Lon Morris College plans to seek assistance from a reorganization firm in order to secure long-term stability.
“What they will do hopefully is go to some of our creditors who are holding endowments and free up some endowments but also … we have assets we can sale to help alleviate this problem,” said Dr. Jack Nelson, a member of the board’s executive committee.
In the meantime, he said Lon Morris hopes to be able to get through the summer and has worked to get refinancing of some long-term loans so it can immediately save money.
“We would really like for Lon Morris to stay. That’s what our long-range goals are and, we’re working toward that … We’re optimistic moving forward. We expect to be in operations in the fall and expect to get through the summer,” Nelson said.
Lon Morris spokeswoman Breezy Lake echoed Nelson, saying the board is hands-on and ready to work on the situation.
“Things are looking positive. … They’re really optimistic about what’s going to happen,” she said.
Employees have received late paychecks about four or five times in the past year. In December, Lon Morris administrators and several faculty and staff deferred paychecks so their colleagues could receive the money they were owed.
Officials have said the issue arises because of cash-flow problems.
Therefore, accounts payable comes in when tuition from government sources arrive, President Dr. Miles McCall has said. He said December and March through July are particularly hard months because students might leave for the holidays or summer still owing money from the previous semester.
“All of our revenue sources are attached to the way the economy is going,” McCall has said. “We have to accept that endowment revenue is down (and) donors can’t give that much.”
David Hubbard, the new executive director of student enrollment and retention services, said last month that Lon Morris is doing everything it can to clean up things that would have disrupted cash flow, and the business office is calling in students to ensure that payment situations are addressed. In the past, the school also pulled back on scholarships, increased tuition and dissolved or combined positions.