"During the same period, the business division improperly used more than $628,000 from this all-purpose account to pay for campus expenditures not authorized by state laws and, in January 1995, illegally diverted more than $219,000 of its unspent utilities funds to the account. The unspent utility funds should have been returned to the State General Fund."
 "The business division improperly directed $15,000 in reimbursements for state expenses to an account it controls. In addition, the business division official mentioned in the allegations improperly used funds from this account to pay for consulting services supplied by acquaintances and former business division employees with whom she contracted."
 "The business division apparently charged other campus departments too much for administrative services and improperly used $197,000 in surplus fees to pay for costs unrelated to providing administrative services. According to the state law cited by the campus as its authority to make such charges, the funds should only be used to pay for the costs of providing those services."
 "The business division official named in the allegations circumvented official contracting policies and procedures when she authorized more than $158,000 worth of work through contracts and service orders, at times without any contractual documents, with her acquaintances and former business division employees."
 "The same business division official engaged in questionable personnel practices when she reassigned two of her staff to management personnel plan positions instead of recruiting for the best candidates, hired an employee who did not meet the minimum qualifications required for the job, placed a contractor in a management personnel plan position on an emergency basis and subsequently hired her as a manager at a higher level than the previous position, and hired another consultant as a management employee on a temporary basis without any recruitment."
 "Campus officials improperly participated in the creation of an auxiliary organization known as the University Advancement Foundation (UAF) and transferred to this organization the investment and management of millions of dollars donated to the campus."
 "From July 1994 to June 1998, campus officials inappropriately authorized payments of about $104,000 from Nonstate accounts maintained at the California State University, Fullerton, Foundation (campus foundation) and the UAF for food, entertainment, flowers, gifts, and other questionable expenditures for themselves and other campus employees."
 "The campus violated its fiduciary duty over funds designated for President's Scholars by transferring the funds to other accounts and commingling them with funds that can be used for other purposes."
 "The campus
led donors to believe that it had raised more than $1 million for scholarships
at its Front and Center fundraising events in 1995, 1996, and 1997 when,
in fact, it set aside only $556,000 for that purpose."
However, many of the allegations address contracting and hiring practices, and fiduciary duties about which there can be little argument. If the allegations in these areas are correct, then campus officials and officials of campus auxiliary organizations (the University Advancement Foundation) at the highest levels have been derelict in their duties. These people are public employees or quasi-public employees who have been entrusted with the management of significant amounts of public funds and private donations. They have a fiduciary responsibility to ensure that these funds are handled and disbursed properly for their intended purposes.
What has been most troubling to the Irascible Professor is the refusal of the campus president and the Chancellor of the California State University system to address these charges by the State Auditor in a forthright manner. Our president, Milton A. Gordon, has been dodging members of the press who have tried to ask him questions about these allegations, referring them instead to underlings who issue canned press releases or refer the questioners to the vacuous response from the Chancellor's Office. As far as the IP is concerned both President Gordon and Chancellor Reed are duty bound by reason of the public offices that they hold to respond to each of these allegations squarely. If they feel that any of the allegations are specious, then they should provide to the public and to the campus community the evidence supporting their positions. For those allegations that they acknowledge to be correct, they should lay out the facts in detail. They should name the university officials involved, take appropriate disciplinary action, and describe carefully and completely those steps that have been taken to ensure that there will be no repetition in the future. If they are not willing to do this, then in the Irascible Professor's opinion, they do not deserve to hold high public office.
As an aside, if any of you doubt the value of tenure and shared governance in academia, this a perfect example of why it is necessary. By a 15 to 13 vote our Academic Senate voted to conduct an investigation of the charges raised by the State Auditor (the IP voted in favor of the resolution authorizing this investigation). Two standing committees of the Senate will conduct the investigation, and will report their results to the Academic Senate by March 1. The president tried to stifle this investigation, using the argument that he had been advised by a consultant that the "story didn't have legs." Well as far as the IP is concerned this is not a public relations issue. The issue is whether or not the allegations are correct. We need a Lincolnesque response, not a Nixonian or Clintonian one! Fortunately, the protection afforded by tenure and shared governance will help us to "follow the money" so that we can get to the bottom of this mess.
about this situation is available from the following news sources:
Professor invites your comments.
©1999 Dr. Mark H. Shapiro - All rights reserved.