Education officials in Tennessee are in talks that could result in some state involvement with the financially ailing Lambuth University, including the possibility of its becoming a campus of the University of Memphis, The Commercial Appeal reports.

Although the discussions are preliminary, the newspaper said Gov. Phil Bredesen, a Democrat, had included an item in his budget proposal directing the Tennessee Higher Education Commission to study the feasibility of the state’s acquiring Lambuth, which is located in Jackson, Tenn.

As reported last week by The Chronicle, Lambuth was one of more than 100 private nonprofit colleges that failed the U.S. Department of Education’s test of financial responsibility.

Earlier this year, Lambuth, citing cash-flow problems, delayed paying its employees. —Goldie Blumenstyk