\u201cThere\u2019s a sense of just fear and anxiety among all staff. Even those who are safe don\u2019t know if this is just the first phase of many future cuts,\u201d said Phil Turner, associate director of USC Housing, who spoke to The Times as an employee and not in an official capacity. <\/p>\n
In a wide-ranging Oct. 29 interview, USC interim President Beong-Soo Kim explained how the university found itself in such dire financial straits, detailed the austerity measures and pushed back against the notion that school leadership didn\u2019t communicate to staff and faculty about how its plan would unfold.<\/p>\n
Kim, who took over for former President Carol Folt in July, described several \u201cinternal\u201d and \u201cexternal\u201d factors that contributed to the deficit, among them the expenses associated with the COVID-19 pandemic, rising costs for athletics and the paying of major legal settlements. <\/p>\n
The belt-tightening has come amid President Trump\u2019s push to remake higher education in a manner reflecting his conservative political agenda. His efforts have included slashing billions of dollars in funding to universities nationwide. <\/p>\n
In early October, the White House presented USC and eight other schools with an education compact promising priority access to research funding in exchange for following Trump\u2019s vision<\/a>. USC rejected the compact about two weeks later, and it is not yet clear how \u2014 or if \u2014 Trump will respond.<\/p>\n Still, in his interview with The Times, Kim, 52, sounded an upbeat note. <\/p>\n \u201cWe can\u2019t predict the future,\u201d he said, \u201cbut we\u2019re feeling very optimistic that we\u2019ve met the budget challenge that was facing us, and can now focus on moving forward.\u201d<\/p>\n What USC says about its deficit<\/p>\n Kim had signaled in July that layoffs<\/a> would be forthcoming, writing a letter to the university community that said USC\u2019s expenses had \u201csignificantly outpaced\u201d its revenue for several years, leading to a budget deficit that, during the final year of Folt\u2019s tenure as president, mushroomed from $158 million to more than $200 million.<\/a> <\/p>\n Notably, in explaining to The Times how the university found itself in such a large hole, Kim did not cite two projects that faculty and alumni have often lambasted as financial albatrosses: the Bloom Football Performance Center, which broke ground in November<\/a>; and the Capital Campus in Washington, D.C.,<\/a> which opened in 2023 and included the purchase of a building for about $49 million<\/a>. <\/p>\n \u201cI feel like we are paying for the opulence of the last decade,\u201d said Turner, who also serves as president of the USC Staff Assembly<\/a>, which advocates for employees. <\/p>\n But Kim told The Times that the Bloom Football project would be \u201clargely … supported through philanthropy\u201d and that the campus in Washington would show a \u201cpositive operating margin after you calculate all the revenues we are generating against expenses.\u201d He touted several programs and institutions with a presence at the Washington campus, including the USC Leonard D. Schaeffer Institute for Public Policy & Government Servic<\/a>e and the Shoah Foundation<\/a>. <\/p>\n USC interim President Beong-Soo Kim assumed the role in July.<\/p>\n (Gus Ruelas\/SC Photo\/Gus Ruelas)<\/p>\n In July, Kim described a new challenge: \u201cSignificant shifts in federal support\u201d for USC\u2019s research and other programs stemming from the Trump administration\u2019s sweeping effort to cut<\/a> billions of dollars in grants to universities across the country. <\/p>\n USC has also been girding for decreases in international student enrollment. The Trump administration has increased its scrutiny of student visas<\/a> and enacted a travel ban that has prevented thousands<\/a> from studying in the U.S. International students typically pay full freight, and as of the fall, USC had 11,959 of them<\/a> \u2014 the largest population in California<\/a> and one of the biggest in the U.S.<\/p>\n Kim said that for this academic year, enrollment of international undergraduate and graduate students is down 3% from a year earlier. \u201cThis was actually less than what we were anticipating,\u201d he said. \u201cThat\u2019s a real testament, I think, to USC\u2019s brand across the globe.\u201d <\/p>\n But, Kim said, \u201cI don\u2019t know what\u2019s going to happen next year.\u201d <\/p>\n The nine-digit deficit and avalanche of layoffs have come as USC has steadily raised tuition and fees to become one of the most expensive colleges<\/a> in the U.S. The university projects the cost of attendance for the current academic year<\/a> to be $99,139, inclusive of housing, though many students receive robust financial aid. <\/p>\n Asked whether the figure would increase, Kim said, \u201cWe haven\u2019t made a decision about that.\u201d <\/p>\n \u201cLet me just say this: controlling the growth in tuition is definitely a focus of ours,\u201d he added. \u201cPeople focus on the sticker price, but the actual annual cost of attendance is less than half of that.\u201d<\/p>\n Who\u2019s to blame?<\/p>\n Historically, layoffs at USC have been rare. The 1990s, marked by a recession brought on by the collapse of the region\u2019s aerospace industry<\/a>, included two notable rounds of job cuts. In one wave, 58 people<\/a> were laid off and 31 vacant positions eliminated to pare down a $15-million deficit. Three years later, at least 100 faculty members at the medical school took pay cuts and an undisclosed number were dismissed as part of a plan to address an $11-million deficit<\/a>. <\/p>\n This time is different. Not only are the cuts deeper, but their scale and scope have shattered a sense at USC that it was immune to financial issues plaguing other schools. And they\u2019ve come after years of being battered by other crises, among them the Varsity Blues admissions bribery cases and the scandals involving former medical school dean Carmen A. Puliafito<\/a> and former university gynecologist George Tyndall<\/a>.<\/p>\n USC is a \u201cwealthy institution … and there\u2019s a sense of confusion from faculty as to how it got this bad,\u201d said Ryan Boyd, an associate professor of writing. \u201cThis is a university that should be well-capitalized.\u201d<\/p>\n The jobs that have been eliminated include every student academic adviser<\/a> in the Viterbi School of Engineering and many others in<\/a> the same role at the Dornsife College of Letters, Arts and Sciences. Other cuts have included adjunct and clinical instructors<\/a>. <\/p>\n Turner, who has worked at the university since 2009, said the \u201cstringing along\u201d of layoffs has sent morale plummeting, which \u201cinevitably is going to trickle down to the students.\u201d<\/p>\n But Kim said that \u201cbefore we sent a single layoff notice,\u201d he attended about 40 town hall-style events with faculty and staff to discuss the financial issues.<\/p>\n \u201cWe were able to compress a tremendous amount of action into a very, very short period of time,\u201d he said. \u201cThat was another one of our goals, to not only just do this once, but to do it as quickly as possible, so it is not hanging over people any longer than is needed.\u201d<\/p>\n Kim said that aside from \u201cordinary workforce adjustments that happen every year,\u201d the university has no plans to send additional layoff notices.<\/p>\n Some people have blamed Folt, whose multimillion-dollar university-owned<\/a> Santa Monica home was put up for sale in October<\/a>. (She no longer lives at the property, which is listed for about $10 million<\/a>.)<\/p>\n \u201cI\u2019m all for USC having … names on buildings and being world-renowned. But the financial hole that you leave when you don\u2019t properly plan for an investment like a building \u2014 it\u2019s the staff that are paying for those decisions,\u201d said Turner, referring to the Washington acquisition, which Folt trumpeted<\/a> in her 2025 State of the University address.<\/a> <\/p>\n In a statement to The Times, Folt said that when she became president in 2019<\/a>, the university faced a litany of issues, among them \u201ca significant deficit, costly legal challenges, and significant gaps in financial aid.\u201d <\/p>\n Folt said that under her leadership, the university took steps to address those and other issues and tackled an unexpected one \u2014 the pandemic \u2014 while focusing on \u201csecuring a sustainable financial future for USC.\u201d <\/p>\n \u201cSix years later, the results are clear,\u201d said Folt, who touted many successes, among them the Capital Campus.<\/p>\n As for the more recent economic woes, \u201cwe also were close to closing the financial gap,\u201d but \u201cexternal pressures\u201d \u2014 including inflation and higher insurance and health system costs \u2014 necessitated \u201ceven greater and faster adjustments,\u201d she said.<\/p>\n Former USC President Carol Folt.<\/p>\n (Art Streiber)<\/p>\n Several people said they did not blame Kim, a former federal prosecutor<\/a> and the son of Korean immigrants. He joined USC in 2020 as general counsel, helping the university navigate the Tyndall scandal, which resulted in $1.1 billion in settlement<\/a> payments to the gynecologist\u2019s former patients \u2014 the biggest sex abuse payout in the history of higher education. <\/p>\n Some USC stakeholders said they admire Kim\u2019s willingness to engage in a dialogue about the budget. <\/p>\n \u201cHe\u2019s met with Staff Assembly, including meeting with me,\u201d Turner said. \u201cAnd we\u2019re grateful, because that\u2019s something we didn\u2019t see over the past six years.\u201d<\/p>\n A steady stream of cuts<\/p>\n <\/p>\n
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