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Internal FSU e-mails show academic officers were concerned with Koch's control over financial gift

Under fire this week for an unusual deal that gives a billionaire donor control over some faculty positions, Florida State University president Eric J. Barron has insisted that his institution's academic freedom has not been compromised.

But internal FSU e-mails show that top academic officers who reviewed drafts of the 2008 agreement with the Charles G. Koch Charitable Foundation had precisely those concerns.

Despite those fears, the arrangement — which was hoped to raise $6.6 million but ultimately yielded only about $3.5 million for the college's economics department — went through only minor changes.

One tweak: A reference in a gift agreement to the "Charles G. Koch Foundation Initiative in Economics" was removed.

The ambitious plan for the study of "political economy and free enterprise" had been sitting in FSU's legal office for a couple of weeks when the dean of the college of social sciences, David W. Rasmussen, tried to move it along with an e-mail saying, "The provost has OK'd" the arrangement.

But the administrator handling the matter, Bob Bradley, vice president for planning and programs, had a different memory of Provost Larry Abele's reaction. E-mails about the contract negotiations were released by FSU on Thursday after a St. Petersburg Times public records request.

"You said the Provost has signed off on the Koch Foundation agreement," said Bradley, whose job entailed reviewing all gift proposals. "He did not express that same level of agreement with me." Bradley went on to list a number of questions and concerns about the deal, which gave unprecedented privileges to an outside party.

Most troubling to FSU's provost, whose office had to sign off on the contract, were terms that allowed Koch to stop funding the program if faculty hired with its money were not complying with its goals. Traditionally, gifts to universities come with few strings attached and are irrevocable, meaning they can't be withdrawn.

Reiterating the provost's concerns, Bradley worried that Koch's control over funding would give it a "disproportionate influence" in the economics department, where it would be paying for two tenure-track positions as well as graduate student fellowships.

"Does it compromise the academic freedom of individuals holding professorships under the agreement indirectly through the evaluation process and the prospective cessation of funds?" Bradley asked in an e-mail to Rasmussen.

Referring to Koch's right to pick graduate fellows paid through the foundation, Bradley wanted "to eliminate the perception that FSU has surrendered its autonomy on such matters."

He also asked why Bruce Benson, head of FSU's economics department, was identified by name in the 10-year contract as the "continuing chair." Benson handled early negotiations with the Koch foundation and describes himself as sympathetic to its goals of reducing government interference with business.

"Again, doesn't this seem to connote our agreement to CGK (Charles G. Koch) control needlessly?" Bradley asked.

By the time the contract was finalized in July 2008, Benson's name was taken out of the document. But Koch's control over the purse strings was still intact.

Signing the memo of understanding with Koch for FSU were John Carnaghi, senior vice president for finance and administration on behalf of then-president T.K. Wetherell, who was out of town; the head of FSU's Foundation; Rasmussen and Bradley, who had become interim provost after Abele's departure. (Abele returned as provost a month later and retired in December. He did not respond for comments.)

In an interview Friday, Bradley said the discussions with Rasmussen were a normal part of contract negotiations and that it was not unusual for there to be miscommunication between the department heads and the provost.

Bradley said he became comfortable with the Koch arrangement after he was assured the college of social sciences had enough state money stashed away to pick up faculty salaries if Koch suddenly departed.

And though Koch could screen job candidates and pull funding if it didn't like the faculty's selection, Bradley said the economics department had the last word: It could simply not fill the slots — and forgo adding staff and classes — if it was unhappy with Koch-approved candidates.

"It's a situation where you don't lose and you may win," he said. "The faculty is always in control and that's the fundamental principle."

Bradley said he's not worried that state budget cuts will make FSU less likely to want to alienate a donor like Koch, which has pledged $1.5 million for faculty and another $500,000 for graduate fellowships. (Another $1.5 million was pledged by BB&T Foundation.) Since the contract was signed, FSU has lost more than $85 million in state funding, and 11 faculty positions were cut in the college of social sciences.

Though he was unable to think of another gift that came with similar donor involvement in hiring decisions, Bradley blamed the recent controversy over the Koch contract on the public's perception of the issue, not the reality.

"We knew from the get-go that a lot of people were not enamored of the Koch foundation," said Bradley, who has been vetting gifts at FSU since 2006. "Whenever you enter into an agreement with an entity that some people have some difficulties with, you're taking a risk. But we took the risk and substantively, everything's been fine."

Times researcher Shirl Kennedy contributed to this report. Kris Hundley can be reached at khundley@sptimes.com or (727)892-2996.

To read the FSU e-mails that show top academic officers' concerns with the 2008 agreement with the Charles G. Koch Charitable Foundation, go to links.tampabay.com.

Internal FSU e-mails show academic officers were concerned with Koch's control over financial gift 05/13/11 [Last modified: Saturday, May 14, 2011 12:28am]

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