USC President Carol Folt, who sought to reset the scandal-plagued university with major initiatives to boost athletics, expand computing programs and widen student access — but also drew criticism for her handling of pro-Palestinian protests — will retire in July, she announced Friday.

“After more than twenty years of leadership at three great universities,” Folt wrote to the USC community, “I am excited to embrace the freedom that comes with a next big leap, and to pass the baton to the next president who will be able to build upon our accomplishments and create a new chapter for this extraordinary institution.”

Folt, 73, will remain at USC as a tenured faculty member. Her future had been in doubt after the USC Board of Trustees in July offered her an extension on her five-year contract — but would not disclose the length or terms — as they reviewed her performance. She took the helm July 1, 2019, with a contract that compensated her at the same level as former President Max Nikias. Rick Caruso, then USC board chairman, said at the time he had hoped she would serve for 10 years.

USC Board of Trustees Chair Suzanne Nora Johnson expressed appreciation for Folt, saying she was hired at “one of the most important moments in the school’s history.” In a letter Friday to the USC community, Johnson praised her leadership skills and “innate ability to connect with community members on a personal level.”

“Her dedication to solving the difficult issues before her — whether past or present — have never impeded her focus on what lies ahead,” Johnson wrote. “Her keen strategic eye towards the future, and the groundbreaking initiatives she has launched as a result, will benefit both the current and next generations of Trojans, and [undoubtedly] contribute to USC’s long-term sustainable excellence.”

Rectifying troubled past on racial justice

Folt said she was proud of her work to expand programs in computing, health sciences, athletics, financial aid and student well-being. She launched a $1-billion plan to expand computing across the university, for instance, with a new School of Advanced Computing as its cornerstone.

Folt also cited “of special significance” her efforts to rectify the university’s checkered past on racial justice — offering honorary degrees to 33 Japanese Americans incarcerated during World War II who were denied the chance to continue their USC studies, stripping the name of eugenicist Rufus von KleinSmid from a prominent building and renaming it after Dr. Joseph Medicine Crow, a Native American leader, and honoring survivors of the Holocaust with a University Medallion.

Folt was hired with an overriding mandate to restore trust in the university, which had been rocked by one scandal after another. She replaced key administrators and brokered a $1-billion settlement with alumnae victimized by a sexually abusive gynecologist. She previously served as Dartmouth College interim president and chancellor of the University of North Carolina at Chapel Hill.

Her higher education experience and crisis management skills helped her land the USC job, Caruso said. He said her performance had “exceeded all expectations.”

“She took a university that was at its darkest point in its history, rebuilt it, restored the pride,” Caruso said.

Shaun Harper, a USC professor of education, business and public policy, lauded Folt’s leadership through the aftermath of serial scandals and the pandemic.”

“It took a special leader to come at that time and turn this university around,” Harper said. “We’re in such a much … better place than we were in 2019. That’s just incontestable. That will be her presidential legacy.”

But Ariela Gross, who was a law professor at USC for most of Folt’s tenure before leaving for UCLA last year, said the president fell short in delivering the ethical reckoning that had been promised. USC reneged on a commitment to make public an investigation of decades of wrongdoing and repair the harms suffered by the campus community, she said.

Gross also faulted Folt for launching what she called a broad investigative bureaucracy to police faculty and others who spoke out on the Israel-Hamas war and other issues.

Meanwhile, Gross said, USC began demonstrating financial struggles — reducing the long-standing benefit of free tuition for family members of employees who served for 15 years or more, which shut out her own daughter.

“I have no concern about the future or the current financial viability of this university. Not for one second,” Caruso said. “I’ve seen all the numbers, and I am very, very confident that the university, fiscally, is just fine.

In a statement, USC said the university is in a “very stable financial situation. Like all universities, we continue to navigate major changes impacting higher education. We are managing our operations and expenses to ensure a sustainable future.”

The first woman to permanently lead USC since its 1880 founding, Folt also worked to open access to more low-income, first-generation and underrepresented students of color. In one of her most highly touted initiatives, Folt directed USC to eliminate tuition for families earning $80,000 or less annually and no longer consider home equity in financial aid calculations. The estimated annual cost to attend USC for 2024-25 is $95,225 for students living away from their families.

She drew national attention for prominent moves to reshape USC’s athletics program. That included hiring a nationally renowned football coach, Lincoln Riley, on a $10-million annual contract — one of the highest salaries in the sport, which is now coming under criticism as USC’s performance falters. She also helped lead the move to the Big Ten that ultimately resulted in the reorganization of the Pac-12 Conference, and hired Jennifer Cohen, the first female athletic director at USC.

Censure over spring protests

Those actions were overshadowed this spring by enormous controversy over her handling of pro-Palestinian protests.

In particular, her decision to rescind pro-Palestinian valedictorian Asna Tabassum’s speaking slot in USC’s main commencement ceremony drew widespread outrage. Folt justified the decision by citing unspecified safety threats.

The turmoil escalated when Folt canceled the “main stage” commencement ceremony, depriving students and their families of a treasured ritual. Folt and her team called in police to dismantle a tent encampment that students set up in support of Palestinians, leading to 93 arrests.

She made no public remarks for two weeks, drawing criticism that she was missing in action during the most explosive issue of her tenure.

Such actions cost Folt key faculty support. In May, the USC Academic Senate voted to censure her and Provost Andrew Guzman over their handling of events around commencement. In a meeting of the senate, which represents about 4,500 faculty, 21 members supported the censure motion, seven opposed and six abstained.

“Carol was disliked by many different constituencies for many different reasons, though I think up until recently, most faculty, including me, saw her as a breath of fresh air from the prior administration’s ethical lapses,” said Morgan Polikoff, a professor at the Rossier School of Education who was on an Academic Senate task force that issued a report this fall criticizing the administration’s response to the spring controversies. “Given the budget pressures facing the university and higher education more generally, plus the current political climate, it would not surprise me if someone more conservative or business-oriented was chosen to replace her, but time will tell.”

Folt’s supporters, however, noted that the president had created the new school of advanced computing and boosted mental health services. She also presided over a record number of applicants — 82,000 for fall 2024 — driving down the admission rate to 9.3%, a record low. Admitted students, one-fifth of them the first in their families to attend college, had an average 3.89 GPA.

Under Folt, USC raised $3.75 billion, including more than $800 million in fiscal year 2023-24, the largest haul in eight years. Its fundraising total the previous year ranked in the top 10 among U.S. research universities, a USC statement said. Research expenditures grew to $1.1 billion in fiscal year 2022-23, a 27% increase over four years, according to the emailed statement.

Devin Griffiths, an associate professor of English and comparative literature, credited Folt with building relations with communities around USC and L.A. along with her focus on the environment. But he said the COVID crisis “blew a hole in the budget” and, like many other faculty, he faulted her for weak leadership during the protests last spring. Both he and Gross criticized the campus security measures taken since the protests, including shutting entry to all unregistered guests.

“The campus is really hurting right now. We face huge challenges moving forward, and I hope that we will find a leader who is able to tackle them and rebuild trust within USC and with our community,” he said.

Caruso also said navigating today’s difficult political environment was one of USC’s biggest challenges going forward. “You’ve got to create an environment where people feel safe and secure to go to class, to speak their mind, to have differences of opinions,” he said. “That’s what an academic institution is all about. I don’t believe an academic institution is there to take positions.”

Harper said USC’s next leader should continue the efforts to transform the campus culture, commit to prioritizing diversity, equity and inclusion, and be strong enough to handle the enormous pressures of being a university leader.

“We need a president who isn’t going to crumble under the pressure of the political context in which we all live,” Harper said. “This is a hard time to be a university president.”

Times staff writers Harriet Ryan and Matt Hamilton contributed to this report.