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Inspector General Forwards Complaint to SUNY Auditor

On March 15, I contacted the New York State Inspector General to ask about the propriety of SUNY employees receiving additional compensation from private foundations.

It’s a question I initially posed last July to the NYS Comptroller’s office. They referred me to the Commission on Public Integrity. I asked them about it via email on August 4, 2010. They responded on January 24, 2011:

I spoke with our investigators, who have reviewed your email of August 4, 2010, concerning certain actions involving officers and employees of the Research Foundation of the State University of New York (“Research Foundation”) and UB Foundation Activities Inc., a separate and distinct entity from the Research Foundation.

The Commission has statutory jurisdiction to act upon complaints that allege a violation of Public Officers Law §§73, 73-a or 74 or Civil Service Law §107 which apply to officers or employees in the executive branch of State government, or Legislative Law Article 1-A, which apply to lobbyists or clients of lobbyists.  Prior to April 25, 2007, the State Ethics Commission, the Commission’s predecessor agency, did not have jurisdiction over the Research Foundation.  As of September 24, 2007, all matters pending before the State Ethics Commission were transferred and assigned to the Commission on Public Integrity.  [See, Ch.14 Laws of 2007, §40.]

The Commission does not have jurisdiction over UB Foundation Activities Inc.

As a result, the Commission will not be proceeding with this matter.

Click here to read the letter I received today from the NYS Inspector General. They say they’ve decided to turn the question over to the University Auditor of SUNY.

It seems like a simple enough question. Should a state employee be handsomely compensated by groups that claim to be private and beyond the reach of the press and public? No extra work is involved, the employee is doing the same job. Could such a set up create a conflict of interest?

Click here to read SUNY Chancellor Nancy Zimpher’s memo recommending that UB president Satish Tripathi receive a combined total of $265,000 from the SUNY Research Foundation and the University at Buffalo Foundation, in addition to his state salary of $385,000. But that’s just one example of such a salary top-up. Some others were documented in The Great UB Heist. Earlier this year, UB Foundation attorneys turned over a 34-page list of individuals on their payroll. It represents over a thousand people.

Click here to read a 2004 audit by the NYS Comptroller’s office describing a situation where a state employee was also being paid by a foundation. The practice was deemed improper, and stopped, because:

By allowing this University employee to be paid a supplemental income by the Foundation, the University is using the Foundation to circumvent the State system by allowing a State employee to earn a greater income than what is permitted under that employee’s salary and title plan and has violated the Retirement and Social Security Law. (page 26 of the document)

In 45 days, the SUNY Auditor’s office is to advise the Inspector General of the results its investigation.

Of course, as we told you the other day, auditors in Albany have quite a bit on their plates these days.


  • Peter A Reese

    Passing off the hot potato is always easier than growing a spine.

  • Jim Holstun

    But strange things happen–you might run into somebody at the SUNY Auditor with a conscience or a belief in law and justice outweighing a desire to be promoted or have a palm greased.

    But why is the Comptroller unwilling to follow its own precedent from its 2004 audit?

  • Danielle Scinta

    As such an action would inhibit the liberty of the state’s residents, it would be a violation of the 14th Amendment for the state to regulate the financial awards provided by private organizations to individuals. And if you want to make public university jobs conditional on and subject to even greater limitations and scrutiny (that is to say the state would limit/prohibit their income from other sources), watch your high quality administrators, professors and graduate students walk out the door. It’s not your money, so why do you care? Probably because you’re not getting it!

    BTW – not really sure where the conflict of interest comes into play, as the foundation is present to improve and better the quality of the university.

    I’m sure you’ll tell me I’m wrong.

  • Buffalo Annoys Me

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  • Peter A Reese

    Danielle:

    Got some case law which says government cannot prohibit public employees from accepting gratuitous payments from private entities in return for doing their regular and necessary government assigned tasks and duties? FI, is it OK if city inspectors accept gratuities from construction companies they oversee? How about cops being paid privately by citizens who are already paying taxes to receive the services they are paying for privately? When you get paid by several sources to do the same job, who is your boss?

  • Danielle Scinta

    Mr. Reese,
    First of all, are you suggesting that there is case law that would “prohibit public employees from accepting gratuitous payments from private entities”? If so, I would like to see those cases so I can be better informed.

    Secondly, your comparisons are not, on their face, valid. The UB Foundation is not the equivalent of a construction company that UB, the inspector, oversees. Nor is the Foundation a private citizen paying police (UB in this situation). Both of those suggest corruption and/or nepotism, where the one is seeking to improperly influence the other.

    The Foundation, on the other hand, has its core purpose in supporting and promoting the activities and programs of the University at Buffalo (somewhat paraphrased from the Foundation’s website). The people who give money to the Foundation know full well that the money is intended to bolster and buttress the University.

    I expect that the Foundation is far less villainous than you or the biased reporters/editorialists of ArtVoice make it out to be. But perhaps that is more an issue of perception.

    I don’t believe the Foundation ever attempts to claim that they or it has any role in the hierarchical decision-making of the University. And I believe Dr. Tripathi, his fellow administrators, and the many UB researchers receiving Foundation money would not at any point identify the foundation as their “boss”.

  • Jim Holstun

    Dear Ms. Scinta:

    It’s not a question of villainy or angelhood–it’s a matter of basic procedure and oversight. It’s a basic principle of institutional governance that we don’t allow people to make decisions that are in their own immediate self-interest–say, opening the company vault and stuffing money into their own pockets.

    Right now, the University at Buffalo Foundation “Compensation Committee” overseeing payments to all and sundry (a total of over $25 million a year) consists of two persons: Angelo Fatta and Satish Tripathi. The committees are appointed by the whole UB Foundation Board.

    So will Satish Tripathi chart a course of action that goes against the corporate interests of the corporate players comprising the UB Foundation Boards of Trustees and Directors? If so, will they continue to allow him to serve on the Compensation Committee, and make decisions in his own interest? Is deciding how to divide up this $25 million a part of the “hierarchical decision making” you refer to?

    Follow the money.

  • Mr. Fox

    I believe that the fox should guard the henhouse. Better eating.

  • G. Parks

    I love John R Ryan’s (Interim Chancellor) response addressing the excessive spending habits of the Foundation to the NYS Controller’s findings of that 2004 audit.

    http://www.osc.state.ny.us/audits/90day/04s13r.pdf

    A trip to Russia, moving expenses at a cost of over $14,000 and someone even had the college expense for their daughter paid by the Foundation as part of their SUNY employment package.

    You can’t make this crap up!

    The entitlement of those administrators on the SUNY campuses is outrageous and who suffers, the taxpayers and the students.

    These foundations are set up as the backdoor to cutting through the red tape without all the oversight. The same goes for the auxilliary service corporations (Faculty Student Associations)who rob the students blind for services they provide so they can use their profits for campus renovations, which makes the administration look good.

    Who sits on the Board of Directors for the Foundations and Auxilliary Service Corporations (Faculty Student Associations)? SUNY Administrators, that’s who!

    So the next time you pay for that exorbitant student meal plan, consider some of that money as a donation to the administrators next campus renovation project.

  • Anon

    Thanks for putting the pressure on. Keep up the great work Buck!

    It’s time to expose the fraud and knock these overpaid bastards off of their pedestals!

    NEWS FROM THE OFFICE OF THE NEW YORK STATE COMPTROLLER:

    DiNapoli to Audit SUNY Research Foundation

    http://www.osc.state.ny.us/press/releases/jun11/060111a.htm

    When DiNapoli is done there, he needs to audit all of SUNY Stony Brook!