NSHE Chancellor Dan Klaich resigns amid controversy

Chancellor Dan Klaich, a power in Nevada higher education for more than three decades, resigned Thursday amid controversy — and praise from state regents who approved a generous golden parachute.

The Nevada System of Higher Education Board of Regents accepted Klaich’s resignation at a special meeting held in response to calls for action from legislators and the Las Vegas Metro Chamber of Commerce following a Las Vegas Review-Journal article published in April.

Emails obtained by the newspaper through the state public records law showed the state agency, which oversees all public higher education, in 2011 and 2012 misled lawmakers who were studying equity in distribution of state funding. System officials went so far as to write a memo on the letterhead of a paid consultant, Colorado-based National Center for Higher Education Management Systems, to give to lawmakers.

Klaich said in retrospect he regretted the system’s handling of the memo, but maintained the newspaper took his emails out of context. He said he did not mislead legislators but would resign because he didn’t want to be a distraction.

Regents “for convenience” agreed to let Klaich retire early on June 2 while still collecting full pay and benefits until his contract ends in June 2017. His base annual salary is $303,000 and he also receives $32,000 in automobile and housing allowances.

Klaich, an attorney, had a long career in the system, first as a regent from 1983 to 1997, with two terms as chairman of the 13-member board. In 2004 he went to work for the board as executive vice chancellor, vice chancellor for legal affairs and administration and chief counsel before his appointment as chancellor — the system’s chief executive officer — in 2009.

“It’s been an honor and a privilege to represent and advocate for NSHE over the last 30 years,” Klaich said.

Regents lauded the chancellor, saying the meeting marked a sad day for Nevada and that he will be missed.

Regent James Dean Leavitt said he read all 3,000 pages of emails requested by the Review-Journal and felt they showed Klaich to be ethical and passionate.

Regent Michael Wixom, a member of the legislative study committee, said the Review-Journal misrepresented the matter. He said the political process regarding state funding worked as it should have.

Regent Mark Doubrava offered no explanation in casting the sole vote against accepting Klaich’s resignation.

Brooke Nielsen, the agency’s vice chancellor for legal affairs, told the regents she reviewed emails obtained by the Review-Journal and the legislative record, finding no basis to fire Klaich for cause. Dean Gould, the regent’s chief of staff and special counsel, agreed with that assessment.

Nielsen, who was appointed by Klaich in 2012, cried after Klaich spoke to the board.

But past and present legislators shed few tears.

“If they believe the chancellor was doing so great then why did they accept his resignation?” said Assemblyman Stephen Silberkraus, R-Henderson.

“I think the chancellor resigning is a solid first step, but it’s only that. I doesn’t undo any of the egregious acts that have been done,” Silberkraus said. “This isn’t over. ”

Silberkraus, who did not attend the special meeting, is working with Assemblyman David Gardner, R-Las Vegas, on legislation to restructure the system, said he hopes Klaich’s resignation will help rebuild trust between the Legislature and the agency.

Former Congressman Steven Horsford, who as state Senate majority leader was chairman of the interim committee, had called for Klaich’s resignation.

“Legislatures can’t legislate, the governor can’t govern, when these are the types of antics being played,” Horsford said in April. “If this shows anything, it shows that the Legislature is not in charge. If anything they’re being used as tools. That has to change.”

Horsford was unavailable for comment Thursday.

Silberkraus criticized the regents for rallying to Klaich’s defense at the special meeting rather than airing concerns about the chancellor’s actions.

William Horne, a former legislative leader who also had called on Klaich to resign, attended the meeting but complained that the regents didn’t examine what happened. He was told to speed up comments critical of Klaich’s actions, though a long, laudatory letter from former Assemblyman Pat Hickey was read into the record.

Assemblyman Elliot Anderson, D-Las Vegas, said he and State Sen. Joyce Woodhouse, D-Henderson, plan to push ahead with reform efforts.

“I have always thought that the issues are bigger than a single personality,” said Anderson, who had called for Klaich’s resignation but on Thursday thanked the chancellor for his service. He said he’s met with individual regents and is optimistic about being able to reach a consensus to tackle structural changes.

Former Western Nevada College President Carol Lucey said reform is needed. She has criticized the state’s funding formula for short-changing community colleges, and said the emails obtained by the newspaper clarified what she long suspected was happening behind the scenes.

“If you live in an echo chamber you’re going to interpret things the way you want to interpret them,” Lucey said of the regents’ special meeting . “They just have no clue about what they did to the community colleges. They just don’t understand and I don’t think they ever will.”

Chamber of Commerce spokeswoman Cara Clarke said the Chamber, which which was involved in the funding formula reform, said what’s important now is what the regents do next. Clarke said the chamber wants a national search for the next chancellor by a committee with a wide range of stakeholders. Ideally, someone should be in place before the 2017 legislative session, she said.

Regents did not discuss the process for replacing Klaich.

Nevada System of Higher Education spokesman John Kuhlman did point to the board’ handbook, which says, “… an ad hoc Committee composed of members of the Board of Regents shall be appointed by the Board’s chair for the purpose of recruiting and screening applicants and for recommending a nominee or nominees to the Board of Regents for appointment …”

Contact Bethany Barnes at bbarnes@reviewjournal.com or 702-477-3861. Find @betsbarnes on Twitter.