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CSU audit finds problems, recommends policy changes

The state audit examining executive compensation within the California State University recommended six steps for trustees:

Create a centralized catalog of all employees’ salaries and benefits.

Consider benefits and perquisites in addition to salaries when comparing employees’ compensation to university systems in other states.

Require that “transition programs” for departing executives include specific duties and reporting requirements to ensure that the employees provide an actual service to the university.

Set stiffer requirements for administrators’ paid leaves of absence, including time restrictions and safeguards if an employee fails to return after a leave.

Limit reimbursements and improve oversight of relocation expenses. The university should not pay employees’ higher taxes resulting from the reimbursement.

Require employees to disclose jobs outside the university and to get permission to ensure there is no conflict of interest.

Here are some examples of questionable compensation examined by the audit:

One employee was paid $102,000 during a seven-year leave of absence “on the premise that he was gaining experience that would benefit the university on his return.” But he never returned to the university.

At least three former university presidents retired but were rehired as “special assistants” to the chancellor, at annual salaries ranging from $54,372 to $204,156.

An administrator was paid for a year after leaving to work for a humanitarian organization.

An administrator accepted a teaching position but then immediately retired to take advantage of a faculty retirement incentive program. She then returned to work for the CSU as a consultant.

An employee was reimbursed $65,000 in closing costs and $19,000 in moving expenses.

Granting multiple raises based on merit and supposed market conditions led to some extraordinary salary increases. Three examples, all from the Fullerton campus: a 48 percent increase for a head coach between April 2005 and July 2006; 31 percent for a dean between March 2005 and November 2006; and 22 percent for a vice president from July 2005 to July 2006.

Nontaxable funds allocated by various foundations were used to supplement salaries and provide benefits. For example, a foundation at the San Diego campus gave $505,000 to one head coach and $280,713 to another last fiscal year.

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