The former chancellor of Elizabeth City State apparently used a university-paid driver, took free meals from the dining service and failed to follow hiring policies, leading to questionable hires, according to two internal audits.
Stacey Franklin Jones resigned abruptly as chancellor in December, after 14 months on the job. She is no longer employed there in any capacity.
She is not mentioned by name in the Feb. 16 audits, which only refer to “Employee A.” But three sources familiar with the audits say the findings center on Jones. An ECSU spokesman, Robert Kelly-Goss, said only a chancellor would have had a driver, unless an employee with a medical disability requested reasonable accommodations. The audits examined a period of time that began on Oct. 1, 2014 – Jones’ start date.
Reached by telephone Tuesday, Jones said she didn’t think she was “Employee A” in all cases, and that the term referred to different employees. She pointed out that the audit itself said having a driver was customary at ECSU, and no policy was violated. She said the dining issue had to do with a longstanding contract and improper invoicing.
Jones said the reports were riddled with innuendo and errors, including something as basic as the university’s freshman enrollment number. “The audit needs to be audited,” she said.
She said she had not seen copies of the reports until they were provided to her Tuesday by The News & Observer. She took issue with the “negatively sensational, dramatic language” in the audits.
“You would think an auditor would not produce something that had unsubstantiated employee statements, negatively sensational tone and all that,” she said. “Clearly that just wasn’t done.”
The two internal audits follow a UNC system audit that found significant problems in financial aid and admissions operations. That report showed that 93 students were accepted for admission last fall without meeting minimum admissions standards; 35 ineligible students ended up enrolling. Also, some students improperly received financial aid.
The two internal audits were focused on hiring practices and misuse of university resources. They were conducted by Stacie Tronto, East Carolina University’s chief audit officer, who was brought in to do the work.
Tronto’s reports said that “Employee A” was not cooperative during an Oct. 15 interview, refusing to answer some questions and “deflected numerous times when asked a direct question.” The employee claimed that there was no training on hiring procedures, contradicting a trainer who said the employee was “dismissive of the training.”
The report on misuse of university resources started with a hotline complaint to the Office of the State Auditor. The tipster alleged that “Employee A” got free lunches from the dining service and used a university employee as a driver who earned overtime for out-of-town trips.
The audit substantiated the allegations, but said “it is important to note that this has been the past practice for individuals serving in this particular position.”
The report said there is no policy that strictly prohibits “employees in this particular position” having other another employee drive for them. But the auditor recommended that management consider stopping the practice.
“It could be perceived by the general public as a waste of University resources, which represents a reputational risk to the University and the entire University of North Carolina,” the report said.
During an eight month period from Oct. 1, 2014 to June 30, 2015, the ECSU driver went on 33 trips, 25 of which required overnight stays. The total cost to the university was $18,633, and one-third of the employee’s work time was consumed by driving, the report said.
Harold Barnes, an ECSU trustee, called the audit “petty.” He himself recommended that Jones use a driver, he said, mainly as a security measure, because she had been stalked.
As for the allegation of free meals, the audit report said the employee personally benefited from the university dining contract for $290, or 29 meals during the eight month period. The meals were not paid for, but were part of “discretionary funds” in the contract.
When interviewed about the meals, according to the report, “Employee A” said: “If indeed there were meals that were delivered and consumed, it is highly likely they were working lunches as I routinely work continuously without a break in schedule from early morning to late in the evening.”
The auditor balked at the explanation. “Working through lunch is a personal choice and [Office of Internal Auditor] does not consider this a valid business purpose for utilizing the ‘discretionary funds’ provided by vendor,” the audit said.
Further, receiving meals through a dining contract that the employee must approve could be a violation of state law. The auditor recommended the university attorney consider whether the university should file a state property incident report with the State Bureau of Investigation. The auditor also recommended that the university stop the practice of allowing employees meals through the dining contract.
Barnes, the trustee, also questioned the idea of an SBI investigation for a $200 meal discrepancy. He said that Jones controlled a multimillion dollar budget and donated $7,000 to the university’s foundation.
“I did inquire, and I was told at the highest levels that there was no evidence whatsoever that the chancellor engaged in any illegal conduct and she never ordered anybody to admit someone who was not eligible for admission, or somehow stacked the numbers so that the university could look good,” Barnes said. “Work that she did at Elizabeth City State University was good work. And so, where these other things come from, I just don’t know.”
The audit concerning hiring practices found that policies were not followed when it came to senior officers such as assistant vice chancellor or assistant dean. Improper waivers were granted to skip open search requirements in the hiring of five employees. In the case of another eight employees who were hired through open searches, the proper procedures were not followed half of the time. The audit cited examples, including situations in which only one applicant was interviewed or a search committee consisted of only one person. In one case, a person was hired despite not being in the applicant pool.
Perhaps the most glaring example of questionable actions was the hire of a former ECSU employee who had previously been terminated for dereliction of duty – taking unapproved leave – and possible misuse of a university cellphone. The employee owed $1,086 for the phone use, the audit said.
Further, unqualified people were hired for interim jobs, the report said, and ECSU filled the position of vice chancellor for student affairs after the job had supposedly been eliminated through a restructuring by the UNC Board of Governors. The audit also found questionable changes to ECSU’s manual for hiring policies and procedures.
The report said the university’s Human Resources office was culpable for some of the problems, but seven of eight current and former employees said in interviews that they feared retaliation or termination if they did not follow orders on whom to hire. From late last year through at least April 1, any hire at ECSU must be approved by the UNC system office.
University management concurred with the auditor’s findings and said a review of procedures and policies, and remedies, would be in place by April 1.
Jones attributed the admissions and financial aid errors to a manual system and poor technology. She said improvements she made will bear fruit in the future.
When asked if she resigned or was fired, Jones said she resigned. She said her next career move was in process and she wasn’t ready to talk about it.
Paul Norman, chairman of ECSU’s Board of Trustees, said the board had left the day-to-day operations, including hiring, to the chancellor. “You trust that the process was being followed to get the best person for the job,” he said.
He said the audit’s findings were news to the board. “We were not necessarily aware of the particulars,” he said, adding, “We have to learn from that, follow the proper procedure and protocol.”
Now, he said, he’s happy with the internal audit’s recommendations so that ECSU can implement improvements. “Now we’re thankful we can drive the car instead of the car driving us,” he said.
Norman said he’s happy with ECSU’s new chancellor, Thomas Conway, who has decades of experience in the UNC system – at N.C. State and Fayetteville State universities. Conway has been on the job since January.
“We’re confident he can lead us to where we want to go, as far as increased enrollment and management of the university,” Norman said.
In the past five years, enrollment at ECSU has plummeted by more than half, to 1,585 students last year, resulting in heavy budget cuts.