Auditor General Jack Wagner: Penn State must show leadership

mdawson@centredaily.comNovember 14, 2012 

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The bell and Old Main on the Penn State campus on Saturday, June 23, 2012.

ABBY DREY — CDT file Buy Photo

— State Auditor General Jack Wagner, the state’s top government watchdog, has quite a few problems with how Penn State runs itself.

Wagner thinks trustees should not become high-ranking employees, such as when the trustees made fellow trustee David Joyner the interim athletic director in the early days of the Jerry Sandusky scandal fallout last year.

In Wagner’s mind, the university president has way too much power as a voting member of the board of trustees, the board’s secretary and someone who sits on almost every board committee. And the size of the board — 32 members — is much larger than other large public universities in the United States.

On Wednesday, Wagner put the ball in the court of the state’s lawmakers and Gov. Tom Corbett, himself a university trustee, to take action to fix the issues that Wagner said the university’s leaders have not tried to fix in the past year. Wagner, the outgoing auditor general, laid out a list Wednesday of recommendations he said would improve Penn State’s governance and make it more accountable.

“I believe that leadership begins at the top,” Wagner said in a statement. “If Penn State’s leaders — in this case, the board of trustees — refuse to show that leadership in this time of need, then the General Assembly and governor must fill the void.”

Penn State has been working on implementing someone else’s recommendations — 119 of them from former FBI director Louis Freeh whose firm looked into how the Sandusky got away with molesting young boys on campus. They’re still a work in progress, but recommendations that have been put in place include changing who reports to whom, giving employees mandatory abuse reporter training and hiring a compliance officer.

Penn State did not comment on the breadth of Wagner’s recommendations, saying it just received the recommendations the same day Wagner released them to the public through a press conference in Harrisburg. But a university spokesman said Penn State “will conduct of thorough review” of Wagner’s report.

Wagner’s report was filled with criticism of how the university has not changed the way it runs since it was founded in 1855. Many of its bylaws are too old, he said.

The old-school way of doing things contributed to the Sandusky scandal that tarnished the university’s reputation, Wagner said. Sandusky could have been caught sooner if the power structure had been changed years ago.

Wagner said the most important change from the nine he recommended was to remove the president from the board. Wagner said there is too much concentration of power given to the president, who he said holds multiple conflicting positions as president, trustee and board secretary.

Wagner said that contradicts the purpose of having the president report to the board as his boss and raises issues about who is the one ultimately in control.

Wagner said those conflicts came to a head in both the presidencies of ex-leader Graham Spanier and current leader Rodney Erickson.

Spanier, now facing charges he allegedly was part of a cover-up to hide abuse allegations against Sandusky, did not inform all the trustees about the grand jury investigation into Sandusky, according to the grand jury’s presentment against Spanier.

Erickson was blasted publicly when he accepted the NCAA’s sanctions that were based on the findings of the Freeh report. Outrage ensued among alumni and people in the community, with people saying Erickson did not have the power to accept the sanctions by himself without the board’s approval.

Wagner said another important change in how the trustees govern themselves is to remove the governor as a voting member of the board of trustees.

As an example of the conflicts of interest, the governor, Corbett, faces, Wagner said the governor works to set up the annual state budget, which includes hundreds of millions of dollars in public money for Penn State. The trustees’ role is to try to maximize the amount of state funding.

Corbett was the attorney general who oversaw the initial investigation of Sandusky. When he was elected as governor, he became a trustee, and he has said he could not tell fellow trustees about the Sandusky investigation because of grand jury secrecy rules.

Wagner also thinks Penn State should add language to its bylaws that would prevent trustees from moving between the board and senior level positions and vice versa.

He cited examples of Joyner, the former trustee was appointed as interim athletic director, as well as Cynthia Baldwin, who was appointed to the trustees in 1995 and remained in that role until the board made her the university’s first in-house attorney in 2010. Wagner also mentioned Steve Garban, a former senior vice president who became a trustee and resigned this year amid the scandal.

“Penn State has sent a public message that influential insiders run the university, and that objectivity and independent thinking are comprised,” Wagner said the in report.

While it remains to be seen if the recommendations will be taken up by state lawmakers when they return to work in January, Wagner said he hopes both Democrats and Republicans push forward together. He said he hopes the lawmakers in Penn State’s backyard — state Reps. Kerry Benninghoff and Scott Conklin and state Sen. Jake Corman — are among those who take the lead.

State Rep. Kerry Benninghoff, R-Bellefonte, said he hasn’t seen the report but said Wagner was aware legislators have been involved.

“He knows that we’re already working on that,” Benninghoff said. “Bottom line is we are trying to do things, Penn State is trying to do things.”

He said if Wagner felt that strongly about it, he should have picked up the phone and set a meeting, adding that Wagner’s actions were somewhat “disingenuous.”

Tor Michaels, chief of staff for Rep. Scott Conklin, D-Rush Township, said Conklin introduced legislation in July in support for the auditor general’s recommendations.

“We have been very proactive and have taken the lead on this,” Michaels said, adding that Conklin will take the lead in getting something done next session.

Corman could not be reached for comment.

The other recommendations from Wagner include:

•  Reducing the size of the board of trustees so it is more in line with the size of peer universities in the Big Ten and other large public universities across the country. Ohio State has 19 on its board, and Michigan State has nine.

•  Increase the number of trustees required for a quorum so that it is more than the 13 of 32 currently needed.

•  Making Penn State subject to the Right-to-Know law. He said Penn State should initiate it.

•  Providing detailed agendas ahead of board meetings, allowing more people to address the board than the limit of 10 currently in place, and setting up a hotline so that people can call in issues.

•  Further reducing term limits to nine years from the 12 years currently in place.

•  Changing bylaws so that no exceptions can be made to award emeritus status, such as was the case with Sandusky, who did not meet the criteria for that title.

Wagner said the work that went into making the recommendations was part of his annual budget and cost in the hundreds of thousands of dollars. But he was not able to pinpoint a more specific number.

Mike Dawson can be reached at 231-4616. Follow him on Twitter @MikeDawsonCDT.

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