Posted: December 4, 2012 at 4:18 pm on The Collegian of Georgia Perimeter College
Updated: December 13, 2012 at 11:09 am
By David Schick
State Rep. Karla Drenner thinks that more blame for GPC’s budget deficit should be placed with the University System of Georgia than with former President Anthony Tricoli.
Drenner recently stated in a CrossRoadsNews article that she believed Tricoli wasn’t at fault and that he was just a scapegoat for the USG.
“How can a president with a long series of successes be abruptly dismissed before any investigation?” wrote Drenner in response to follow up questions the Collegian submitted via email.
In the response, Drenner analyzes and questions the USG’s Special Audit of GPC’s budget deficit.
“I also started to wonder about the USG involvement and learned that they meet annually with the college’s leadership teams to review the college’s budget actions of the precious year and discuss their future budget proposal,” wrote Drenner. “If they were meeting annually, how could the Chancellors office not know?”
Drenner stated that if they didn’t know, they should have known. Drenner stated that the changes to USG budget oversight procedures, which were adopted on June 5 according to an email by Chancellor Hank Huckaby, are an indication of the USG’s culpability.
“Clearly, the financial oversight processes and procedures which were in place at the System Office were inadequate,” wrote Drenner.
“While ultimately it is the college president’s responsibility to manage the organization, again I would offer with the adoption of these changes does it not communicate the recognition of the lack of appropriate processes and procedures by the University System that added to this problem?”
According to USG’s Special Audit, “email discussions among GPC’s financial staff starting in Jan 2012 that reference the declines in the auxiliary fund balances”were not shared outside GPC’s Office of Financial and Administrative Affairs until “several months afterwards.”
Drenner noted that the Tricoli was specifically excluded from these communications.
“I am particularly concerned that the USG’s special audit report failed to communicate that ‘system level’ leaders had been involved in these e-mail discussions which excluded the president,” wrote Drenner.
In her last point, Drenner makes reference to the special audit’s claim that all of GPC’s budget presentations were “incomplete and inaccurate.”
Drenner wrote:
Again, I ask myself, if the president was receiving ‘incomplete’ and ‘inaccurate’ budget presentations from the second person in authority at the college and the top financial administrator with 40 years of experience, the CBO, why was the president removed? Only too recently the Board at the University of Virginia removed the President of the UVA. The president after the investigation was restored to her leadership position. Consider the recent events at Emory when upper level administrators purposefully misled the public for years regarding its successes. An investigation was done, and when it concluded that the Emory’s president did not know, the president was retained, and the individuals responsible not.
Drenner concluded that she understood how difficult it could be to reverse the decision of removing Tricoli, but the evidence from the special audit “suggests thoughtful reconsideration.”
The Collegian emailed Chancellor Huckaby requesting a response to Drenner’s statements.
As of press time, there has been no response.
Representative Drenner’s Comments:
In the court of law the presumption of innocence is the principle that one is considered innocent until
proven guilty. It stands to reason that the prosecution or in this instance that the University System of
Georgia has to collect and present compelling evidence to support the allegation of “fiscal
mismanagement” that subsequently supported the termination of GPC’S President. Of course, I
realize that Georgia is right to work State and the legal metaphor that I use is not applicable. But the
larger question for me in this situation is how can someone be removed, not rehired, terminated or
any of the above without first obtaining the facts??? Effective June 30th the GPC’s President’s contract
was not renewed and the USG formal audit was not released until 11 weeks later on September 17th,
2012.
Below are my responses to your questions:
1) Why do you believe Anthony Tricoli wasn't at fault for the Georgia Perimeter College
budget deficit?
Several statements made in the final audit report suggest the problem was not solely at the
presidential level. Other departments suggested to be involved were the Human Resource and Budget
Offices. “A significant inaccuracy regarding personal services was budgeting of fringe
benefits. GPC understated the fringe benefits that corresponded with each employee
on the payroll. This understatement has been estimated at $6.7 million. Understating
fringe benefits allowed other budget areas to be overstated. When funds were spent
against the overstated areas, deficit spending occurred.”(page 14)
Does this mean the college’s Office of Human Resources made mistakes in assigning employees to the
appropriate departments? From what I understand, both the Human Resources Department
reported to the same vice president as did the Budget Office. Thus, the problems regarding the
budget are centralized in this one area under this one vice president (CBO).
Presidents in all organizations are ultimately responsible for the organizations in which they have
been charged to run but, presidents must rely upon their staff to provide them with accurate
information, so the best decisions can be made in a timely fashion. On this point, the special audit
reported the following: “It is clear from our review that GPC’s CBO did not provide GPC’s
President with timely and reliable financial information for the President’s use in
managing the institution.”(page 3)
The special audit report indicates the following about the role the college’s budget manager played in
the college’s budget problems: “Meanwhile, the former budget director stated that he knew
of no one who was looking at the overall budget. It seems apparent that he should
have had the responsibility for doing so since his job description included
responsibility for budget planning, development and monitoring in accordance with
institutional and system requirements. He indicated he had conversations with the
former CBO and the former AVP to notify them they were overspending, but no
actions were ever taken to curtail the spending. (We did not find documented evidence
to support the existence of the conversations referenced by the former budget
director.)”(page 19-20)
When the former budget manager was questioned by an attorney about his role in this situation, he
responded by sending a signed Affidavit. This Affidavit was noted in the special audit review: “He
[budget manager] also stated in an affidavit signed for former President Tricoli that
he did not believe there were any budget deficits and that he never brought concerns
about budget deficits to the attention of the former President.”(page 20).
Again, I began to wonder how the President did not know about this budget issue.
The special audit answered my question in this way: “The former Budget Director’s job
description states that he is responsible for “budget planning, development and
monitoring in accordance with institutional and System requirements. As noted
throughout this report, fundamental budget duties were not performed. Budget
reporting was inaccurate, budgets were not correctly loaded into the financial
system, numerous individuals could override the flawed budgets that were loaded in
the system, and budget development essentially ignored actual financial experience.
In short, essentially every primary duty of the Budget Director was left
unfulfilled.”(page 5 ) This finding alone suggested to me a system flaw.
I began to think about the annual budget reports and the creation of those reports what role did they
play in the budget problem at GPC. The Special Audit stated, “We found three such
presentations for FY 10, 11, and 12 and noted that presentations were not
representative of GPC’s financial condition.” (page 19) So, from this information I now knew
that the budget information received by the college president was inaccurate.
At this point, I also started to wonder about the USG involvement and learned that they meet
annually with the college’s leadership teams to review the college’s budget actions of the previous year
and discuss their future budget proposal.
So, if they were meeting annually, how could the Chancellors office not know?? Well, either they knew
or they should have known? If they did know then how come from 2010-2012 the systems office did
not discuss the looming financial concerns with GPC and make adjustments back in 2010? I could
find no evidence in the final report that there was a discussion from the Interim President and the
current GPC President? Why?
2) Do you have any evidence that the University System used Tricoli as a scapegoat?
The USG Chancellor shortly after the departure of the President of GPC, adopted changes to the
processes and procedures within his office and other USG departments to strengthen budget
oversight in the future, suggesting that perhaps GPC may not have experienced the financial crises
which resulted. Clearly, the financial oversight processes and procedures which were in place at the
System Office were inadequate. They were so insufficient that they prevented the USG from providing
appropriate review and guidance of the budgets for the institutions in the System, including GPC. In
a June 5, 2012 letter to the University System Presidents, Chancellor Huckaby said the following:
“Effective oversight of fiscal operations is a shared responsibility among our presidents, our
chief business officers, and the University System Office.” “In an effort to strengthen our
fiscal operations, the System Office will be implementing enhanced review of each
institution’s financials. Accordingly, I am implementing the following procedures. These
procedures will be formalized shortly; however, please implement these at your respective
institutions as follows:”
The communication follows with great detail about how each of these areas listed below will be
carried out in the future: 1) Budget Hearings; 2) Quarterly Financial Reports; 3) External Audits; 4)
Use of Reserves; and 5) Institution Visits.
While ultimately it is the college president’s responsibility to manage the organization, again I would
offer with the adoption of these changes does it not communicate the recognition of the lack of
appropriate processes and procedures by the University System that added to this problem?
3) If Tricoli wasn't at fault, do you know of any specific person(s) that was in a position
to prevent the budget deficit?
The special audit acknowledges the following: “We also noted the existence of email
discussions among staff within GPC’s Office of Financial and Administrative Affairs
starting in January 2012 that reference declines in auxiliary fund balances and the
use of auxiliary reserves for non-auxiliary expenditures over the past several fiscal
years. There was no evidence that these emails were shared outside of the Office of
Financial and Administrative Affairs until several months afterwards.” (page 1) While
this information is disturbing, I am particularly concerned that the USG’s special audit report failed to
communicate that “system level” leaders had been involved in these e-mail discussions which
excluded the college president.
4) Do you have any other knowledge regarding Georgia Perimeter College's budget
deficit or the removal of Tricoli? (Beyond what has already been published in the press
or the special audit review)
During my tenure in the Georgia State Legislature thousands of my constituents have been and/or are
currently connected to GPC, and there’s an overall dissatisfaction with what has happened at the
college as a result of the Chancellor’s and BOR’s decisions. We all have the same question: how can a
president with a long series of successes be abruptly dismissed before any investigation?
5) What do you think are the necessary steps to ensure this doesn't happen to another
University System school?
Allow me to first share that I am saddened that so many college employees were harmed as a result of
this situation. This problem appears to have occurred because of a lack of communication as well as a
lack of a strong oversight guidelines at the University System level, as evidenced by new and more
comprehensive System Budget Oversight Process.
As I conclude my responses, I want to share one last point made by those who conducted and
prepared the special audit report: “GPC’s former fiscal leadership team relied on
inaccurate, internally generated spreadsheets that did not correspond to the General
Ledger. Specifically, it appears that members of GPC’s cabinet, to include the former
President, and both the President’s Council and the Strategic Budget Committee, were
provided incomplete and inaccurate budget presentations made by the CBO and the
Budget Director at various group meetings.”(page 6)
Again, I ask myself, if the president was receiving “incomplete” and “inaccurate” budget presentations
from the second person in authority at the college and the top financial administrator with 40 years of
experience, the CBO, why was the president removed?
Only too recently the Board at the University of Virginia removed the President of the UVA. The
president after the investigation was restored to her leadership position. Consider the recent events at
Emory when upper level administrators purposefully misled the public for years regarding its
successes. An investigation was done, and when it concluded that the Emory’s president did not
know, the president was retained, and the individuals responsible not. I understand how difficult it
can be for a decision to be reversed. As is evidenced by the internal findings of the USG’s Special
Audit and the implementation of an extensive new budget review process by the USG suggests
thoughtful reconsideration.
