According to current and former University of Minnesota Board of Regents members, the recent sale of Eastcliff mansion to the University of Minnesota Foundation spurred questions regarding the health of systemwide transparency at the University. 

UMF is a private support organization that frequently partners with the Board and the University of Minnesota Alumni Association, another private organization, to support the University through donor gifts.

Eastcliff used to be managed by the Board, and thus, decisions were made in a public forum.

“Eastcliff has been with the University for a long time since the Brooks family graciously donated the property,” Regent James Farnsworth said.

Now that a major public asset has been handed over to a private organization, those conversations are now shielded from the public, as UMF meetings are completely private. This is one of many University assets UMF now possesses.

“The foundation supports the Board of Regents, but it should not replace the Board of Regents. Now you have a situation where an ancillary entity now has oversight in how Eastcliff is maintained and improved,” former Regent Darrin Rosha said. “That should stay fully under the control of the Board.”

UMF owns several properties on campus — the McNamara Alumni Center, Dinnaken Properties and more recently, The MIX, or Minnesota Innovation Exchange, formerly known as the East Gateway Project. Now, Eastcliff mansion will join them.

The McNamara Center was built for $4 million in a deal between the University and UMF, according to the International Masonry Institute. Former Regent Michael Hsu said the Board strives to engage with UMF to nurture a partnership, but the deal does not exactly break even. 

“It’s the University that guarantees the leases and the debt,” Hsu said.
“So the debt is actually in the books of the University.”

Hsu felt the Eastcliff was another poor real estate decision, referencing previous successes the University executed independently. The Bell Museum, along with both Northrop and Bruininks Hall renovations, all cite the University or the Board responsible for erection.

“Turning over assets, reducing the number of board meetings and not having public comment opportunities,” Rosha said. “None of those things are consistent with strong public institutions, and I think that those are things that the public really ought to be paying more attention to.”

The Eastcliff sale also sparked discussion on whether or not the Board itself can run democratically, as it is comprised of multiple members with financial conflicts of interest.

At the Oct. 10 Finance and Operations Committee meeting, Regent Ruth Johnson expressed her willingness to cooperate with UMF to hand over Eastcliff to the Foundation, seeing that she has been a trustee for nearly 3 years. Johnson is not the only one in the middle of this debate, with Douglas Huebsch serving as a UMF trustee for over 4 years.

There is a clear rule against conflicts of interest like this in the Board’s Code of Conduct. A conflict violates a regent’s duty of loyalty when a regent has an actual or potential financial, employment or other personal interest that may impair objectivity, the code says.

University administrators seem to be able to have exempted themselves from the standards, Hsu said. 

“They have this way of hand-waving. The conflict of interest is not hard to understand, right?” Hsu said. “In the case of regents, if their first allegiance is to the University, obviously, when they’re acting on behalf of the Foundation and it has to do with something in regards to the University, property or money, property changing hands, then it would be an obvious conflict of interest.”

A noticeably pervasive goal of UMAA is alumni housing on or near campus.

Rosha said that incorporating alumni housing into the MIX property was discussed. In a 2020 UMAA Executive Committee meeting, it was suggested that East Gateway would manage the first phase of alumni housing exploration. 

One of The MIX’s key land purposes stated that the project will not be targeted toward undergraduate students.

The current property, still boarded up awaiting construction, is located on Washington Avenue. The projected expansion of the MIX will stretch out to Delaware Street, Ontario Street and Huron Boulevard, according to the MIX’s Website.

The MIX’s “innovation ecosystem” will not be seen on Washington Avenue anytime soon. The first phase of The MIX’s project is scheduled to end in 2029.

It will take 15-20 years to fully develop The MIX’s with three phases, according to The MIX’s website.

The UMAA Board of Directors claimed at a June 2021 meeting that intermingling alumni and students will enrich the community via alumni housing.

What is not nearly discussed as much is student housing. The University has the least amount of dormitory buildings in the Big Ten, despite placing third in enrollment within the Big Teh and 6th in the country, according to University enrollment data.