EDITORIAL: Central Michigan University's $10 million lie
University President George Ross admitted more than $10 million of the Events Center’s funding came from Central Michigan University reserves during Tuesday afternoon’s Academic Senate meeting.
“Look, if we fall short in our fundraising for the medical school, we will probably use university funds, (too),” Ross said.
This is the first admission after a week of Central Michigan Life investigation into the origin of the $10 million.
On Thursday, CMU Board of Trustees Chairman Sam Kottamasu didn’t even know what to call it.
“I wouldn’t call it a donation,” he said Thursday. “I would say that this is additional funding to help complete the project so donors can come forward.”
With his admission after a week of uncertainty surrounding the project, Ross and his administration have lost all credibility.
“We’re committed to raise all $21.5 million privately,” Athletics Director Dave Heeke said in April 2008. “We’re going to go out and ask alumni, friends and others to contribute to the project.”
Heeke did not return calls from CM Life and Associate Athletic Director Derek van de Merwe referred all comment on the $10 million to University Communications on Monday.
The public was never told about this $10 million allocation.
What is worse, students — who contributed to the Events Center — were never told their money would be used in this manner.
This was never the plan; it was never announced. No one was ever notified.
Website changes
Until Tuesday night, the Events Center website described the project as “privately funded” and made no reference to any permanent contributions from the university.
In fact, the image of an FAQ (frequently asked questions) section posted on July 5, 2008, was captured by CM Life during the meeting at 4:22 p.m. before its link was found to be removed at 5:30 p.m, along with links to multiple other references to funding on university-owned sites.
The FAQ showcased several statements explaining how and why the funding came entirely from donations.
The answer to Question 6, “Why didn’t the University fund this project?” stated “With declining state appropriations, the university did not have the cash reserves or operating budget to fund a project of this magnitude, and only academic buildings are funded by the state of Michigan.”
Question 10 and its answer were more specific: “Why where [sic] funds used for this project in tough economic times for the university and state?” The site stated, “Funds for the Events Center was [sic] provided entirely by contributions, sponsorships, and other new revenue donated specifically for the project. The University’s general fund and operating fund was [sic] preserved exclusively to support CMU’s academic mission.”
Other references to funding, including a fundraising brochure that referred to a “$20 million campaign” multiple times, were removed from cmich.edu in the same window of time.
Removing these pages without notification was nothing less than an attempt to alter history.
Financial responsibility
The FAQ’s answers are perfectly rational explanations for why the general fund should have never been used for projects that do not advance academics.
While it is understandable for the board of trustees to authorize funds to be repaid later for a substantial project, to change that funding from a loan to an allocation without a public announcement is disingenuous and unacceptable.
In the contract dispute with the Faculty Association, the University continued to make references to both limited cash reserves, the operating budget and the financial state of Michigan in general.
“Overall, however, the (FA) proposal would raise salaries by 9.8 (percent) ... The total compensation — salary and related benefits — would increase the university’s base budget by approximately $10 million,” said Ray Christie, vice provost of academic administration, in a July article.
After 2008, donations continue to be solicited for the $21 to $22 million project; fundraising efforts continue with an event specifically designed to collect funding for the complex which is scheduled to be hosted by alumnus and broadcaster Dick Enberg this Saturday.
No member of the University or board of trustees has stated whether funds beyond the next $3 million will be raised or whether they would be repaid into the general or facilities maintenance funds.
Students paid to have a “privately-funded” facility built and are now expected to pay admission to see the first-rate events it hosts. Students and alumni who have paid tuition dollars since 2007 deserve to attend any future events there for free.
If anything, a campus-wide vote should be held allowing students to choose their favorite name for the new arena, considering students are, in fact, the most generous donors to it and the Events Center.
Doesn’t “Student Tuition Arena” have a nice ring to it?
Consequences
The actions and words of the CMU administrators can no longer be trusted.
Large projects such as the biosciences building and the College of Medicine must be minutely scrutinized by the state of Michigan, the press and citizens.
There has been and will be more fundraising for each project. The administration should not be allowed to spearhead these efforts when it cannot tell the truth about a $10 million donation.
How can we trust any price tag the university gives the public when that number is changed and never noted?
Not only will all statements made from this point on be cast into doubt, particularly those pertaining to the aforementioned topics, but any project undertaken since George Ross began as vice president of Finance and Administrative Services also deserves scrutiny.
Despite his shortcomings as a public speaker and figure, Ross has always been marketed as a fiscally responsible leader. But his failures to protect or even accurately represent our economic health, including the CMU Promise scheme, have been damaging.
It would be irresponsible to allow this administration to move forward with such costly and ambitious projects as the at least $30 million College of Medicine and the $95 million biosciences building, the latter of which Ross described at the A-Senate meeting as the “largest financial investment of this university.”
Unfortunately, we cannot look to the board of trustees, which is nothing more than a rubber-stamp committee, to ask Ross the hard questions.
Board members have time and time again proved their spinelessness by ignoring serious problems and then refusing to answer questions about the issues.
How do its members justify keeping highly paid administrators at this university who will not admit they made a mistake after spending $10 million with-out telling its financiers?
Ross’ administration lied to students, faculty, alumni and community members about $10 million worth of funding.
It must be held accountable for failing at the most basic level of its responsibility.
