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February 7, 2002

Action on environmental law clinic criticized, defended

A week after a University Senate committee issued a report concluding that Pitt's administration infringed on the academic freedom of the law school's Environmental Law Clinic, senior administrators on Feb. 4 defended their actions in the clinic controversy.

Chancellor Mark Nordenberg and Provost James Maher disputed "both the factual presentation and the conclusion" of the report by the Senate's tenure and academic freedom committee (TAFC). In addition, the administrators:

* Argued that they had no legally defendable choice but to begin billing the Environmental Law Clinic for its full overhead costs (even though the state funds less than 20 percent of Pitt's budget) after the Pennsylvania legislature prohibited state money from going to the clinic. Lawmakers inserted that ban in the University's appropriations bill for the current fiscal year, in retaliation for the clinic's work on behalf of environmental groups opposed to logging in the Allegheny National Forest.

* Rejected faculty pleas that the clinic be permitted to approach major local foundations for additional funding. The Heinz Endowments granted Pitt $2 million to establish the clinic, which gives Pitt law students hands-on experience representing environmental groups that could not otherwise afford attorneys.

* Cited what the administrators called "promising signs" that law school personnel are making progress on a plan that will "ensure the clinic's financial health and its freedom to zealously represent its clients," as Dean David Herring told law faculty last week. The plan is expected to spin off the clinic as an independent entity affiliated with, but not part of, the law school.

In remarks at Monday's Senate Council meeting and in a University Update by Provost Maher distributed earlier that day, the administration denied that lawmakers' attacks on the Environmental Law Clinic threaten academic freedom at Pitt.

"Governments have the legal right both to appropriate public funds and to limit the purposes for which appropriated funds may be expended," Maher wrote. To Senate Council, the provost added: "We don't like what [the state legislature] did. But they didn't pass a law saying we couldn't run an environmental law clinic" — an action that would violate Pitt's academic freedom, he said.

Paying its full overhead costs ($62,599 this year, out of an operating budget of about $120,000) could bankrupt the Environmental Law Clinic within a year, according to clinic director Thomas Buchele.

Buchele, who attended the Senate Council meeting and said he read both the TAFC and administration documents, said the senior administrators' comments disappointed him. "I was hoping that the University administration would at least reflect on what they did and maybe reconsider some of the decisions they made — for future situations, not necessarily to affect my case.

"For me, the most disturbing part of the provost's letter was that the administration seems to be conceding that the state legislature can tell Pitt how to spend purely University funds, as opposed to state money, since 80 percent of my clinic's budget does not come from the state. This is a precedent that the University — and, I'm afraid, other faculty members — ultimately will regret," Buchele said.

At Senate Council, Chancellor Nordenberg urged the University community to take the time to read Maher's 12-page, single-spaced letter, together with TAFC's six-page, double-spaced report. Copies of the TAFC report are available from the University Senate office, 1234 Cathedral of Learning (e-mail:

Subjects covered by the documents range from comparisons of environmental law clinic operations nationwide to the historical foundations of academic freedom. Nordenberg noted that TAFC's charges of academic freedom infringement focus on two issues: the Pitt administration's calculation of overhead for the clinic, and what the chancellor called "an honest disagreement" about whether the clinic should be allowed to solicit additional grants from major local foundations.

Overhead charges In assessing the clinic's overhead costs, Pitt applied the federal Office of Management and Budget's Circular A-21, a formula commonly used for cost accounting of federal research grants.

According to TAFC, A-21 "does not appear to have been applied, before this case, to other foundation grants at the University, nor is it charged to other clinic programs at the University of Pittsburgh. Moreover, the state contribution to the University is approximately 20 percent of its budget, yet the University assigned 100 percent of the calculated charge" to the clinic.

Following its investigation, which included an interview with Arthur Ramicone, Pitt vice chancellor for Budget and Controller, TAFC concluded that the administration had imposed what the committee called "a severe and perhaps idiosyncratic overhead charge upon the Environmental Law Clinic."

But according to Ramicone, Nordenberg and Maher, A-21 is the standard cost-accounting formula for educational institutions. Had Pitt used any other formula to assess the Environmental Law Clinic's overhead, they said, the University would have risked legal action by state auditors.

As for billing the clinic for 100 percent of its costs, Pitt and state auditors have long agreed that public and private dollars are co-mingled and cannot be separated within the University's budget, Ramicone said. "We have used that argument many times to our advantage. We couldn't flip it the other way in this case," he said.

Nordenberg said: "Typically, when you apply A-21 you are applying it to a grant…and you need to be able to demonstrate to the auditors that you have, in fact, expended the monies that they have provided for the approved purpose. In this instance, of course, everything is flipped around. The obligation under the appropriation act [providing Pitt's state funding] is to demonstrate that the monies generally made available were not applied in any way to the prohibited purpose" — i.e., funding the Environmental Law Clinic.

Pennsylvania lawmakers repeatedly warned that denial of state funds to the clinic was a condition for granting Pitt's whole $180 million appropriation, the chancellor told Senate Council.

"While some would prefer another kind of [cost-accounting] approach, this hasn't been an institution that engages in what I would call 'Enron-style accounting.' We're playing it by the book," Nordenberg said.

Law professor Jules Lobel, who has represented environmental groups in lawsuits against Pennsylvania's timbering industry, told Senate Council: "I'm not an accountant, but I find it odd that the amount of money that the state gives the University is irrelevant in determining the share of the ultimate costs" attributed to the clinic.

Using the administration's reasoning, Lobel said, the state apparently could cut its appropriation to Pitt from the current $180 million to just $1 million, and still the Environmental Law Clinic would be billed $62,599 for overhead.

"It seems to defy common sense," Lobel said.

Approaching foundations Even professors who allowed that Pitt charged the clinic appropriately for overhead questioned why the administration won't permit the clinic to solicit grants from local foundations to offset its overhead expenses.

During the Senate Council meeting, professors asked: In response to extraordinary circumstances (the legislature's singling out of the clinic) and to show that Pitt won't be bullied or intimidated, couldn't the administration allow the clinic to seek additional grants from foundations such as the Heinz Endowments?

In their report, TAFC members said they were told that Pitt has a strategic approach to soliciting foundation support, that the Environmental Law Clinic had already received a $2 million gift from the Heinz Endowments, and that the clinic could not be permitted to interfere with Pitt's fund-raising strategy.

"It is understandable that the University's development plans are of great importance, and that a random approach to local foundations could defeat that strategy," TAFC wrote. "At the same time, the amount sought by [the clinic] was relatively small, the situation, as a result of the newly applied overhead charges, exigent, and an exception to the University strategy of this size would not put the larger plan in jeopardy."

Maher, in his University Update, countered: "In point of fact, the prohibition regarding the further solicitation of major Pittsburgh foundations applied to all of the clinics of the School of Law and had been in place since the Heinz Endowments made their commitment to the Environmental Law Clinic several years earlier. The overall rationale was clear: in a $500 million [Pitt fund-raising] campaign, this single program already had benefited through a $2 million grant from one of the University's most generous philanthropic supporters.

"Further solicitations from the clinic directed to other major Pittsburgh foundations would neither be fair to other University programs nor consistent with campaign priorities," the provost continued. "This left the clinic free to pursue other local and national foundations where gifts and grants would clearly be tied to programmatic interests and not principally dependent on broader commitments to the University. And, indeed, the clinic succeeded in attracting support from one anonymous local foundation and is in the process of seeking support from another anonymous local foundation."

Buchele bristled at Maher's account. "The provost's suggestion is that the $2 million from the Heinz Endowments would have gone to somebody else in the University if my clinic had not gotten it," Buchele said. "That's absolutely false. Heinz came to the law school, not to the University, and said: 'We want to fund an environmental law clinic.'"

Buchele confirmed that his clinic attracted a $25,000 grant from an anonymous local foundation in January 2001, nine months before Pitt began charging the clinic for overhead. Buchele said he didn't know of the other foundation from which, according to Maher, the clinic is seeking support.

"I have no idea what he's talking about," Buchele said, "and I think it's very odd that I don't know what he's talking about. If there is some sugardaddy who's willing to help fund the clinic, it would be nice if somebody would tell me about it."

According to Buchele, his clinic's fundraising is now hampered by the fact that foundations do not want their gifts to go toward overhead. "At least one foundation has made it clear to me and to the University administration that they are upset that their money is being used to pay for things like faculty recruitment and the dean's office and the library," Buchele said.

— Bruce Steele

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