Spend. Build. Repeat. Unbridled Growth Is at the Heart of a Crisis at UCF.

A widening financial scandal at the University of Central Florida, which may have cost a newly minted president his job, has raised deeper questions about whether a culture of ethical shortcuts and lapses in oversight took root during years of unbridled growth at the institution.

The university’s Board of Trustees will consider on Thursday whether to accept the resignation of Dale Whittaker, who ascended from provost to president just eight months ago. Whittaker and the university have been in state lawmakers’ cross hairs since August, when an audit found that Central Florida had misappropriated $38 million of restricted taxpayer money for the construction of a new building.

For the last two decades, the story of the University of Central Florida has been about more students and more buildings. Under John C. Hitt, who preceded Whittaker and led the university for more than a quarter century, Central Florida transformed from a midsize commuter campus into a behemoth public research university of 66,000 students.

The once-sleepy institution gobbled up territory in Orlando, added a medical school, and cultivated a zealous athletics department that has floated plans for a resort-style “recovery cove” where Division I athletes can glide down their own private lazy river.

It may well be, as some on campus believe, that all of this swagger put a target on the university’s back, and Whittaker is paying the price. Lawmakers, including one who recently suggested that the university might need to be shut down over the misappropriated-money scandal, have lambasted the university for months and show no signs of relenting.

To many at the university, this legislative outrage seems overblown. Even so, the controversy has invited a broader conversation about whether the University of Central Florida has played fast and loose with the rules on its path to prodigiousness. Whittaker’s resignation is unlikely to put that matter to rest.

‘Broken Culture’

The financial controversy at Central Florida picked up steam in January, when an independent investigation found that the university had inappropriately used or planned to use more than $85 million for various new construction projects. The investigation’s report, Whittaker said at the time, exposed a “broken culture” and suggested that the university’s administration and finance division “didn’t place enough value on integrity and competence,” the Orlando Sentinel reported.

Manoj Chopra, an engineering professor and former member of the State University System of Florida’s Board of Governors, said a larger conversation about accountability and oversight at the university is appropriate. In that vein, he said, it is fair to question whether the university’s systems of checks and balances have evolved appropriately to accommodate its rapid growth and complexity.

“All of that is starting to strain the infrastructure, and it cannot be sustained,” said Chopra, who has also served on the campus-level Board of Trustees. “I will be blunt in saying growth has to be restrained.”

After decades of consistent construction, it was the building of Trevor Colbourn Hall, an academic building that houses the College of Arts and Humanities, that drew the attention of state auditors.

To finance the building, the university tapped into operational funds, which cannot be legally used for the construction of new buildings. Much of the blame was laid at the feet of William J. (Bill) Merck II, the former vice president for administration and finance and chief financial officer, who “clearly understood” that the financing could run afoul of state rules, according to a report by an Atlanta law firm hired to investigate the matter.

Had the campus-level Board of Trustees been informed of the dubiousness of the financing strategy, Merck knew that it would never have approved the project, the law firm stated.

Chopra, whose tenure as a trustee did not coincide with the Trevor Colbourn project, said it is “very difficult to blame trustees” for accepting at face value that construction projects they are asked to approve are legal. It is clear in hindsight, however, that the trustees failed to interrogate whether the university had sufficient internal checks and balances, he said.

“I will take responsibility for not questioning the business model where multiple layers of approval were not provided for all funding sources,” Chopra said.

In the wake of the scandal, the university axed the vice-presidential-level position that Merck held, creating two financial-officer positions designed to work as a check on financial decisions.

The controversy has raised questions about the cabinet structure and broader culture that took shape under Hitt, who ended his 26-year run as president in June 2018 at the age of 77. Late in his tenure, Chopra observed, Hitt increasingly relied on his lieutenants.

“The fact that he was not aware of what was going on at the institution for the last few years is disappointing and concerning,” Chopra said. “That probably led to the malaise. Decisions that should have been made at the executive level were made at the lower levels. John relied on the expertise of people, but potentially that conflicted with structural checks and balances in the system.”

The Chronicle requested interviews with Hitt and Whittaker through the university’s communications office, but neither was made available.

Faculty Response

The crisis at Central Florida has further strained relations between administrators and some of the university’s unionized faculty members. For them, this isn’t a byzantine story about a university’s tapping the wrong pot of money for a building in violation of some obscure regulation. It’s the story of an administration willfully taking money that should have gone to faculty salaries, all the while poor-mouthing to the union in collective-bargaining sessions.

“The faculty-union position is that we are not anywhere near the bottom of this,” said Scott Launier, president of the university’s chapter of the United Faculty of Florida. “We’ve known for years that we’ve been lied to about how much money there was to compensate and provide for faculty.”

Launier found a tongue-in-cheek reason to be upbeat about the unfolding story.

“Every year, the university has said, ‘We would like to give you more money, but we don’t have it,’” said Launier, a writing and rhetoric instructor. “It is nice that they have finally changed that narrative, and they have finally said, ‘We have the money, we just don’t want to give it to you.’ At least we’re having an honest conversation.”

The Faculty Senate held an emergency meeting on Wednesday afternoon. William (Bill) T. Self, chairman of the Senate and a university trustee, said that some professors had expressed anger that Whittaker felt forced to resign because of legislative pressure. Others, he said, felt that the president ought to resign in light of the investigation’s findings.

The Atlanta law firm’s report said that Whittaker knew that operational funds had been used to pay for Trevor Colbourn Hall’s construction, but that he had been given “vague and arguably misleading information” on the subject. Whittaker told investigators that he did not know about restrictions on the money.

Self, in a text message to The Chronicle on Wednesday evening, said that Whittaker “shows strong personal character in his willingness to sacrifice his position as president for the sake of the university.”

Jack Stripling covers college leadership, particularly presidents and governing boards. Follow him on Twitter @jackstripling, or email him at jack.stripling@chronicle.com.