University of Minnesota President Eric Kaler on Tuesday denied contentions that administrative costs at the flagship institution have spiraled out of control, but also vowed to rein in spending.
Facing a growing drumbeat that the university is wasting money on well-paid administrators, Kaler headed to the Capitol to tell legislators that the university's $1.18 billion, two-year budget request is a smart investment.
"I am confident that the University of Minnesota is a well-run institution," he said, "but it has many opportunities to do better." He told the state Senate Higher Education Committee that he welcomed the request by committee Chairwoman Terri Bonoff for an analysis of the university's payroll.
Legislators have vowed to take a stern look at the university's costs this session. Debate around the country over administrative bloat got personal when the Wall Street Journal zoomed in on the University of Minnesota, reporting that, among 72 major research institutions, the Twin Cities campus had the largest share of employees labeled as administrators and that the school had gone "on a spending spree over the past decade," inflating its ranks of administrators. The paper's report echoed themes in Star Tribune coverage last year that found that administrators were leaving the U with lucrative severance packages.
"Constituents from all over were e-mailing us saying, 'What are you doing about this?'" Bonoff said.
Kaler and the Board of Regents have limited the practice of routinely granting paid leaves to administrators leaving the university.
Given the growth in enrollment and research, Kaler asserted Tuesday, the university is "more productive than ever." And he challenged the Wall Street Journal's analysis, saying there was no standard definition of an administrator and that "schools categorize employees in vastly different ways."
Capitol scrutiny
Legislators have long questioned how the U spends its money. DFL Rep. Gene Pelowski, the new chair of the House Higher Education Committee, has promised "weeks of due diligence," studying the budgets of the university as well as that of MnSCU, "program by program, campus by campus."
Kaler, who during his inaugural speech in September 2011 pledged "to reduce administrative costs every single year," listed on Tuesday recent savings in purchasing, energy and administrative costs. He said he lopped off the Office of Academic Administration -- eliminating a senior vice president position and reassigning the office's duties. He also eliminated the Bursar's Office. Those two moves should save $2.2 million, he said.
Kaler challenged the Wall Street Journal's reporting, citing what he said were inconsistencies within the data that universities submit to the federal government each year.
"I'm dismayed" he said, "about how they conflated some of the data, and ultimately, about how they misreported some of our administrative costs."
The paper reported that the U added 1,000 administrators from 2001 through last spring. That number included 354 faculty members, Kaler said, which the university incorrectly classified. "We clearly won't do that again," he joked. The remaining employees include study-abroad advisers, librarians and employees focused on classroom technology.
The Board of Regents received a new breakdown of the U's workforce in October. About 57 percent of the U's payroll goes toward employees who teach or conduct research or outreach. About 11 percent is spent on "administrative oversight."
Bonoff and Senate Majority Leader Tom Bakk wrote Kaler last week, saying the talk about administrative costs "has taken on a life of its own." Acknowledging that "stories like this too often become sensationalized," they asked for "both a short-term analysis ... as well as exploring the in-depth analysis other Big Ten universities have conducted." An interim report is due "no later than March 15."
The Higher Education Committee's ranking minority member, Sen. Jeremy Miller, GOP-Winona, said that he has not been satisfied with the university's responses to his previous requests about administrative spending. "They'd say that it's complicated," he said. "That it's hard to say who's in administrative roles and who's not." At one point, he said, he got a single-page document listing 11 positions and their salaries.
"Obviously, we know there's more than 11 administrators," he said, adding that he's looking to the March report.
"I don't think it's my responsibility as a legislator to micromanage the university's budget," he said. "But we owe it to our constituents and to the taxpayers of Minnesota to hold the university accountable."
Jenna Ross • 612-673-7168 Twitter: @ByJenna
