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EASTERN MICHIGAN UNIVERSITY: THE HOUSE THAT
BUILT CONTROVERSY
In Ypsilanti, school officials, and union
members square off over a lavish mansion, built in part, some say,
with student funds
July 30, 2004
BY MARYANNE
GEORGE
FREE PRESS ANN ARBOR BUREAU
Reacting to the threat of a faculty protest outside a fancy
farewell reception for Eastern Michigan University President Samuel
Kirkpatrick on Thursday, EMU officials abruptly canceled it.
Union members at the university said the reception and the
partial use of student funds to build a 10,000-square-foot
presidential/fund-raising house illustrates misguided priorities by
the EMU Board of Regents. Union members say the regents are
diverting funds from the classroom.
Members of the EMU chapter of the American Association of
University Professors had planned a bread crumbs-and-water
alternative reception outside the Eagle Crest Golf Club clubhouse in
Ypsilanti to protest Kirkpatrick's $514,000 severance package and
the controversial $6-million house criticized in a state audit.
The controversy comes at time when EMU tuition has increased 30
percent and room and board has increased 15 percent in four years,
while state appropriations have fallen 15 percent, according to EMU
officials.
The EMU Foundation, the university's fund-raising organization,
decided late Wednesday to cancel the reception -- paid for by donors
-- after flyers about the alternative reception began circulating,
said Kathy Tinney, EMU associate vice president for university
relations.
The union has asked Gov. Jennifer Granholm to fire Kirkpatrick,
revoke his severance package and replace EMU Board Chairman Philip
Incarnati, Provost Paul Schollaert and investigate replacing the
entire board.
Kirkpatrick announced he would step down on June 15, four weeks
before the state audit was released. But Incarnati and other EMU
officials have said the resignation had nothing to do with the
audit's findings. Kirkpatrick could not be reached for comment
Thursday.
The audit criticized the university for not disclosing the actual
cost of the house, which they put at $6 million -- $2.5 million more
than the university claimed. Officials also failed to obtain state
approval for the project, which included $3.7 million from the
general fund, and did not maintain budgetary control of the project,
auditors concluded.
"I think this is a scandal," said James VandenBosch, vice
president of the EMU-AAUP. "The governor must step in and do
something to restore faith in Eastern Michigan University."
Granholm is studying the audit. State law permits the governor to
remove the board. A bill to remove the board is pending in the state
Legislature.
Incarnati said administrators have corrected mistakes discovered
by state auditors and denies using student tuition to build the
house, a gracious red brick and stone edifice located on 8 acres on
Hewitt Road in Ypsilanti.
Incarnati and Schollaert have said they will not resign and argue
that the union is calling for their resignations to gain an
advantage in contract negotiations.
"People may have questions about building a house, but to
question the board's stewardship of the university is inaccurate,"
Incarnati said. "There's no question that if we had known what was
in the future as far as state appropriations, we would have delayed
the project."
John Beaghan, EMU interim vice president for business and
finance, said the difference between the $3.5-million cost of the
house reported by EMU and the $6-million figure determined by
auditors was in part due to the definition of the project's scope.
EMU officials said state law required them to list the cost of
the house and anything within a 5-foot perimeter on the use and
finance statement, required by the Joint Capital Outlay Subcommittee
and the state Department of Management and Budget. The statement is
required for university projects of more than $1 million. Because
the project was controversial, EMU expanded the perimeter from 5
feet to 10 feet.
But they failed to include the $75,000 cost of a commercial
kitchen and the $423,000 cost for the 8-acre site, Beaghan said. The
finance statement was filed last July after the project was
completed, instead of prior to construction, as required by law.
Beaghan and Incarnati said not filing the form was an oversight
and procedures have been put in place to prevent future mistakes.
Bidding procedures for projects, which were criticized by auditors,
have also been improved.
State auditors said narrowing the scope of the project to the
building and a 10-foot perimeter for disclosure purposes "obfuscates
the true cost of the project."
While EMU officials cited the five-foot perimeter requirement "it
ignored requirements of the same provisions that provided for
disclosure of all other costs as site development." they said.
When costs such as landscaping, driveway paving and an internal
audit are included, auditors said the project cost $6 million.
Beaghan disputes that figure and the auditors' conclusion that
general fund dollars, which come from tuition, were used. Private
gifts, corporate royalties and revenue from debt refinancing were
used instead, he said. Only $200,000 in interest payments will be
reimbursed from the general fund.
"Every dollar was accounted for, nothing was hidden anywhere,"
Beaghan said.
But State Rep. Ruth Ann Jamnick, D-Ypsilanti Township, who called
for the state audit, said EMU officials owe the state an apology.
"I think it's time the president and the regents accept
responsibility for what happened at the house," she said.
Contact MARYANNE GEORGE at 734-665-5600.
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