Individuals within the University of Minnesota community have recently pointed out concerns about President Joan Gabel’s December 2021 contract and the University’s search for Duluth’s next chancellor.

Regent Darrin Rosha, former Minnesota governor Arne Carlson and University law professor Richard Painter sent a letter to the Legislative Audit Commission (LAC) in June requesting an audit of the Board of Regents. They cited possible ethical issues with the language in Gabel’s contract and the University of Minnesota-Duluth (UMD) chancellor search. The board will vote on a search committee’s recommendation for UMD chancellor at the July board meeting on Wednesday.

The LAC responded to the letter on June 27 stating the issues raised are “complex.” The commission stated it will put the University Board of Regents on the topics list for the LAC to consider during the topic selection process for next spring.

Who is the Board?

The Board of Regents consists of 12 unpaid elected members, each one serving a six-year term. According to the board’s website, the board “articulates a vision for the University and works to ensure the University of Minnesota fulfills its mission of education, research and outreach.”

Out of the 12 regents, eight are elected by the state Legislature from each of the congressional districts. The legislature elects the remaining four from the state at large, with one being a University student at the time of the election.

The board typically meets once a month to discuss important issues at the University. They approve new policies, certain financial decisions like tuition, the president’s performance and much more. The decisions they make affect the University community, including students, staff and faculty.

Controversial language in Gabel’s 2021 contract

The LAC letter outlines concerns that Gabel’s December 2021 contract gives the board chair more power than the other 11 regents. The board approved Gabel’s 2021 contract in a 9-2 vote at the December board meeting.

According to the letter, the contract “expressly gives the board chair the sole power over the president’s performance assessment, financial bonus and the president’s goals and objectives without any approval by the remaining 11 regents.”

Regent James Farnsworth said he was “concerned about the power the chair has” and said there was an imbalance of power between the regents.

Along with a pay increase, the December 2021 contract states any bonuses Gabel receives will be based on metrics, goals and objectives she and the board chair annually agree upon. It also states “the bonus amount for each fiscal year will be determined by the chair, in the chair’s discretion” after the chair consults with the Board’s Presidential Performance Review Committee.

The review committee consists of regents the chair appoints, according to the board’s website.

Gabel is eligible for up to an extra $50,000 for the 2022 fiscal year and up to $100,000 for each subsequent year, according to the 2021 contract. This is in addition to retirement benefits and a $649,600 salary that increases each year.

The 2021 contract language is different from Gabel’s original contract from December 2018, which states she will submit a statement with her objectives to the board annually. This is listed as one of the president’s duties and responsibilities. The 2021 contract no longer includes this provision in the Duties and Responsibilities section.

The 2021 contract does state the board will evaluate Gabel’s performance annually and have discussions about mutually established goals, objectives and accomplishments. This language contradicts what is previously stated regarding Gabel’s bonuses.

The 2018 contract also states establishing future incentive compensation would be “awarded at the board’s sole discretion,” not the chair’s.

According to the Board Operations and Agenda Guidelines Regents Policy, the president’s compensation should be set by the board at a public meeting. “It shall be the responsibility of the chair, in consultation with the vice chair, to recommend presidential compensation and other contract terms for board action,” according to the policy.

According to the board’s bylaws, the chair’s duties are to preside over the Board of Regents meetings, name and identify committees’ duties and responsibilities and fill committee vacancies. The chair can also “execute such instruments and documents which would devolve upon the principal corporate officer.”

The individuals who signed and submitted the LAC letter said they believe the language in the 2021 contract violates the board’s ethics and policies because the chair now has the authority to decide the president’s goals, objectives and total compensation.

“There’s nothing more fundamental in managing and overseeing and strategic planning for the University than the goals and objectives for the coming year,” Rosha said. “To take that away from the full board and put it in a single regent is outrageous.”

Rosha said determining the goals and objectives is what determines things like the University’s focus and where the University invests its resources.

The University’s Charter states, “the government of this University shall be vested in a board of 12 regents, who shall be elected by the Legislature.” Additionally, the Reservation and Delegation of Authority Regents Policy states the board’s authority “resides only with the board as a whole and not in its individual members, except as the board itself may have delegated specific authority to one of its members or one of its committees.”

The Charter, which is also a part of the Minnesota Constitution, specifically states there will be a 12-member board because 12 members provide a range of experiences and perspectives, Rosha said.

“The [2021] contract … specifically proves that the president’s compensation is decided by this one individual and only needs to reach agreement on goals and metrics with one individual,” Rosha said. “That clearly is not a governing board. That’s an individual.”

The Minnesota Daily was unable to receive statements from Gabel and Board Chair Kendall Powell before publication.

The search for UMD’s next chancellor

In November 2021, Gabel announced the University of Minnesota-Duluth’s chancellor, Lynn Black, was retiring, leading to a University search for his replacement.

Gabel originally created a search committee consisting of 18 people who all have ties to UMD and the University system in general. The University paid a search firm, Korn Ferry, $166,000 to conduct a search and bring back three candidates to the search committee, one of whom the committee would choose as a possible recommendation to the board for the next chancellor.

On May 23, Gabel announced to the UMD campus that the committee found three candidates, but the search ultimately failed and the University would be accepting applications for a two-year interim chancellor through June 15. Gabel would then have chosen the interim chancellor after consultation with other constituencies, she said.

Gabel has not issued a public explanation for why she deemed the original search a failed search.

Regent David McMillan, who was the board chair when the board hired Gabel as the University’s president, resigned from the board after Gabel’s message and announced his run as a candidate for the interim chancellor position. McMillan also supported the board approving Gabel’s 2021 contract. A regent resigning in this way is not something that typically happens, Rosha said.

Carlson said this is a conflict of interest and potential quid pro quo because McMillan helped hire Gabel as the University’s president and was part of the group that gave her the pay increase. He added that he questions the qualifications McMillan has for this position.

“As far as I know, he has no background in academic administration whatsoever,” Carlson said.

McMillan graduated from UMD in 1983 and studied economics and history. After he graduated, he attended the University’s law school and graduated in 1987. Starting in 1989, McMillan began working for Minnesota Power, an ALLETE electric utility company based in Duluth. After serving in a variety of roles at Minnesota Power, McMillan became the executive vice president for the company and was senior vice president for external affairs for.

McMillan has previously served as board chair of the Minnesota Chamber of Commerce, the Natural Resources Research Institute, the Area Partnership for Economic Expansion and Goodwill Industrial Vocational Enterprises.

The Minnesota Daily was unable to receive a statement from McMillan prior to publication.

After community members like Carlson raised questions about Gabel choosing the interim chancellor and McMillan applying to the position, she sent the UMD campus a message on June 22 announcing she would not choose the interim chancellor and instead delegate that decision to the original search committee.

“While the president has the authority and discretion to appoint an interim chancellor, I have charged the search committee to, solely at their discretion, review the applications, interview candidates as needed and ultimately recommend to the Board of Regents who the committee believes should serve as interim chancellor,” Gabel said in her message.

The board will vote whether to approve the search committee’s recommendation for interim chancellor at the July board meeting on Wednesday, according to the meeting docket. The search committee chose McMillan as its recommendation to the board, according to the docket.

UMD chancellor candidates and history

During the 2021-22 school year, Gabel announced the search committee found three candidates for UMD chancellor before announcing the search failed.

Corey King would have been UMD’s first Black chancellor. Debra Larson would have been the school’s second female chancellor.

Amy Hietapelto, the interim executive vice chancellor for academic affairs at UMD, submitted her application to the search committee but was not contacted for an interview, despite her qualifications, Regent Farnsworth said.

"Someone in her position would normally be considered natural for an interim appointment," Farnsworth said.

Regent Mike Kenyanya said a failed search is not out of the ordinary and that it has happened at the University in recent years.

“An appropriate and qualified person who would have the confidence of the students, staff and faculty at UMD was simply not found in the process,” Kenyanya said in an email to the Minnesota Daily. “The worst mistake you can make is appointing someone just to do it.”

According to the recommendation letter from Myron Frans and Jennifer Mencl, the search committees’ co-chairs, to the board, “no other candidate is more suitable for this interim role than Mr. McMillan.”

Contradicting Board opinions

While multiple people signed and submitted the letter to the LAC, Rosha was the only regent to sign it. After the signatories sent the letter to the LAC, board Chair Powell and board Vice Chair Steve Sviggum sent a letter to Rosha on June 27 responding to the concerns in the LAC letter.

Powell and Sviggum cited the Regents Policy for code of conduct in their letter, which states a “review of an alleged violation by a regent…shall be initiated when seven regents sign a written complaint…and deliver it to the board chair.” They said in the letter that Rosha signing and sending the letter to the LAC exemplified a “disrespect for good governance.”

Additionally, they said the assertions questioning the ethics and possible quid pro quo of McMillan running for the UMD chancellor position in the letter to the LAC were “baseless and reckless'' and have been “flatly denied by both President Gabel and David McMillan.”

The letter also stated Gabel’s 2021 contract does not violate any policies because a majority of the board voted to approve the contract and asking the legislature to change the result “would be an improper intrusion into the board’s constitutional autonomy.”

Rosha sent a letter to Powell and Sviggum in response on July 5.

In the letter, Rosha said, “regents have a fundamental right to express their views as they deem necessary and appropriate,” citing the First Amendment. He also said in the letter that the code of conduct regents policy was not applicable in this situation because it addresses acts by an individual regent and not the board as a whole.

Rosha stated, “the concern[s] about the UMD chancellor matter raised in the LAC letter are appropriate and based on objective facts.” He also said in the letter, “no regent or even a majority of the board has the authority to remove the constitutionally-granted governance authority of any other regent.”

Additionally, Rosha stated in the letter that while the University does have constitutional autonomy for issues like academic freedom, that autonomy “does not place the University above the law or beyond review by the Legislature or the courts.”

“It reflects a view among the board’s current leadership that the University of Minnesota is an independent fiefdom above any review or oversight by our electors in the legislature or any other entity,” Rosha said in the letter.

The Minnesota Daily was unable to receive statements from Powell and Sviggum before publication.

Clarification: A previous version of this article misstated who the University paid $166,000 to conduct the UMD chancellor search. The University paid a search firm $166,000, and the firm worked with the search committee to conduct the search. 

Clarification: A previous version of this article misstated who Amy Hietapelto sent her UMD chancellor application to. Hietapelto sent her application to the search committee.