Calif. university spends student MBA fees on professor pay

8:15 AM, May 14, 2012   |    comments
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By Erica Perez

Officials at CSU Long Beach spent nearly $200,000 on extra pay for some business school faculty, tapping student fees that were supposed to be spent on recruiting professors, getting more research published and boosting enrollment.

The CSU Board of Trustees authorized a new fee for graduate business school students in 2009. At $254 per unit, it nearly doubles the price of a degree, adding $12,000 to the cost. CSU Long Beach projects it will have spent about $1.7 million in MBA fee revenues from 2009-10 through 2011-12, documents show.

Fee revenues were supposed to help universities boost enrollment and strengthen their accreditation. The accrediting agency requires schools to have a high number of tenure-track faculty who are consistently publishing peer-reviewed research.

While Long Beach officials say accreditation status has improved, the college has seen a drop in enrollment in its MBA programs. Meanwhile, the College of Business Administration has spent $191,000 of the fee revenues on stipends for existing faculty members in the last three years.

Some 43 professors received $3,000 each for participating in a course development workshop. One faculty member has gotten $21,750 in extra income from the student fee since 2009.

The payments went toward developing and gaining buy-in for "Revitalized MBA," a proposed overhaul touted by College of Business Administration Dean Michael Solt and a group of professors. But the idea ultimately failed to win enough faculty support to survive a vote.

Although Revitalized MBA has ended, the spending shows the university went out of its way to use the student fee money to boost faculty pay for those who worked to support the controversial plan.

"I've never seen faculty paid that much to develop curriculum," said Mary Celsi, a marketing professor who was paid to attend a June 2010 workshop.

"What I remember about the workshop is faculty saying to each other that we were convinced that the course integration and team-teaching concepts wouldn't work, but we took the money because we were encouraged to do so," Celsi said.

Solt said the spending was in line with the purpose of the MBA fee because it was aimed at improving the quality of the program for students.

"Our MBA program had not been revised for a very, very long time, so the ... MBA revitalization effort was an attempt to sort of bring our program up to date and try and make it as high a quality program as possible," Solt said.

Under the Revitalized MBA proposal, faculty in different departments would collaborate to teach integrated courses. The university paid faculty $3,000 each for participating in one of two on-campus workshops on developing course outlines for these new classes.

The college also paid 16 faculty members $3,000 each for participating in a half-day conference panel held on campus in February 2010. Participants made presentations about what integrated classes might look like. Ten professors participated in both the panel and workshop, earning $6,000 each.

Solt dropped the MBA revitalization effort in fall 2011. Some faculty members have taught new classes as part of a pilot, but that is ending.

Solt said the university paid professors because they worked in summer and winter.

"Only on a voluntary basis can people do things during the summer and winter," Solt said. "They were doing real work that was aimed at this revitalization effort."

The faculty council has questioned the spending. The group provided California Watch with an internal financial report.

The council in April sent a letter to the attorney general's office, the California state auditor and the CSU Board of Trustees asking for an investigation.

Thomas Rhee, a finance professor and faculty council chair, chose not to participate in the workshops or panel.

"Our faculty members should have been solicited for any meaningful projects or ways to allocate this new source of income," Rhee said. "But instead the dean has been spending the money for his own political convenience."

Ying Liu, an assistant professor of information systems who attended the June 2010 workshop, said he worked with professors from the accounting and marketing departments on an outline for an integrated customer relationship management course. In addition to the time spent in the workshop itself, he recalled spending eight to 16 hours on the course outline.

"It's not a normal workload. It's extra," Liu said. "You have to create a syllabus."

One marketing professor, Ingrid Martin, made a particularly handsome profit. Over three years, she garnered $32,000 in extra income for her work on the revitalized MBA, including $21,750 from the student fee. Her base pay is $121,600.

In 2008-09, Martin was part of a 10-member MBA task force that performed a competitive analysis and came up with the revitalization concept. She later became chair of the Graduate Program Committee, which came up with the idea for the workshops and panel.

For her work on the task force in the summer of 2009, Martin was paid $5,000. In January 2010, she got $3,000 for participating in the panel.

She received $10,000 in summer 2010 for MBA revitalization development and coordination plus $3,000 for participating in the June 2010 workshop.

In winter 2011, Martin got $2,000 for MBA revitalization development and coordination, plus $3,000 for facilitating the January 2011 workshop - even though the college also paid $9,000 to a professional development expert for developing and facilitating both workshops.

Solt defended the payments to Martin.

"Everything that she was compensated for was for work performed," Solt said. "And she has done a great job at it."

Martin also said her pay was appropriate.

"Summers are set aside to work on research," Martin said. "Instead of being able to focus on research, I was having to take part of my time and focus on doing this."

Martin's husband, CSU Long Beach economics professor Wade Martin, also received $3,000 for participating in the June 2010 session. He was the only faculty member from outside the College of Business Administration to take part in one of the workshops.

Ingrid and Wade Martin collaborated with others to create a course on sustainability. Ingrid Martin said she invited her husband to join.

"He has done a lot of work around the world in environmental economics, and so he had a certain amount of expertise that fit well with what we were looking for," she said.

She said other business faculty could have proposed working with outside faculty members but chose not to.

"Everybody was encouraged to think outside the box," she said.

Meanwhile, although the MBA fee was also aimed at increasing enrollment, budget cuts led the CSU system to close admissions to programs in spring 2009 and spring 2010.

Enrollment in the state-supported MBA program at CSU Long Beach dropped by nearly half in the last few years, from 292 in fall 2008 to 161 this spring, according to university data.

"Who knows? Maybe the MBA fee cost had a dampening effect on our enrollments," Solt said. "They have declined, and we're trying to help them grow back again."

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