The economic relief legislation approved by Congress yesterday included $1.3 billion worth of debt forgiveness for historically Black colleges and universities — including $22 million at Philander Smith College in Little Rock.
The bill erases debt for buildings and improvements. The legislation will instruct the Department of Education to pay off those federally backed loans, including interest, principal and fees.
The New York Times reported the good news for Philander Smith:
Roderick L. Smothers, the president of Philander Smith College, in Little Rock, Ark., said that he was still reeling from the shock. The measure would wipe out $22 million, about 70 percent to 75 percent of the school’s debt, overnight, he said, and make the college’s wish lists, like a new academic center, a reality.
“This really provides a moment to reset our finances, our balance sheets, our dreams — and it gives us the runway we now need to step back and think more creatively and more audaciously about the things we need to serve our students,” Dr. Smothers said.
He noted that it came in an extraordinary year for Black colleges, which have received huge increases in funding from both Congress and philanthropists, and widespread bipartisan support in their mission to take the nation’s most vulnerable student populations and build a strong, Black middle class.
“It feels like a form of reparations,” Dr. Smothers said.
Arkansas Baptist College received a loan of more than $30 million in 2014 from the HBCU Capital Finance program, according to a link in the Times article, but it’s not immediately clear if this is one of the debts to be forgiven by the new legislation. Arkansas Baptist received that money to refinance existing debt, incurred during a growth spurt and it has had a rocky financial road since. So far I’ve been unable to reach anyone at Arkansas Baptist.
Rep. Alma Adams, a North Carolina Democrat, first proposed the loan forgiveness plan in July and House Democrats included her proposal in the stimulus package.