Auditor: UMass Broke Law Privatizing Fundraising Jobs

An earlier version of this article originally appeared in the June 13 edition of the Montague Reporter.

AMHERST – The state auditor’s office recently determined that the University of Massachusetts Amherst violated state law last year when it eliminated over 100 unionized positions from the university’s fundraising office and offered the workers jobs at the private UMass Amherst Foundation.

University officials first announced the proposal to outsource fundraising work from the Office of Advancement in December 2022 as a way to comply with state pension laws, and the transition was finalized in May 2023. The two unions that had represented the employees, the Professional Staff Union (PSU) and University Staff Association (USA), opposed the change and continue to argue it wasn’t necessary.

“The fight to save public work and bring these positions back to UMass Amherst isn’t over,” USA president Mary Malinowski said in a statement last week. “In the end, even UMass must be accountable to the law — and we won’t stop until this theft of public work is put right.”

The 1993 Taxpayer Protection Act (TPA) requires state agencies to receive approval from the Office of the State Auditor (OSA) before outsourcing services. UMass officials failed to submit required information prior to the transition, OSA general counsel Michael Leung-Tat wrote in a May 31 letter, or to explain how the move was “in the best interest of Massachusetts taxpayers.”

“After reviewing this matter and the provided documentation in detail, we are unable to determine that this outsourcing produced financial savings at a higher quality of public service,” Leung-Tat wrote. “We are informed that a time tracking system was not and is not currently in place to track employee time allocation…. This has prevented our office from completing the analysis that would help us make a determination regarding the cost savings.”

The OSA urged UMass to begin tracking how the fundraising employees spend time at work.

“Although the TPA does not provide the OSA with enforcement powers, we caution in the strongest terms that UMass Amherst and all campuses within the University of Massachusetts system comply with the TPA in the future and in all respects,” Leung-Tat wrote.

UMass Amherst spokesperson Ed Blaguszewski said the university first proposed the use of a time-tracking system in January, and has been negotiating with the unions on its implementation.

“The University of Massachusetts Amherst appreciates the work of the Office of the State Auditor (OSA) and will continue to work closely with all regulatory bodies to ensure strict compliance with the law,” Blaguszewski wrote in a statement. “As promised, and in fulfillment of the transfer agreement between UMass Amherst and the unions, every state employee whose position was affected by the compliance-driven reorganization either accepted an offer to work for the UMass Amherst Foundation or remained in state employment at the university. There were no layoffs”

According to a PSU spokesperson, the Foundation continues to rely on public university workers to perform a number of tasks.

The Foundation, founded in 2003 as a fundraising arm of the university’s flagship campus, is a private nonprofit, and its employees do not receive state pensions. Under Massachusetts law, public employees may spend no more than 25% of their working hours performing tasks on behalf of affiliated institutions of this kind.

“The time tracking system would be for any state employee (unit or non-unit) who believes they are doing foundation-related work within the 25% allowance under state law,” Blaguszewski wrote. “The system would not apply to the UMass Amherst Foundation, which is a private, independent nonprofit.”

In 2022, university administrators told PSU and USA that many of their members were in danger of losing their pensions because their jobs exceeded this 25% threshold. After months of unsuccessful negotiation, UMass vice chancellor for advancement Arwen Duffy, who also serves as the Foundation’s executive director, announced the decision to outsource the jobs.

“[T]hese positions are not being lost; they are being moved for compliance reasons and in the interest of protecting your past and future retirement contributions,” Duffy wrote in February 2023.

At a March 2023 meeting of the state retirement board, Massachusetts treasurer Deborah Goldberg said the non-compliance issue was “clearly and absolutely, 100%, UMass Amherst’s responsibility,” and indicated that the threat to the employees’ pensions did not originate from her office.

“We’ve been arguing all along that UMass Amherst was recklessly rushing their privatization scheme – and now, the State Auditor agrees that UMass violated the law,” PSU union steward Jason Johnson, a former Advancement employee, wrote on Wednesday.

Sarah Robertson is an independent journalist living in western Mass.

The Shoestring is committed to bringing you ad-free content. We rely on readers to support our work! You can support independent news for Western Mass by visiting our Donate page.