Salisbury State chief defends contract with fund-raising consultant President invokes 'standards of civility' after critical audit

August 14, 1998|By Ivan Penn and Tom Pelton | Ivan Penn and Tom Pelton,SUN STAFF

The president of Salisbury State University said yesterday he sees no reason to drop the school's former top fund-raiser from the state payroll, even though auditors said he abused his office and the state attorney general has launched a criminal investigation.

"We do have standards of civility here," said William Merwin, president of Salisbury State, who was backed yesterday by the university system's chancellor. "If someone works for you for 16 years, you don't just throw them out on the street."

But Salisbury State's agreement to continue paying Robert M. Gearhart Jr. $36,000 a year as a fund-raising consultant through November has angered some Eastern Shore lawmakers, who say he should be immediately fired for problems uncovered more than a year ago.

University system auditors in June 1997 found that Gearhart used university employees to do the work of his home-based consulting company, funnelled $19,000 in no-bid work to companies that employed his son, and used a university credit card to buy equipment for his boat.

"In no way, shape or form do I think that Gearhart should be collecting any type of salary from Salisbury State -- which means, of course, from the taxpayers," said state Sen. Richard F. Colburn, a Republican who represents the Salisbury area.

The problems at Salisbury's fund-raising foundation, which Gearhart directed, come to light as the university system's governing board considers punitive action against the Bowie State University Foundation for misspending more than $100,000 in scholarship and campus activity money.

The abuses raise questions about the need for more oversight ofthe university foundations, which are run by university officials out of state buildings -- but not subject to the scrutiny of the state legislature or public information laws.

At Salisbury State University, the president signed an agreement with Gearhart to keep the public and potential donors from hearing about the problems, according to university records obtained by The Sun.

Merwin forced Gearhart to resign from his position as the university's director of institutional advancement in March 1997. But the president retained him as a consultant after feeling pressure from donors for whom Gearhart did favors.

In addition to his "full-time" consulting contract with Salisbury State, Gearhart since June 1997 has also earned $76,695 a year as the full-time director of fund raising for the University of South Carolina Spartanburg.

His employers at that school had no idea he was still working for Salisbury State or that he had been the subject of a critical audit, said John Stockwell, chancellor of the Spartanburg campus.

Gearhart, who could not be reached for comment yesterday, has said that he did not steal any money and that he was successful in raising millions for Salisbury State University.

But the Maryland attorney general's office is investigating whether Gearhart committed theft by using state employees to do the work of his home-based business on state time, according to Carolyn H. Henneman, chief of the office's criminal division.

"The use of university employees, that would be a true theft of something of value from the state," said Henneman.

Gearhart's Advanced Resources Corp. marketed his fund-raising consulting services at the rate of $500 a day to nonprofit organizations. It also sold, at $495 a copy, a fund-raising manual that Gearhart had plagiarized from a university manual, according to auditors.

Gearhart started working at Salisbury State in 1982. He held positions as both the state-paid director of fund raising for the university and as the director of the school's private fund-raising organization, the Salisbury State University Foundation.

Legislators yesterday debated whether they should resurrect proposed changes in state law that would allow them to scrutinize the books of the public universities' fund-raising organizations.

Proposals to allow this oversight died in 1990 and 1994 after university presidents lobbied against them.

State Sen. Ulysses Currie, a Prince George's Democrat who co-chairs the joint legislative audit committee, said yesterday that lawmakers should have the authority to look at the financial records of public university foundations.

Although legislators approve the budgets for state schools, Maryland law does not require the universities' private fund-raising organizations to let lawmakers see what they do with the money they raise.

State Sen. Barbara A. Hoffman, a Baltimore Democrat and chairwoman of the Budget and Taxation Committee, criticized the university system for failing to take action to solve problems at not only Salisbury and Bowie state universities, but also at Coppin State College, which was involved in a recent scandal for making questionable payments to former state Sen. Larry Young.

But opponents of changes in Maryland's law say they fear that allowing the public to see the foundations' records would scare away donors who want to remain anonymous.

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