First, there are questions about the story itself. Why would Naples News do a story now, in late July, when AMU's SACs application was supposedly sent in May? Also, is it really newsworthy to cover a school's application, particularly when it is the third such application request for this school? We saw a similar piece on their SACS application in 2004 (Naples News, August 5, 2004). It was reported in a December 2006 Naples News article that then-Provost Fr. Joseph Fessio said that AMU was "still 3-4 years away from receiving national accreditation through the Southern Association of Colleges and Schools". That's December of 2009 or 2010.

At present, and for the near future, AMU's access to federal student loans comes through its "pre-accreditation" status with AALE (The American Academy of Liberal Education), a status that AMU has enjoyed since 2004 (Naple News, Dec. 22, 2004). That status will expire in November 2007. But AALE, as an accrediting agency, is in deep trouble. AveWatch was the first to report on the federal Department of Education's final decision to suspend AALE's ability to grant access to Title IV funds to new applicants.

The second curious aspect to AMU's recent application to SACS is the apparent re-arrangement of their Board of Trustees. For over one week, AMU has listed the names of their "Board of Trustees" as:

• Thomas S. Monaghan, Chancellor (CEO)
• Nicholas J. Healy Jr., President (COO)
• John E. Sites, Vice-President of Academic Affairs (CAO)
• Paul Roney, Chief Financial Officer (CFO)
  

The University's "Board of Regents", however, is the size of a continental congress coming in at 31 people.

On July 19, AveWatch contacted Dr. Candace de Russy "a nationally recognized writer and lecturer on education and cultural issues". Her profiles at National Review's "Phi Beta Cons" and at the SUNY Board of Trustees state that, "In 2005, she joined the Ave Maria University board of regents, which in 2006 she was appointed to chair." As chair, AveWatch asked for clarification on the roles between "Regents" and "Trustees" - specifically if Regents are merely advisory to the Trustees, with the Trustees having final authority to set university policies. Dr. de Russy responded, "I think you are correct but it would be good to get the actual language of the by-laws exact."

"I think"? Does Dr. de Russy not have a copy of the by-laws? The chair of AMU's Board of Regents, who has been with AMU through the last two years offering (presumably) pivotal input on the school's development, isn't 100% certain (without checking the by-laws) if her board serves in an advisory or policy-setting capacity? That is telling.

Let's assume, as Dr. de Russy does, that the 31-member Board of Regents does not have final policy-making authority... that such final authority rests ultimately with the four Trustees. What does it say about an institution where the Board of Trustees is comprised entirely of individuals who also have official job titles at the same institution? The conflict-of-interest is stunning.

But beyond conflict-of-interest, if this is AMU's new Board arrangement, AveWatch wonders how this will impact both SACS and AALE accreditation.

SACS standards for "a governing board" [comments in brackets]:

• that the board has at least five members with legal authority over the institution - [AMU has only four Trustees listed. Three of those Trustees are listed as officers for "Ave Maria University, Inc" filed with the Florida Department of State, 2006 report. None of the Regents, however, are listed as officers.]
• that the board is not controlled by "organizations or interests separate from it" - [Two of the four Trustees, Monaghan and Roney, are partners in the for-profit Ave Maria Development, a real estate firm that manages multiple other businesses. Also, Monaghan and Roney run Ave Maria Foundation, which has its own interests apart from AMU.]
• that the board does not have a 'presiding officer' or majority of voting members who have "contractual, employment, or personal or familial financial interest in the institution" - [The problem here is glaring for all four Trustees. IRS-990s show Roney, Healy, and Sites as being compensated by AMU. Tom Monaghan's bank, for-profit businesses, and personal land holdings all orbit AMU's activity and decisions.]
• that the board CEO is not the presiding officer - [Monaghan holds the Trustee title of "CEO" and the administration title of "Chancellor"]
• that there is a clear distinction "in writing and practice" between the board's policy making and the administration's implementation of that policy - [Healy as President, and Sites as Academic VP, are part of "administration" and involved in academic policy implementation. Roney is involved in fiscal implementation. The role of a Chancellor is nebulous. If Chancellors can fire a sitting Provost, Monaghan is involved in "policy implementation".]
  

AALE standards:

• policy implementation, and the creation of those policies, are to be separate
  

Large excerpts from the SACS and AALE standards are below.

Tom Monaghan's chronic inability to address the conflicts-of-interest of his governance is increasingly being brought to the forefront. The non-profit watchdog group "Where Needed Most: The Charity Industry Observer" recently drew insightful parallels between the Roger Williams University debacle, issues of accreditation, and the "extreme case of donor control involving Thomas Monaghan and Ave Maria School of Law". As "Where Most Needed" points-out, accrediting agencies must spell-out and enforce standards of board independence "before the excesses of unchecked power become an embarrassment to another institution".

AveWatch is glad to see AMU apply for SACS; many of AMU's past decisions, and much of its future success, rides on that application. But after years of dysfunction and conflict in every Tom Monaghan educational endeavor, no reasonable person can argue that his governance structure promotes board independence and institutional health. SACS may see it the same way.. that is, if this third application isn't also pulled.

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VERBATIM EXCERPTS FROM SACS & AALE ACCREDITATION STANDANDARDS:
[no comments were added]

SACS - Southern Association of Colleges and Schools; Commission on Colleges 2007 Principles of Accreditation

Section 2 - Core Requirements

2.2 The institution has a governing board of at least five members that is the legal body with specific authority over the institution. The board is an active policy-making body for the institution and is ultimately responsible for ensuring that the financial resources of the institution are adequate to provide a sound educational program. The board is not controlled by a minority of board members or by organizations or interests separate from it. Both the presiding officer of the board and a majority of other voting members of the board are free of any contractual, employment, or personal or familial financial interest in the institution. (Governing Board)

2.3 The institution has a chief executive officer whose primary responsibility is to the institution and who is not the presiding officer of the board. (Chief Executive Officer) (See Commission policy 'Core Requirement 2.3: Documenting an Alternate Approach.')

Section 3 - Comprehensive Standards

3.2 Governance and Administration

3.2.1 The governing board of the institution is responsible for the selection and the periodic evaluation of the chief executive officer. (CEO evaluation/selection)

3.2.3 The board has a policy addressing conflict of interest for its members. (Board conflict of interest)

3.2.4 The governing board is free from undue influence from political, religious, or other external bodies and protects the institution from such influence. (External influence)

3.2.6 There is a clear and appropriate distinction, in writing and practice, between the policy- making functions of the governing board and the responsibility of the administration and faculty to administer and implement policy. (Board/administration distinction)

*********

AALE - American Academy for Liberal Education2006 Institutional Standards

Part II - Institutional Standards

Section A - Organization and Governance

A.7 The board approves an academic and administrative structure which serves the institution’s mission and educational objectives. Implementation and administration of policies approved by the board are the responsibility of bodies within this structure, not of the board.

Section B - Financial Management

B.5 The institution employs an accounting system that follows generally accepted principles of institutional accounting as these appear in the appropriate NACUBO or AICPA regulations.

Tags: conflict-of-interest, accreditation