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UC Regents Delay Action on Compensation Issue

By J. Douglas Allen-Taylor
Tuesday April 25, 2006

The chairperson of the UC Board of Regents said this week that there may be disciplinary action taken in the wake of the university’s employee compensation scandal, but what those disciplinary actions might be will not be revealed until the regents’ May meeting. 

The scandal surfaced last November after a series of articles appeared in the San Francisco Chronicle, charging that many highly paid university employees had gotten close to $600 million in additional compensation packages not publicly reported by the university. 

As a result, the university has already initiated three separate audits of compensation package procedures. Further, UC President Robert Dynes convened a task force of business, government, media, and education community members to look into the current compensation scandal and the regents have formed a permanent committee of compensation. 

Saying that the secret compensation packages were contrary to regents’ policy, regents chairperson Gerald Parsky said in a telephone interview following a special regents meeting in Los Angeles this week that regents “have asked [Dynes] to come to the May meeting to offer an explanation” as to why the secret compensation packages did not come before the regents for public approval. 

Parsky said that Dynes “believes that there will be consequences taken.” 

Parsky said that after Dynes’ presentation and a review of three separate audits of the compensation issue, regents may also take action themselves. 

One of those likely actions, Parsky said, “is a change in policy so that voluntary compliance with disclosure won’t be the framework for the future.” 

On Monday, UC auditors PricewaterhouseCoopers of San Francisco released the results of one of the compensation audits to regents, concluding that “certain benefits promised or paid” to some top-level university employees had not been approved by regents “as required by Regental policies” and that some of these benefit packages were “exceptions to university policies or standard practices.” 

In addition, the PricewaterhouseCoopers’ audit concluded that “certain of the compensation items” were not disclosed to the public as required. 

Among the compensation items listed as not approved by the regents in the PricewaterhouseCoppers’ audit was $97,500 in relocation allowances to UC Berkeley Chancellor Robert Birgenau, $248,000 in bonuses and incentives to UC San Diego Chancellor Marye Anne Fox, and $125,000 in relocation allowances to UC Santa Cruz provost M.R.C. Greenwood.  

In answer to a reporter’s question, regents’ chairperson Parsky said that it was “inappropriate to speculate whether or not the regents would have approved the compensation packages if they had been aware of them. The regents should have been made aware of them, and been allowed to address the situation. 

It’s important that the regents have a complete picture of what is being offered. That’s one of the responsibilities of every public board that I’m aware of.” 

Also listed in the PricewaterhouseCooper audit as one of the compensation items that was an “exception to university policies or standard practices not approved by the regents” was a perk granted to former UC Chancellor Robert Berdahl following a one year leave of absence after he left the chancellor’s position. 

An article in the San Francisco Chronicle earlier this year revealed that contrary to university policy, Berdahl was not required to return to a teaching position with the university, and did not have to pay back $355,000 he had earned from the university while on leave. 

“UC policy usually requires faculty members to return to teaching for at least as long they were on paid leave,” the Chronicle reported at the time. “Otherwise, they are supposed to pay back a prorated portion of the money.” 

Following the article, the UC Berkeley Associate Vice Chancellor for Public Affairs, George Strait, had issued an open letter to “the Cal community” stating that “we are certain that a review of relevant documents makes it quite clear that Chancellor Robert Birgeneau’s decision regarding former Chancellor Berdahl’s sabbatical and compensation was a matter of public record, in no way violated existing policy, and was completely consistent with the best interests of the university.” 

In his telephone press conference on Monday, regents chairperson Parsky said that it was a “reasonable expectation that the public should be informed of everything in the compensation packages. We have made it plain to [President Dynes] that if he can’t defend the terms of the compensation package to the public, then the compensation should not go forward.””