As a Senate panel prepares to press University of Hawaii officials Monday about accountability issues in the wake of the Stevie Wonder concert debacle, faculty are questioning a lack of transparency in the raising and spending of millions of dollars in private funding at UH each year.
Long before the university lost $200,000 in the apparent concert scam, faculty raised concerns about what they describe as a secretive system in which outside money, typically routed through nonprofit organizations, is collected and spent with little public oversight.
"It’s really hard to track the money in and out," said Kristeen Hanselman, an associate director at the University of Hawaii Professional Assembly, the faculty union.
UH officials say they are guided by the donors’ wishes.
"We are extremely grateful for every hard-earned dollar that is contributed to the University of Hawaii," UH President M.R.C. Greenwood said in a statement. "In asking for and receiving financial support for any organization, there is an obligation first to respect the donor’s wishes. Not all donors want their gifts to be a matter of public examination. Many, in fact, don’t. And we adhere completely to the donor’s instructions.
"Beyond that, we encourage our deans and directors to share with their faculty how such funds are used to benefit their programs, but the degree to which that information is disclosed is ultimately their decision, and we do not dictate to them in this area."
Private funding provides critical benefits to UH, ranging from scholarship money for students who otherwise might not be able to afford college to helping underwrite research to improve medical care in Hawaii.
The $200,000 that UH wired to a Florida-based company to arrange the Wonder concert was not private money, but the fallout from the botched event has triggered even more questions about UH’s oversight of its overall spending practices.
A panel led by Sen. Donna Mercado Kim is to question UH officials Monday about the Wonder fiasco, the school’s fiscal management and related matters.
The UH Board of Regents also has formed a committee to "evaluate the university’s operational and financial controls and oversight practices."
THE QUESTIONS being raised about private funding similarly focus on oversight, whether the money goes through the University of Hawai‘i Foundation, a nonprofit fundraising entity for the university, or other nonprofits.
By the time the money gets to UH, the original funding sources and how the dollars are spent often are unclear, and the funding bypasses the usual route of state money appropriated through an open, publicly accessible process, according to Hanselman and faculty members. Greater transparency would help alleviate concerns about potential conflicts and other issues, they said.
Former Manoa Faculty Senate Chairman Bob Cooney, a researcher at the UH Cancer Center until January 2011, said faculty there questioned what he called lavish spending of foundation funds.
When the center’s director hosted parties at his home for the school’s supporters, faculty and others, foundation money was used to buy, among other things, imported wine from Italy, valet parking services for guests and house cleaning services before and after the parties, according to Cooney, now at UH’s School of Public Health.
When faculty candidates or others were taken out to dinner, they sometimes were treated at fine-dining establishments at the Halekulani and Kahala hotels, he added. At one foundation-funded dinner meeting Cooney attended, along with about 15 others, foie gras and venison were served, and the tab came to about $2,000, he said.
Over the years, faculty asked for expenditure information from the center’s administration, but they were rebuffed so often that "we basically gave up asking," Cooney said.
Dr. Michele Carbone, who has headed the center since 2008, defended the expenditures as part of an overall effort to "fix a cancer center that was in serious trouble" when he took over, raise community awareness of the important work done there and build support among donors and potential donors.
In the four years before Carbone’s appointment as director, the center raised slightly more than $1.5 million, he wrote in a statement. Since fiscal 2009, more than $22 million in gifts and commitments have been received, he added.
Carbone also noted that he paid for many of the dinners at his home, doing the cooking himself.
"Having dinners in our home adds a personal touch, allows guests to interact and is, of course, much more economical, and helps create a positive atmosphere that is conducive of dialogue and collaboration," he wrote.
Regarding faculty recruiting, Carbone said candidates — top scientists highly sought by other research institutions — were rarely taken to high-end restaurants and instead went to less-pricey ones with an ambience that promoted discussion.
Since 2009, 31 faculty have been recruited to the center, contributing to the renewal of its National Cancer Institute designation, according to Carbone.
MOST DONATIONS to UH are made for specific purposes and come with restrictions on how the money can be spent. For discretionary funds, deans and directors determine the best way to use the money.
Expenditure requests are reviewed by at least two UH account administrators to ensure the transactions are appropriate, reasonable and conform to the account’s purpose, according to the foundation and UH. In addition, the foundation reviews the requests.
The spending of private money on such things as valet parking has raised questions in part because the university has no specific policy for disclosing such expenditures at the college, department or program level.
In a statement, UH spokeswoman Lynne Waters said no system is in place that consolidates expenditure information for the public in an easily accessible way, and a database like that would be costly.
"In many cases, deans and directors have an ongoing relationship with major donors and routinely update them on the impact of their generous support," Waters wrote. "Additionally, many units provide annual reports that include how private and public fundings has helped their program."
Despite the private status of the UH Foundation, the organization goes beyond state and federal disclosure requirements and provides audited financial statements, tax returns, annual reports and endowment summaries on its website, according to the foundation and UH.
But such documents typically do not detail expenditures at the college, department or program level — the kind of information faculty and others consider most useful.
Like all state and county public agencies, UH is subject to the state’s open-records law, and anyone interested in getting expenditure information can submit requests under that law.
But that process can take weeks or months, with no guarantee of success.
The Star-Advertiser asked UH a month ago for records showing what the athletic director’s office has purchased with foundation funds over the past several years. UH has yet to provide the information, saying it is going through two file boxes of documents and redacting personal and proprietary information to make the records available.
The controversy over getting access to expenditure information last flared up a year ago at the College of Engineering, where faculty leaders seeking such data accused the college administration of stonewalling.
The faculty eventually received their answers, but only after repeatedly pressing the administration and after the publication of a Star-Advertiser story about the controversy.
"When the rubber hits the road, that’s when the process becomes long and convoluted," said engineering professor Amarjit Singh, co-chairman of the Faculty Senate for the entire UH system. "There are hurdles."
Ken Berger, president of Charity Navigator, an evaluator of charities, said he wasn’t surprised that UH faculty have trouble getting spending information.
"The culture within many of these universities is not very transparent at all," Berger said. "They would prefer people not to get into that level of detail."