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Ex-UT Law dean’s credit card bill: $400k in four years

By   /   January 17, 2015  /   News  /   No Comments

Part 34 of 72 in the series Trouble in Texas
Photo courtesy of the University of Texas

HEY, BIG SPENDER: Lawrence Sager was running up annual six-figure bills on a credit card paid for by the UT Law School Foundation.
From 2007 to 2010, Sager racked up $401,498.29 on that card, all of it paid by the foundation.


By Jon Cassidy | Watchdog.org

For years before a forgivable loan scandal forced him to resign as dean of the University of Texas Law School in 2011, Lawrence Sager was running up annual six-figure bills on a credit card paid for by the UT Law School Foundation.

From 2007 to 2010, Sager racked up $401,498.29 on that card, all of it paid by the foundation, apart from tens of thousands in other expenses for conferences, computers, club dues, food, travel, storage units and other items.

By comparison, when Bill Powers was dean of the law school, his credit card expenses were far lower — $6,209.15 in 2004 and $9,260.62 in 2005 — although strangely enough, the foundation continued to pay various bills for Powers into 2007, more than a year after he became president of the university.

In 2011, some members of the foundation’s board objected to Sager’s “excessive” expenditures and reined them in, according to a long-delayed report by the attorney general’s office released late Friday.

The report flatly contradicts an earlier internal investigation that attempted to absolve everyone at UT of any involvement in covering up an off-the-books compensation program at UT Law that violated system rules. The new report describes “a climate of non-disclosure” around the program.

Sager was so keen on keeping the details of his faculty perks program secret that he used public and private funds to settle a dubious lawsuit by a professor that threatened to expose the program, according to the new report.

The report offers news both good and bad for Powers: It raises new questions about whether his own compensation from the foundation was properly authorized, but it also provides new witnesses (names redacted in the version released Friday) who say he didn’t know about Sager’s half-million dollar forgivable loan.

In all, the foundation has spent more than $1 million in compensating and reimbursing Sager. That’s just a fraction, however, of the $68 million the foundation has spread around UT during the past decade, most of it compensating the school’s faculty and administrators.

The question the attorney general’s report does not answer, or even ask, is whether the members of the Law School Foundation have received anything in return for their largesse. Reporting by Watchdog.org has established that many children of generous foundation members have been admitted into UT Law, although there is little evidence that would cast doubt on their qualifications.

That question of undue political influence on the admissions process is the subject of another investigation that’s nearing completion. One place to seek answers would be a stash of 70,000 emails that Sager kept after stepping down as dean.

After John B. Scott, the former deputy attorney general who wrote the new report, learned of those emails, UT apparently recovered 35,000 of them from Sager. Scott did not examine those records in his review.

Most of the turmoil at the University of Texas in recent years can be traced back to a report the UT System published on Oct. 15, 2012, regarding an investigation into the Law School Foundation conducted by Barry Burgdorf, a system attorney who was pressured to resign when a majority of the Board of Regents came to doubt it.

HALL: The UT regent is on the hot seat for his investigations into law school admissions.

HALL: The UT regent is on the hot seat for his investigations into law school admissions.

Regent Wallace Hall and several other board members thought that Burgdorf simply hadn’t dug very hard. Powers’ many friends and political allies decided that meant Hall’s real aim was to dig up dirt on Powers.

The first footnote of the first sentence of the Burgdorf report expresses the whole: “There exists no evidence that anyone at the Foundation or the Law School attempted to or did conceal the forgivable personal loan program which is the primary focus of this report. The forgivable personal loan program was simply not known or understood outside the immediate Law School community.”

The new report, in contrast, faults Sager for keeping the program secret, despite a regents’ rule forbidding employees from accepting money from university foundations without approval by the chancellor.

The report says that “under Dean Sager’s leadership the Law School provided incorrect or incomplete responses to requests for salary information by both University management and the public pursuant to the Texas Public Information Act. To settle a lawsuit, both Foundation and public funds were expended in order to paper over a climate of non-disclosure.”

Scott also faulted Sager for concealing the $500,000 forgivable loan he procured for himself, reporting that “the Law School maintained two forgivable loan lists — one that contained Dean Sager’s $500,000 forgivable loan and one that excluded that particular loan.”

When a professor filed a sex-discrimination lawsuit over the secret loans, “Sager indicated that the matter should be settled, at least in part, because he believed if the full picture of the Law School’s compensation package were to become public it would be very damaging to the Law School and the University. Importantly, Dean Sager himself had received a $500,000 forgivable loan that would have been publicly disclosed, although Sager specifically denies this was a concern.”

According to a partially redacted footnote, Burgdorf knew about the settlement agreement.

Sager has long maintained that Powers knew of his loan, which Powers has denied. Although key names are redacted in this version of the report, it appears that one or possibly two members of the Law School Foundation board support Powers’ version.

The report also shines light on compensation that Powers received from the foundation.

In early 2001, when Powers was dean of the law school, he signed a $325,000 deferred compensation agreement with the foundation. Several administrators above him at the time were informed of the agreement and approved of it, although there’s no record that a necessary sign-off by the chancellor was obtained.

The purpose of these agreements, whether they’re called forgivable loans or deferred compensation, is to act like “golden handcuffs” for valuable employees, guaranteeing them a bonus if they ignore suitors at other universities.

On Dec. 14, 2005, nine days after Powers was named the new president of UT, the foundation president at the time, Kenneth Roberts, agreed to give him a check for an additional $115,000.

That payment was approved by the chancellor at the time, although it’s not mentioned in the minutes of either the foundation or the board of regent’s meetings beforehand.

“The approval of the payment was premised upon it being a payment for deferred compensation,” Scott writes. “That basis was clearly what Powers and others believed at the time. (Redacted) recollection and the lack of supporting documentation do not support this belief today.”

That $115,000 payment wasn’t widely known until the Austin American Statesman reported it last April, although the newspaper did not report the payment was not part of Powers’ compensation agreement, and that it came after he was named president.

Powers received $256,292 from the foundation in 2006 and another $379,626.87 in 2014, representing the balance of his agreement, plus interest.

Contact Jon Cassidy at [email protected] or @jpcassidy000.

Part of 72 in the series Trouble in Texas
  1. Texas’ Rep. Pitts announces retirement after improper influence story
  2. University of Texas regents show support for Wallace Hall
  3. Case against UT regent Wallace Hall is a sham — here’s proof
  4. Texas senator got $477k for supposed ‘cameo’ appearance in Wallace Hall lawsuit
  5. Lawmaker admits pulling strings on UT admissions
  6. Trustee accused of crime for rejecting dodgy accounting
  7. Longhorns: Senator used clout in UT law school admissions
  8. Children of Texas lawmakers get into UT School of Law, but struggle to pass bar exam
  9. Chancellor is probing favoritism in UT admissions
  10. UT report: Charge against Hall is legally ‘absurd’
  11. Attorney in UT case hides six-figure charges despite terms of contract
  12. University of Texas clout scandal grows as new e-mails surface
  13. Four more get into UT Law despite low LSATs
  14. Reports on UT favoritism, impeachment expected soon
  15. Attorney: Secret tape covered up by lawmakers proves regent’s innocence
  16. Dozens of UT Law’s least qualified students are connected politically
  17. University of Texas uncovers admissions corruption, halts investigation
  18. UT admissions: Straus, Branch, Pitts pulled strings
  19. Who got the 128? UT Law admits students with bad LSAT scores
  20. Patrick’s win may doom Hall impeachment effort
  21. Chancellor promises complete investigation of UT admissions
  22. Board to decide UT president’s fate Thursday
  23. Texas politicians smarten up, ditch UT pres this time around
  24. Tribune story may have doomed UT’s Powers
  25. Academics condone the privilege they denounce
  26. Three essential stories on the UT admissions scandal
  27. Texas AG Greg Abbott embraces Roe v. Wade
  28. Roe v. Wade is AG’s new pretext for blocking Texas law school investigation
  29. Two UT regents pressed for records destruction
  30. New crime invented for Hall: assisted guesswork
  31. Texas lawmaker failed to disclose his own clout letter in UT flap
  32. Texas legislator Fischer insists on role in UT investigation
  33. Hutchison pulled strings for friends’ kids and grandkids at UT
  34. Ex-UT Law dean’s credit card bill: $400k in four years
  35. Abbott’s UT picks are pro-affirmative action
  36. Report: University of Texas showed favoritism to thousands
  37. Kroll ignored hundreds of weak UT applications
  38. Billionaire defends UT admissions privileges for ‘leaders’
  39. Weak admissions to University of Texas Law increased after Sager’s ouster
  40. Kroll report takes dig at Watchdog.org
  41. Hicks won’t stop UT’s backdoor admits
  42. Texas governor’s wife was on UT nominee’s payroll
  43. Bill to limit UT oversight clears committee
  44. UT regent blasts speaker for ‘abuse of office’
  45. Texas politician rebuts himself with apparently plagiarized letter
  46. Pay-to-play scandal involves UT dean, Texas Exes
  47. Supreme Court asked to look at UT’s backdoor admissions program
  48. Lawmakers want UT applications shielded from scrutiny
  49. McRaven makes UT scandal his own
  50. An open letter to Attorney General Ken Paxton on the UT cover-up
  51. Chancellor Bill McRaven’s UT cover-up has no defenders
  52. UT’s back door still open, but can’t stay secret, AG rules
  53. Whitewash: Kroll left dozens of bad LSATs out of UT report
  54. McRaven’s defense to Hall lawsuit refuted by own words
  55. Ready for the end of affirmative action?
  56. UT admissions scandal is 10 times bigger than official report
  57. McRaven trolls Dallas Morning News
  58. Powers to get top salary at UT Law
  59. UT sues to block Watchdog access to admissions investigation
  60. UT approves ‘Spinal Tap’ policy for backdoor admissions
  61. Admissions survey: No, UT, everybody doesn’t do it
  62. UT admissions scandal prompts new investigation
  63. Ticket scandal a black mark for UT, DA
  64. Showdown over UT cover-up nears end
  65. McRaven’s rationale for UT cover-up denounced by regents, AG
  66. High court to decide if University of Texas can deep-six investigation
  67. High court hears arguments on whether UT can bury investigation
  68. Testimony by UT contradicts story fed high court
  69. These ‘horns ain’t loyal, McRaven finds
  70. UT’s Hall challenges Abbott over board picks
  71. Texas Supreme Court nullifies rule of law; impunity to reign
  72. The battle for the Kroll records goes on

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Jon Cassidy was a former Houston-based reporter for Watchdog.org.