Texas Southern University’s financial crisis deepens

Texas Southern College faces an uphill climb to regain monetary autonomy because it enters 2026 underneath a crippling state funding freeze. 

Following a monetary audit that uncovered systemic mismanagement, the college should now navigate intense state oversight to reveal that it may be trusted with its personal funds.

Signaling a possible state takeover, Lt. Gov. Dan Patrick issued a New 12 months’s Eve ultimatum to TSU: Repair the “disturbing” monetary mismanagement found within the December 2025 audit, or the legislature will step in and do it for them.

“It’s my hope, for the sake of the scholars on the college, that TSU can proceed,” Patrick mentioned within the publish. “Nevertheless, to take action, dramatic and everlasting modifications should happen instantly to adjust to state requirements… I’ll do the whole lot inside my energy to ensure that not one further taxpayer greenback goes unaccounted for ever once more at TSU.” 

State Rep. Harold Dutton, Jr. (D-Houston) responded with a message of his personal. “These clowns ought to look within the mirror. Any issues at TSU have to be directed to the Board of Regents. And who appointed them for the final 30 years? The clowns within the mirror,” he posted on social media.

Systemic failures

The December 2025 state audit discovered important and systemic failures in TSU’s monetary operations, concluding that the HBCU repeatedly bypassed procurement safeguards, confirmed “important deficiencies” in its asset administration capabilities, didn’t account for hundreds of thousands of {dollars} in property, and submitted late and inaccurate monetary stories to the State of Texas.

The audit reviewed TSU’s procurement and asset administration practices from September 2022 via July 2025, together with monetary reporting for fiscal years 2023 and 2024.

Auditors labeled the problems as “precedence” considerations, which means they pose critical dangers to the college’s potential to handle public funds responsibly if left unaddressed.

Monetary lockdown

Patrick mentioned he, together with Gov. Greg Abbott and Home Speaker Dustin Burrows, has frozen all non-essential spending on the establishment. On the similar time, a legal investigation by the Texas Rangers stays ongoing.

“Everybody concerned have to be held accountable, from college staff to contractors, going again as a few years as there are questionable data and practices. Let the details lead the place they might,” Patrick mentioned.

The outcomes of the State Auditor’s report launched at the moment on Texas Southern College are past disturbing and present, at a minimal, a transparent mismanagement of hundreds of thousands of taxpayer {dollars} over a few years.

The brand new TSU President, on the job for lower than 2 years, agrees with the…

— Workplace of the Lieutenant Governor Dan Patrick (@LtGovTX) December 31, 2025

Congresswoman Sylvia Garcia (D-TX-29) and Congresswoman Alma Adams (D-NC-12), founder and co-chair of the Bipartisan Traditionally Black Faculties and Universities (HBCU) Caucus, wrote a letter to Abbott, expressing concern over his choice to order a legislation enforcement investigation into TSU earlier than a state audit is finalized. 

“Texas Southern College is being put in danger earlier than the details are even on the desk,” mentioned Congresswoman Garcia. “Launching a legislation enforcement investigation whereas an audit remains to be underway threatens TSU’s funding, damages its status, and creates uncertainty for college students and college. Accountability issues, however so does equity. The governor owes Texans a transparent clarification for why this step was taken early and the way he plans to guard the way forward for the state’s solely unbiased public HBCU.”

What does the audit say?

Auditors on the State Auditor’s Workplace discovered that TSU usually violated its personal procurement guidelines, permitting departments to buy items and providers with out required approvals, price range checks, or documentation. In all 60 invoices sampled by auditors, totaling $102,100, departments ordered straight from distributors earlier than finishing buy requisitions, a course of designed to make sure spending is permitted and funds can be found. 

Within the procurement course of, key findings from fiscal years 2023 via 2025 embody:

The college’s contract database, referred to as the Authorized Administration System, was riddled with errors. 97% of vendor data reviewed contained incorrect contract dates, quantities, or approval statuses, and a few contracts have been lacking solely.

Greater than 8,000 vendor invoices throughout the college have been dated earlier than requisitions have been created.

TSU lacked a dependable system to confirm whether or not vendor contracts have been legitimate. Auditors discovered that 743 invoices have been paid on contracts that had already expired.

In asset administration:

There have been extreme breakdowns in asset administration. TSU had not accomplished its required annual bodily stock since 2019, a lapse that auditors say straight contributed to the college’s lack of ability to find 50 of 60 property examined, representing $3.2 million in buy worth.

Monetary stories have been regularly inaccurate, with 2023 knowledge submitted practically a 12 months previous the deadline.

The College didn’t persistently monitor asset disposals. Many property lacked assigned custodians or have been nonetheless attributed to former staff. Consequently, property that had been auctioned or written off, together with a $560,000 bus for which the college had already been reimbursed by insurance coverage, continued to be energetic property within the system.

TSU maintained a separate Microsoft Entry database containing greater than 7,700 property that weren’t recorded in Banner, the college’s official system of report. Auditors described this dual-system method as “a big breakdown” in accountability that made it unattainable to find out what property the college really owns.

In monetary reporting:

TSU failed to offer well timed and correct monetary info to the Workplace of the Comptroller of Public Accounts. The monetary statements for fiscal 12 months 2023 have been submitted 10 months late, whereas fiscal 12 months 2024 statements have been filed 4 months previous the deadline.

Unaudited monetary knowledge submitted to the state contained main errors, together with misstatements of debt funds by $86.5 million in FY 2023 and $77.3 million in FY 2024. Whereas these errors have been later corrected in audited statements, the delays compelled the Comptroller’s Workplace to make changes to the state’s annual monetary report.

The college’s protection