Interim President Grimes Reinforces T.I.P.
MESSAGE FROM THE OFFICE OF THE PRESIDENT
When I agreed to take on the role of Interim President at Bethune-Cookman University, I implemented a management philosophy I called T.I.P. (Transparency, Integrity and Positive Action). T.I.P. is my promise to students, faculty, staff, alumni and the community that leadership at B-CU will communicate more effectively and work together with you to create the best possible learning environment for our students.
Living the T.I.P. philosophy sometimes requires difficult conversations and that certainly applies to what I will share with you today.
As many of you will recall from the 2012-2013 timeframe, a shortage of student housing – coupled with safety concerns for certain students living off-campus – created the need for a larger dormitory on campus. To address these issues, we set out to find the best options possible, given our financial circumstances and lack of business credit.
An internal committee was formed to analyze prospective bids for the project. This committee’s ultimate recommendation to the Board of Trustees was based upon a set of representations made by one of the bidders, Quantum (including its related entities). Based on the representations and assurances of Quantum, the committee suggested retaining Quantum as the developer of the project. That recommendation was then passed along to the University’s Board of Trustees. However, the information then presented to the Board of Trustees was very different than – and far less favorable than – what was presented to the initial screening committee.
Following a review of the different and conflicting representations made by Quantum and its representatives to the Board of Trustees, the proposed deal was nevertheless approved, and the dormitory was ultimately constructed.
Additionally, the terms of the transaction proved to be incredibly unfavorable to B-CU. According to the construction company that actually built the dormitory, the project cost $59.2 million. However, B-CU paid $85 million for the facility; further, if this deal were to continue through its stated maturity, the cost – including interest and other payments – would reach a staggering $306 million.
Such an arrangement could cripple this institution. Obviously, something was very wrong.
Aside from seeking a refinancing package that would make terms more agreeable, we began to thoroughly research this transaction in an effort to determine exactly what happened.
What we found will be troubling to our entire B-CU community.
Regrettably, we believe that several former members of our leadership team failed to fulfill their obligations to B-CU, and instead worked with Quantum and others to knowingly enter into an agreement that was not in the best interests of our University.
As of this writing, we have filed a lawsuit in the Circuit Court for the Seventh Judicial Circuit alleging various claims. The defendants in the lawsuit include former B-CU President Edison O. Jackson, former B-CU Vice President of Institutional Advancement Hakim J. Lucas, former B-CU Vice President of Fiscal Affairs Emmanuel E. Gonsalves, TG Quantum LLC, Quantum Equity I LLC, Quantum Realty Capital LLC and several other parties.
The complaint seeks damages, interest, attorney’s fees and any other relief that may be necessary under the circumstances.
The complaint outlines how the subject transaction unfolded, and alleges that the former B-CU officials received improper inducements to ensure that the deal would be approved.
The decision to file this complaint was made after careful deliberation and considerable analysis of the available facts. We are invoking the legal process in an effort to protect our students and the institution (including B-CU’s financial interests).
When I was officially named Interim President July 13, 2017, my top priority was to pledge a spirit of transparency in an effort to win back the trust of those who are most important to B-CU.
We have taken steps to solidify B-CU’s financial future, including saving money through staff realignment and the sale of property. Still, resolving this dormitory issue truly was – and remains – our top priority.
As I am sure you know, litigation is an adversarial process and my ability to publicly comment on it will be limited. As much as I am legally able, I pledge to keep you apprised as we move through the litigation process.
As always, creating an optimal environment for our students, faculty and staff is our utmost concern. We have an outstanding group of students at B-CU, and it is our job to ensure that they receive the best education possible.
We thank you in advance for your patience as we move through this very complex legal matter.
Office of Communications
Assistant Director of Communications
About Bethune Cookman University:
Founded in 1904 by Dr. Mary McLeod Bethune, Bethune-Cookman University (B-CU) today sustains her legacy of faith, scholarship and service through its relationship with the United Methodist Church and its commitment to academic excellence and civic engagement. B-CU offers 38 degrees on its main campus and online college. Located in Daytona Beach, B-CU is one of three private, historically black colleges in the state of Florida. The institution boasts a diverse and international faculty and student body of nearly 4,000. For more information, visit www.cookman.edu.