HURON, S.D. ? On the heels of a bond issue proposed to bail out a financially struggling university system, 18 Si Tanka/Huron University employees lost their jobs on its two campuses.
The employees working on campuses in Huron and Eagle Butte were notified Dec. 1 of the layoffs.
The move came as Huron University acting chancellor R. John Reynolds and the university's board worked to get the tribally operated institution back on sound financial ground.
Reynolds said personnel costs were too high adding he did not anticipate further layoffs.
But the university's future could hinge on a bond referendum proposed by the Cheyenne River Sioux Tribal Council. It is one of the projects that would be funded under leveraged Joint Tribal Advisory Committee (JTAC) funds or just compensation money for lands lost to the Pick-Sloan Missouri River dam projects.
Thirteen of the employees worked on the Huron campus and five at the Eagle Butte campus. All but one or two of those who lost their jobs in Huron had worked at the university for only six months to a year.
"Our personnel costs were out of line, were just too high," the acting chancellor told local media. Personnel cuts were necessary to decrease costs as the school works to restructure its finances, Reynolds said.
Reynolds initially was hired by the board of directors as a consultant to recommend ways to get the school out of debt. He served as HU president from 1984 to 1993. During the early part of his presidency, the school also experienced turbulent times.
Reynolds indicated last month the university would have to trim costs, including cutting personnel and other expenses.
Cheyenne River officials estimated the university is at least $1 million in debt and they are attempting to restructure its financial situation. The board will discuss those options within a week, Tribal Vice Chairman Harold Frazier said.
Si Tanka College purchased Huron University earlier this year, but overspending on salaries, alleged undisclosed outstanding debt tied to the transaction and accounting irregularities led to a spiraling financial situation for the first off-reservation tribal college in the region.
Former key administrators allege that when Si Tanka acquired Huron University, tribal college officials were misled about the university's financial status.
The tribal college purchased the university using a $3 million direct loan from the U.S. Department of Agriculture and a $3.3 million loan from Marquette Bank guaranteed by the USDA. The latter was an existing loan Huron University's previous owners had with the bank at a lower USDA guarantee rate.
With the university clearly in financial trouble, its former president T.L. Traversie attempted to negotiate another $2 million loan and a $1 million grant with the agency.
Documents in a lawsuit filed by Traversie and several others who were fired, demoted or feared for their jobs say the federal agency refused, saying a new financial arrangement wouldn't be extended until the "present management" was dismissed.
At the start of the fall term, university officials said there were 619 students including 80 Native American students at the Huron campus and more than 200 students attending classes in Eagle Butte.
If the tribal bond referendum passes, the tribe will use a 20-year term bond issue that will net about $26.5 million the tribe could spend on refinancing debt and new capital projects.
The bonds will be issued against the nearly $290 million plus accrued interest the tribe will receive in just compensation monies.
The bond revenue also would be used to refinance debt for the tribe's Super 8 motel and buffalo ranch. Funds would be pledged for expansion of Cheyenne River's Lakota Technologies enterprise and the construction of a new 60-bed nursing home facility.
If passed, tribal councilmen say the bonds will be issued in January. Should the measure fail, the tribe may be forced to look at other financial arrangements to refinance its debt.