The City of Birmingham had offered its share of requested funding to keep Birmingham-Southern College in business, but the college announced today that the college will be closing in May after the state never delivered on the $30 million loan the college requested.
Birmingham Mayor Randall Woodfin lamented the loss in a statement released today.
“Word of the decision to close Birmingham-Southern College is disappointing and heartbreaking to all of us who recognize it as a stalwart of our community,” Woodfin said.
“I’ve stood alongside members of our City Council to protect this institution and its proud legacy of shaping leaders. It’s frustrating that those values were not shared by lawmakers in Montgomery.”
He also offered kudos to Birmingham-Southern’s final college president, Daniel Coleman, who had served as a financial advisor to Woodfin on his first mayoral campaign.
“To President Coleman, you have our undying gratitude for your relentless pursuit of solutions during this difficult time,” Woodfin said. “Your dedication to BSC will not be overlooked. And to the many students past and present who call BSC home, know that you are part of the fabric of this city.”
Last year, Birmingham-Southern College touted its value to the state by issuing an economic impact statement.
Birmingham-Southern released a study by M. Keivan Deravi of Economic Research Services Inc. that asserts the college has an impact of $97.2 million annually on Alabama’s economy.
The private liberal arts college, founded in 1856, asked for $30 million in funding from the State of Alabama, $5 million from the City of Birmingham and $2.5 million from Jefferson County.
“Dr. Deravi’s study validates the fact that a $37.5 million investment by the public sector can return nearly a billion dollars in direct impact over the next 10 years to our state’s economy,” said BSC President Daniel Coleman in a statement released with the economic impact study. “That’s a great deal for city, county, and state taxpayers.”
Deravi based his economic impact statement on recent financial information from the college. BSC has 292 employees who were paid a total of nearly $21.7 million in salary and benefits in fiscal year 2022. It had 972 full-time students, 604 of whom were Alabama residents, with 40 percent from Jefferson County.
The impact statement estimates that each student spends $12,690 on retail, rental of real estate, utilities, recreation, gas and other expenses, a total of more than $11 million. Add in $19.5 million in in-state spending by employees and $15.1 million in in-state spending on goods and services, for a total of $45.7 million in direct in-state spending, the statement said.
The Birmingham Business Alliance “recognizes the significant loss this closure represents for the City of Birmingham and the broader state of Alabama. BSC has long been a pillar of our educational community, and its absence will undoubtedly impact our region’s academic, cultural and economic landscape,” the BBA said in a statement issued Tuesday afternoon.
“As we navigate this challenging transition, BBA commits to working closely with BSC and City of Birmingham officials to offer our support in any way needed. We will continue to seek avenues to support the students, faculty and staff affected by this unfortunate decision,” the statement read.
“The closure of Birmingham-Southern College will be a great loss not only for the Birmingham community but for the entire state of Alabama,” U.S. Rep. Terri Sewell posted on X, formerly known as Twitter.
“While no one had hoped for this outcome, the failure of state leaders to do their part and provide assistance to BSC is particularly disappointing. It remains my belief that the cost of such an investment would be small relative to the tremendous benefits of keeping the college open,” Sewell added.
“This is unfortunate, it is a travesty for our county. To lose $100 million of economic impact each year is devastating,” said State Sen. Rodger Smitherman, D-Birmingham.
”Birmingham-Southern did everything that the standards and criteria require to be eligible and then they came back with some more hoops and they jumped through those and made those adjustments too. So there’s nothing else that they could have done,” Smitherman said.
”We still have a bill,” he said. “I think it could (be voted on), but it just depends on a lot of dynamics. The positive side of it is that we do have a criteria set up.”
On Nov. 28, the Birmingham City Council voted to offer Birmingham-Southern College two $2.5 million loans to stay open, with the first contingent on a fall reopening, and the second with long-term contingencies. Both those loans were paid out to the college and under the agreed-upon terms will have to be repaid to the city.