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Job-protection provision in UNLV donation questioned

Updated March 16, 2018 - 11:37 pm

Nine days after UNLV President Len Jessup received an evaluation that detailed “several weaknesses” in his job performance, he secured a donation for $14 million that required him to remain in his position through 2022.

The pledge toward the construction of UNLV’s new medical school building included a provision that medical school Dean Barbara Atkinson also keep her job through 2022, according to a memo obtained by the Las Vegas Review-Journal.

Kris Engelstad McGarry, a trustee of the Engelstad Family Foundation, said she doesn’t believe Jessup engaged in “self-dealing” when he signed the agreement. “It’s what we wanted,” she said.

But the philanthropic commitment — a memorandum of understanding between the Engelstad Family Foundation and the UNLV Foundation — raised ethical concerns, and Thom Reilly, chancellor of the Nevada System of Higher Education, sought an outside legal opinion.

“Equally serious, however, is the conduct of Dr. Jessup and whether his third-party beneficiary status under the MOU renders him unfit to continue to serve as president,” according to the memo written by Scott Abbott of the Kamer Zucker Abbott law firm. “While Dr. Jessup may claim that he did not negotiate his continued employment as a condition for the donor’s gift, the optics are appalling.”

Engelstad McGarry said no one at NSHE talked to her about the donation, and she believes system officials should have had a conversation with Jessup rather than assert that he was dishonest.

“It’s not a self-dealing issue,” Engelstad McGarry said. “It’s a donor-preference issue.”

“Nobody told me what to say in this agreement,” she said.

In the memo written to Reilly, Abbott said Jessup’s execution of the donor memorandum in his capacity as president of UNLV is “extremely troubling” as it would guarantee him nearly $1.6 million in salary. The memo said the execution was “made even more egregious given the timing.”

Reilly conducted a performance evaluation of Jessup on Jan. 22 and found Jessup’s work performance to be “below expectation and required immediate improvement.” On Jan. 29, Jessup and Reilly discussed the evaluation.

Jessup signed the memorandum of understanding with the Engelstad Family Foundation on Feb. 7. Atkinson signed the deal the day before Jessup did.

“If President Jessup is so confident that he is being treated unfairly, then I encourage him to authorize the chancellor to release his evaluation,” Regent Trevor Hayes said.

Abbott’s memo to Reilly, dated March 5, also said that if Jessup is removed “there is great risk that the pledge memorialized by the MOU will likely be canceled.”

Engelstad McGarry told the Review-Journal on Wednesday that the foundation revoked the $14 million gift in light of Jessup’s announcement that he will seek other job opportunities. Conversations about the gift began about a year ago, Engelstad McGarry said, and Scott Roberts, vice president for philanthropy and alumni engagement at UNLV, told the Review-Journal about the gift in December.

“There are lot of versions that go back and forth before you actually get something signed,” Engelstad McGarry said. “It’s not atypical that agreements have three or four different versions until you fine tune things that work.”

According to the MOU, “if either the dean of the School of Medicine or the President of UNLV changes, Donor reserves the right to discontinue, modify, withhold any future payments, or cancel the Engelstad Family Foundation Medical Education Building Matching Gift Pledge, in its sole discretion.”

Atkinson said nothing is legally or ethically wrong with the provision and said similar language is present in agreements with other donors. She said she wouldn’t comment on whether or not such language is present in the $25 million anonymous donation the medical school received prior to the close of the 2017 legislative session last June.

“It was a donor seeking some assurance that the leadership of UNLV, both me and President Jessup, would remain to help shepherd the gift from the Engelstad Foundation,” Atkinson said. “To me it looked perfectly legal — it still does. A lot of donors put all kinds of restrictions on the gifts they give.”

Regent Mark Doubrava, however, said he doesn’t think the Board of Regents will accept any gift that guarantees employment for specific individuals.

“It is the board’s authority who will be a college or university president, and the board’s authority determines the terms of their employment contract,” he said. “I would consider it a slippery slope to accept a gift that tries to usurp the board’s authority.”

Prior to the foundation’s revocation of the grant, UNLV had raised $64 million to fund construction of a new medical education building. Most recent figures from the university show that the building could cost $232 million.

Reilly declined to comment for this story. Jessup did not immediately respond to requests for comment.

Contact Natalie Bruzda at nbruzda@reviewjournal.com or 702-477-3897. Follow @NatalieBruzda on Twitter.

Confidential memo regarding UNLV President Len Jessup by Las Vegas Review-Journal on Scribd

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