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NDSU president not the only school-affiliated official in hot seat

FARGO -- President Joseph Chapman isn't the only one taking heat this week for how he spent North Dakota State University donations.

Much of the blame, both before and after Chapman resigned Wednesday, has also been placed on the NDSU Development Foundation and its board of trustees.

"There's no question that we bear some responsibility for some of the events that have led now to the resignation of President Chapman," said John Q. Paulsen, a trustee and former president of the board. "We have obviously made mistakes during this very unfortunate process."

Yet many may not know exactly what the foundation or trustees do.

The foundation, the nonprofit fundraising arm of NDSU, funds the salaries of 31 foundation and Alumni Association staff. The two groups work as one financially, said foundation Controller Ron Peterson.

As of last June, they had an operating budget of about $3.9 million and had received nearly $13 million in total contributions, he said. The market value of their total endowment funds equaled $82 million.

The foundation staff carries out policies given to them by the board of trustees, a group of no more than 61 volunteers who oversee the foundation.

"Our sole mission is to do everything we can to support the work of the university," Paulsen said.

The trustees don't receive any pay or reimbursements for their work, said foundation Executive Director Jim Miller.

Most are NDSU alumni, though that isn't required. Others are just loyal NDSU supporters, Miller said.

"The trustees are upset that Dr. Chapman has resigned," Miller said. "They have a very strong commitment to the welfare of North Dakota State University."

They're elected to five-year terms by a committee of trustees and can be re-elected. Paulsen said 12 are elected annually.

"We are, by serving on the board, contributors to the foundation ... (and believe) in NDSU and its mission," said Ryn Pitts, an NDSU alumna and retired Fargo pharmacist.

The trustees serve on committees that oversee endowments, trust funds, grants or awards, budgets and audits. And they, like Miller's staff, appeal to donors for contributions.

The president, Paulsen said, advises them on what the university's needs are.

An executive committee is made up of 14 trustees and three staff members, Peterson said. They meet four times a year while the entire board of trustees meets once in the fall and once in the spring.

They live all over the country - from Michigan to California to Florida - hence frequent teleconferences. And while most are retired, they represent various professions - from professors to bankers to business owners.

In situations like this week's, Pitts said, "The time commitment increases substantially."

And they're likely going to have more on their plates since news broke that the new $2 million president's house was double what it was budgeted for and Chapman spent more than $22,000 in NDSU donations to take his family to January's presidential inauguration - both of which were covered by the foundation.

"Our board is now looking at additional measures that can be put in place that will prevent similar situations from happening in the future," Miller said.

Trustees will more carefully monitor presidential expense accounts and financial management issues, Paulsen said. "I think that the foundation certainly has to learn from this experience."

Top NDSU Development Foundation and Alumni Association staff salaries

Executive Director Jim Miller: $216,272

Associate Executive Director Jason Wohlman: $141,500

Associate Executive Director Sherri Schmidt: $120,000

Director of Planned Giving M. Scott Barrett: $120,265

Controller Ron Peterson: $116,500

Assistant Director of Major Gifts Leo Ringey: $101,800

Source: The foundation's 990 tax form. The figures are for the fiscal year ending June 30, 2008, the most recent available.