June 25, 2007

$50-Million Donor to U. of Michigan Will Review Performance as Part of Gift

The University of Michigan announced today that it had received an anonymous $50-million gift that comes with some hefty strings attached to it. The pledge is for the new Cardiovascular Center, which opened on June 11.

The donor plans to give $25-million over the next 10 years, beginning this month, and the university will receive the remaining $25-million upon meeting goals agreed upon by the donor and the center’s leaders, according to a university news release.

The institution and the donor have created benchmarks that will allow the benefactor to review the center’s performance before releasing the final $25-million. Some categories that will be measured for results include performance on clinical measures, to ensure that the university is providing effective care, and scores on patient-satisfaction surveys.

Other areas that will be monitored by the donor include the amount of research grants won, the number of research publications and patents, and the quality of teaching. The donor has also asked that the center be led by a team, not an individual, so that specialists are encouraged to work together. —Erin Strout

Comments

1. I’m sure most institutions will not be pleased that a donor insisted on an assessment plan before turning over a donation, and even less pleased that the second half of the donation would be contingent upon good use of the first half. But “trust me” is an inadequate safeguard, especially when talking about the large donations which are becoming more common in academia. Oversight, more than just internal oversight, will help insure that the donation is well spent, and that the aims of the donor are met.

   — Laurie Fathe    Jun 25, 03:46 PM    #

2. It is good to see a donor demanding of an institution what institutions have been demanding of professors. Too often accountability stops short of the top.

   — Robert Beckett    Jun 25, 04:17 PM    #

3. Major donors, more than ever, seek increased accountability and a desire to play a pivotal role in evaluating complex program gifts. This gift epitomizes both the institutional philanthropic opportunities, and challenging planning and operational challenges, inherent in this model of gift planning.

   — Steve Weldon    Jun 25, 05:48 PM    #

4. Good for the donor. It is his/her money. If Michigan did not want, someone else would.

   — Nathan Johnson    Jun 25, 10:42 PM    #

5. Wasn’t this an episode on “House?” Everybody needs to step back a couple of paces and measure the boundaries before the thundering applause turns to a deadening thud.

   — Jeremiah    Jun 26, 08:43 AM    #

6. This type of donation seems to blur the disctinction between a gift and contract. It has no direct benefit to the donor, but it does have clearly defined, detailed reporting requirements. Is it still tax deductible to the donor? Many institutional advancement offices do not have the staff or mechanisms for outcomes monitoring, so I’m curious as to who will take on this responsibility at U of M.

   — Holly    Jun 26, 09:55 AM    #

7. It is good to see a strengthening of accountability in a situation in which the measures are reasonable.

   Good for this doner.

   — William L. Graham    Jun 26, 10:08 AM    #

8. The University of Michigan should relinquish its claim as a public university and sell itself for what it is: a wholly owned subsidiary of its donor, whether a donor be a person or a corporation. If a donor doesn’t trust the university to spend the donation wisely, she should keep her money. A donation by definition is a gift with no strings attached. This “donation” is actually a payment for services rendered, in which the “donor” maintains control (often couched in the word ‘accountability’). Academic freedom in public education has taken another hit. What a disgrace for the university!

   — Herbert Morgan    Jun 26, 10:27 AM    #

9. This modifies institutional accountabilities such that promotion, tenure, and pay raises will likely be based on what peers and a governing committee anticipate (or learn) what will be acceptable to the third party. The penalty for institutional noncompliance would likely be severe—or at least the fear of such would be.

   So while one can applaud the donor’s interests, this persons anonymity, as well as the presence in that person’s location of unknown individuals who will assist him or her, make this an untenable situation, in my judgment.

   — Bob Silverman    Jun 26, 11:38 AM    #

10. Don’t blame the donor. UM could have simply said, “No thanks.” That it did not suggests UM is willing and able to comply with the donor’s requests.

    — Jim    Jun 26, 01:03 PM    #

11. Why not blame the donor? In any type of corruption scheme, it takes at least two parties: the corrupter, in this case the donor, and a party willing to be corrupted, the university. Both parties need to enroll in Ethics 101.

    — Herbert Morgan    Jun 26, 03:28 PM    #

12. My interpretation: it sounds like UM got a gift of 25 M that they can use however they like for their cardiovascular center. The ethical question is whether it is worth doing what the donor is asking them to do to get the second 25M. If the “strings attached” involve demonstrating appropriate use of the 25M gift, then there is no problem. If they don’t like the “strings attached” then they don’t have to try to meet the criteria and they can settle for a 25M gift. Most universities would be happy with the first 25 M.

    — Ken L. Nafziger    Jun 26, 07:15 PM    #

13. I like Mr. Morgan’s idea that the U of Michigan should relinquish its claim to being a public university, just as long as they also relinquish any claim to public tax dollars. It takes an awful lot of arrogance to advance the “just give us the money and keep quiet” attitude that Mr. Morgan apparently espouses.

    — J. Ward    Jun 26, 09:18 PM    #

14. Thanks, J Ward. Could it be that Mr. Morgan’s disdain has to do with the donor being “she” – did the rest of us know that???

    — J. Gurule    Jun 27, 10:52 AM    #

15. Jeremiah made a good point, and I agree: This was an episode of “House.” The U. of Michigan is a public institution charged with overseeing the public good, not the special interest of the donor. If the donor wants more administrative control, let him join a board at the university. Perhaps the university is too incompetent to be accountable to the citizens of Michigan on its own accord and needs a donor to attach “some hefty strings.” Certainly the donor thinks so. He’s buying control.

    Regarding the pronoun ‘she.’ There was a time in the not-too-distant past when writers were chastised for using the pronoun ‘he’ when the gender of a person was unknown. Good to see that gender equality has now made the use of ‘she’ in the same situation equally disdainful.

    — Herbert Morgan    Jun 27, 12:28 PM    #

16. The Chronicle is clearly grinding an axe: my comment to the effect that the so called hefty strings were not strings at all was not published, while the anti-university cohort is in full cry. Nonetheless, I’ll make a second attempt to be heard over the censorship.

    Consider the following: 1) the conditions that the commentators decry are requirements not to pursue a specific ideology, but to provide quality and an improved management model (notwithstanding the fact that the university is already ranked #1 nationally for health-care administration education); do the commentators think that the university should strive to lower quality?; 2) one commentator talks about the university being for sale. Is this true of private schools as well? Did the commentator graduate public or private? Should private/”elite” schools get federal monies for anything?; 3) UM’s annual legislative allotment from the state of Michigan (in the 1960s) was well over $1.3bn per annum, and is now roughly $350MM per annum. Should UM be pilloried or lauded for moving from a public toward a private model and for closing the funding gap?; 4) How many of the Yahoos decrying this donation have donated as much as $50,000 to anything? My advice, figure out how to make the money, then you might have a seat at the table.

    Castigating the university for attempting to improve healthcare has to be the most perverse thing I’ve ever read. Fortunately, the university has done research on what motivates such disturbed – and disturbing – behavior…some people gain rewards from angering others: http://www.ns.umich.edu/htdocs/releases/story.php?id=3209

    — R.Will    Jul 1, 12:22 PM    #

17. R. Will makes four points, and I want to address them all.

    1) Who is this donor who assumes that he knows what’s best for the center? Or what’s best for the public good? Will says, “the university is already ranked #1 nationally for health-care administration education.” If so, why is the donor attaching strings? This says to me that the donor does not trust the university to spend his money wisely. He must maintain control. When was the last time you made a donation and attached strings?

    2 & 3) Well, yes, the university is for sale. Instead of going into detail here, I’ll recommend Jennifer Washburn’s book “University, Inc.: The Corporate Corruption of American Higher Education” as a well-researched introduction to the problem. By the way, I was graduated from a public university. I am arguing about ethical problems at public universities and am not interested in what private ones do. Their mission is different. UM should be pilloried for agreeing to the donor’s demands and for lowering its ethical standards.

    4) I take this point to mean, “If you aint rich, shut up about ethics.” Would the university kowtow to my attached strings if I donated what I could afford, say $500? Probably not because I’m sure there is a strings-attaching threshold (perhaps as you suggest, it’s $50K). Are you suggesting that having a lot of money means the donor knows what’s best for the public good?

    I am not castigating the university for attempting to improve health care. How did you make that leap? I castigate public universities for compromising their ethics. Perhaps UM should conduct research on donors such as this and ask what makes their behavior so “disturbing.”

    — Herbert Morgan    Jul 3, 01:55 PM    #

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