Raising billions for a world-class university is no simple task, especially when that institution is more dependent than ever on private support to sustain itself.
Still, at UC Berkeley, the job has its perks.
Expense reports for an 11-month period obtained by The Daily Californian through the California Public Records Act show that Vice Chancellor Scott Biddy, the head of fundraising and public affairs, paid for about a dozen business-class and first-class flights with UC funds.
Records for the 11 months show he flew to London, Paris, Madrid, Zurich, Tokyo, New York, Beijing, Seoul and Singapore, among other cities. During that period, he charged more than $37,000 to the university.
The records, which spanned November 2013 to October 2014, include expenses for stays at luxurious hotels such as the Taj Mahal Palace and Ritz-Carlton. Restaurants on the menu were some of Berkeley’s best: Chez Panisse, Revival Bar and Kitchen, FIVE, Bistro Liaison and Gather.
“What’s happened over the last decade or so, with the changing financial model of the campus … there is just a much greater recognition that a thoughtful fundraising program can be critical to the campus maintaining its financial health.”
— Vice Chancellor for University Relations Scott Biddy
In every category — travel, lodging, airfare, dining — Biddy far outspent his counterparts at other UC campuses for a seven-month period of comparison. For four months’ worth of her expense reports, UC President Janet Napolitano also spent fewer university funds than Biddy during the same four months.
In addition to his travel expenditures, Biddy also regularly dined with colleagues on the university’s dime during that time period.
Through exceptions and authorizations for certain expenses, all fell within university policy.
Private support is now roughly equal to state support as UC Berkeley strives to compete with other top schools, many of which have invested in fundraising for decades longer and have the endowments and foundations to show for it. Under the hovering threat of deadlocked budget negotiations between Napolitano and Gov. Jerry Brown, the UC system’s public character is once again receiving scrutiny from all sides.
Biddy is uniquely situated within this public-private tension: Catch up to universities such as Harvard and Stanford, but do so under the public eye. It is nearly impossible to know if Biddy’s counterparts at private universities spend at his level, because their universities don’t answer to same public-record laws. Indeed, some critics say public employees should be held to a higher standard — a different set of rules — even if they are playing the same game.
An evolving model
Biddy, who heads University Relations, is one of seven vice chancellors on campus and reports directly to the chancellor.
He came to UC Berkeley in 2002 as associate vice chancellor for university relations, previously working at Georgetown University and Rice University. Upon joining the public campus, he found its development efforts less established, with fewer employees in the fundraising office and less alumni outreach.
“What’s happened over the last decade or so, with the changing financial model of the campus … there is just a much greater recognition that a thoughtful fundraising program can be critical to the campus maintaining its financial health,” Biddy said in an October interview during which his expense reports were not discussed.
Private support, which comprises about 13 percent of the campus operating budget, now approximately equals the percentage coming from state support. Drives such as the widely hailed Campaign for Berkeley raised $3.13 billion over eight years.
Non-coach flights are allowed when an “itinerary involves overnight travel without an opportunity for normal rest before the commencement of working hours,” according to UC policy.
But apart from campaigns aimed at the general community, one of Biddy’s duties most crucial to the success of the campus is cultivating relationships with a small group of wealthy philanthropists and influential alumni. Connecting donors to campus events and professors, calling them on the phone and eating meals with them are common components of the job.
“When you look at the large gifts, it’s not a transaction,” Biddy said during the fall interview. “It really is a relationship.”
For UC Berkeley, which raises more overseas than any other UC campus, cultivating meaningful relationships with donors often means flying across the globe and dining in fine establishments.
Earn more, spend more
UC policy lays out guidelines for when travel expenses can be reimbursed but provides a degree of leeway and room for exceptions.
A comparison of seven months’ worth of expenses among Biddy and his counterparts at UCLA, UC San Diego and UC Davis show that Biddy billed far more expenditures to the university than his colleagues. A smaller data set — just three months’ worth of expenses for UC Berkeley’s chancellor, each of the seven vice chancellors and the executive vice chancellor and provost — also show Biddy charged more to the university than other campus executives for that time period.
Rhea Turteltaub, UCLA’s vice chancellor for external affairs, flew just one non-coach flight during the same time period, using “premier access” airfare, cheaper than business- or first-class flights. UC Davis’s equivalent vice chancellor, Shaun Keister, booked one business-class flight during those months because “it was less expensive than coach fare offered through Connexis,” referring to the program that procures inexpensive travel contracts for UC and CSU employees. UC San Diego’s Vice Chancellor for Advancement Steve Gamer flew just once, for a New York business trip, during those seven months.
Napolitano appeared to be reimbursed more selectively for travel than Biddy. Between March and June of last year, she almost always flew Southwest Airlines, which does not separate seats by class. Even when she used the airline company’s “business select” program — which gives travelers priority boarding — she was only reimbursed for the coach equivalent.
UC policy states that coach flights should be booked for all travel expenses but provides four exceptions to the rule. In Biddy’s case, he was authorized to fly in business-class and first-class seats because his itinerary involved, as the policy reads, “overnight travel without an opportunity for normal rest before the commencement of working hours.” Biddy flew overnight more often than any other aforementioned UC executive, which opened up more opportunities for first-class accommodations.
Although some of Biddy’s overnight flights landed during the workweek at typical working hours, others brought him to the destination on evenings or weekends.
A first-class flight Biddy took from San Francisco to London in January last year landed at 2:05 p.m. on a Saturday. His business-class flight on the way home touched down at 4:50 p.m. the following Sunday. An April business-class flight from San Francisco to Beijing also landed on a Saturday afternoon. A business-class flight to Delhi in March landed on a Friday night.
Due to Biddy’s busy schedule, members of UC Berkeley’s public affairs office answered questions about his expenses.
Campus spokesperson Dan Mogulof said the flights were allowed under UC policy because Biddy needed to work as soon as he landed, even on weekends. The chancellor, Mogulof said in an email, personally approved such flights prior to departure by looking at “the totality of the situation” and seeing the “toll” frequent travel was taking on Biddy during a time when an associate vice chancellor role was unfilled.
“(The chancellor) understands how important it is that people like VC Biddy are as rested and ready as possible when meeting with high net worth individuals around the world,” Mogulof said in the email.
Frequent flights and business-class airfares, though, don’t come cheap. Biddy’s airfare one week in June, when he visited Paris, Madrid and London, cost $10,013.40.
“You have a donor you’re trying to get a million dollars out of, you’re not going to take them to McDonald’s.”
— Patrick Callan, president of the nonprofit Higher Education Policy Institute
UC Berkeley also is not alone in authorizing top administrators’ first-class travel. A report by the Center for Investigative Reporting in August 2013 revealed that many UCLA deans were permitted to fly first-class because they submitted medical notes saying they needed the accommodations, which is another exception to the coach-only rule.
Charles Schwartz, a UC Berkeley professor emeritus of physics and frequent critic of UC finances, related Biddy’s expenditures to executive compensation and a problem of “corporate attitude” among regents.
“Let’s acknowledge the university has been and always will be in the fundraising business,” Schwartz said. “Then the question is, ‘What extra perks do they get?’”
Wining and dining
Closer to campus, developing relations with philanthropists is cheaper — but it still comes at a price. In the world of fundraising, though, if a pricey meal later culminates in a check, the meal itself is inconsequential.
UC Berkeley does not keep tabs on how much each employee raises in funds, so it is impossible to track the outcome of any particular donor interaction.
In July, Biddy went to dinner at Chez Panisse with three potential donors who chose the internationally renowned restaurant. After tip, the cost of their meals totaled $354.59. Although the per-person charges exceeded what the university permits, Biddy was allowed to use UC funds because the prospective donors chose the restaurant.
Patrick Callan, president of the nonprofit Higher Education Policy Institute, questioned the necessity of certain luxurious expenses but recognized the need for donor cultivation.
“What the restaurants themselves all have in common is the fact that they take reservations for lunch, which is not the case for many establishments in town … I hope it is apparent why it would have been essential to have reservations.”
— Dan Mogulof, campus spokesperson
“The biggest gray areas are in these development-fundraising arenas,” Callan said, referring generally to employee expenditures, though he declined to comment on specifics. “A lot of their job requires them to interact and entertain at a higher level. … You have a donor you’re trying to get a million dollars out of, you’re not going to take them to McDonald’s.”
During the 11-month period for which the Daily Cal obtained records, Biddy charged twice as many meals with colleagues to the university as those with donors.
The university only pays for meals among colleagues if the employees are “unable to accomplish the business purpose during working hours,” according to the policy text. For high-level administrators with jam-packed schedules, this is a regular occurrence, according to Mogulof.
With his colleagues, including the chancellor on several occasions, Biddy also maxed out the university’s authorized limits and paid the remainder of the bill out of pocket. On a Sunday night in June, Biddy went to dinner in San Francisco with Chancellor Nicholas Dirks, Executive Vice Chancellor and Provost Claude Steele and Vice Chancellor for Administration and Finance John Wilton. Biddy requested reimbursement for the maximum allowed amount, $312.
Meetings over meals, according to policy text, must serve “substantial and bona fide University business.” The listed purpose for the San Francisco dinner was “to discuss a range of campus issues,” according to the reimbursement form.
Biddy frequently charged meals with colleagues to the university, owing partly to his international travel, where expenses are based on federal per diems, or daily limits, rather than the meal’s business nature. While abroad, he sometimes maxed out the per diems and regularly came close to maxing them out.
Written reasons for domestic meals included discussing the roles of interns, UC initiatives, athletics messaging, the chancellor’s foreign travel, communications support for the chancellor and upcoming policy changes.
“What the restaurants themselves all have in common is the fact that they take reservations for lunch, which is not the case for many establishments in town,” Mogulof said in an email. “Given VC Biddy’s schedule during this period of time, and the importance of these meetings, I hope it is apparent why it would have been essential to have reservations.”
UC policy prohibits “lavish or extravagant” meals when an employee is requesting reimbursement. The policy, though, provides little guidance on what kinds of meals might fit that description. For instance, the rules state that “an expense is not considered extravagant merely because it exceeds a fixed dollar amount or involves first-class accommodations.”
“If it’s a routine way of doing business, it’s not the way governmental or nonprofit organizations should act. Most of the time, meetings can be done in a conference room,” Callan said, referring to the practice of dining out with colleagues.
A look at Biddy’s UC equivalents again shows a difference in expenditures. Gamer, UC San Diego’s vice chancellor, did not charge any meals with colleagues to the university over seven months, according to a list of expenditures provided by the campus’ public-records office. Turteltaub of UCLA and Keister of UC Davis occasionally dined with colleagues and were reimbursed with university funds, but less frequently than Biddy.
A matter of perception
Comparisons among administrators are imperfect at best. UC Santa Barbara, for one, doesn’t currently have a vice chancellor for institutional advancement. Accounting systems also work differently — an exception approved on one campus might not be approved on another. And comparisons between UC Berkeley administrators and those of private schools are nearly impossible, because the employee expenses at the latter institutions are off limits to the public eye.
Though UC Berkeley’s fundraising practices are increasingly emulating private universities, it is still operating under a system that answers to the UC Board of Regents, legislature, governor and California residents.
“A good judgment requires that at a time when the university is so pressed that we have these unprecedented tuition costs, public credibility is not good, people are unhappy about higher education and its costs — this kind of thing doesn’t help,” Callan said. “This is a time for people to err on the side of caution, not push the limits of what’s allowed.”
Mogulof emphasized that expenditures on travel and entertainment are not financed by state funds or tuition. He also said in an email that the campus rejects the suggestion that Biddy bent policy.
“Biddy is tireless, hands-on and deeply involved in every aspect of the fundraising endeavor,” Mogulof said in the email. “That means he is ready and willing to get on a plane at any time if there exists the possibility that new or additional support can be gained for our university.”
Contact Kimberly Veklerov at [email protected].