During what one employee characterized as “a very emotional day,” Lon Morris College confirmed that employees were furloughed and school President Dr. Miles McCall tendered his resignation, effective today.
The announcement came amid the school's efforts to reorganize and salvage the private, two-year faith-based institution, which is facing financial struggles.
John Kroll, a Lon Morris trustee and economist with the firm Haley Romero Winick & Kroll Inc., said Wednesday that employees haven't been terminated, as has been reported in other media outlets, but “a great number of employees” have been furloughed as the school goes through reorganization over the next 30 to 60 days.
Dave Hubbard, executive director of student enrollment and retention services, said the school hopes to be able to rehire employees for the fall semester. All campus departments are functioning, with 11 employees still working, he said. Hubbard also confirmed that the employment actions today were furloughs.
“It's hard news, but … this group of people is the best group I've ever worked with. Their resilience is marvelous, and they didn't want to leave when they were told to leave (Wednesday). The consulting firm is amazed at the employees at this place. We're hopeful this will turn out to be a positive thing… Sometimes you have to go through the valley to get back up the mountains.”
Hubbard said in the last week or so, Bridgepoint determined that Summer I and Summer II sessions won't be offered. Maymester is slated to end Friday.
Despite the assertions from Kroll and Hubbard, the letter received by affected employees makes no reference to furloughs. However, the subject line of the email reads “furlough notice.”
The letter, written by Chief Restructuring Officer Dawn Ragan, who is in charge of day to day operation of the college, references Lon Morris' “significant financial and liquidity difficulties” as well as missing its last three payrolls.
“Your loyalty to the college, and especially to the mission, is very much appreciated, but unfortunately due to the current circumstances, all employment by the college is hereby terminated on the earlier to occur of either immediately as of 5/22/12 or the last day worked prior to 5/22/12, subject to confirmation where appropriate, excluding a minimal core group,” the letter reads. “Vacation accruals, pursuant to company policy, are extinguished upon termination of employment.”
The letter further calls for employees or other representatives who have extended campus housing or other room/board type benefits to vacate within 10 days and states that health care benefits for all employees are expected to be canceled “in the near term due to nonpayment of premiums.” Employees were asked to return all college property to human resources.
Ms. Ragan concludes the letter by writing, “We regret the financial situation we find ourselves in, but are hopeful with the support of our board and stakeholders we will find a viable and sustainable solution to our difficulties. We are very appreciative and respectful of the contributions and loyalty of each of you on behalf of the college and our mission, and respectfully ask that you continue to work with us for the next few weeks while we try to develop alternatives to maximize the value of the college and seek to get employees and creditors paid.”
“He made the decision to resign … He felt like his statement to us and the board was his mission was to keep the school open and felt at this point it would serve reorganization effort better if he would step down…,” McRae said.
“It was at a point where authority had been given to the (chief restructuring officer) anyway. He hadn't been involved in the decision making. He asked 'Do I have a function I could aid in this reorganization?' and 'How can I be used the best?' and they told him it would help … if (he) told (them he) wanted to do what was best in the reorganization effort, and (the officer) said it would be helpful to step aside, and she said the sooner the better … His main concern was the viability of the college. He wanted to see it survive.”
Kroll commended McCall for his work at the college, saying he doesn't think the school could have done as well as it has without his leadership.
“As we go through the reorganization and the assistance that the school needs to maintain the quality of education we offer and the wonderful things we offer to students, I think (his resignation) was one of the things that unfortunately had to happen,” he said.
Kroll added, “Once again Dr. McCall put the interest of the college ahead of his own and resigned during this reorganization process. … It became clear to Miles and ultimately the board that the best term of action was for Miles to resign and move forward with (the reorganization process).”
With regard to his separation from Lon Morris, Kroll said there was not any severance package offered to McCall, and, to his knowledge, McCall has not taken a salary “in quite some time.”
McCall, who has been in the position seven years, declined to comment on his resignation.
Now, Kroll said the plan is to restructure debt obligations and move forward with the reorganization efforts.
“The college is fiscally sound. It has a cash flow issue, (and) … the board took great steps to bring in some experts that have dealt with this situation before, which is not a skill set that the board or Dr. McCall has had, so we brought in two experts that this is what they do for a living…,” he said.
“It is our hope that the city of Jacksonville will rally around Lon Morris and its employees and realize what an integral part of the fabric and well-being it is (in the community).”
The Texas Annual Conference of the United Methodist Church is already taking steps to help Lon Morris College employees.
Several ministers in the conference, along with the bishop and entire cabinet, have sent a letter asking members to either designate funds or take up a collection that will be designated to help Lon Morris pay salaries, Paula Arnold, director of communications for the conference, said Tuesday. The goal is to cover one payroll, which is about $250,000.
Ms. Arnold said Wednesday the bishop now certainly believes efforts to help staff and faculty at Lon Morris is even more important, so the conference will continue that effort.
“We anticipate the response will be good and will talk to (donors) about the … mechanics of how to get money to employees,” she said.
Wednesday's announcement “certainly doesn't change our opinion that we need to find a way to help faculty and staff,” she said.