The Search For A New President of UofL Must Be More Open.

The University of Louisville is trying hard to recover from what can arguably be considered its darkest hours.  It has, and is still weathering challenges to its accreditation at several levels.  It has been turned upside down by a string of scandals that may yet lead to criminal charges.  All of this has been well-reported publicly resulting in a community consensus that a lack of transparency and accountability at the highest administrative and governance levels allowed corrupt and abusive practices to fester for years.  Where there should have been openness, there was deliberate obfuscation.  It is against this background that the UofL’s Board of Trustees seeks to appoint a new President of the University using a process that could not be more opaque.  Faculty members, some administrators, and students who have the most skin in the game are openly critical.  I am too.

The descriptors ‘open’ or ‘closed’ in reference to such a search are by themselves poorly defined. However, the recruitment process selected by the Trustees would deliver us as Deus ex machina, a new president to solve our problems, but one who would not be named until after they were appointed.  Such a process meets my definition of ‘secret.’  More of the same is the last thing we need.  The Board is increasingly being criticized for its retreat into opaqueness generally.  Its meetings are carefully scripted and I have yet personally to hear a substantive discussion publicly.  I must conclude, as I have in the past, that all major discussions or decisions occur behind closed doors.  Perversely, even those Trustee representatives of faculty, staff, and students are prohibited from sharing information with their own respective constituencies – or for that matter even sharing their own opinions publically. The assumption of this posture by the Board beggars the concept of shared governance. Continue reading “The Search For A New President of UofL Must Be More Open.”

Fiduciary Audit of UofL Foundation Looks Really Really Grim

Just got 269 pages of documents with a summary.

The summary supports previous claims of major financial mismanagement– if not worse. Oversight by Foundation Board was feeble if not inadequate. Ramsey supporters, enablers, and apologists, and  shares blame with former President Ramsey and other University executives. The so-called elite, chardonnay swilling, trouble makers who dared rock the boast and ask questions are vindicated in spades.

You can read the executive summary here.

Statements by current UofL President and Chairs of UofL Trustees and Foundation affirm their commitment to transparency and emphasize that the report reflects the management of previous administrations and boards.

Bad enough to put people in jail or to claw-back money?  We’ll have to see.

More when I dig into the details.

Here is a copy of the entire document. (6.7 MB)  What do you see that sticks out as either good or bad?

Peter Hasselbacher, MD
President, KHPI
8 June 2017
4:50 pm

Somethings Big Are In The Air

The Executive Committee of the UofL Board of Trustees is assembling now. The executive committee can act for the whole. I predict it will vote on the relationship with KentuckyOne Health. It is likely the vote will involve severance of the joint operating agreements. UMC would then take control of the entire Hospital. From what I have heard, and because of recent financial events, I will be surprised if this does not happen.

Tomorrow the State Auditor will announce the results of the audit of the relationship between the University and its Foundation. I understand that the audit will not be kind.

We will soon know more.

Peter Hasselbacher

Drop In Value of UofL Endowment Confirmed.

Endowment growth stalling compared to other institutions.

Numerous earlier reports by Mr. Chris Otts of WDRB brought to the attention of the public information about financial dealings of enough concern that at least two major donors to the University of Louisville withdraw their support, triggering in large measure an intervention by the University of Board of Trustees to take a more controlling role in the University of Louisville Foundation and a full-scale fiduciary audit. This latter offers the potential to clear the air or to lead to even more troublesome revelations. Mr. Otts’s latest report  deals with unauthorized spending of the University’s endowment by the Foundation in support of its commercial research, real estate, and other agendas both known and unknown. The result has been a substantial fall in the value of the endowment as its principal is consumed.

Sparked by Mr. Otts’s use of information provided to him by the University as reported to the American Association of College and University Business Officers (NACUBO); and by comments made by Trustees Greenberg and Benz at last week’s meeting of UofL Trustees raising serious concerns about the endowment; I went to NACUBO’s website myself.  Summary files for public use are available including the market values of the endowments of some 850 of the most important Colleges and Universities in the US and Canada from 1990 to 2015.  I abstracted these and plotted the market value of UofL’s endowment along with its rank among other institutions in this regard. Spending information or investment yields for individual institutions are not made available to the public, although summary statistics on aggregates in broad categories are available. A static image is presented below, and an interactive version revealing the underlying data is available.

In summary, the amount of our endowment rose progressively from 1990 until around 2007 after which much volatility occurred to the point that the market value of the endowment in 2016 is indeed less than it was 10 years ago in 2006!  UofL appears to be eating its nest egg, and compared to other institutions of higher education, is losing ground in endowment growth.

uofl-endowment-1900-2016
Continue reading “Drop In Value of UofL Endowment Confirmed.”