University of Texas at Austin President Greg Fenves and his wife violated school policy by flying first or business class “multiple times” without a regularly approved reason, a University of Texas System audit says.
After the audit recommended that the president’s office stop “purchasing premium airfare,” the school promised that Fenves and his wife would comply with the rules going forward. A university spokesman, Gary Susswein, also told The Texas Tribune on Monday that Fenves will reimburse the university about $27,000 for the cost added by the premium airfare.
"The trips identified by the audit were taken for official university business," Susswein said. "They were not paid for with tax or tuition dollars, but with gift funds specifically donated for presidential expenses. We acknowledge the audit results and the need to follow university rules."
The February audit reviewed the travel expenses of Fenves and his spouse between June 2015 and June 2017 – a period in which Fenves also proposed back-to-back tuition increases for UT-Austin’s students. University officials said Fenves flew business class around 50 times during that span. His wife, Carmel, did so about 40 times.
The money to pay for the flights came from a 1984 donor fund set up to cover certain expenses, including travel, by the president. The trips included visits to university donors and "potential university partners," Susswein said.
The school’s travel policy says the president and his spouse should fly coach except under specific conditions, such as a documented health issue, if a first class seat is the only one available or if another entity is reimbursing the cost of the plane ticket.
The explanation for why Fenves and his wife flew premium rather than economy did not fall under any of these approved exceptions, the audit says. The discovery was flagged as a non-priority “medium-level finding” in the report, which concluded that otherwise the president’s expenses seemed appropriate and accurate.
The premium airfare was "generally done because of space and time concerns," Susswein said. "As the audit concludes, that does not fall under allowable exceptions and we accept those findings."
"Moving forward, we will follow internal policies and no one will fly business or first class at university expense, except under the allowable exceptions," he said.
The UT System periodically reviews the travel, entertainment and housing expenses of its institutions’ leaders. Previous audit reports are posted online, but are sparse on details; they rarely contain any dollar amounts or exceed five pages in length.
This is the first time Fenves, who took the helm of UT-Austin in 2015, has had his travel expenditures audited by the System. Audit reports covering September 2012 to June 2015 said the expenses incurred by Fenves’ predecessor, Bill Powers, and Powers’ spouse “appeared appropriate and accurate,” but also included recommendations about how to improve the school’s processes.
The UT System auditor, J. Michael Peppers, made a separate recommendation about deans' and vice-presidents' entertainment expenditures. In a memo sent to UT-Austin’s chief financial officer the day the audit was issued, Peppers said a review found the school's high-level administrators are able to sign off on their own entertainment expenses. Though the expenses are subject to review by UT-Austin’s Payment Services department, the memo says “this does not provide effective oversight of expenditures because any expenses/exceptions for senior management may be self-approved.”
UT-Austin officials agreed in the memo to amend the policy.
“Internal controls need to be tightened, so that no employee may approve their own expenditures, providing for appropriate segregation of duties,” the memo says.
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