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Audit has new concerns about FAMU's finances

Published September 10, 2004

A state audit details new management and financial problems at Florida A&M University, less than a year after the school was criticized for a wide range of improper practices.

The new problems include questionable expenses and the spending of millions of dollars on scholarships and athletics that were not budgeted or available, according to the preliminary audit, which will be released in final form in a few weeks.

FAMU president Fred Gainous, already under fire by alumni of the historically black school, is expected to be asked about the audit at a meeting next week of the school's Board of Trustees.

"I'm disappointed," said Carolyn Roberts, chairwoman of the Board of Governors, which oversees all public universities in the state. "All universities have to be accountable when you are dealing with public money."

The leader of FAMU's National Alumni Association is expected to demand Gainous' resignation at the meeting. That prospect prompted an angry letter Thursday from a trustee.

Trustee Barney Bishop, who supports Gainous, said board chairman Jim Corbin is trying to force Gainous from the school. He asked the board to evaluate Corbin's leadership as well as Gainous.

"I am VERY concerned that this Board meeting NOT be used as some sort of kangaroo court by forces that are intent on unilaterally forcing the president to step down," Bishop wrote to Corbin.

Corbin did not return a phone call seeking comment.

The state audit, which covers 2003 and parts of this year, shows various bank accounts remain unbalanced, that bills were repeatedly paid late and that checks, cars and cell phones were not properly used or documented.

FAMU spent $4.3-million more on scholarships than it budgeted and can't show where the money was taken from, the audit says. The school also spent almost $1-million more in the athletic department than it had, appearing to rely on revenue from a contract that failed to bring in expected money.

"You don't like to get this kind of news but I don't think it's a surprise," said Larry Reese, FAMU vice president for administrative and financial services. "I'm certainly hoping we can do it a lot better in the future."

Reese, who was hired in February, blamed problems on staff turnover, a lack of training and not enough money spent to modernize technology. But he said his staff is still responding to the state and he can't talk about specifics.

University leaders were given a copy of the state Auditor General's preliminary findings Aug. 30, and have 30 days to respond. Mike Gomez, the deputy auditor general, said he can't discuss a preliminary report.

FAMU made national headlines last year when state officials learned one of the nation's best-known historically black schools was mired in a financial mess that began during the tenure of former president Frederick Humphries, who ran FAMU for 16 years.

Gainous, a FAMU graduate, said the university has made improvements since he took over two years ago, including upgrading its accounting and technology.

While acknowledging that Gainous inherited many problems, Roberts and Corbin said he must take responsibility for what has happened since he took over.

"I think he's had some problems," Corbin said earlier this week. "They've rolled up on him and he hasn't responded."

Corbin has refused to say whether he wants Gainous, 57, to step down from his $275,000-a-year job.

Gainous said he doesn't know how much support he will get next week from trustees, who threatened to fire him five months ago. He said the alumni has no business calling for his resignation, but said he will respond to their complaints at the meeting.

Gainous' problems with the trustees and alumni began last year, after state officials refused to issue paychecks to top FAMU administrators until the school turned over crucial financial records. The school eventually complied but missed its deadline by six weeks.

More recently, Gainous has been blamed for the recent resignation of FAMU's well-regarded pharmacy school dean, who complained about a lack of administrative support; the failure to name a new dean of the high-profile business school and the Mid-Eastern Athletic Conference stripping the school of 11 conference titles.

[Last modified September 10, 2004, 01:14:19]

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