Harry Smith Jr. was picked in 2012 for the governing board of North Carolina’s public university system in large measure for his business acumen.
He knows how to run a business, state Sen. Phil Berger would say. Favored by several key voices, he rose to vice chairman on the board and in May was elected chairman.
Now he’s got his biggest test since the banks told the former CEO to shut down Flanders Filters, an air-filtration company with no money, limited sales and a reported net loss of $16 million in 2010.
Margaret Spellings, the university system’s president, is leaving. Her exit is two-sided.
She succeeded in part where critics of her hire said she wouldn’t. Professors at UNC and East Carolina penned an op-ed saying “UNC needs a president who will help the university system continue to give students the best education possible while avoiding unnecessary tuition hikes.” She was deemed a political pawn.
Not only has tuition not been raised in two years, enrollments and graduation rates are up. Accountability and transparency are touches she leaves across the 17 campuses.
She fails, however, by quitting so quickly. Continuity between the president, board and the board’s appointment body would be welcomed, and it was Spellings — not Smith — that initiated the “time to go” discussion. Her contract, with generous exit strategy after fulfilling two years, was through Feb. 28, 2021.
She’s walking away with half a million dollars in separation payment.
Smith might have asked her to leave anyway. Regardless, the board that long reflected the Democratic stronghold of the General Assembly now reflects the Republican control.
Spellings’ tenure covers the state’s controversial periods of the HB2 bathroom bill, Confederate statues and a splintered board of governors. She was challenged. But she was also paid $775,000 a year and earned bonuses of $90,000 or more each of the last two years for a reason.
Whatever happened to Smith’s filter company? He’s no longer CEO. Four Flanders facilities he solely owned sold for $51 million in 2011, and a private-equity firm bought Flanders for $190 million in May 2012 — when Smith had shares valued at $13.2 million.
He stayed on as CEO until 2014, and has since shifted attention to his real estate investments. Flanders was later bought for about $430 million in 2016, showing revenue growth of 40 percent from 2010-15.
Yes, he absolutely rescued and turned around that company.
Those like us who wish for the UNC System to remain a national leader are hoping Smith can do two things in this next assignment.
One is get the spotlight off the board and back on positives within the UNC System. The second is a two-for-one: bringing unity to this group when it lands Spellings’ successor.
We wish him the best.