independent certified public accounting firm of CliftonLarsonAllen, LLP (CLA). And a financial statement audit was conducted by the staff in the Tennessee Comptroller’s office.
The forensic audit concluded, “Based upon the procedures performed, CLA did not identify evidence indicative of fraud or malfeasance by executive leadership of the University or Foundation.” The forensic auditors also stated their primary objective as requested by the Comptroller’s office “was to conduct procedures to examine whether there was evidence indicative of fraud or malfeasance by certain members of executive leadership of the University and Foundation.”
The forensic audit follows a thorough eight-month review of TSU’s operations, financial and business practices, and covers the four year period from July 1, 2019 through June 30, 2023. The report’s conclusion that there was no evidence of fraud or malfeasance comes after the forensic audit firm reviewed 2,084,899 emails of TSU executive leadership, and over 500,000 other documents.
TSU is pleased but not surprised by the report’s conclusions. In addition to the overall conclusion that there was no fraud or malfeasance, the report contains over 50 references that there was no fraud or malfeasance.
TSU finds the report’s observations and recommendations to be helpful as we continue to improve our business operations, but it must be stressed this forensic audit firm was retained specifically to determine if TSU had committed fraud or malfeasance.
In addition to the release of the forensic audit report, today, the State Comptroller’s office released its FY 22 Financial Audit Report for TSU. This report covers the period from July 1, 2021 through June 30, 2022 and contains findings pertaining to operational activities that occurred approximately two years ago.
TSU has challenged each finding the Comptroller’s office levied at the university in the FY22 financial report, and points out that each year the TSU audits are scheduled six to eight months later than that of our peer universities and released almost two years after the period under review. These findings in this report cover a period that began in 2021, and do not reflect the substantial improvements that TSU has made to its business operations over the past two years, and gives the impression that TSU is committing the same infractions in the present, which is not the case. Additionally, the audits do not mention the gross underfunding of TSU.
Moreover, the audits do not support any of the allegations that had been brought forward as the basis to dissolve the TSU Board of Trustees.
TSU is committed to engaging in additional measures to address the items covered in the FY 22 Financial Audit Report. TSU has been and will continue to be good stewards of state funding, and the University remains committed to further improving all operational practices.
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The second reads:
Today, the Tennessee House of Representatives voted to adopt the Senate version of HB1739 (SB1596), which will result in vacating the entire Tennessee State University Board of Trustees. This is unprecedented, unfortunate, and uncharted waters for any public university in the state. We believe this legislation will disrupt our students’ educational pursuits, harm the image of the University, and remove a Board that had achieved success in its enhanced governance of TSU.
In passing today’s legislation, some lawmakers suggested the action was necessary due to audit findings and the forensic report released today by the State Comptroller’s Office. There have not been any audit findings that TSU mismanaged funds. The university has made significant improvements to its business operations from two years ago, which were not addressed in the just-released FY 2022 audit. Additionally, today’s forensic audit report clearly states that TSU had not engaged in any fraud or malfeasance. TSU has been a good steward of taxpayer dollars.
State lawmakers also have made very little mention of the chronic underfunding that TSU has experienced over generations. Confirmed totals are $544 million according to state officials, in which $250 million was allocated in April 2022; and $2.1 billion according to a recent federal report. TSU would undoubtedly be in a different position today if it had received the funds promised by the state over the course of the last three decades.
While we are very disappointed by today’s vote, we will continue to work with the General Assembly and the Governor’s office to pursue options, both in funding and governance, that allow TSU to continue the momentum it has achieved in enrollment, research, academics, and providing great opportunities for students.
Within hours of signing the bill, Gov. Lee also announced his new appointees for the board.
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