ATLANTA — One of the nation's top historically black colleges is cutting employee salaries and retirement contributions to increase student aid.
The announcement Tuesday by Atlanta's Morehouse College comes months after billionaire Robert Smith promised to repay all student loans accumulated by Morehouse's class of 2019. That one-time gift will total $34 million after the college announced this week that Smith would also repay money borrowed by parents of Morehouse graduates.
Morehouse President David Thomas tells news outlets that, for the next nine months, the all-male college will impose an unpaid monthly furlough day for 415 professional employees and stop retirement contributions of 3% of employee salaries.
"We are trying to take an approach that creates the least disruption to our education programs as well as to the quality of student services," Thomas told the Atlanta Journal-Constitution . "No faculty are being laid off or eliminated, and our hourly employees -- who tend to be our lowest paid -- are not impacted."
Some jobs will also be eliminated, with responsibilities absorbed by remaining employees. The overall cost-cutting effort is meant to save $3 million, the college said.
Thomas said the money will cover costs students aren't paying. He said 500 current students owe $5 million in unpaid tuition and fees.
"These students are trying to piece together a way of staying at Morehouse," he said. "We know from Morehouse history that in those 500 students are a great number who can go out and do amazing things in the world."
Morehouse and other colleges nationwide that depend on tuition for most of their revenue are increasingly cutting prices to entice students. The sticker price for Morehouse's cost of attendance, including tuition, room and board, is $48,723 this year, according to its catalog.
Thomas said Morehouse is seeking more donors, plus trying to raise more revenue by renting its facilities, developing online course and educating adults. He says expected revenue should allow an end to furloughs and cuts in retirement contributions.
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