Chronicle: Red Tape Hid Felner's Red Flags

Former UofL Education Dean Robert Felner was big on promises.

Having received a $694,000 grant from U.S. Department of Education funds, earmarked by Rep. Anne Northup, Felner promised to create an elaborate research center to help Kentucky's public schools. Five UofL faculty members, supported by a staff of four, would work at a center under an advisory board headed by Kentucky's Secretary of the Education Cabinet Virginia Fox. The state would be carpeted with surveys. There would be papers and conferences.

Too bad Fox didn't know there was a grant.

Too bad none of the surveys were conducted.

Too bad the Kentucky Department of Education didn't know anything about the surveys.

Too bad there were no papers or conferences.

Too bad most of the money had disappeared.

By the spring of 2008, all but $96,000 of the grant had been spent, but none of the tasks listed in Mr. Felner's proposal had been accomplished.

So he approached Louisville officials for $200,000 more to enter into a subcontract with his buddy Thomas Schroeder's nonprofit organization in Illinois - a group that had already received $450,000 from the Felner grant.

Felner assured UofL officials that the surveys Schroeder was supposedly conducting with students and teachers in Kentucky would "let us give the feds something that should make them very happy about the efficiency and joint commitment of the university to doing a good job with an earmark, as I know we will want more from this agency," he wrote in an e-mail message on June 18.

Two days later, as Felner was preparing to leave for a new job at the University of Wisconsin-Parkside, federal agents raided Felner's UofL offices and confiscated his files and laptops.

Turns out Uof L was not Felner's first rodeo.

By October a federal grand jury had indicted Felner on nine counts of mail fraud, money laundering, and tax evasion. The indictment said Schroeder's National Center on Public Education and Prevention was a shell organization that existed to funnel money into the Felner and Schroeder's personal bank accounts. Prosecutors calculate that the men made off with the $694,000 earmarked grant plus $1.7-million in payments from three urban school districts connected to Felner when he was in Rhode Island.

But that's not the way it's supposed to work. There's supposed to be oversight. UofL officials made some promises too.

In their upcoming June 12 issue, the Chronicle on Higher Education takes aim at the lack of oversight at UofL.

When Louisville accepted the earmarked grant, its officials signed the boilerplate language attached to most federal contracts. The university, they promised, had "the institutional, managerial, and financial capability ... to ensure proper planning, management, and completion of the project."

But did it in fact have that capability? For several months in 2007, Mr. Felner charged almost $37,000 of his salary against the grant, but there is no evidence that he ever worked on the project. (In an October 2008 memorandum, Robert N. Ronau, the college of education's associate dean for research, declared that he knew of no
reports, articles, or other products that resulted from the grant.). Federal regulations require that universities use "suitable means of verification that the work was performed" when they prepare time-and-effort reports; Louisville officials declined to comment on how Mr. Felner's time-and-effort reports were processed.) And when he sent his first big payment to the Illinois group, Mr. Felner constructed the deal as a personal-services contract instead of a formal subcontract, which would have been subject to more oversight by the university. But no one corrected that error for more than a year.

Provost Shirley C. Willihnganz, seemed to admit that UofL's procedures could be overridden by an individual of high standing, such as a dean.

"I think what we had in this case was a person who abused the system. And so it's not so much that our policies were bad or that our procedures were bad. We had a person who did not follow them and did not respect them."

"This person was a dean," says Ms. Willihnganz, the provost. "And deans here have a very wide breadth of control. They have a lot of authority. I think, in fact, no one else here at this university could have gotten some of those things through. Because he was a dean, he was trusted."

But that explanation goes nowhere with former UofL education faculty who say they had plenty of reason to distrust Mr. Felner.

Beginning in 2004, the university's grievance officers were approached dozens of times by faculty members and students with complaints about Mr. Felner's temperament and personnel decisions. Many of those records were first described last year by Page One Kentucky, a political blog that has aggressively covered Mr. Felner's story (and whose comment section has become a meeting ground for aggrieved faculty members at Louisville).

The Chronicle lists the most egregious alleged offenses which include harassment of a female grad student, threats, intimidation, violations of governance policies, questionable expenditures and a generally oppressive atmosphere in the department. This was followed by a 27-24 "vote of no confidence" against Felner.

After the vote, Ms. Willihnganz hired a mediation company called Just Solutions to review morale at the college of education — but after interviewing many faculty members, the company never filed a final report.

"I talked to a lot of people" after the no-confidence vote, Ms. Willihnganz says. "There were detractors, but there were also supporters. My hope was that Just Solutions could come in and find some common ground to go forward. They completed some faculty interviews — but in all honesty, at that point I realized that they weren't going to be able to accomplish what I had hoped."

Several months later, a faculty member circulated an anonymous note that read, "It appears that the Provost has chosen to bury that [Just Solutions] report without giving any feedback to faculty. ... Now the dean likes to taunt people about how nothing came of any of our complaints."

By the time university leadership finally recognized that they had been suckered by Felner's unmet promises they were stuck cleaning up Felner's mess. That didn't go all that well.

President James Ramsey and Willihnganz circled the wagons, inferred that faculty complaints were only from the disgruntled who refused to make necessary changes and Ramsey called their complaints anonymous crap.

Calls for Ramsey's resignation could be heard but he was supported by Louisville's board.

Last September he and 20 other faculty members who left the college of education during Mr. Felner's tenure wrote to Louisville's Board of Trustees, asking it to scrutinize how complaints about Mr. Felner had been handled by Ms. Willihnganz and by James R. Ramsey, the university's president.

"Felner often bragged openly at faculty meetings that he had the full support of the provost and president," the letter said. "Faculty should feel free to speak their mind
and be counted. Yet, when faculty did exactly that, they were systematically ignored and targeted for further abuse by Felner."

Former county superintendent and Council for Better Education president Blake Haselton was appointed interim dean of the college of education. Unlike his predecessor, Mr. Haselton's background promises steady leadership, not flashy research grants.

University-wide accounting and research-compliance reforms were undertaken but some current and former faculty members are skeptical that the reforms will go far enough - or that all parties who erred during the debacle will be held appropriately accountable.

The Chronicle concludes that too much red tape hid what should have been red flags to university overseers.

HOW RED TAPE MIGHT HIDE RED FLAGS

The University of Louisville, like other institutions, has struggled to bring order and coherence to its research-administration system. A single federal grant might be monitored by multiple offices there: one office to verify researchers' time-and-effort reports, another office to approve subcontracts, yet another to oversee the protection of research subjects.

Does that fragmentation allow some things to slip through the cracks? Robert D. Felner, a former dean of education at Louisville, has been indicted on charges that he misappropriated a $694,000 federal grant.

At one point, Mr. Felner set up a subcontract as a personal-services contract, which allowed him to bypass some layers of supervision.

In March, Louisville's Board of Trustees received a report on plans to improve the system. Deans will have less unilateral power to make purchases, and the university will "develop a central process to monitor research projects for compliance."

Belated hat tip to Page One Kentucky.