UC chief faces the political music
After scathing audit uncovers $175M in hidden reserves, can Napolitano mend fences with a perturbed Legislature?
OAKLAND — When former Arizona governor and thenHomeland Security Secretary Janet Napolitano was tapped to head the University of California nearly four years ago, supporters touted her political stature and experience running another unwieldy bureaucracy.
Hiring a politician rather than an academic was a strategic choice: The powerhouse research university, with more than 230,000 students, needed to make inroads in Sacramento after losing $1 billion in state funding during a painful recession. But Napolitano’s bold
plays for a greater share of the pie — most famously a threat to hike tuition unless the state ponied up the difference — rankled some Sacramento politicians. Now a blistering new state audit that found her office accumulated tens of millions of dollars in secret reserves and inappropriately interfered with the audit has brought simmering tensions to a boil.
One of the many questions swirling after the report is what — if anything — will happen to Napolitano: Will the leader recruited to improve UC’s standing in Sacramento face consequences for alienating the Capitol instead?
The answer could depend on how she responds to the findings starting Tuesday, when she faces a panel of angry legislators at an oversight hearing.
“This is going to be the greatest test of the extent of her political skills,” said Dan Schnur, a former GOP strategist who now teaches at USC’s Annenberg School of Communication. “She has to find a way to fix a broken set of political relationships without sacrificing more than the university is willing to tolerate.”
The state has hammered UC with audits about its spending and admissions practices during Napolitano’s tenure, and some lawmakers have tried to strip away some of the university system’s autonomy from state government.
The latest battle with the state is over an audit requested by state lawmakers — Assemblymen Phil Ting, D-San Francisco, and Kevin McCarty, D-Sacramento — that found hidden reserves totaling $175 million, a figure UC disputes.
The auditor also accused her office of interfering with survey responses from individual campuses, a startling claim that suggested a culture of tight message-control under Napolitano’s leadership rather than the openness she once promised.
Indeed, when the Bay Area News Group asked officials at the Irvine, Riverside and San Diego campuses whether they knew the president’s office would be altering their responses to auditors, each campus directed questions back to the Office of the President.
UC Regent John Pérez even turned down an interview request because, according to his spokesman, officials from the president’s office had requested that all press inquiries go through them.
“Unbelievable,” said Lt. Gov. Gavin Newsom, who serves with Pérez on the board of regents — officials, he says, who are too often “lap dogs” for the Office of the President. “Enough said right there. If that’s the case, it just reinforces, full stop, my concern.”
But he’s not blaming Napolitano. Newsom, who is running for governor, cites weak board oversight for the fact that UC has “the Legislature breathing down our necks.”
Napolitano declined to be interviewed for this story, but Nathan Brostrom, chief financial officer for the University of California, defended the president’s office in a phone interview on Thursday, calling elements of the audit’s tone and characterization “unfortunate.” He disputed the idea that the central administration — whose budget makes up $747 million of UC’s total operating budget of $31.5 billion — maintains a “slush fund,” as lawmakers have charged, and said much of the funding in question was tied to specific initiatives, such as cybersecurity and sexual violence prevention.
But the latest revelations have already caused turmoil for UC, with growing calls to cancel the tuition hikes and even new legislation to force such a move.
Yet, while many interviewed for this story were quick to blast the Office of the President or the regents for the audit findings, they were hesitant to place the blame on Napolitano, who once vowed to bring transparency and spending controls to the bureaucracy headquartered in downtown Oakland.
“I remain a supporter of Janet’s,” Newsom said. “I still believe in her.”
Even Kathryn Lybarger, an outspoken critic of UC’s management who leads a union representing UC’s lower-wage workers, AFSCME Local 3299, declined to say whether Napolitano was responsible for the problems, saying only that it should be further investigated.
Paul Monge Rodriguez, a UC Berkeley graduate student appointed to represent UC students on the board of regents next year, said Napolitano has worked more closely with students than previous presidents and generally has “led us in a positive direction from where we started.”
Schnur said it was understandable why people, politicians especially, might avoid pointing out Napolitano’s failings on the job. “She might be politically wounded at the moment,” he said, “but she’s going to recover, and she probably has a very long memory, so there’s not much incentive for anyone to get in her doghouse.”
In 2015, after Brown and Napolitano clashed publicly over the tuition-hike threat, they struck a deal: The state would help to pay down the system’s pension debt and help to fund enrollment expansion if UC kept tuition flat for another two years, made pension reforms, and added 10,000 more in-state spots for undergraduates.
But two years later, the university says it has no choice but to raise fees again this fall — by $336 to $12,370.
Napolitano also has been coping with her own personal struggles. She was hospitalized in January for side-effects of cancer treatment. She kept the news private, telling only the chairwoman of the board, Monica Lozano.
Lozano took a defensive posture about the latest audit in an interview Friday. She said she stood with the president, saying Napolitano has harnessed the university’s size and brainpower to take on “great social challenges.”
“I think Janet Napolitano is a tremendously effective leader for the University of California,” she said.
Newsom said he has no doubt Napolitano can tackle the bureaucratic problems highlighted in the audit or that she “has the political skills to smooth things over with the Legislature.”
“The fact that she hasn’t,” he said, “doesn’t mean she won’t and can’t.”