University to review administrative spending

The hire was announced days after legislators raised concerns.
January 22, 2013

University of Minnesota President Eric Kaler announced plans to hire a consultant earlier this month in light of criticism from a Wall Street Journal article that reported excessive administrative spending.

While Kaler disputes some of the article’s accuracy, he announced in a press briefing that hiring the consultant would give the matter “external validation.”

The Journal’s analysis showed that the University spends more than any major research university on employees classified as “executive/administrative and managerial.”

Administrators, the Journal reported, grew 37 percent —“more than twice as fast as the teaching corps and nearly twice as fast as the student body.”

Since 2001, more than 1,000 administrators have been added to the University payroll, according to the article. During that same period, tuition and fees more than doubled.

Kaler criticized the Journal article at the state Senate Committee of Higher Education and Workforce Development last week. He noted that the University worked closely with Journal reporters in data compilation.

“We were as open and transparent as any institution could be to a media outlet,” he said. “And that’s why I’m dismayed about the [Journal’s] characterization of the University, about how they inflated some of the data and ultimately how they misreported some of our administrative costs.”

The article prompted two Minnesota legislators — Senate Majority Leader Tom Bakk, DFL-Cook, and Sen. Terri Bonoff, DFL-Minnetonka — to write a letter asking the University to review administrative spending.

In the letter, Bakk and Bonoff requested a data-driven, in-depth analysis of administrative costs similar to those that other Big Ten universities have conducted. They requested a report of the analysis by March 15.

“We understand that a thorough analysis will likely take more time, yet having this interim report will provide us with a strong tool as we formulate and hope to pass our 2013 budget,” they wrote.

In a letter to Bakk and Bonoff, Kaler expressed similar concerns about administrative spending.

“When I became president 18 months ago, I made the reduction of administrative costs a top priority,” he wrote, noting he would comply with their request for a report.

He also said that the University was making “solid progress,” pointing to the recent elimination of two major administrative offices, among others.

Kaler told legislators he was “very confident” in hiring the consultant to analyze costs because of his experience at Stony Brook University, where he previously served as provost and senior vice president for academic affairs.

“I brought in that same group of consultants, and I will tell you, they are very expensive,” he said.

As the legislative session continues, the University will continue to try to demonstrate to legislators why it’s deserving of an 8.4 percent increase in state funding.

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