I am the Chancellor & CEO of South University and understand you are working on a story and would like factual information regarding our history. I hope that this information which I am providing you on-the-record is helpful and allows you to better understand some details that your prior reporting has missed. I've been told that your questions not only relate to South, but also to its ownership by EPF along with its relationship to Studio, our non-core service provider.
South is owned by EPF, a completely independent, non-profit foundation with a self-perpetuating board. EPF was made independent before South was sold to EPF. Colbeck does not have any ownership or control, in any way, of either EPF or South as both are entirely independent non-profit entities with self-perpetuating boards. Any suggestion (sic) otherwise, is categorically false.
South itself is also governed by an entirely independent and separate, self-perpetuating board of trustees.
When EPF rescued South from DCEH, South was saddled with onerous debt from its predecessor ownership. Those debt terms prevented South from investing in the restructuring activities that were necessary to separate South from DCEH.
EPF and South had to borrow money from a bank to refinance this legacy debt and to provide additional capital and flexibility for South to invest in its own restructuring, which ultimately saved the institution from closure.
During COVID when many universities were forced to close campus operations (South included), access to the Main Street Lending Program became crucial. 100% of the proceeds from the Main Street Loan were used to refinance the bank debt which was guaranteed by both EPF and South. This refinancing helped to reduce the cost of debt service and allowed more time for South to absorb yet another setback (the Pandemic).
South has stabilized and continues to execute on its mission to provide high quality education to its students.
Additionally, given the strength of South's recent 2022 performance, with over $20mm of operating surplus, South is well positioned to pay back the Main Street Loan, in full and on time.
Studio is our non-core service provider, with over 100-employees that provide South with services such as IT, Compliance, Facilities and Marketing.
Studio has been a valuable servicing partner and incredibly accommodating; offering crucial support and services to the institution at its cost and without profit for over four years.
Studio has cancelled all service margin (profits) owed by South, every year since the beginning of the relationship. Without this accommodation, South would not have survived, much less have recovered in a manner that has provided stability to the students, faculty, staff, and alumni of this 123-year-old institution.
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