Saint Augustine’s University files for Chapter 11 bankruptcy in Raleigh

Saint Augustine’s University’s Chapter 11 filing puts student aid, payroll and the downtown Raleigh campus under court oversight as the school tries to keep operating. For Raleigh’s historic HBCU, the immediate question is whether classes, housing and day-to-day operations can continue while the university works through a debt load that runs into the tens of millions.

The university said it began a voluntary Chapter 11 restructuring process on April 28, 2026, with the stated goal of organizing its financial affairs in an orderly and transparent manner. Federal records show SAU estimated it owes between $50 million and $100 million to creditors, while listing assets between $100 million and $500 million. The largest debt listed was more than $14.4 million to the Internal Revenue Service. Other major obligations included about $3.3 million to an employee retirement fund provider and more than $2.1 million to the U.S. Department of Commerce. More than 20 creditors were listed in the petition filed in the U.S. Bankruptcy Court for the Eastern District of North Carolina.

Chapter 11 does not automatically force a university to close. It is designed to give an organization room to continue operating while it develops a plan to reorganize and pay debts. That distinction matters for students, employees, alumni and neighbors in downtown Raleigh, where Saint Augustine’s has long been one of the city’s anchor institutions. But the filing also raises immediate pressure around how long the campus can keep functioning, especially with the school’s finances already under strain and its academic standing still unresolved.

The bankruptcy comes after a prolonged accreditation fight with the Southern Association of Colleges and Schools Commission on Colleges. SAU said SACSCOC’s appeals committee unanimously affirmed the December 8, 2024 decision to terminate its accreditation, then said an arbitration panel upheld that ruling on July 14, 2025. The university also said it secured a preliminary injunction on August 15, 2025 that allowed it to remain accredited and operational during legal proceedings. SAU has said the Chapter 11 process is meant to strengthen its financial foundation, address accreditation matters and position the institution for long-term success.

The strain has already shown up in enrollment. WUNC reported in March 2025 that the university had lost more than 800 students since 2023 and had about 200 students remaining. Inside Higher Ed reported that SAU will automatically lose eligibility for federal financial aid in bankruptcy, which means many degree-seeking students will have to finish elsewhere. SAU said it plans to offer nondegree certificates and apprenticeships while students in degree programs transfer.

Leadership at the university has also remained unsettled. Local reporting said the interim president resigned after about four months on the job, and SAU later confirmed that Dr. Jennie Ward-Robinson had stepped down. The board now lists Sophie Gibson as chair, the first woman in SAU history to hold that post, and the university says its board includes 19 members with a student representative. Founded in 1867, Saint Augustine’s is now trying to stabilize its finances, preserve its mission and convince Raleigh that the campus can stay open while the court case unfolds.