CA: State audit finds UC execs got millions in extra compensation

AP on Bakersfield Californian ^ | 5/2/06 | Michelle Locke - ap

[NormsRevenge]

A state audit found University of California administrators skirted their own pay rules, giving senior managers millions more in bonuses, relocation packages and other perks than their publicly reported salaries.

The report, released Tuesday, is the latest in a series of probes highlighting irregularities in how the 10-campus system rewards its leaders.

The revelations, first reported by the San Francisco Chronicle, have been an embarrassment for the prestigious system, particularly since they cover a period when UC officials raised student fees substantially in response to state funding cuts.

The audit drew sharp responses from legislators, with state Sen. Jackie Speier, D-San Francisco, issuing a statement declaring the report was "more damning proof that UC leaders have flunked as guardians of the public trust."

Assembly Speaker Fabian Nunez, D-Los Angeles, said the findings "should be the final nail in the coffin of the University of California's outrageous compensation practices."

Nunez, who is also a regent because of his office, said UC should have a chance to fix problems, but "we must see immediate and marked improvement in their failed system."

UC President Robert C. Dynes, who has made some reforms to the system and promised more, issued a short statement saying the report illustrates the need for better oversight and promised "where there has been misconduct, misjudgments or mistakes, I will take appropriate action."

UC administrators have noted their executives generally make less than their peers at similar institutions nationwide and say they have to be able to compete for top talent. Still, they've acknowledged the need to do a better job of spelling out policies.

"This audit, like the other reviews, makes clear the kinds of compensation packages we've had to offer to maintain UC's level of competitiveness and quality," said UC spokesman Paul Schwartz. "At the same time, it also makes clear our need to clean up our approval and disclosure processes."

The audit noted that a survey of comparable institutions indicated they generally disclose no more than UC.

The report from State Auditor Elaine Howle looked at 2004-05 compensation and found that stipends, housing allowances and other perks accounted for $334 million out of a $9.3 billion total.

The data indicate that the 4,071 employees making more than $168,000 accounted for about 10 percent of regular compensation but received about 26 percent of the extra compensation.

Auditors also reviewed 100 highly paid employees and found that 17 benefited from policy exceptions granted by the UC president's office.

The new report confirmed findings by a recent independent audit that administrators didn't consistently get the required approval from regents for extra compensation.

For instance, when regents approved a salary for an incoming provost of $380,000, an increase from the incumbent's pay, they didn't know the new provost was getting a $125,000 housing allowance.

Information on all compensation was disclosed to regents in an annual report, but those reports weren't always accurate and were late the last two years, the audit found.

The issue of disclosing more information to the public came up in a separate issue this week. The legal adviser to the state Legislature issued an opinion saying regents' committees should meet in public when taking action on proposals involving the president, chancellors and some other top executives.

UC lawyers counter that the full board takes final action on executive compensation in public. They say committees can legally meet in closed-door sessions to protect employees' privacy.

Recommendations in the state audit include overhauling UC's pay tracking system, limiting policy exceptions and keeping a closer eye on campus compliance. UC should also disclose all forms of compensation for the highest paid employees, the report said.

Auditors also suggested that UC should look into seeking repayment where appropriate.

Regents are expected to discuss the pay issue when they meet later this month. Board chairman Gerald Parsky said in a statement that regents "stand ready to take strong action in regard both to individual cases and adoption of improvements to our compensation programs."

[NormsRevenge]

On the Net:

www.universityofcalifornia.edu/news/compensation
http://www.universityofcalifornia.edu/news/compensation

[SierraWasp]

Hey! If all the other stuff in the world is Bush's fault, why ain't this here Slippery Schwartzenegger's fault???

[txroadhawg]

I'm shocked, SHOCKED I tell you!

[DannyTN]

"why ain't this here Slippery Schwartzenegger's fault???"

It is. He ordered the audits. Always blame the person who catches the corruption and deals with it, not the previous administrations who fostered it.

[Libertarian444]

I love the faux "outrage" of all the state Dems quoted in the article, especially since they are the same people who collect boatloads of campaign cash from these crooks.

[calcowgirl]

http://www.bsa.ca.gov/reports/summary.php?id=501

California State Auditor/Bureau of State Audits
Summary of Report 2006-103 - May 2006

University of California:
Stricter Oversight and Greater Transparency Are Needed to Improve Its Compensation Practices

AUDIT HIGHLIGHTS

Our review of the compensation practices of the University of California (university) revealed the following:

• The Corporate Personnel System (CPS) used by the university's Office of the President (president's office) to track the pay activity of university campuses contains inconsistencies and overly vague categories that did not allow us to determine the reliability of various compensation and funding source classifications contained within it and that limit its usefulness as an oversight tool.
• Despite these problems, the CPS is the most detailed and complete centrally maintained source of information, and in fiscal year 2004-05 it reflects that university employees earned approximately $9.3 billion—comprised of $8.9 billion in regular pay and $334 million in additional compensation.
• The president's office appears to regularly grant exceptions to university compensation policy. In a sample of 100 highly paid university employees, 17 benefited from an exception to compensation policy.
• Appendix A presents the compensation, exceptions to policy, and additional employment inducements received by a sample of 100 highly compensated university employees.
• Some university campuses circumvented or violated university policy, resulting in a $130,000 overpayment to an employee and improper increases to others' retirement-covered compensation.
• The university did not consistently disclose its officers' nonsalary compensation, such as housing allowances, to the Board of Regents as required by policy.

[calcowgirl]

If all the other stuff in the world is Bush's fault, why ain't this here Slippery Schwartzenegger's fault???

Cuz he's just an actor. How about blaming this guy?

UC Regents Board chairman Gerald Parsky

[the anti-liberal]

Is this the same University of CA in Santa Cruz that's being threatened with withholding fed dollars over the whole military on campus bruha?

[Libertarian444]

Assembly Speaker Fabian Nunez, D-Los Angeles, said the findings "should be the final nail in the coffin of the University of California's outrageous compensation practices."

[calcowgirl]

Yes. The University of California has 11 campuses. The UC Regents oversee them all. The campuses are: Berkeley, Davis, Hastings College of the Law, Irvine, Los Angeles, Merced, Riverside, San Diego, San Francisco, Santa Barbara, and Santa Cruz.

[the anti-liberal]

"UC Regents"

I have discovered the root of all evil, the very plaque which threatens all of civilized society.

Thanks, I think...

[ArmstedFragg]

the very plaque

Twice daily brushing and the regular use of Regent Floss will take care of that.

[the anti-liberal]

Plaque, plague, oh what's the difference...

(oops...)

[NormsRevenge]

Highlights from state audit of UC pay practices
The Bakersfield Californian

http://www.bakersfield.com/119/story/49431.html

OVERALL FINDINGS:

- In fiscal year 2004-05, bonuses, stipends, relocation allowances and other perks amounted to $334 million of $9.3 billion total compensation.

- In a sample of 100 highly paid employees, 17 benefited by getting exceptions to pay rules.

- Administrators didn't consistently disclose the extra compensation to their governing Board of Regents.

- UC's pay tracking system has inconsistent and vague categories.

EXAMPLES OF EXTRA COMPENSATION:

- A dean at UC Riverside got a housing allowance of $187,500; the limit in place was $53,300.

- A dean at UCLA got a $270,000 housing allowance.

- A UC San Diego dean was overpaid by $5,000 a month over a five-year period in a complex plan designed to get around a requirement that the university get a percentage of outside earnings. UC San Diego officials told state auditors it would be inappropriate to drop the extra pay because it would take his salary below market level. The UC president's office is reviewing.

- A UC San Diego vice chancellor who was on sabbatical for much of 2004-05 got a $68,100 administrative stipend and an $8,900 auto allowance. UC San Diego officials said the employee assisted with administrative matters during her sabbatical and also said she had been approved for a raise earlier, but it was deferred due to budget constraints.

-A senior manager at UC San Francisco received a $1.2 million low-interest loan from the supplemental home loan program to pay off previous university loans, a personal loan and to make $573,000 in renovations to a home in Sonoma.

UC REFORMS SO FAR:

- All separation agreements of $100,000 or more must be approved by UC regents.

- Policy exceptions must be approved by the UC president in consultation with regents.

- Renovation to chancellor's houses or offices must be approved by UC president.

- Web site developed to disclose compensation information.

[NormsRevenge]

same article also on the net titled
Audit: UC execs skirt pay rules, pick up extra compensation
http://www.mercurynews.com/mld/mercurynews/14483992.htm

[calcowgirl]

Here's another good one:

http://www.bsa.ca.gov/reports/summary.php?id=501

For example, although the university agreed to provide an incoming provost with a $125,000 housing allowance, it did not disclose this allowance to the regents when they were deciding on the provost's salary. Consequently, the regents increased the new provost's salary to $380,000 without knowing she was receiving a $125,000 housing allowance.

[calcowgirl]

Don't dismay--Parsky will "fix" it. ;-)

[SierraWasp]

Why... That's a wonderful idea!!!

[SierraWasp]

THIS is the REPUBLICAN I had hoped would challenge Slippery Schwartzenegger in the 2006 Primary Election!!!

I think he lives in Oakland and he's dynomite!!! He's better than that black man running for Governor of Ohio!!! Rush read this article of his today and Rush rarely EVER reads stuff as lengthy as this on his show. I was enthralled, to say the least!!! (and so was Rush)