SACRAMENTO, CA - On May 18, the University of California Board of Regents voted to retain UC president Robert Dynes with no change in his authority. The move followed revelations that a UC pay scandal previously addressed in this space ("Oh Say Can UC?" December 7, 2005) was worse than originally reported. The Regents' move sends the wrong message to a state in need of reform on all fronts.

In recent years, the UC has been hiking student fees nearly 80 percent while dishing out lavish bonuses and perks to already highly paid executives. A report in the San Francisco Chronicle pegged the amount at $871 million, more than enough, as the Chronicle noted, to cover the increase in student fees. Fabian Nunez, Speaker of the Assembly, called for an investigation.

Last month an audit by PricewaterhouseCoopers revealed more than 90 cases that evaded official UC policy. Seven of the 63 UC executives examined in the audit got stipends of more than 15 percent of their salary, a violation of UC rules. One got the stipend while on sabbatical. Some were paid for work performed previous to their appointment and enrolled in compensation programs for which they were not qualified. Some benefits were not reported to the UC Regents, the public, or the Internal Revenue Service. A full 20 pay deals occurred with no written evidence of approval.

Some of the violations occurred before Robert Dynes became UC president but others occurred after the Chronicle revelations, after the speaker's call for an investigation, and after promises from UC officials to fix the problem. They didn't. A May university audit found that UC officials skirted the rules 143 times in order to increase pay and benefits to 113 UC managers.

The PricewaterhouseCoopers audit did not name anyone responsible for the violations. To all but the willfully blind, those responsible are those in charge of the UC system. Gerald Parsky, chairman of the UC Board of Regents, warned there would be consequences, but that didn't happen.

After reviewing three audits and a task force report, the UC regents voted on May 18 to increase oversight but also to retain UC president Robert Dynes, with no change in his authority. Speaker Nunez, who called for the investigation, did not weigh in on the decision but others did.

"Where's the accountability? Where are the consequences?" said a statement from Senator Abel Maldonado. He was "dumbfounded" by the Regents' decision but clearly grasped its message. "The Regents are telling taxpayers that it is okay to waste the people's money and hold no one accountable," he said.

Meanwhile, a related UC case covered here ("Pillage People Turn to Pillory Penalty," February 8) also turns out to be worse than reported. UC Davis chancellor Larry Vanderhoef paid vice chancellor Celeste Rose a salary of $205,000 a year for two years, for a job with no duties, followed by a $50,000 payment if she dropped a discrimination suit. That works out to $460,000 in public funds, with no work in return.

The Sacramento Bee reports that, while working for the NCAA, Rose got other benefits that violated UC rules. Back at UC Davis as vice chancellor in 1998, she hired a consultant who during seven years billed the public university $200,000, at the rate of $1,500 a day. An investigation by UC Davis officials failed to reveal what work this consultant actually performed. As far as can be discerned, nobody was held accountable.

The University of California exists for the higher education of the best students in this state. It was not intended to be a patronage system for the redistribution of taxpayer dollars to a cozy club of affluent executives. Allowing UC bosses to break the rules with impunity provides no incentive for reform and sends a bad message to all state agencies.

To avoid such secrecy and waste, the next governor should appoint Regents committed to accountability. Those new Regents, along with the governor, should look into a new UC president committed to fiscal responsibility and leadership for the students of California.

K. Lloyd Billingsley is Editorial Director at the Pacific Research Institute. He can be reached via email at
klbillingsley@pacificresearch.org.