Winthrop President

Winthrop board neglected financial oversight, former president claims

Winthrop’s board of trustees at a meeting in March 2015.
Winthrop’s board of trustees at a meeting in March 2015. aburriss@heraldonline.com

Editor’s note: Jamie Comstock Williamson was fired in June 2014 after just 11 months as president of Winthrop University. Since then, she has declined to answer questions about her dismissal, including the reasons Winthrop board members gave for terminating her. In late May, The Herald met with Williamson and her husband, Larry, over two days in Florida. This is the fourth of a five-part series from those interviews.

Jamie Comstock Williamson accuses some of the Winthrop University trustees who fired her last summer of not providing enough oversight to the school in recent years.

Williamson was suspended and then fired in June 2014 amid allegations – all of which she denies – that she lied to the university’s Board of Trustees, that she violated nepotism laws, and that she mistreated Winthrop employees. The alleged problems led to a state investigation and an upcoming South Carolina Ethics Commission hearing.

In response to the Winthrop’s trustees’ claims against her, Williamson is airing her own grievances with the board.

She said recently that she wants new Winthrop President Dan Mahony to be able to work “in an environment free from the untoward political pressure” she experienced from school trustees.

Mahony, the university’s 11th president, took office July 1. He took the reins from Winthrop Provost Debra Boyd, who served as acting president for one year after Williamson was fired.

Williamson says Mahony faces working with a governing board – the school’s Board of Trustees – that doesn’t fully understand its role and responsibility. She believes some board members “do not put the concerns of the institution ahead of their own personal opinions and preferences.”

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Jamie Comstock Williamson during her 2014 inauguration. Jeff Sochko JEFF SOCHKO

I was going to have to lead the university through substantial organizational change ... I knew not everyone was going to like me or agree with me early on.

Jamie Comstock Williamson

Some of the Winthrop board’s past actions, Williamson alleges, may violate a requirement from the school’s national accreditation body that the university’s governing board be free from undue political influence.

Last week, Winthrop officials called Williamson’s claim that the board has jeopardized the school’s accreditation “unfounded.” In a statement to The Herald, officials wrote: “The Board of Trustees is very proud of Winthrop’s accreditation from (The Southern Association of Colleges and Schools Commission on Colleges).”

Winthrop’s board “categorically rejects (Williamson’s) unfounded allegations that the board would risk the university’s full and unconditional accreditation,” officials wrote. All eligible academic programs at Winthrop are fully accredited and the school in 2011 had its overall accreditation reaffirmed.

The university’s Board of Trustees is made up of 15 voting members who include business people and attorneys, Winthrop alumni, educators, and governmental appointees. Trustees are unpaid and attend dozens of meetings and events at Winthrop annually.

The breakdown of relations between the Winthrop board and the president’s office during Williamson’s administration is an outlier in the school’s recent history. Trustees were “deeply saddened when faced with clear and convincing facts” that led to Williamson’s firing, officials said this month.

Before Williamson arrived on campus, the school’s governing board had worked with one president at the helm for 24 years. Williamson’s predecessor, Anthony DiGiorgio, generally had good relations with the board during his last decade or so in office.

The expert consultant who in 2012 helped Winthrop search for and prepare for a new president cautioned that campuses and governing boards often experience difficulties when working with a new leader after two decades of growing accustomed to one person’s style.

Williamson, however, says problems she saw with Winthrop’s board ran deeper than clashes that could be expected during a presidential transition.

Williamson: Finances needed more attention from trustees

For several years, Williamson claims, Winthrop trustees didn’t pay close enough attention to the school’s finances – particularly as Winthrop’s student enrollment declined while nearly every other South Carolina public school increased enrollment. Winthrop has about 300 fewer students than it did in 2004.

About six months into her presidency, Williamson said, she learned the university had been using “non-recurring” state tax dollars to cover enrollment revenue shortfalls in some years. As a public university, Winthrop receives a small portion of its budget annually from state money.

Trustees, Williamson said, permitted Winthrop’s staff to use non-recurring funds from the state – allocated for specific, one-time costs – for other budget needs. Williamson told the Winthrop board that type of use of non-recurring money should stop, she said.

Williamson said she also raised concerns about the university’s past use of its reserve money on new campus construction instead of addressing facility needs of academic buildings. Recently, some state lawmakers have weighed in on Winthrop’s reserve fund use.

$10.8M current Winthrop reserves – half of what the school had in 2008

S.C. Rep. John King, D-Rock Hill, asked earlier this year for state auditors to examine Winthrop’s finances. He later met with school leaders about his concerns.

The S.C. Legislative Audit Council declined to investigate, saying the agency doesn’t have enough auditors to perform the work.

At the time, Winthrop officials defended the school’s financial health and said they hadn’t used reserve funds or the institution’s savings to cover budget shortfalls. Instead, officials said, reserve fund money has been used for special one-time projects.

This month, the university again fended off concerns and issued a statement saying Williamson “appears to lack an understanding of Winthrop’s finances.” Officials pointed to the university’s two most-recent tuition increases, which have been the lowest in 16 years – a time marked by steep cuts to state tax dollar support for Winthrop.

A college’s reserve fund can be tapped for various reasons, including emergency and unplanned expenses as well as jump-starting special campus projects.

Winthrop’s current reserve is about $10.8 million, which is about half as much as it was in 2008 – the height of the most recent national economic recession. By contrast, almost every other South Carolina public university’s reserve fund has grown since the recession.

All public colleges have experienced significant losses in state funding since the recession.

The Herald analyzed annual financial statements for other four-year public schools in S.C. over seven to 10 years, ending with the most recent figures available. The analysis included specific school financial statements with the exception of the University of South Carolina system. Individual USC campus data was not available – USC’s public financial statements reflect system-wide finances.

With three exceptions – Winthrop, Francis Marion University, and South Carolina State University – reserve funds at every public university in South Carolina have increased since 2008.

Some colleges reported strategically saving money in reserves for future facility upgrades. Many schools reported their recent gains came from increased student enrollment and subsequent higher tuition and housing revenues.

For example, Clemson University reports that in recent years, officials have used reserve funds to pay “start-up” packages for new professors who were needed to keep up with growing student enrollment. Clemson’s enrollment has grown nearly 25 percent over the past 10 years. The school’s financial statements show a reserve fund – now at nearly $133 million – benefiting from more students on campus and Clemson’s strategic move to build savings for future projects.

By contrast, South Carolina State University’s financial statements show drastic annual declines in the the school’s reserve fund level. The school’s estimated debt is $17 million, caused by years of lagging student enrollment and cuts from tax dollar support.

Francis Marion’s reserve – now at nearly $4.5 million – is about the same as it was in 2008, but the Florence school reports some years of positive growth, up to $8.9 million.

Before the recession, Winthrop had more than $20 million in reserves. Winthrop officials have said the school intentionally grew reserves in the early 2000s, planning to use the money later to pay for major campus improvements such as a new brick walkway called “Scholars Walk” and an open-space “green” in the center of campus.

Spending from the reserves in recent years has been minimal. In response to Williamson’s recent comments, Winthrop officials point to nearly five years of a stable fund balance level.

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Byrnes Auditorium at Winthrop University Tracy Kimball Special to The Herald

Williamson’s claims are designed to “focus attention away from the conduct which actually led to her termination.

Winthrop officials’ statement

Still, Williamson says she was working with trustees in her first year to avoid relying further on reserve money.

Winthrop, Williamson said, had to confront budget shortfalls in 2013 and 2014, caused by Winthrop’s spending outpacing its revenues – largely due to the university not taking appropriate actions to address student enrollment issues.

The former president said she was also concerned about Winthrop’s debt-per-student rate being higher than some other South Carolina schools. She says trustees weren’t properly informed in the past about the university’s financial challenges or how long the debt for new buildings would affect the institution’s finances.

Lack of enrollment growth over the past decade has prompted Winthrop officials in recent years to say the school needs to improve its student recruitment, marketing, and retention efforts. Now at around 6,100 students, Winthrop’s enrollment has fallen about 5 percent over the past 10 years.

Williamson points to her re-organization of the university’s marketing and admissions efforts, her hiring of a new recruitment and retention manager, and her focus on outreach and strategic messaging as ways she was prepared to tackle enrollment problems.

“I knew I was going to have to lead the university through substantial organizational change and do it quickly ... I knew not everyone was going to like me or agree with me early on,” she said.

Audit: DiGiorgio retirement benefits problematic

In her first few weeks at Winthrop, she said, she learned “I was going to have to be the bearer of bad news to the board,” but she wanted trustees to know “what happened on their watch.”

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February 2013: Winthrop University Board of Trustees chair Dalton Floyd Jr. and vice chair Kathy Bigham applaud as Jamie Comstock Williamson accepts the job as Winthrop's next president via Skype. MELISSA C. TOTH mtoth@heraldonline.com

Each individual problem is not so awful on its own but when you have a long list of things...it suggests the board has not done its job.

Jamie Comstock Williamson

As an example, she points to a 2013 Winthrop internal audit report that found problems with an employment contract the Board of Trustees signed with retired President Anthony DiGiorgio. DiGiorgio was named president emeritus upon retirement, and he became a tenured faculty member.

DiGiorgio’s presidential contract had for many years stipulated that he would have a one-year “sabbatical” research and planning period after his retirement – “with full presidential benefits” for that year, said Rebecca Masters, the former spokeswoman for Winthrop and now senior research associate in the president emeritus office.

Those benefits had included Winthrop paying for both a cellphone for DiGiorgio’s wife and housekeeping services at his off-campus home in Rock Hill. In July 2013, two weeks after DiGiorgio’s retirement, the auditor wrote that paying for those benefits with state tax dollar appropriations to Winthrop would violate state laws that govern how public universities can spend tax money.

After the audit revealed this, Winthrop discontinued paying for certain benefits with state tax dollars, Williamson said. Other benefits continued for DiGiorgio, but the auditor recommended Winthrop make DiGiorgio aware that some of his benefits in retirement would be taxable – something that happened, according to school records.

It had been up to the board, not DiGiorgio, to determine how certain pledged benefits would be funded without using tax funds, Masters said. Once Board of Trustees Chairwoman Kathy Bigham notified DiGiorgio of the auditor’s concerns on July 31, 2013, DiGiorgio concurred with Winthrop discontinuing those benefits “because they would have expired in 2014 whether the audit had occurred or not,” Masters said.

The 2013 audit also flagged the Winthrop Foundation’s use of donated money to make charitable donations to other nonprofit organizations. The foundation, according to the audit report, had a checkbook in DiGiorgio’s name, linked to a Winthrop Foundation account created for various advancement purposes, including donations to local charities.

Masters said the Winthrop Foundation mailed checks to charitable groups upon requests from DiGiorgio, until his retirement. Winthrop Foundation money comes from private donations, not state tax dollars or tuition.

On average, the yearly total of such charitable donations from the Winthrop Foundation was $2,000 or less, Masters said.

“Donations were made to charitable organizations with whom Winthrop worked as part of Winthrop being a good neighbor to them and a good institutional citizen of Rock Hill,” she said. Examples of local groups that received such donations in the past are the York County Arts Council, the Red Cross, Keystone Substance Abuse Services, Pilgrim’s Inn, and The Herald’s Empty Stocking Fund.

The auditor report states that because donations were given but receipts were not provided to the Winthrop Foundation, “the possibility exists that (DiGiorgio) might have inadvertently mixed these receipts in with his personal charitable contributions in the preparation of his personal taxes, thereby taking a deduction for some charitable contributions that he cannot legally claim.”

Winthrop’s internal auditor called for the Winthrop Foundation to “terminate immediately” the account in DiGiorgio’s name.

Masters said the DiGiorgios use their personal checking account records as the basis of claiming charitable contributions on their personal tax returns. The retired president, she said, never claimed Winthrop Foundation charitable donations as his own.

Instead of charities sending receipts, Masters said, the canceled or endorsed check sent back to the Winthrop Foundation served as receipt of the donation.

Williamson and Winthrop officials have said the audit of the DiGiorgio’s president emeritus employment contract was performed at the advice of the presidential search consultant hired in 2012. Masters said DiGiorgio had not seen the full report from July 2013 until earlier this month when The Herald contacted the president emeritus’ office.

Williamson says she felt the audit was necessary after she learned that DiGiorgio retained “full presidential benefits” from Winthrop in his retirement. She was concerned, she said, that he may be surprised by some of his benefits being considered “taxable income” by the IRS, though his contract didn’t specify.

After the audit was complete, Williamson says Bigham handled the issues appropriately with DiGiorgio and changes were made to ensure compliance with state law and university policies.

But, Williamson alleges the problems that surfaced in the audit were the result of inadequate board oversight. She said similar problems existed “across all areas of the institution.”

“Each individual problem is not so awful on its own but when you have a long list of things like these problems, it suggests the board has not done its job and it’s a pattern,” Williamson said.

Part 1: Former president speaking out after year of silence since firing Part 2: Williamson weighs in on ethics, nepotism & her husband’s job Part 3: Board used employee bullying allegations to ‘discredit’ her, Williamson claims

In a statement to The Herald this month, Winthrop officials took issue with Williamson’s assertion that the internal audit of DiGiorgio’s benefits demonstrates poor board oversight. Officials said Winthrop’s attorney and the board’s executive committee reviewed the president emeritus’ contract before signing it.

The statement contends that Williamson is making such claims to “focus attention away from the conduct which actually led to her termination.” Winthrop officials said “sadly,” Williamson “feels compelled to make accusations against President Emeritus DiGiorgio.”

But, Williamson says her concerns aren’t about her predecessor but the board’s oversight and attention to detail. She argues that Bigham would not have had to address issues with pledged benefits for DiGiorgio if the Winthrop board had properly reviewed the contract.

Williamson says: DiGiorgio “should not have had to suffer these adjustments because of the board’s mistakes and I should not have been put in the situation of leading the effort to correct the board’s mistakes.”

Anna Douglas •  803-329-4068

On Twitter: @ADouglasHerald

Pay raises, summer tuition irked Winthrop board

The first public indication of strained relations between trustees and former Jamie Comstock Williamson came nearly 10 months into her short stay at Winthrop. Pay raises of more than $10,000 to several top administrators raised concerns from some trustees who said Williamson should have given them a heads up before approving such salary increases.

Williamson says she had plans to notify trustees of the raises before the controversy erupted – although, at the time, state and university guidelines did not mandate that the Board of Trustees approve such raises. She also pointed out last spring that the total dollar amount of pay raises given campus-wide during her presidency was similar or less than the amount approved in years past.

Last year after Williamson’s dismissal, trustees changed some university policies and procedures to provide for more board oversight over pay and administrator contracts.

Months before granting those raises, Williamson says she spoke with Winthrop board Chairwoman Bigham about two specific promotions and salary increases planned in the president’s office. One was a 6 percent or $10,000 raise for Winthrop’s chief academic officer. The other – a $10,711, or 12 percent raise – was for Williamson’s chief of staff.

Bigham, according to Williamson, told the former president that she did not have to consult with the board about pay raises and promotions for Winthrop administrators. The conversation happened during Williamson’s first two months on the job, she said.

But, after news broke about Winthrop’s police and athletics director receiving 33 percent and 22 percent pay raises, respectively, caused a stir in May 2014, Williamson claims Bigham “failed to own her role.” Williamson accuses Bigham of leaving her to defend herself even though she’d assured the president that the board didn’t need to approve such raises.

Williamson says it wasn’t the first or only time Bigham gave her guidance or direction “and then, if the follow through of her advice received negative feedback from trustees or faculty ... (I was) in the position of either catching the spears or confronting her in public.”

When trustees fired Williamson, they accused her of misleading the board and the public about the salary review process she used to evaluate the pay raises. Williamson denies lying to trustees.

The former president was also criticized last spring for the roll out of a 40 percent summer tuition increase that some students and faculty members said surprised them. The change resulted in most classes costing about $363 more.

School trustees vote on fall and spring tuition but, prior to Williamson’s arrival at Winthrop, they delegated power to the president’s office to set summer rates. When she was fired last year, trustees claimed Williamson had misled the board on her efforts to inform the campus of the tuition hike.

Williamson spoke to The Herald last year about the miscommunication and said campus employees had used usual methods in posting the tuition change and informing students. She also met with professors after the tuition hike was in effect and pledged to improve campus communication.

Recently, Williamson said board members were notified of the summer tuition hike in February 2014, about one month before the new rates were published on the school’s website. The increased tuition still kept Winthrop’s summer tuition rate as one of the lowest in the state, and Williamson says trustees had asked her in 2013 to find ways to increase revenue by raising non-mandatory student fees.

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