Nancy Welch: UVM Foundation should disclose who’s getting its millions – VTDigger
This commentary is by Nancy Welch of South Burlington, a professor of English at the University of Vermont. She is active in UVM United Against the Cuts, whose petition of No Confidence in the Leadership of UVM President Suresh Garimella has gathered more than 2,800 signatures.
Two letters to VTDigger, posted March 18, argue that the University of Vermont is akin to a corporation that will not be altered by employees airing “personal grievances” and that UVM faculty and staff must enter the “real world” where the pandemic has resulted in devastating private-sector job losses.
By equating Vermont’s public land-grant university with private corporations, these letter writers miss the mark. To safeguard this institution whose mission is to operate for the good of our state, both the University of Vermont and its private nonprofit wing, the University of Vermont Foundation, need to come under much greater public scrutiny for how its key administrators use, or abuse, public and donor trust.
As recent commentaries by Eleanor Hagopian and Helen Scott detail, UVM’s financial records reveal that the institution is in remarkably robust financial health, including its untouched $34 million “rainy day fund” and a total endowment of more than half a billion dollars. Imperiling the university, Hagopian and Scott argue, is the redirection of substantial resources away from academics and toward executive salary spending, multimillion-dollar consultant contracts, and super-sized capital projects such as the planned $95 million sports arena.
To this picture of troubling spending priorities, we need to add the previously undiscussed University of Vermont Foundation, the private nonprofit established a decade ago to solicit and manage alumni donations and other gifts for UVM’s benefit. The UVM Foundation’s publicly available IRS Form 990 filings and financial statements expand our understanding of UVM’s significant resources — and the hoarding of those resources even as academic departments like Classics, Geology and Religion face elimination and the campus child care center has been closed.
Consider: The UVM Foundation had a fund balance in 2018-19 (its 2019-2020 Form 990 filing not yet available) of more than $180 million. That balance includes $66 million in unrestricted reserves.
Given that the foundation’s 2020 financial statement shows an 18 percent increase between 2018 and 2020 in its restricted funds, we can surmise it has retained, and perhaps added to, this $66 million unrestricted reserve. When combined with the university’s own rainy day account, it is probable that together UVM and its private foundation sit on close to $100 million in available funds.
More: The UVM Foundation’s IRS filings also reveal that it is spending some $9 million annually in total compensation with $7.3 million of that compensation going to unspecified persons in unspecified amounts. Whereas UVM must make available to the public its list of all employees and their base salaries, the UVM Foundation is only required by the IRS to list the names and salaries of its principal officers and five highest-paid employees. All others receiving compensation — and at universities nationwide, this has included not only the salaries of foundation staff but tens of thousands of dollars in “supplemental” pay and bonuses for already handsomely paid university presidents and athletic coaches — remain a secret.
What the available public records can tell us, however, is that relative to its fund balance size, the UVM Foundation is spending more on compensation than the foundations for the University of Connecticut, the University of New Hampshire, and SUNY Binghamton and Stony Brook. Among these comparable university foundations, the UVM Foundation manages the smallest fund yet has the highest-paid officer, a director whose 2019 total salary was $426,000. Compare that with the salary of the UConn Foundation director, paid $295,000 to manage a fund three times greater than UVM’s.
All told, as a percentage of their total fund balance, these comparable university foundations spend between 1 and 3 percent on compensation. In contrast, salary spending for the UVM Foundation in 2018-19 amounted to 5 percent of the fund balance — with no legal accountability to donors and to the public for naming, beyond foundation officers, who is on its payroll.
To put this in perspective: If the UVM Foundation reduced its salary spending to 3 percent (in line with the UConn Foundation), it would free up close to $4 million in alumni and other donor gifts to reinvest in UVM’s core liberal arts offerings. If it reduced salary spending to 1 percent (in line with the Binghamton Foundation, whose fund size is just slightly larger than UVM’s), more than $7 million could be directed — as most donors likely intend — to mission-critical academic and campus programs.
It is possible, certainly, that UVM and its foundation have amassed a war chest of rainy-day and unrestricted funds to invest in the sports arena and other projects well outside the university’s core academic and land-grant missions. Here is where the public — and alumni donors — need to step in: to demand that this money be neither hoarded nor put toward vanity projects and excessive executive compensation but instead drawn on to fund jeopardized academic programs and canceled campus services.
We need to put the “public” in our public university and its foundation to ensure that UVM operates for public good, not for private gain.