UCWATCH.ORG - Accountable UC

The Need for Accountability at the University of California

UC claims that in order to remain competitive with other universities and institutions it needs to pay more to recruit and retain top talent. Still, if UC’s top executives are so talented and come at such a high price to students and taxpayers, why should it be acceptable that they are such poor managers of the public’s money, of university employees, and of student and patient services? Scandal after scandal plagues the University and its executives – from quality of care issues at UC’s medical centers to financial irregularities throughout the system.

Excessive Pay

Since UC employees first brought the issue of excessive executive pay to the public’s attention in 2005, scores of articles have appeared in the press detailing large-scare irregularities in the pay and perks awarded to high-level administrators. From a Provost’s $125,000 relocation payment to move 70 miles to a Chancellor’s new $30,000 dog run, to the Regents disavowing any knowledge of a variety of outrageous salary actions, the UC executive pay scandal has it all. And, it’s not just workers who’ve taken issue with UC’s excessive executive compensation. Public officials, students, and even UC’s faculty have criticized the University and its president for continuing the practice of offering high pay and executive perks even as UC faces unprecedented budget shortfalls.

Overly generous pay packages for executives – including large severance packages for executives who then accept employment elsewhere in the UC system – have remained the norm since President Yudof took over in June 2008. In 2009 President Yudof introduced a 5% pay cut for 30 top executives as a way to ‘share in the pain’ of addressing the University’s budget woes, but he and nine Chancellors had just been hired at salaries that already averaged 22% more than their predecessors. And, when news broke this year of President Yudof’s costly housing fiasco, it was clear again that UC’s top executives enjoy perks and privileges the majority of Californians will never see.

UC’s Top Executives

Robert Birgeneau UC Berkeley Chancellor Year Hired: 2004 Base Salary: $436,800 Hired in at 24% more than predecessor	Linda Katehi UC Davis Chancellor Year Hired: 2009 Base Salary: $400,000 27% more than predecessor	Gene Block UC Los Angeles Chancellor Year Hired: 2008 Base Salary: $416,000 29% more than predecessor	Sung Mo “Steve” Kang, UC Merced Chancellor Year Hired: 2008 Base Salary: $295,000 13% more than predecessor	Henry Yang UC Santa Barbara Chancellor Year Hired: 1994 Base salary: $315,000
Mark Yudof UC President • Year Hired: 2008 • Base Salary: $591,084, 46% more than predecessor • Total compensation including benefits: $924,642 In March 2008, President Yudof told the San Francisco Chronicle that his parents were afraid he'd “starve to death” when he announced that he was planning to become a lawyer. “As you can see from my compensation package,” he continued, "I'm not starving to death".
George Blumenthal UC Santa Cruz Chancellor Year Hired: 2008 Base Salary: $310,000 10% more than predecessor	Michael Drake UC Irvine Chancellor Year Hired: 2005 Base Salary: $392,200 Hired in at 25% more than predecessor	Marye Ann Fox UC San Diego Chancellor Year Hired: 2004 Base Salary: $392,200 Hired in at 25% more than predecessor	Timothy White UC Riverside Chancellor Year Hired: 2008 Base Salary: $325,000 8% more than predecessor	Susan Desmond- Hellmann UC San Francisco Chancellor Year Hired: 2009 Base Salary: $450,000 12% more than predecessor

UC Regents

UC’s Board of Regents is made up of 26 voting members, 18 of which are appointed by the Governor of California for 12-year terms. Seven of the remaining Regents are ex officio members including the Governor and Lieutenant Governor, Speaker of the Assembly, Superintendent of Public Instruction, UC President, and the President and Vice President of the Alumni Associations of UC. There is one Student Regent appointed to the Board for a one-year term.

Excessive Pay

The Regents have the power and authority to set policy and make decisions for all of UC, and all actions of the University are done in their name. Under current state law, the Regents are allowed full powers of organization and governance while the California’s Constitution clearly dictates that “Regents shall be able persons broadly reflective of the economic, cultural, and social diversity of the State…”

Still, Regent Richard Blum has assured Californians that the University is better managed under current President, Mark Yudof. But, the fact remains that overly generous pay packages for executives – including large severance packages for executives who then accept employment elsewhere in the UC system – have continued since President Yudof took over in June 2008. And, despite President Yudof boasting in 2009 that he was introducing a 5% pay cut for 30 top executives as a way to ‘share in the pain’ of addressing the University’s budget woes, he and nine Chancellors had been recently hired at salaries that already averaged 22% more than their predecessors.

But UC’s Regents are a far cry from reflecting California’s socio-economic diversity. Regents are mostly wealthy lawyers, politicians and businesspeople. Political money, political allegiances and business relationships rule where appointments to the Board of Regents are concerned, and several regents have very close personal and financial ties to the Governor. An appointment to the Board of Regents is yet another coveted resume builder for the state’s elite class of high-achieving investment bankers, corporate lawyers, and power brokers – never mind the ordinary Californians who the University is supposed to be here to serve.

Finally, by virtue of their extremely deep reach into California’s corporate and political world, many Regents fill their roles on the Board while coming dangerously close to what amount to potential conflicts of interest. Is this really the best UC can do to meet the needs of all Californians?

The List of UC Regents

Russell Gould, Chair Vice President of the Board of Regents, Gould has served as a Senior Vice President of Wachovia Bank and Senior Managing Director of Wachovia Portfolio Services. Regent Gould was Governor Wilson’s Director of the Department of Finance of the State of California from 1993 to 1996 and his Secretary of the Health and Welfare Agency from 1991 to 1993.	Sherry Lansing, Vice-Chair Regent Lansing is the former Chairman and CEO of Paramount Pictures Motion Picture Group. She is also the founder of the Sherry Lansing Foundation and is a member of the Board of Directors for both Qualcomm and Dole Food Company
Richard C. Blum Regent Blum is a powerful financier, president of the investment firm Blum Capital, and husband of United States Senator Dianne Feinstein. Blum is a major stockholder in a number of companies, and Blum and Feinstein have come under scrutiny multiple times for potential conflicts of interest in which their public service duties have ultimately proved massively profitable for their businesses.	Eddie Island Regent Island is a retired attorney and executive. Prior to his retirement in 1998, Mr. Island served as a Vice President for McDonnell-Douglas Corporation, a major aerospace manufacturer and defense contractor.
Odessa P. Johnson Regent Johnson served on the Modesto City Schools Board of Education for sixteen years, and was Assistant Dean of Education at Modesto Junior College. She is also a member of the Modesto Chamber of Commerce.	George Kieffer Regent Kieffer is a prominent West Los Angeles attorney, businessman, lobbyist, and personal attorney to Maria Shriver. Kieffer is a partner at Manett, Phelps & Phillips, where he chairs the government and regulatory policy division. A personal friend to Governor Schwarzenegger, Kieffer co-chaired the governor’s reelection committee and was chosen to help recruit staff for the governor’s current administration.
William De La Pena M.D. Dr. De La Pena is an ophthalmologist and the CEO of the De La Pena Eye Clinic chain, with locations in Montebello, Los Angeles, and Santa Ana. Dr. De La Pena has owned Spanish language TV stations and a soccer team, La Salsa, in Los Angeles.	Monica Lozano Regent Lozano is the CEO of Impremedia, LLC, the parent company of La Opinion Newspaper, which is the nation’s largest Spanish-language daily newspaper and was founded by her family in 1926. She also sits on the Board of Directors for the Walt Disney Company and is a Trustee for the University of Southern California.
Hadi Makarechian Regent Makarechian is Chairman of Makar Properties Board of Directors and Banning Lewis Ranch Management Company Board of Directors.	George Marcus Regent Marcus is the founder and chairman of the Marcus & Millichap Company, one of the largest national commercial real estate brokerage, investment and development companies. He is also Chairman at Essex Property Trust.
Norman Pattiz Regent Pattiz is the founder and chairman emeritus of Westwood One, America’s largest radio network company.	Bonnie Reiss A lawyer, Regent Reiss serves as operating advisor to Pegasus Capital Advisors, a private equity firm. She recently served as Senior Advisor to Governor Schwarzenegger.
Frederick Ruiz Regent Ruiz is a member of the Frozen Food Hall of Fame and serves as Chairman and CEO of Ruiz Foods, a manufacturer of frozen Mexican foods that includes the famous El Monterey brand.	Leslie Tang Schilling Regent Tang Schilling is founder and Director of Union Square Investments Company, a commercial real estate investment and management firm. Her grandfather built up a conglomerate in textiles, cement and flour and established the South Sea Textile Manufacturing Company in Hong Kong. Regent Tang Schilling is married to a member of the Schilling family, of the spice fortune fame.
Bruce Varner Regent Varner is a corporate lawyer and a partner with Varner & Brandt LLP.	Paul Wachter Wachter is an investment banker and founder and CEO of Main Street Advisors, an asset management firm headquartered in Santa Monica. He is also a member of the Board of Directors for Time Warner.
Charlene Zettel Regent Zettel is a former State Assembly member from San Diego County and former Director of the California Department of Consumer Affairs. She has also served as Public Interest Director for the Federal Home Loan Bank of San Francisco and as a member of the Poway Unified School Board. Prior to entering public life, Zettel was a dental hygienist and a rental property manager. Most recently, she was head of Governor Arnold Schwarzenegger’s San Diego field office.