March 9, 2017
Florida House Speaker Richard Corcoran is turning his fiscal wrath on a new and more powerful target: the state university system.
He’s using the power of his office to scrutinize state university foundations that use taxpayer money to pay for worldwide travel, lavish salaries and solicitation of private donations to expand school endowments.
Corcoran’s chief budget-writer, Rep. Carlos Trujillo, R-Miami, invited officials of all 12 universities to the Capitol to justify their spending, laying the groundwork for what’s expected to be a bipartisan House strategy to slash their spending — a year after giving them tens of millions of dollars for new projects.
The House is going in the opposite direction of the Senate, which wants to increase university spending by $1 billion next year to make them more prestigious.
A three-hour hearing by Trujillo’s House Appropriations Committee on Wednesday followed his demand in January for records showing that universities spend taxpayer money to hire people who in turn raise money for the schools’ foundations.
Foundations are created to boost philanthropy, augment faculty salaries and award student scholarships.
Most foundation records the House obtained are confidential under state law. But the House released them, including the $61,473 that the University of Florida Foundation spent on a trip to Paris last year.
“We don’t really know if there’s a return on investment,” Trujillo said. “I think that’s troubling.”
Under precise questioning, mostly by Trujillo and Democratic Rep. David Richardson of Miami Beach, university officials defended their spending. They said independent audits found no problems and that their decisions were approved by trustees — politically influential community leaders appointed by Gov. Rick Scott.
They also said it’s all legal, because state law allows school employees to do work for foundations.
That did not deter lawmakers, who demanded that University of South Florida officials explain why the USF Foundation’s chief executive earns $532,000 a year and asked how much is paid by Florida taxpayers.
“It’s hard for me to say, because the foundation also supports salaries,” said the USF foundation chief financial officer, Rob Fischman.
Fischman said the foundation employs 160 people, 25 of whom earn more than $100,000 a year in a major campaign to create a $1 billion endowment.
USF chief financial officer Nick Trivunovich said the foundation gets back more than five dollars for every dollar spent.
“We feel like we’re getting a good ROI (return on investment),” Trivunovich said.
But Rep. Richardson, an accountant who has made repeated tours of state prisons to expose a wide range of problems, was not swayed.
“I have a problem with them using appropriated state dollars to grow wealth,” he said.
Senate President Joe Negron, R-Stuart, said he agrees with the House’s close look at universities.
“The speaker’s comments have been very supportive of what we’re doing to help students,” Negron said Thursday. “I think we’re committed to the same agenda. The issues that were being discussed have to do with routine oversight over government and quasi-government agencies… I support that.”
USF officials said that last year, its foundation spent twice as much money to boost faculty salaries as it did on student financial aid. Trujillo called that a case of misplaced priorities.
Foundation money is used to supplement the salaries of faculty, deans, coaches and university presidents because they are capped by state law.
The foundations are the latest target for Corcoran, who wants to cut by two-thirds the budget of Visit Florida, which promotes tourism, and to abolish Enterprise Florida, which is the state’s jobs recruitment agency.
Scott has waged an aggressive counterattack to save both programs, calling Corcoran and House members “job killers” who are endangering Florida families purely for political gain.
The difference in targeting foundations, however, is that universities are more capable of fighting back, equipped with armies of well-connected lobbyists and influential boosters and alumni — including legislators, dozens of whom are proud Gators or Seminoles.
Speaking of lobbyists, Trujillo’s research shows that the USF Foundation spent $448,000 on lobbying last year, the most of any university.
That included $100,000 paid to the firm of Corcoran & Johnston, which includes the speaker’s brother, Michael.
If Speaker Corcoran follows his pattern, the next step could be a hard-hitting video, ridiculing the universities for irresponsible use of taxpayers’ money, as he did with Enterprise Florida.
It’s a major shift in philosophy from recent years.
Last year, Corcoran personally signed off on $713 million in new higher education construction, including $22.5 million to get USF’s medical school closer to Tampa General Hospital and to strengthen downtown redevelopment.
For the past four years, Scott and the Legislature have frozen university tuition statewide.
University presidents have complained for years of a lack of state funding — made worse by the tuition freeze — that has led to an exodus of faculty seeking better-paying jobs in other states and students being shut out of classes or being taught by low-paid adjunct professors.
But Trujillo’s staff cited state data to show that higher education spending has grown by 61 percent in th
e past decade compared to 17 percent for the rest of the state budget during that time.
Higher education student enrollment grew 15 percent in the past decade.
House budget experts also noted that unlike state agencies, colleges and universities can keep unspent funds. That unspent balance last year stood at $839 million — not including a 5 percent reserve required by law. [READ MORE]