Taman Siswa

Benedict College has been required to repay more than $658,000 since 2001 for violating rules governing federal student loans, U.S. Department of Education records show.

Benedict President David Swinton dismissed the ordered repayments.

“That’s what auditors do,” he said. “They point out things that need to be fixed.

“That audit covered every year since the [direct] student loan program was started [in 1996-97]. That audit took two-and-a-half years to do. We disagreed with it.”

Such repayments are unusual, according to a check by the Education Department of 10 private institutions and 11 public colleges in South Carolina.

Only three of those schools - Columbia’s Allen University, Newberry College and Spartanburg’s Wofford College - have been forced to make repayments. Those three schools repaid a combined $134,977 following federal audits dating back to 1992, with almost all of the money coming from Newberry last year.

Loss of federal loans and grants could financially cripple Benedict, which has faced a cash-flow shortage for at least a year.

Benedict has been a mainstay of black education in South Carolina for a century and a half. The decade-long disagreement with federal officials over student loans is important because 92 percent of Benedict students use the loans to help cover the $21,814 annual cost of tuition and other expenses at the private, nonprofit college.

Federal officials have threatened to cut off loans to the college’s students if Benedict doesn’t improve its management of the student loan program.

“That’s boilerplate language,” Swinton said Friday. “As far as I know, we are not in any danger of losing our eligibility. We’ve always responded to their findings.”

Federal Education Department officials cited Benedict, in part, for giving federal loans to students who were not making satisfactory progress toward graduation.

Benedict graduates 6 percent of its students in four years and 24 percent in six years, the most recent figures from the Education Department show.

That’s the second-lowest graduation rate among South Carolina’s independent colleges. Allen University has the lowest. Among the 37 colleges of the United Negro College Fund, including Benedict, nine schools have lower six-year graduation rates.

Swinton said the school is making progress toward improving the graduation rate. He said statistics more recent than those used by the Education Department show students who entered Benedict in 2000 graduated after four years at a rate of 13.7 percent, and after five years at 23.3 percent.

For the class that started in 1999, the six-year graduation rate was 25.9 percent, according to information Swinton provided.

“We’re not satisfied with the rate,” Swinton said. “We’re dealing with students whose parents were disadvantaged. We’re doing the best we can with those kids.”

A handful of Benedict’s 31 trustees have expressed concern that they have not been briefed on the college’s financial problems.

Newly elected trustee Darrell Jackson said he would like to see board chairman Charlie W. Johnson of Louisville, Ky., poll the board to see whether other members want to meet to learn more about the school’s finances, especially its $101 million in debt and other liabilities, and the student loan program.

Jackson questioned whether the school’s leadership has adequately served Benedict’s students.

“Claflin University and Morris College have avoided these kinds of penalties,” said Jackson, a state senator who represents the district in which Benedict is located. “Other historically black colleges have done what we are doing and have avoided these problems.

Four other trustees have told The State newspaper they would support such a meeting.

Efforts to reach Johnson for comment were unsuccessful.

Benedict’s enrollment dropped to about 2,550 last fall after peaking at 3,005 in 2002.

Because Benedict depends on tuition and fees to operate, the drop in enrollment has produced operating losses. Stabilizing enrollment this fall will be crucial to Benedict’s efforts to balance its finances.

Swinton has said he expects enrollment to match that of last fall or be slightly higher.

Each year since 1997, the Education Department has cited Benedict College for deficiencies in solving accounting and policy problems left from previous years.

Last year, the department issued its strongest warning in a Nov. 7 letter to Swinton:

“We would still remind the institution that this is a repeat finding. We would also like to restate that repeat findings in future audits or failure to satisfactorily resolve the findings of this audit may lead to an adverse administrative action.”

Swinton said Benedict disagreed with the auditors’ findings.

“They started out saying we owed them $2.5 million,” he said. “We were able to prove to them those loans were legitimate, all except about $250,000. The fact is, we thought those loans were legitimate, too. But someone lost the paperwork, or something.”