c. 1997 Religion News Service

MONTGOMERY, Ala. _ Trustees at the University of Mobile have been given a July 15 deadline to either show how they will get the school’s Nicaraguan campus out of debt or risk losing Alabama State Baptist Convention funds.

The decision, reached at a meeting Tuesday (June 3), came on the heels of an investigative report from Nicaragua by the Mobile Register newspaper about the school’s operations in that country.

In recent weeks, the troubled Mobile school has witnessed the ousting of its president and the admission by its board of trustees chairman that the school had”sinned as an institution”by breaking monetary agreements with the convention _ the coordinating body for Alabama’s Southern Baptists _ involving the Nicaraguan campus.

Former university president Michael Magnoli was removed May 13. He admitted he had trouble managing the school’s finances during his 16 years in office.

Board of trustees Chairman Robert Maxwell said the school had agreed in 1994 to limit financial funding for the Latin American Branch Campus in Nicaragua to gifts specifically earmarked for, or generated by, that campus or from University of Mobile operating funds. The trustees were to return about $2.3 million to the Mobile campus that had been used as start-up funds for the Nicaraguan branch.

Maxwell said neither agreement was kept.

The Alabama Baptist State Convention, which gives the university more than $2 million of its $24 million annual budget, prohibited the university from using any of the convention’s money for the school in Nicaragua.

A recent audit projected the Nicaraguan campus will be about $3.3 million in debt to the main campus, forcing the school into a financial crisis.

Interim university president Walter Hovell told the convention’s executive committee Tuesday that to present a debt reduction plan he would need freedom to cut personnel and expenses as he saw fit, without regard to”politics.””I am not going to sacrifice my integrity, and if I’m going to be told who is off limits, I will resign,”said Hovell, who indicated he has been under pressure from Baptists statewide not to cut certain programs or individuals.”Give me the freedom to do what I know has to be done. We will not balance the budget with the status quo.” If the budget cannot be balanced, Maxwell said, the branch campus may have to be sacrificed to maintain the main campus’ financial well-being.”I did not mean to imply that come rising waters or the advent of Hades that we would hang on to that campus. We cannot hold onto it, unless there’s some other way of funding it,” Maxwell said.

The university, formerly known as Mobile College, opened the Nicaraguan branch in 1993 and its first senior class graduated last month. Nicaraguan President Arnoldo Aleman spoke at the ceremony.

The June 3 ultimatum came two days after the Register’s investigative report and a day after the university announced it would conduct its own probe in response to the newspaper account.

The Register story explored the campus’ finances, property acquisitions, scholarship disbursement and other operations.

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Tom Whatley, chairman of the state convention’s subcommittee on the University of Mobile, said a written promise from the university that it would comply with its past promises was necessary to ensure accountability for the laypeople tithing in the pews on Sunday morning.

Money collected in offering plates flows to the convention’s Cooperative Program, the general fund for denominational projects, then is disbursed to various programs or entities run by the convention.”If the people in our churches lose faith in the Cooperative Program, and lose heart in it, all our entities are doomed. If they think there is no control over how the money is spent, all our programs are doomed,”Whatley said.”We need this letter from the board as a statement to the churches that their Cooperative Program gifts are a sacred trust to this committee,” Whatley said.”Basically, what we’re asking these folks to do is to keep their word. It’s that simple.” (END OPTIONAL TRIM)

In 1994, the convention prohibited the university from using any convention money for the Nicaraguan campus after the university had committed heavy investments in Nicaragua without the convention’s permission.

The executive committee on Tuesday adopted a recommendation asking the university to certify in writing by July 15 that the school will comply with the 1994 agreement reached after the Nicaraguan controversy erupted.

That agreement called for all money used in the start-up of the Nicaraguan campus to be returned to the main campus whether or not it originated with the convention, and to send no more funds except those specifically earmarked for the Latin American branch.

The university’s indebtedness has forced its officials to borrow up to $2.2 million to keep the institution afloat.

Troy Morrison, executive secretary-treasurer of the state convention’s executive committee, strongly urged the convention and its Foreign Missions Board to take a hands-off approach to the university’s problems.

Any involvement by the convention in the university’s”international scandal,”he said, might not only reflect poorly on the convention, but”could result in bankruptcy for the Alabama Baptist State Convention. I do not believe any of us would want that kind of a disaster.”

MJP END LONG