A plan to loan Birmingham-Southern College (BSC) $5 million in city funds in an attempt to keep the school open passed a Birmingham City Council committee on Tuesday.
The full Birmingham City Council will consider the plan on November 28. Under the plan, the city would give two loans of $2.5 million to the private school, one forgivable if the school is open for classes in the Fall 2024 semester and the other non-forgivable.
The North Alabama Conference of the United Methodist Church's Board of Pension and Health Benefits approved an investment earlier in November in BSC for $2.5 million to support the College's efforts to remain open as it continues to secure funds for its permanent endowment. The investment is contingent on the City of Birmingham making a separate investment in the College of at least an equal amount at a city council meeting next week.
BSC has also secured another $2.5 million loan from private funders.
"This proposed funding represents a critical part of our effort to pursue solutions that will keep the College open permanently. The funding would give us time to continue to work with elected officials to obtain the bridge funding that has already been set aside by the Alabama Legislature and to continue to secure endowment funding from private sources," Birmingham-Southern President Daniel Coleman said in a statement on Tuesday.
BSC, a private school, is financially troubled due to missteps by the College's administration in previous years and declining enrollment. Alabama State Treasurer Young Boozer recently denied a $30 million state loan to bail the private school out.
Legislators passed the Distressed Institutions of Higher Education Revolving Loan Program and appropriated $30 million in the 2023 legislative session. The Alabama State Treasurer's Office administers the program.
Montgomery County Circuit Judge James Anderson dismissed a lawsuit recently filed by BSC against Boozer for the loan denial.
To connect with the author of this story or to comment, email caleb.taylor@1819News.com.
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