EL RENO — The Redlands Community College Board of Regents has called a special meeting Monday to discuss the college's current financial crisis and the possible termination, discipline or resignation of longtime Redlands President Larry Devane.
Devane, 67, told The Oklahoman on Friday that he has been president of Redlands for 24 years and at times has contemplated stepping down — perhaps at the end of the year — but did not ask for his job status to be placed on Monday's agenda for discussion.
Devane said he's not sure how the item was placed on the agenda because the agenda was not put together by his office like normal. The meeting will begin at 7 p.m. in the Regents Room at the college.
Devane has been on the hot seat ever since the Oklahoma State Regents for Higher Education released the results of an accounting firm's financial analysis of Redlands about two weeks ago.
The analysis by BKD LLP revealed the college owes more than $1.1 million in unpaid bills, including some dating back more than six months.
The report also revealed examiners had obtained notes from a computer file that raised concerns about university administrators' failure to obtain competitive bids or approval from Redlands' regents for a construction project involving the Darlington Annex, which cost more than $50,000.
The computer file notes allegedly were authored by former Redlands Vice President of Finance Karen Boucher, who died Feb. 1, examiners said.
State law requires that state construction projects in excess of $50,000 be competitively bid and prohibits bid splitting to circumvent the law. Higher education institutions are not exempt from the $50,000 limit, a spokeswoman for the higher education regents said.
The analysis released by regents did not include Boucher's alleged notes, but The Oklahoman subsequently obtained the notes from the state regents' office through an open records request.
The notes describe a series of meetings the author reportedly had with Devane and contractor Cody Tankersley in which the author said she repeatedly told them that competitive bids and regents' approval were required for the project because it was expected to cost more than $137,000.
She stated that Devane disagreed and that the president and contractor eventually worked out an arrangement for the construction to be done in four phases.
“We found RCC paid at least three invoices for the annex project and the total costs exceeded $50,000,” BKD reported. “Two of the invoices were issued in sequence on the same day.”
Devane said Friday that a “construction management process” was used and he believes he complied with the law.
Tankersley said he coordinated with Devane, and Devane determined how the project was done and billed.
“I provided estimates for every project,” Tankersley said, adding he didn't know if the college obtained estimates from others.
The BKD report questioned other aspects of the relationship between the college and Tankersley, noting that Tankersley was paid through Redlands' payroll while his construction company was paid through invoices.
“We consider this arrangement a questionable practice,” the BKD report said. “No one we spoke to could explain why the arrangement was done this way instead of paying the construction company for the work and obtaining bids when appropriate.”
The report said invoices from Tankersley's company were “often paid before other vendors awaiting payment.”
Tankersley said Friday that his company essentially served as a bank for projects and that the payments to his company reimbursed it for the company's costs, while the payroll payments to him were his profits.
Tankersley said he was a part-time employee, so he wasn't entitled to college benefits. The arrangement was designed by the college for its financial benefit, he said, adding the college still owes him money for some of the work he did.
A spokeswoman for the state regents said they turned a copy of the BKD report over to the state attorney general's office Friday for review and any appropriate legal action.
It is unknown how many regents want to force Devane out.
Regent Jim Kitch, of Yukon, said Friday that he wasn't the regent who requested the agenda item asking for an executive session “for the purpose of discussing the employment, hiring, appointment, demotion, disciplining or resignation of the president of Redlands Community College.”
“I'm not sure what the expectations are,” Kitch said, adding that his focus is on solving the college's financial problems.
Kitch said Devane told regents Redlands was experiencing cash flow problems shortly after Boucher's death, but he wasn't aware of the depth of the problems.
The college's other six regents could not be reached for comment.
Payroll likely to be cut
The BKD report cited several factors as contributing to Redlands' financial problems, including failure to collect about $1.8 million in overdue tuition and fees over the years and declining enrollment.
Devane said Friday that there were many other contributing factors, as well, including the federal sequestration, which reduced the availability of federal funds.
“We also found out after the death of our vice president for finance that monies from student housing that paid the bonds on that had been moved to pay other bills,” he said.
Devane said Redlands will have to reduce its payroll to get finances back in balance.
“The biggest reduction that we will have to do to get that back is … basically reductions in personnel since it's such a high percentage of the overall budget,” he said.
Redlands will not renew a number of part-time contracts, is slowing down or stopping some capital projects, and not filling a number of vacant positions, he said.
Not only is Redlands facing a financial crisis, the campus also sustained millions of dollars in property damage during the May 31 storm, Devane said.
After serving as Redlands' president for 24 years, Devane said he feels both a “commitment” and almost an “ownership” obligation to try to see it through its current problems before resigning.
Devane said he has been a college president longer than any other two-year or four-year college president in the state.