Southeast Missouri State University says its decision to evict Three Rivers Community College from its three Bootheel education centers last year is paying off financially even though the centers are still operating in the red.
School officials said the university is generating more revenue from student fees now that it's offering all the classes at centers in Sikeston, Malden and Kennett.
Southeast president Dr. Ken Dobbins said the university could break even on operating the centers within three to four years.
The university expects to lose $540,000 in its operation of the three centers for the current fiscal year which ends June 30.
That's a lot of money, but it's still an improvement, school officials say.
Southeast previously was losing about $800,000 a year in operating the three centers before it decided to boot out Three Rivers' classes.
Three Rivers taught most of the lower-division classes and received the student-fee revenue generated by those courses.
With Southeast teaching all the classes now, the university has increased its student-fee revenue.
"We're bringing more cash to the table," said university regent Al Spradling III of Cape Girardeau.
About 1,100 students are enrolled at the three centers.
Dobbins said the university expects some increase in enrollment in the next few years. That, coupled with increased fees approved by the regents Monday, puts the school on a path to eventually breaking even.
The regents and university administration don't want to continue subsidizing the centers. Dobbins said the university wants its centers to generate enough student-fee revenue to be self-sufficient.
Southeast and Three Rivers had a longtime partnership where the two schools shared the teaching load. But that dissolved after Southeast announced last year that it would teach classes at the centers after the spring 2005 semester.
The move angered Three Rivers officials who accused Southeast of breaching an agreement in which the Poplar Bluff-based junior college paid rent to teach classes at the center.
Southeast officials said Three Rivers wasn't paying enough rent to offset costs.
A year ago March, the community college filed a lawsuit against Southeast over the action by the university's board of regents.
To compete for students, Three Rivers in August opened five education centers in existing buildings in Malden, Sikeston, Kennett, Bernie and Campbell. A sixth center is housed in the University of Missouri's Delta Center in Portageville.
Meanwhile, the lawsuit is pending before Dent County Circuit Judge William Seay. The case was moved to Franklin County on a change of venue.
The dispute so far has cost the two schools more than $24,000 in legal fees, according to records obtained by the Southeast Missourian under the state's open-records law.
Over a 13-month period ending this February, Southeast paid more than $15,553 to the Cape Girardeau law firm of Limbaugh, Russell, Payne and Howard in regards to the dispute with TRCC.
Three Rivers reported spending more than $8,600 in legal expenses. That included more than $3,400 in connection with taking Southeast to court, and $4,204 to deal with Southeast's unsuccessful motion to dismiss the lawsuit.
Through Dec. 31, the college had spent more than $7,600 on its legal battle with Southeast.
Poplar Bluff lawyer Paul Kidwell, whose firm represents Three Rivers in the court fight, had no firm figure on legal expenses incurred in January and February of this year.
He said his bill to the college totaled more than $604. But with fees incurred by other lawyers' in the firm in the court battle with Southeast, Kidwell said the total expense to Three Rivers for the first two months of this year probably amounted to $1,000 to $1,500.
Dobbins suggested that Three Rivers' legal costs seem unrealistically low. He said Southeast pays its lawyers $125 an hour.
Kidwell said his rate is $130 an hour.
"We are just more efficient," Kidwell suggested as to his law firm's work.
Kidwell said that ties in with one of the arguments repeatedly made by Three Rivers officials -- that it can educate students at less cost than Southeast.
University officials said they have higher-priced faculty than Three Rivers.
"Efficiency is one of the arguments we have been making," Kidwell said of Three Rivers. "We can do it cheaper and more efficiently."
Southeast is spending $2.86 million to operate its three centers this year. That includes heating and cooling costs, building maintenance, and the salaries of the administrators of the centers, custodians and faculty.
Out of that total, the university is spending about $1.6 million on classroom instruction, Dobbins said.
Student-fee revenue is generating $2.32 million, said Kathy Mangels, the vice president of business and finance.
Dobbins said the university spent more than a half a million dollars to upgrade computers and provide quality science labs in the centers which added to expenses in 2005
In its lawsuit, Three Rivers wants more than $25,000 in damages. "The divorce is final except for monetary-type issues," said Kidwell.
Dobbins said the university isn't accounting for such a cost in its goal to break even in operating the centers. "It is a frivolous lawsuit," he said.
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