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Editor: Paul L. Caron, Dean
Pepperdine University School of Law

Friday, March 31, 2017

NY Times:  Cincinnati Law Dean Put On Leave After Trying To Close Multi-Million Dollar Deficit By Increasing Teaching Loads, Cutting Summer Research Stipends And Salary Supplements Of Chaired Professors

UC BardNew York Times DealBook: Cincinnati Law Dean Is Put on Leave After Proposing Ways to Cut Budget, by Elizabeth Olson:

When Jennifer S. Bard took the reins of the University of Cincinnati College of Law in 2015, her chief mission was to overhaul the school’s troubled finances.

She proposed measures to cut costs, including expanding teaching loads, limiting travel expenses and curbing summer salary stipends for research. But faculty members pushed back.

After so much squabbling between the dean and the professors, the public university’s provost stepped in to mediate. Last week, Dr. Bard, who came from Texas Tech University’s law school, was stripped of her duties as dean and placed on leave — with no public explanation.

Internal faculty emails provide a window into why Cincinnati Law — and schools like it — have made few changes even as they face serious revenue shortfalls. Normally, such financial information never sees daylight, but a local newspaper, The Cincinnati Business Courier, published a string of emails after obtaining them through public records requests.

Cincinnati Law is not unique by any means. With the exception of the very top tier, law schools, including Cincinnati Law, are facing a steep decline in the number of graduates — this year will be the lowest in about four decades. And predictions for 2018 are that there will be even fewer.

“We have a massive amount of contraction taking place,” said William D. Henderson, a law professor at the Indiana University Maurer School of Law. “The average entering class is now about 182, which is down from 260. And there are 40 more law schools now than there were 40 years ago.” ...

[L]aw schools like Cincinnati’s — one of the oldest in the nation, founded in 1833 — have hefty expenses, including six-figure professor salaries that are meant to match partner-level wages.

Dr. Bard, for example, was paid $300,000 annually over her five-year contract, according to her contract. The school has more than two dozen professors on its faculty, including two former deans. Now Dr. Bard will join them as a third dean because she remains a faculty member..

No amount has been disclosed, but according to data Cincinnati Law is required to file with the American Bar Association, the school appears to have racked up a multimillion-dollar shortfall as the number of students and the amount of tuition revenue slid in recent years. ...

Most law schools have not opted for new ways of doing business and, instead, have resisted changes that might result in slippage in the national rankings.

To attract students with stellar test scores and grade point averages, nearly every law school, including Cincinnati, heavily discounts tuition through so-called merit scholarships. That is commonplace even though, according to critics, the aid subsidizes wealthier students at the expense of those who lack access to a superior educational system and extras like test preparation. ...

According to data filed with the American Bar Association, only about 12 percent of students in the 2015 academic year paid the full listed price. The school’s current annual charge of $29,010 for tuition and fees for nonresident students is less than the $40,000 it charged as recently as the 2012-13 academic year. Resident tuition and fees have stayed static, at $24,010, but the net tuition figure — or the actual amount paid — is $15,233 as a result of tuition discounts. All of this adds up.

During her tenure as dean, Dr. Bard improved the school’s ranking, up more than 10 places, to No. 72 in the 2017 national law school results. Enrollment is up 73 percent over the last two years, to 277 full-time students. Bar passage rates have stayed steady and she also re-established relationships with some law school donors.

Nonetheless, Peter E. Landgren, the university’s interim provost, placed her on administrative leave. He declined several requests to explain why he had taken a measure typically reserved for actions deemed improper. Christo Lassiter, a professor of law and criminal justice at Cincinnati Law, said that Mr. Landgren told the faculty at a meeting he attended last Friday that “Dean Bard has done nothing unethical and nothing illegal.”

Still, it is clear her proposed budget-cutting measures rankled faculty members. One of them was combining the law library with that of the main university library — and separate law libraries are counted as pluses in the national rankings. Other deficit-slashing proposals included requiring written advance approval for faculty travel and for receipts, and increasing the current teaching load of three classes.

A major point of contention was her proposal to trim back the use of school operating funds to supplement salaries of senior faculty members holding endowed chairs. By last December relations had deteriorated so badly that Mr. Landgren had devised a plan to “restore mutual trust and respect” to smooth over difficulties between Dr. Bard and the faculty.

The plan went into effect in January, providing for the parties to meet a mediator. But before that came about, Mr. Landgren announced last week that “after much consideration,” he was placing Dr. Bard on administrative leave.

Dr. Bard, who has retained a lawyer, has declined to elaborate, but in a public statement last week she said: “This action was unexpected and raises serious questions about the university’s failure to support the financial goals for which I was hired and the due process to which I am entitled.”

Those in charge of the transition, according to Mr. Landgren’s announcement, are “senior faculty.”

Prior TaxProf Blog coverage:

http://taxprof.typepad.com/taxprof_blog/2017/03/ny-times-cincinnati-law-dean-is-put-on-leave-after-trying-to-close-multi-million-dollar-budget-defic.html

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Comments

"A major point of contention was her proposal to trim back the use of school operating funds to supplement salaries of senior faculty members holding endowed chairs." That sounds strange. Usually the endowments are precisely for research and salary supplements for the holders, in addition to their normal salaries. What's going on?

Posted by: Eric Rasmusen | Mar 31, 2017 10:59:12 AM

Unfortunately, the problems Dean Bard inherited will be the same as those inherited by most new law school deans. The generation of deans who weathered the collapse of the legal education market as we knew it a decade and more ago by making only changes that inflicted no pain on faculties is now moving out of the deans’ suites. The incoming generation of deans has bigger problems and fewer options than any before. They will need the support of their presidents and provosts even more than their faculties. As the season for new dean searches approaches, anyone thinking of applying should think very carefully. This is not the job it once was. I predict an increase in both internal candidates being appointed dean and in non-conventional candidates being appointed dean, as the pool of sane, qualified conventionally-credentialed candidates who understand the problems and options evaporates.

Posted by: westcoasttaxprof | Mar 31, 2017 12:40:33 PM

This is a really interesting story. Kudos for the local newspaper for digging up the emails.

The long-term fix to these kinds of budget problems seems relatively obvious. Tenure-track faculties have to shrink, and remaining faculty need to teach more courses (or to rationalize the curriculum by, for example, eliminating small-enrollment courses), and/or staff more classes with adjuncts. The summer salary tradition also seems ripe for the picking. Most other academic departments don't provide more-or-less-guaranteed summer salary support. The pre-approval for travel idea, though, seems problematic. It doesn't save much money overall, and it causes a point of friction/annoyance with faculty who are probably among those who are most productive, while also multiplying bureaucratic red tape.

Posted by: Jason Yackee | Mar 31, 2017 7:58:42 PM

Her actions sound like reasonable ones to me. How does the faculty expect the budget to be balanced? Double tuition? Continue to run a structural deficit and receive the university's cross-subsidizing? There just are not many options for a Dean and if she was hired to balance the budget, it sounds like she was exploring existing options -- having existing faculty teach more so as to avoid hiring more.

Posted by: TS | Mar 31, 2017 11:41:54 PM

Keep in mind that public universities are run by administrators who
worry as much (or as little) about students, donors, alumni, the Dept. of Education, the statehouse, the janitors’ union, and recruiting employers as they do about the faculty. They are well aware, though, that if you take away summer research support, reduce salaries, and increase teaching loads, and your faculty are in a marketable field like academic law, you will lose literally 50% of your faculty--- and it will be the best half, the ones you want to keep. You will no longer have professors who are smarter than your students.

I was talking in the hallway yesterday with a prof who I would guess makes about $200,000/year. Pretty expensive! But as I recall, he charges $400/hour for consulting and he was saying that his equivalent in the same field in Chicago would be a partner earning $800,000/year. If the law school were to cut his salary by $50,000, he’d move elsewhere, and the law school would lose a lot of talent. They could easily find an unemployed lawyer to teach his classes for $100,000, but would that be wise?

Posted by: Eric Rasmusen | Apr 1, 2017 7:01:11 AM

I am a professor at a top-30 public law school. We have to receive pre-approval for travel, for example; it has not chilled faculty productivity or travel; no one bats at an eye at it – it is normal here (and probably most faculty members think it is done everywhere). This is not the only law school at which I have taught. Practices vary considerably from school to school and across time at any given school. Whatever the practices happen to be at a particular school regarding travel expenses, adjusting teaching loads, or the use of professorship funds are not universal principles, I assure you. These practices may have been new to the UC faculty, but they were not Dean Bard’s innovations – she was adopting them from other schools. Whether or not she should have adopted them, or whether or not she could have implemented them in better ways, I cannot say. But I can say nothing revealed thus far suggests something is “strange.” Using practices that are used at other schools (if not all, and if not UC), she tried to rein in faculty expenses; the faculty responded by making the provost’s life miserable; the provost removed her. The end result is that expenses were not cut, and UC is going to get to have a new dean search – and all the candidates will know that the school is badly in need of cutting expenses; the president and provost are not going to back up the new dean when she tries to cut expenses; and that the faculty, having already succeeded in resisting one dean’s efforts to cut expenses is extraordinarily unlikely to ever support another dean’s attempts. Law schools, even good ones like UC are running at deficits that have been tolerated thus far by universities but cannot be tolerated indefinitely. Law faculty are notoriously difficult for university administrators (we are far more aggressive than most of our colleagues across campus). Perhaps Dean Bard could have done this or that differently in terms of details, but, in broad strokes, nothing reported thus far is “strange” (in light of the considerable variations in practices among universities) nor unreasonable (in light of the normal business practices for an entity with an operating deficit). She is the first headlined casualty in the law school faculty v. university administrator conflict that will soon be at more and more law schools. Score: law school faculty, 1; university administrators, O.

Posted by: taxprof | Apr 1, 2017 7:32:23 AM

It's hard to comment without access to more internal documents but, as a faculty member (and chair holder) at another Ohio public law school, I have a few comments. (1) Chair endowments often fail to pay the full difference between a “regular” salary and a chair holder’s salary and research support. Some of these endowments were established decades ago at fairly modest levels, and interest payouts have declined since the Great Recession. It seems quite plausible that operating funds support some of this compensation. Under those circumstances, chair holders (like everyone else) should be willing to consider their contribution to stabilizing a school’s financial situation. (2) OSU has required us to preapprove travel for several years now. We also have strict requirements for some kinds of receipts. My understanding is that these requirements stem from ethics/financial responsibility rules designed for all state employees. Why can’t law professors follow those rules? It’s really not a big deal—especially with electronic approval systems.

Posted by: Deborah Merritt | Apr 1, 2017 9:45:13 AM

"At the same time, law schools like Cincinnati’s — one of the oldest in the nation, founded in 1833 — have hefty expenses, including six-figure professor salaries that are meant to match partner-level wages."

Sorry, but law firm partners are not making $100 to $200K per year like professors at Cincinnati. Partners are making $500K to $3 million.

Law schools are barely matching first year associate salaries.

Posted by: Our misinformed New York Times | Apr 1, 2017 3:57:39 PM

It's almost as if tenure means that faculty are entitled to security of position and compensation.

Posted by: Tenure | Apr 1, 2017 5:43:50 PM

@Our Misinformed Commenter,

Oh, the number of fallacies in your little post. The implied notion that all law firm professors, who typically logged 2 years' at most as a junior associate somewhere, would have automatically become the 1 associate in 25 who made it to equity partner. The rather less implicit notion that a public university law school should pay on par with a white-shoe law firm. The elided reality that law firms in 2017 don't start their first year associates at what they made in 2007 expressed in 2017 dollars. And the notion that law profs, who have the lightest teaching loads in all of higher education, to say nothing of the vapidity of their education (Research requirements? Dissertation?), should be paid on par with professional sheep who log 2000 to 2200 billables per year. Do we live in a bubble or what?

Oh, and very firm law firm partners in Cincinnati are making $3 million per year, I think you'll find. Not every law firm is a Vault 5 firm, you see. In fact, the overwhelming majority of law firms are not.

Posted by: Unemployed Northeastern | Apr 2, 2017 6:40:26 AM

@taxprof:
"Using practices that are used at other schools (if not all, and if not UC)"

To the best of my knowledge, no law school has yet merged its law library with the main university library, as former Dean Bard proposed to do.

Posted by: Rob T. | Apr 2, 2017 9:34:59 AM

@UNE

Elizabeth Olson said law profs at Cincinnati were getting paid like law firm partners, which clearly isn't true.

Whether the professors would have made partner is irrelevant to this point. The fact is, they don't get paid anywhere near like partners.

Journalists should get their facts straight.

Partners in Ohio can make $500K+ and a lot of the folks at Cincinnati probably left bigger legal markets to become professors. Even if they had spent their whole lives bouncing from firm to firm as mid level associates or gone in house at a big company, they'd make hundreds of thousands per year more than as law professors, cumulatively several million.

Posted by: Olson | Apr 3, 2017 4:13:29 AM

@ Eric Rasmusen,

Your assumptions about the marketability of law professors are so plainly ridiculous that someone has to respond. You think that 50% of the faculty at non T30 law school could easily lateral for the same compensation? Please. Try 2%. How many laterals land positions in today's market? 30 per year? Are you saying that is lack of interest? So many profs who grew up and went to school in coastal cities are just happy to hang around in Kansas, West Virginia, Alabama, rural Ohio, etc.? None of them would love to move to DC, LA, NYC, Chicago, Boston? How about indications from the entry-level market? So far there are about 20 full time TT hires in American law schools. Last year, one of the lowest recorded hiring years, there were twice that at this time. You state that law schools would have to hire a practitioner with less prestigious credentials for $100k as a scab. Why not hire one of these summa cum laude from Columbia, Article III Clerk, PHd kids with no offers that is facing an embarrassing third year in a fellowship at a top 6 school?

The vast majority of law schools are offering buyouts and trying to find ways to contract and save salary. Your assumption that there are a sea of buyers out there is preposterous.

Oh, and when some law prof tells you he makes $400/hr consulting, unless he is one of a few in tax or corporate law, that means that he is able to bill that for about 10 hours per year, probably 3 years ago.

Posted by: JM | Apr 3, 2017 6:36:37 AM

Is the "law library" the rooms filled with books that no one uses (since all legal research is done on Westlaw, Lexis, or Hein), or is there some other meaning of the term?

If the former, can someone explain why we should care whether it is merged with the university library, and if the latter, what is this "law library?"

Posted by: brad | Apr 3, 2017 9:16:49 AM

@Olson,

The point is that law professors SHOULDN'T be paid anything like law firm partners. They don't work the same hours, they don't have the same skill sets (most partners actually know how to practice law beyond doc review and cursory proofreading of motions), and of course tenured profs have job security unknown in the private sector, particularly in these days of multi-tier partnerships and increasing deequitization of nonperformers.

Posted by: Unemployed Northeastern | Apr 3, 2017 10:09:47 AM