Nov 112008
Authors: Aaron Hedge, J. David McSwane

As speculation grows in the wake of former CSU President Larry Penley’s abrupt resignation last week, skeptical student leaders and state lawmakers say the embattled leader’s departure comes at an odd and frustrating time.

Penley resigned after committing the university to intensive stretch goals this year in his state of the university speech at the beginning of the semester, which he started: “As I begin my second five years as president of Colorado State…”

The initiatives included increasing student enrollment and faculty by substantial numbers and bringing CSU to complete carbon neutrality by 2020 — a lofty goal that exemplified Penley’s exhaustive marketing of CSU as the “green university.”

In his resignation letter to the CSU System Board of Governors last Wednesday, Penley said he wanted to pursue other leadership opportunities in higher education, but he didn’t mention any immediate job opportunities, which is unusual for departing university presidents.

“I believe that my leadership has contributed to significant progress for Colorado State University,” Penley said in the letter. “But I want to be free to pursue other leadership positions in higher education. This resignation will allow me the flexibility to do so.”

And while Penley is currently taking vacation leave until his official departure Nov. 30, he has not announced plans to take a post at another institution.

But as the university will pay the former president nearly $400,000 after his departure that was not afforded by his contract, Luke Ragland, the former director of Legislative Affairs for the Associated Students of CSU and self-described “opponent” of Penley, said the payment brings into question whether Penley left on a voluntary basis.

“When people quit out of nowhere like that, they usually don’t get money,” Ragland said.

Michelle McKinney, the BOG’s chief spokesperson, said the money was included in the severance package as a “prudent action” to avoid possible additional legal fees, should Penley try to negotiate the package.

“As you know, legal fees aren’t cheap,” McKinney said. “(Penley) had a year and a half left on his contract, and the board decided to deal with it quickly and cleanly.”

Penley’s resignation came two weeks after Penley’s No. 2, Executive Vice President John Lincoln, retired amid a swirl of complaints from student leaders and faculty members about Lincoln’s management style.

The board had recommended that Lincoln be removed from his position more than two months prior, McKinney said. And after Lincoln went into what Penley called “semi-retirement,” he took on a part-time, contractual position with CSU’s Public Affairs Department.

But when the board sent Lincoln’s contract to be reviewed by university attorneys last week, Lincoln relinquished the contract, severing all ties with the university. “The board was unaware of that contract, and all that came to the surface last week,” McKinney said Monday.

Ragland said the Lincoln resignation is suspect. “If John Lincoln resigned, why is the Board of Governors not following through with the contract?” he said.

“I have a feeling that the contract offered to John Lincoln was not looked on happily by the board, and I hope it wasn’t.”

Penley’s resignation comes after months of increasing scrutiny regarding his administration’s financial philosophy after, in his five years as president, millions of dollars that could have gone to the academic colleges have been funneled into swelling top-level administrative salaries and budgets.

During that administrative overhaul, several key financial overseers left the university — three on the same day — accepted large financial incentives and signed confidentiality agreements, a Collegian investigation found. C.W. Miller, a 40-year biomedical sciences professor and long-time critic of the funding shifts at CSU, said there has long been scrutiny from faculty members about the funding practices.

And while Penley has brought hundreds of millions of additional dollars into the university budget and increased national visibility for CSU by leaps and bounds, Miller remains critical about the former president’s all-business, CEO approach to leading the university.

“To me, it was clear that the president was at odds with his boss (the BOG) over some of those issues,” Miller said.

Seth Walters, the director of Legislative Affairs for ASCSU, said the abrupt departure didn’t come as a huge surprise in light of recent concerns, which were the subject of an ongoing investigation by a recently formed student government financial oversight committee.

“At this point, with all the stuff coming out about the administration, I don’t really buy the looking for other opportunities in higher education thing, obviously,” Walters said.

“. This is a surprise, but it didn’t come completely from left field. There was writing on the wall. It just depends on whether you decided to read it.”

And Trevor Trout, the former vice-president of ASCSU who had close contact with Penley, echoed Walters’ comments, adding that in Colorado’s tight fiscal environment, which places the state at the bottom of the barrel in the U.S. for higher education funding, the president should focus on increasing state funding instead of reaching stretch goals.

“There’s a lack of fiscal flexibility at CSU . to meet its core purposes,” he said. “The stretch goal is what, like 450 new faculty, and we’re not even close. . I think that also turns the board off a little bit.” And Penley’s tenure at CSU, Trout said, was riddled with “disregard for the constituency,” which he said is primarily students.

In the last five years, tuition and student fees have climbed 52 percent and 73 percent respectively, while funding for administration has seen much steeper growth than that of the academic colleges, according to university budget reports.

“Pressure was mounting for Penley,” Trout said. “I think that the board wasn’t attuned to the adjustments (in administrative funding).”

State Sen. Steve Johnson, R-Larimer County, who sits on the Joint Budget Committee, which decides university spending authority and allocates state funding, said “the reason Dr. Penley gave for his departure was vague at best,” in an e-mail message to the Collegian.

But he said Colorado’s funding shortfall must have been a thorn in Penley’s side, as he was charged with funding the state’s second largest university.

“I can only speculate that the long-term prospects of adequate state funding of higher ed. must have been frustrating to Dr. Penley and contributed to his decision,” Johnson said.

News Managing Editor Aaron Hedge and Enterprise Editor J. David McSwane can be reached at

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