Georgia Completes Higher Ed Consolidation Plan

The University System of Georgia has completed the consolidation of eight of the state’s 35 colleges and universities. There are now 31 USG institutions.

On Tuesday, the Board of Regents gave final approval to combining eight institutions into four, and appointed presidents to lead them.

“The board’s actions represent the culmination of a tremendous amount of work by many individuals, both on the campuses and at the [University] System office,” said Chancellor Hank Huckaby. “We identified the opportunity, did our homework and then moved quickly, but thoroughly, to follow through.”

In December, the planned consolidations were approved by the Southern Association of Colleges and Schools, the Southeast’s accrediting organization for higher education.

The SACS approval paved the way for Tuesday’s vote, and for the beginning of the transition process.

The consolidation will allow USG to use resources better and increase the scope of academic programming for students in the areas served by the new institutions, according to Shelley Nickel, associate vice chancellor for planning and implementation.

“Georgia has shown national leadership in our willingness to assess our structure and make major changes designed to better serve the state and students,” Nickel said. “In the University System, the past year has seen a tremendous amount of work as we have moved quickly and comprehensively to create new institutions for a new era.”

Moody’s Investors Service said last year that the consolidation effort is a credit positive for the university system because it fosters operating efficiencies and reduces overhead costs amid declining state support.

“If effectively managed, the mergers will reduce administrative costs, enable lower tuition increases and reinforce the value the system provides to Georgia taxpayers,” said Moody’s analyst Dennis Gephardt.

Like other public university governing boards across the country, Georgia’s is being pressured as state funding declines as a share of revenue and student charges climb to compensate, according to Gephardt.

“To maintain affordability, these universities must find new operating efficiencies to limit tuition increases,” he said. “Consolidations typically face intense opposition from entrenched stakeholders, especially loyal alumni, who are often successful in blocking mergers.”

Moody’s assigns its Aa3 rating to USG’s lease-revenue bonds.

Six of the eight merging institutions had a combined total of $305.4 million of outstanding debt at the time planning for the consolidation effort got under way, according to USG’s office of real estate and facilities.

The debt was sold by the Georgia Higher Education Facilities Authority and various local development authorities. The new entities will be responsible for the outstanding debt, university officials said. They are:

Georgia Regents University, formed by consolidating Augusta State University and Georgia Health Sciences University.

University of North Georgia, formed by combining North Georgia College and State University and Gainesville State College.

South Georgia State College was created by merging Waycross College and South Georgia College.

Middle Georgia State College created by consolidating Macon State College and Middle Georgia College.

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