CSU President Larry Penley unexpectedly resigns; walks with $389,000

Colorado State University President Larry Penley gives his fifth annual State of the University address in Fort Collins in September. Penley spoke about the need to continue the university's efforts to attract "green" research and learning over the next five years. (Photo/Jason Kosena)

Colorado State University President Larry Penley gives his fifth annual State of the University address in Fort Collins in September. Penley spoke about the need to continue the university


Copyright 2008, The Colorado Independent

Larry Penley, the president and chancellor of Colorado State University, unexpectedly resigned his position Wednesday via a letter to the system’s Board of Governors, effectively ending his five-year reign at the state’s second-largest public university.

His resignation, effective Nov. 30, comes two months after an investigation by The Colorado Independent highlighted Penley’s efforts to shift state funds away from the university’s academic colleges and library system while injecting cash to the school’s athletics department and nearly tripling the budget of his own Office of the President. The investigation sparked criticisms and concern from longtime CSU faculty members and state lawmakers, who questioned Penley’s shift of public funding to nonacademic functions.

In his Nov. 5 letter [PDF] to board chairman Doug Jones, Penley said he was resigning mid-semester to pursue other, unspecified leadership roles in higher education.

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

Rumors that the board was ready to ask Penley to resign have swirled through university faculty and administrative ranks for days, and the CSU Board of Governors Evaluation Committee met in a closed executive session on Monday. At the time, CSU officials said the committee was meeting to evaluate the performance of one or more of the CSU employees who report directly to the board, including the general counsel, the auditor and Penley. On Wednesday night, Jones told The Colorado Independent that Penley resigned of his own accord.

“Someone asked me if this was a surprise and my response is, maybe it was and maybe it wasn’t,” Jones said. “The life span of any president at a university is usually around three to five years and [Penley] was at CSU for five years. I think he got to a point where he felt that he had achieved what he could at CSU and that he would be better able to pursue other opportunities if he wasn’t working full-time with his duties as president.”

When asked if Penley had lost support among the governing board, Jones said, “Every board member feels differently about things and has different needs and demands about what they want to see on different aspects of the operation but overall he still had our support.”

Students walk and ride their way down the middle of the historic Oval on the Colorado State University campus in Fort Collins. (Photo/Jason Kosena)

Students walk and ride their way down the middle of the historic Oval on the Colorado State University campus in Fort Collins. (Photo/Jason Kosena)

Under the terms of a severance agreement, Penley will be paid $389,000 for one year of his remaining contract with CSU, which expires in 2010, said Michele McKinney, the CSU system public relations director in Denver. CSU’s Academic Provost Tony Frank will serve as interim president until a search committee replaces Penley.

Penley’s resignation comes one week after John Lincoln, Penley’s top executive vice president and right-hand man, announced his retirement from the university. Lincoln, a good friend of Penley’s dating back to their tenure at Arizona State University, was given a $70,000 separation package and immediately signed a consulting contract with the university to strengthen “public affairs and communications.” The consulting contract can pay him up to $10,000 a month.

Tripling his budget, increased tuition and student fees

During his five years at CSU, Penley restructured many university operations, including a 212 percent funding growth increase to the president’s office and a 135 percent increase in state funding to the school’s Athletics Department, according to an analysis of university documents by The Colorado Independent in September.

The increase to the budget of the president’s office was nearly three-and-a-half times the 66 percent increase that Penley’s predecessor, former CSU President Al Yates, employed during the final five years of his tenure. Penley’s budget included large salary raises to some top administrators, a doubling of the number of vice president positions within his office and a beefed up public relations campaign.

The result was a dramatic increase in the amount of money being used for nonacademic purposes at CSU. Meanwhile, student tuition increased by 52 percent, mandatory student fees rose by more than 70 percent and the number of credit hours taught by tenured professors shrunk, while class sizes grew.

None of Penley’s efforts suggested legal improprieties, but all were largely made with little, if any, public input — and without the oversight of state lawmakers, who assign the money to Colorado’s higher-education coffers.

In September, administrators defended the tuition increase and funding shifts, saying it was part of a larger effort to rebrand the university as a worldwide leader in renewable energy research, to attract more private and federal research dollars, and to help cut its dependence on state funding, which is susceptible to economic downturns.

Among other efforts, Penley created a nonprofit center at CSU aimed at streamlining the university’s research to the commercial market and to attract additional research dollars to CSU. Penley’s effort indeed increased the number of federal and private research grants that came to CSU since 2003, especially in the area of biomedical sciences, cancer research and global sustainability. 

Concerns over the changing core mission
Although the additional research and new direction was heralded by some, many longtime faculty members and state lawmakers expressed concern over a diminished undergraduate education amid higher tuition costs for Colorado taxpayers, along with a change to the university’s core mission to offer an affordable education to the state’s working class families.

Political science professor John Straayer is one such faculty member.

On Wednesday night, Straayer said the general direction of the university has been a concern among a growing number of people but could not say if the resignation was forced by the board or not.

“It’s no secret that I have been uncomfortable with the direction of the university recently (but) I wish Dr. Penley the best as he pursues other leadership challenges,” Straayer said, adding that he has complete confidence in Frank, the new interim president. “This institution has been a wonderful university for the state of Colorado and it has served working families well for more than a century. I hope that the new leadership, when it arrives, will take stock of that and make sure that tradition continues.”

The national search for Penley’s replacement will begin in the next several months, Jones said.

Click here for links to The Colorado Independent’s September series.

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Jason Kosena

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