Spending $1 Million to Get Rid of a Single Bureaucrat

In California, state officials are giving due diligence a bad name.

Brian Nguyen / Reuters

Every so often, Californians get distracted from the physical beauty that surrounds us, remember that a state government is nominally under our control, notice a feature that galls us, and stage a populist revolt—for better or worse. Steep increases in property taxes led to Proposition 13. Anxiety over immigration prompted Proposition 187. Power outages and an increase in the vehicle license fee fueled the recall of Governor Gray Davis and the rise of Arnold Schwarzenegger. And I reckon that the Golden State is about due for its next political earthquake.

Lest a shortage of farm labor cause a kale shortage that vaults Gwyneth Paltrow into the statehouse, I hope to trigger a tremor on a different fault line. I’d rather Californians unleashed their pent up seismic tension on the system that gave them the saga of Linda Katehi.

Do you recall the controversial UC Davis leader?

Last year, when she lost her chancellorship, I mocked her golden parachute, expressing a journalist’s fleeting outrage at how much taxpayer money her failure cost us.

But the weather was so nice and a new taco truck had just arrived in my neighborhood. I’d have totally forgotten my anger if the Sacramento Bee hadn’t published a coda to her saga last week. As it turns out, an extra million dollars of UC money was spent––and so needlessly, so extravagantly, I can scarcely believe it. The UC System’s annual budget is $28.8 billion. Next to that, $1 million isn’t much. Then again, $1 million would cover the student loans of a lot of students. The people in my neighborhood’s tent city could all be housed for $1 million.

So I say this saga matters.

Before I tell you how that million was spent instead, let’s quickly review the vast sums, beyond the final million, that were already squandered during Linda Katehi’s tenure. Then I’ll proceed with the big reveal and close with a million-dollar question.

* * *

The story began on November 18, 2011, when UC Davis students were lawfully assembled on a campus quad to peacefully protest during the Occupy Wall Street movement. That is when unusually insane behavior from California’s public sector started:

Some footage of controversial law-enforcement encounters require experts in police training or painstaking frame-by-frame video analysis to adequately comprehend.

Not that infamous video.

In an efficient system, an administrator would promptly have concluded that Lieutenant John Pike, the pepper-spraying cop, should never again police undergraduates. Under a less efficient system that afforded reasonable protections against unfair termination, Pike might have lasted a week during a review and appeal.

Under the insane system that operates in California, investigators took five months to reach the conclusion YouTube viewers grasped in 30 seconds: “Lt. Pike bears primary responsibility for the objectively unreasonable decision to use pepper spray on the students sitting in a line and for the manner in which the pepper spray was used.” The insane part is that even then, Pike couldn't be immediately fired. In total, he remained on administrative leave for eight months after the incident, doing no work but receiving $70,000 in salary by my calculations. Then, when his employment was finally terminated, the police officer found “primarily responsible” for an “objectively unreasonable” use of pepper spray––a cop whose actions forced California taxpayers to pay the undergrads he assaulted $30,000 each––got $38,000 in workman’s compensation for psychological trauma at the way he was treated!

Investigators found that Katehi was partly responsible, too. She bore culpability for the decision to remove students from the quad, the dubious timing of the operation, and the failure to convey that force should not be used. She said at the time that she took “full responsibility” for what happened and apologized to students. Had the matter ended there it would be no incitement for a populist revolt.

We’ve got traffic to fight.

But a few years later, the Sacramento Bee reported that Katehi “contracted with consultants for at least $175,000 to scrub the Internet of negative online postings” on the pepper-spraying and “to improve the reputations of both the university and Chancellor Linda P.B. Katehi.” UC Davis signed one 6-month contract with a PR company at a rate of $15,000 per month. An objective described in the company’s proposal was the “eradication of references to the pepper spray incident in search results on Google for the university and the Chancellor." Scott Shackford called it “another example of colleges no longer fulfilling their roles as defenders of speech and openness, combined with abusive police behavior, with an added dash of the administrative bloat that's driving up higher education costs.” He added, “in the years since Katehi took over in 2009, the budget for the communications office has grown from $2.93 million to $5.47 million.”

Alas, the squandering of the UC system’s money was far from complete. Embattled since the pepper-spraying incident, Katehi came under additional fire for accepting lucrative positions on the boards of firms that seemed to pose clear conflicts of interest, including a major publisher of college-level textbooks, where she earned more than $400,000 moonlighting over the course of three years, and a for-profit university.

The original plan was to pay her $106,000 in salary to fulfill zero responsibilities for three months while investigators figured out whether she should be fired or retained, because that’s the insane way that California deals with high-ranking bureaucrats who’ve behaved badly—never mind that the vast majority of California residents earn far less with no such job security. Katehi was paid $424,360 annually.

What happened next was even more galling.

Katehi’s bosses finally decided that she should be ousted. It turned out that she had spent $407,000 on a series of PR consultants, a costly effort to make a negative story go away that ultimately brought orders of magnitude more attention to it years later. What’s more, the way she handled outside boards was deemed unacceptable.

And then, having earned that cool 6 figures while being investigated? As I noted at the time:

California’s median household income is $61,933. Assistant professors at UC Davis earn about $80,000.

“After resigning Tuesday as UC Davis chancellor under a cloud of controversy, Linda P.B. Katehi will take advantage of a University of California perk that allows campus leaders to receive chancellor-level pay with few responsibilities for one year,” the Sacramento Bee reports. “Katehi will continue to receive her salary of $424,360 plus retirement and health benefits, but she will not have to teach classes in her transition year, after which she plans to become a UC Davis engineering professor.”

Back then, I thought that was the most insane result of the system the Golden State has set up. I was wrong. And that brings us to the additional million dollar expense that I learned about last week when The Sacramento Bee reported it. Understand that by the time Katehi was investigated, student protesters at Davis were making poster-board signs detailing her transgressions, drawing on detailed reporting from The Sacramento Bee and other news organizations. Some faculty members were saying that they wanted Katehi to step down. A basketball or football coach would never have survived the loss of institutional faith. Any outsider with Google could see she needed to resign or be fired.

But for some reason, the California bureaucracy goes about terminating failing employees using the most drawn out, flagrantly costly methods imaginable. In this case:

University of California officials spent nearly $1 million investigating former UC Davis Chancellor Linda P.B. Katehi, a probe that ended in her resignation last August and a deal that allowed her to take a year off at full pay before returning to a faculty job, according to figures released Friday.

The four-month investigation was ordered last April by UC President Janet Napolitano after disclosures in The Sacramento Bee about Katehi’s acceptance of lucrative corporate board seats and her use of university funds to clean up her image online. The final investigative report was released Aug. 9, the same day Katehi agreed to resign after fighting for months to save her job running one of the nation’s premiere universities.

The probe by the Orrick law firm was headed by two former U.S. attorneys from Northern California – Melinda Haag and McGregor Scott – and included interviews with 55 individuals, the compilation of 2.7 million emails and documents and a review of more than 67,000 emails and other electronic documents. Haag and other investigators were to be paid $595 per hour, according to the contract between the university and the firm.

Team members who conducted document review were due a much lower rate, university officials said in June.

After heavy winter rains, California is experiencing super-blooms of spring wildflowers at the moment. And even so, I can’t stop thinking about this saga’s coda.

The Sacramento Bee managed to report on nearly all of Katehi’s objectionable behavior while paying its reporters and copy editors between roughly $15 and $40 an hour (from what I gather via the salary estimates posted online at Glassdoor). How did the state bureaucracy get to a place where it made sense, or seemed to make sense, for UC leaders to spend $595 an hour on investigators who produced nothing more damning than information publicly available at the outset?

As a general matter, it’s hard to fault thoroughness, but can it possibly be rational to review 67,000 documents, interview 55 individuals, and spend nearly $1 million in public money to get rid of a chancellor whose failures were manifestly clear? Wouldn’t it be better to have a bureaucracy where employees earning  $400,000 or so per year could just be fired at will, or after a short review, or with the right to one brief appeal? Why should Californians permit a system where the class of public employees enjoys job protections and due process against termination so extravagant that private employees can scarcely imagine them?

At some point, procedure and due diligence cross over to insanity. Whether we’ve reached that threshold because of fear of lawsuits, or bureaucratic drift, or a class of  elites who pay one another vast sums to sit on boards and carry out investigations, the system is in need of reform. If any UC insider has insights that go beyond the unsatisfactory explanations state officials have been willing to give the Sacramento Bee, I would love to hear them. If you’re a lawyer, or a public policy expert, or a reader of any sort with insights or laments or explanations or even defenses of this phenomena, in the public or private sector, email conor@theatlantic.com. Am I right that even as much of America struggles, its elites have orchestrated a nonsensical culture of what one might call undue diligence?

I encourage your correspondence, so long as you don’t send an over-scrupulous report. As for the million dollar question: Is there a ballot measure that could stop this madness?

Update: This story originally used “taxpayer dollars” as shorthand for the final million-dollar expense of investigating Katehi. In fact, those funds “came from the presidential endowment,” a UC spokesperson said. “These are funds given to the university by private donors. They are unrestricted. That is, the president may use them as she sees fit.”