University of California President Robert Dynes hopes to look
ahead with a series of compensation reforms after facing state
legislators in a Senate hearing last week, which marked the second
time in just over a decade that the UC has had to answer to the
state regarding its compensation practices.
The UC has been under fire recently for what critics have called
questionable compensation practices after the San Francisco
Chronicle reported last November that the UC paid its employees
$871 million in unreported bonuses, raises, and other forms of
compensation.
Last Wednesday’s hearing was the first of two Senate
hearings in which UC officials will be questioned by state
legislators regarding UC compensation practices.
In 1992, the UC faced a similar position when it was discovered
that the university gave generous compensation packages to top UC
officials, including a $1 million retirement package for then UC
President David Gardner.
On that occasion, the UC promised reform after a state audit and
a series of Senate hearings. The state audit cited about $2 million
in questionable spending from a special administrative fund,
including expensive stays at hotels and charity donations made in
the names of UC leaders. Shortly after the audit, Gardner
acknowledged changes were needed and promised to respond to the
audit.
But Sen. Abel Maldonado, R-Santa Maria, said the UC is obviously
still conducting business the old way and asked Dynes how he will
ensure more compensation problems do not arise.
Dynes promised to make compensation reforms permanent with a
periodic review process to ensure policies are being properly
followed.
“Let me be clear: I intend to put things in place that
will stick,” Dynes said during the hearing Wednesday.
While apologizing for what he admitted to be a lack of
transparency in compensation matters, Dynes promised to investigate
fully the extent of any policy violations and cited a number of
reforms implemented to improve the university’s
accountability to the public.
“We take these matters seriously, and took to heart our
promise to correct some of the compensation-related policies and
practices that appear to be problematic,” UC spokesman Paul
Schwartz said.
But while admitting reforms are necessary, Dynes also emphasized
the difficulty of the university’s need to attract the best
administrators in order to remain a quality institution.
Schwartz said legislators are understanding of the challenges
the UC faces in keeping the university competitive.
But members of the Senate Education Committee present at the
hearing never stated that they accepted Dynes apology, and instead
emphasized the need for the UC to reform its practices.
State Sen. Gloria Romero, D-Los Angeles, said someone in the UC
must take responsibility if the questionable compensation deals
were found to be more serious. Romero suggested that some UC
administrators should be fired if serious violations of policy were
turned up.
“I want us to go beyond mea culpa and exact some
responsibility,” she said.
During the hearing, Dynes said no one has yet been fired as a
result of the accusations and investigation, but some people have
shifted to other positions within the UC.
UC Students Association President Anu Joshi, who attended the
hearing, criticized the university for shortchanging students by
making them believe that cuts to student services were the only
solution to the budget problems the university has been facing.
Students now know executives were receiving large compensation
packages while student fees were increasing and services were being
cut, she said.
“We are concerned about how far the UC is willing to go to
attract and retain top level employees,” Joshi sad.
Sen. Jeff Denham, R-Merced, introduced a bill in January which,
if passed, could require the state to approve the UC budget if the
university does not make its practices transparent.
A UC-ordered external audit of senior management compensation is
underway and its results are expected to be released at the end of
the month.
An independent taskforce has also been established to review
what Dynes has called confusing and sometimes contradictory UC
compensation policies. In addition, a new compensation committee
formed by the UC Board of Regents was created to provide oversight
of compensation matters on an ongoing basis.
A second Senate hearing in which board chairman Gerald Parsky
will testify has been planned for Feb. 22.