Capitol Alert

Napolitano would have ‘intervened’ if she had known about UC audit interference

University of California President Janet Napolitano responds to a question while appearing before a legislative committee on May 2, 2017.
University of California President Janet Napolitano responds to a question while appearing before a legislative committee on May 2, 2017. The Associated Press

Is the frosty relationship between the University of California and the Legislature starting to thaw?

Tuition hikes, surging nonresident enrollment and a series of administrative scandals have generated intense outrage at the Capitol in recent years, culminating in a heated hearing last May in which lawmakers expressed frustration over what they felt was UC’s continued “arrogance” and resistance to change. But a follow-up hearing Tuesday suggested there has been a decided de-escalation in tensions in the intervening eight months.

Amid pointed questions for UC President Janet Napolitano about her role in interfering with a critical state audit of her office last year, many lawmakers in attendance expressed their pride in one of the world’s most prestigious university systems and their desire to rebuild trust with UC.

Napolitano assured lawmakers that she did not direct her staff to interfere with the audit, and she would have stopped them had she been aware.

“Perhaps my chief of staff and deputy chief of staff were doing what they thought I wanted them to do,” she said. “Had I known what they were doing, I would have intervened and stopped it.”

The audit, released last April, found that Napolitano’s office systematically overcharged UC campuses to fund its central administrative functions and had amassed $175 million in undisclosed reserves, even as it raised tuition.

But state auditor Elaine Howle also slammed the university for inhibiting her efforts to determine whether the Office of the President’s expansive duties and nearly 1,700 employees could be slimmed down. A survey for UC’s ten campuses, to assess what administrative functions they found valuable, was abandoned after Howle discovered that Napolitano’s office ordered significant revisions to critical responses.

Napolitano said she accepted full responsibility for approving a plan that required campuses to provide their surveys to her office for review before submitting them to the auditor, which resulted in the changes to negative answers. She said she merely wanted to ensure that campuses understood the surveys and provided accurate information.

“I made a mistake and I want to apologize for it,” she said. “It’s clear to me now that no one at the Office of the President should have been involved in reviewing the survey responses.”

“Perhaps I should have paid greater attention,” she added.

Legislators called the hearing Tuesday after an independent investigation, ordered by UC’s governing board, concluded that the Office of the President directly and intentionally interfered with the audit.

Former California Supreme Court Justice Carlos Moreno, who led the investigation, said he spoke with 38 witnesses and examined more than 420,000 documents.

He determined that Napolitano’s office interfered with the audit on multiple levels: both implicitly, by notifying campuses that it would review their surveys before submission, which may have created a chilling effect on responses, and explicitly, by changing responses so that they reflected more positively on the university.

But he said he found no evidence that Napolitano was aware critical survey answers were changed, a process carried out by her former chief of staff Seth Grossman and deputy chief of staff Bernie Jones. Both of them resigned last November, shortly before Moreno’s report was released.

Some committee members expressed skepticism over his conclusions, including Assemblyman Phil Ting, D-San Francisco, who suggested that UC engaged in a “cover-up” to keep facts away from the auditor, and by extension, the Legislature and the public.

“I find it hard to believe that a chief of staff acted without permission from their boss,” he said. “That’s usually when a chief of staff gets fired.”

There was also lingering anger directed at Napolitano. Assemblywoman Sharon Quirk-Silva, D-Fullerton, who has previously called on Napolitano to resign, reiterated that she did not feel Napolitano faced sufficient consequences for her actions.

“I’ve lost confidence,” Quirk-Silva said.

Nevertheless, when Napolitano finally appeared before the panel more than two hours into the hearing, the interrogations were muted. A few lawmakers urged their colleagues to hold off on the reactionary policy-making that has resulted in recent session as the Legislature has attempted to wrest back some of UC’s autonomy.

“I want to say a word of caution, that as we move forward and we move forward in this legislative year, that we think and think deeply and long before we take action,” Assemblyman Jose Medina, D-Riverside, said.

George Kieffer, chair of the UC Board of Regents, said the university took Moreno’s report seriously. In addition to policy changes to prevent interference in future audits, he said, the regents released a statement admonishing Napolitano’s actions and required her to apologize. Kieffer added that he did not feel any further discipline was necessary.

“We think we’re better off with the president than without the president,” he said.

Welcome to the AM Alert, your morning rundown on California policy and politics. To receive it regularly, please sign up here.

GETTING HELP: With the opioid epidemic growing, in California and across the country, so has the demand for treatment – and concerns about the quality of some of the facilities that have sprung up in recent years. The Senate Health Committee will hold an informational hearing on substance abuse treatment in California, including approaches that work and existing regulations on the system, 1:30 p.m. in Room 4203 of the Capitol.

SAFETY: As the federal government considers cutbacks to social services such as Medicaid and food stamps, UC Davis economics Professor Marianne Bitler will provide an overview of research into the effectiveness of these War on Poverty programs, noon at the UC Center Sacramento on K Street.

Alexei Koseff: 916-321-5236, @akoseff