Only one UNC System school is not ‘financially healthy,’ report says. Here’s why
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- NC Central University is the only UNC System school rated not financially healthy.
- NC Central enrolled more than 9,100 students this past fall while its CFI lagged.
- The UNC System launched an unplanned audit into NC Central’s foundation.
NC Central University — Durham’s historically Black public university — is the only UNC System school that is not considered “financially healthy,” according to a new financial assessment framework used by the system.
That system, the Composite Financial Index, measures institutional financial health based on answers to the following four questions:
- How much does the institution have in reserve?
- Can the institution cover its debts?
- Is the institution’s financial strength improving?
- Is the institution living within its means?
For 2024 and 2025, the UNC System’s answer to each of these questions based on NC Central’s financial statements was negative. That means NC Central has a Composite Financial Index, or CFI, below the minimum threshold for financial health.
In that same time frame, however, enrollment at NC Central reached historic levels, according to the university. It celebrated its largest student body this past fall, with a population of more than 9,100 students.
And the university’s status did improve in 2025 — just not enough to join the other 15 UNC System campuses on the side of financial health.
“My first priority upon arriving at NCCU in 2024 was to strengthen the university’s financial position,” Chancellor Karrie Dixon said in a statement to The News & Observer. “We made difficult but necessary decisions to reduce costs and improve financial management. At the same time, we recognized enrollment growth as a key driver of financial health. Together, those efforts have helped improve our CFI score from 2024 to 2025.”
Dixon took the job of leading NC Central in 2024. She left Elizabeth City State University, a place she is credited as having brought back from the brink of closure. During Dixon’s first year in charge, NC Central boosted its position in each category included in the CFI calculation, figures derivable from the university’s financial statement.
UNC System President Peter Hans told The News & Observer that he’s “bullish” on the future of NC Central.
“We’re seeing consistent improvement over the past two years under chancellor Dixon’s leadership and sustained involvement from [the System] in supporting them, identifying issues, and exploring remedies,” Hans said.
“[That] isn’t to say that we should quickly gloss over or forget lessons that have been learned. ... I think it’s very useful for the Board of Governors to hear the information [on the CFI], and for the public to have a sense that people are paying very close attention to this.”
Dixon told The N&O that NC Central’s continued financial uncertainty underscores the need for overdue enrollment funding from the legislature. Enrollment funding pays for the costs of teaching and providing services to students, beyond what is covered by tuition. Because of the lack of state budget, the system hasn’t gotten that money this year or last year. Now, it’s asking for $159 million to cover both years.
But so far, it hasn’t been mentioned as part of the budget framework Republican lawmakers announced earlier this month. The system’s chief financial officer, Jennifer Haygood, urged board members not to worry: there is support for enrollment funding in the legislature, she said.
“Our first priority is restoring and strengthening NCCU’s financial position,” Dixon told the board on Wednesday. “As our enrollment continues to increase, growth has already contributed to improve our CFI score. However, that growth must be adequately supported.”
The data that informs the CFI has a substantial lag, meaning the current score represents the university’s position months ago, according to Joshua Lassiter, vice president for financial health and strategy. Lassiter called the data “stale.”
He is working on a financial early-warning system to complement the CFI scores. The hope is that it will allow the system to “look around corners” and identify financial risks before they become problems. That will include looking at indicators like turnover in key finance positions and late submission of financial reports.
“The ability to get in front of a problem or handle a problem in real time, in my opinion, it’s not going to come from these public-facing documents that are produced annually, and in some cases six or eight months after a fiscal year has ended,” Lassiter said.
“I think trouble sometimes lives below that public-facing surface,” he continued.
The university says it recently received a clean audit for the first time in three years, and had its credit rating affirmed by Moody’s, which indicates “continued progress in financial oversight and stability.”
“Like many public universities experiencing enrollment growth, NCCU is managing increased demand while working to strengthen reserves and align resources with student needs,” a statement from the university reads. “Recent actions, including spending controls, cautious hiring, operational realignment and expanded academic initiatives through Project Kitty Hawk, support a broader strategy for long-term sustainability.”
Meanwhile, an unplanned audit into NC Central’s foundation is underway, according to the UNC System’s audit plan status update.
