California State Auditor Confirms Compensation Scandals at CSU

The auditor’s report also highlighted a university policy that allows employees to have jobs outside of the university system provided there are no conflicts of interest. However, employees are not required to obtain prior approval for outside employment, nor do they need to disclose such employment. The State Auditor determined this policy to be completely inadequate.

Among the recommendations, the State Auditor urged the University to:

• Provide effective oversight of its system wide compensation policies by creating a centralize information structure to catalog university compensation by individual, payment type and funding source.

• Consider total compensation received by comparable institutions, rather than just cash compensation.

• Monitor the executive transition pay programs to ensure that the chancellor administers them prudently. In addition, transition agreements should include clear expectations of specific duties to be performed.

• Strengthen its policy governing the reimbursement of relocation expenses, including monetary thresholds above which would require board approval.

• Strengthen its dual-employment policy by imposing disclosure and approval requirements.
Clearly, this audit confirms that major changes are needed at the university and that the Trustees and the Chancellor need to begin investing in instruction rather than creating a get rich factory for executives.

Last month, the Governor signed into law legislation I authored that will help bring about some of the necessary changes. SB 190, the Higher Education Governance Accountability Act, will require all executive compensation packages to be voted on in an open session of a subcommittee and the full board. The bill will also require full disclosure of the compensation package with accompanying rationale, allow the public to comment on such action items, and make public advisory group meetings that deal with compensation matters.

Instead of supporting students, faculty and staff, the University has catered to elite executives. As a graduate of San Francisco State University, a parent of a CSU student, and a legislator entrusted to protect taxpayer dollars, I hope the CSU administration swiftly enacts changes so our public university system can succeed rather than be so tarnished by executive compensation scandals.

Leland Yee is a member of the California State Senate Democratic Leadership team and the Assistant President pro Tem of the Senate. Senator Yee is also a graduate of the University of California at Berkeley.