The Great LSU Restructuring Of 2013

UPDATE (April 27): We thought we’d bring this post back in light of today’s events, in which LSU System President John Lombardi was let go from his job. Reorganization of the LSU system is coming, and Lombardi doesn’t fit in.

Reports are surfacing that former LSU system president Bill Jenkins will return to his old job on an interim basis, but we’re now hearing an interesting name as a possible replacement along the lines of the reorganization discussed below – Stephen Perry, a member of the LSU Board of Supervisors who has served as Chief of Staff to Governor Mike Foster and is now the president of the New Orleans Convention and Visitors Bureau. Perry, who has undergraduate and master’s degrees from LSU as well as having gone through the Senior Executives Program in State and Local Government at the John F. Kennedy School of Government at Harvard, would be an “inside” choice, but he’s demonstrated some management ability within Louisiana state government and he’s remembered fondly by many at LSU for his efforts in the Foster administration to prioritize the university from a funding standpoint.

And since LSU is about to undergo a transition not just to the new business model discussed below but in the overall picture of higher education – which many believe is an unsustainable bubble about to burst – it might not be a bad idea to marry the university’s future to an individual trapped in the current educational mindset one would expect from poaching a prominent academic administrator from another university.

But that hire is at least several weeks off, as the material discussed below will need to play out against the canvas of seven potential new Board of Supervisors appointments in June…

ORIGINAL (March 27): I’ll admit from the beginning that this post is probably a bit premature, and much of what’s in it is not particularly baked into the cake as yet (at least that’s what I understand).

But yesterday the Advocate had a piece on the subject of studies being done to rearrange the LSU System in order to orient it more toward a main campus and a flagship charged with high-level education and world-class research and perhaps stripping away some of the more ancillary entities currently in its mix.

The LSU Board of Supervisors in a few months may decide whether to reorganize the LSU System under the flagship campus in Baton Rouge, then consolidate the system president and flagship chancellor positions.

The Louisiana Flagship Coalition of statewide business leaders that formed last year to support LSU is pushing for the structural change behind the scenes. The nearly 50-person coalition includes an eclectic mix, such as Democratic political strategist James Carville, self-described conservative Baton Rouge contractor Lane Grigsby, and largely non-political Raising Cane’s founder Todd Graves.

Flagship Coalition co-Chairman Sean Reilly, who is the Baton Rouge CEO of Lamar Advertising, is pushing the unofficial proposal of moving closer to the University of Florida umbrella model behind the scenes. Earlier this month, the proposal was presented to the Association of Past Presidents of the LSU Student Body, which includes Lt. Gov. Jay Dardenne, state Department of Economic Development Secretary Stephen Moret and other prominent officials.

“It’s really about creating an organizational chart and getting all the pieces pulling in the same direction,” Reilly said in an interview. “You don’t see that happening now. We have a cacophony when it comes to speaking on behalf of quote, LSU, unquote.”

Reilly’s view is a different one from what has traditionally been LSU’s position; namely, that having the system be a large enough collection of entities encompassing a service area touching enough of the state would protect LSU’s funding at the state legislature. And the old position helped to create, over the decades, a great empire running the length and breadth of the state – not just LSU’s main campus but satellite campuses in the Crescent City, Shreveport, Alexandria and Eunice, medical schools in Shreveport and New Orleans, a New Orleans-based dental school, the Pennington Biomedical Center in Baton Rouge, 10 LSU-run Charity Hospitals strewn all over the state and LSU Agricultural Extension units virtually everywhere.

And because LSU had all those entities under its umbrella, the thinking went, virtually every state representative and senator would be swayed by LSU’s impact in his/her district, and resources would be plentiful.

Didn’t work that way, though. LSU fares better than the other higher education institutions where funding is concerned, which is to be expected considering the fact that LSU is the state’s flagship university. But you won’t find anybody at LSU’s main campus who thinks it’s funded as a flagship school should be. Particularly not now, when the state has to restructure its budget to meet economic realities and higher education in general has to take a major hit.

Obviously, the model will have to change. the old way of doing things isn’t working.

And the word is that LSU is going to get dusted off and become a lot more flagship university and a lot less system.

The Advocate article gets into some of this…

The University of New Orleans moved out of the LSU System last year and into the University of Louisiana System, which administers institutions like the University of Louisiana in Lafayette and Southeastern Louisiana University in Hammond. Legislation also is pending for a proposed Louisiana Tech University takeover of LSU in Shreveport within the UL System.

The Flagship Coalition, and many on the main campus, want LSU to oversee the law center, the AgCenter, Pennington and the medical schools as one umbrella entity. The chancellor positions of those institutions would remain but report to a consolidated “president-chancellor,” Reilly said.

The other LSU academic campuses, like the one in Eunice, would operate within the system as satellites of the Baton Rouge campus, Reilly said. The Flagship Coalition has taken no stance on the Louisiana Tech merger with LSU-S.

Reilly said the organizational change would create more backroom efficiencies and consolidated services. The other key change is that LSU should quickly go up multiple spots in college ranking lists like the U.S. News & World Report’s Best Colleges. The argument is that by adding the research power of several institutions into one entity would dramatically improve LSU’s standing, he said.

Actually, what’s out there is that LSUE, since it’s a two-year school, would move to the community college system, and LSUA would follow LSUS into the University of Louisiana system – with LSUS merging with Louisiana Tech. That would mean LSU’s main campus is the only undergraduate institution left for LSU to govern.

And the law school and the two medical schools would go under the main campus’ governance.

Then comes the big bite – those Charity Hospitals. Not only isn’t LSU going to be in charge of them; nobody will, because the Charities will be going away, and along with them will go some large part of $650 million in annual brick-and-mortar costs the state is laying out. Most of those facilities are sellable to private hospital groups; Ochsner, for example, has been trying to get hold of the one in New Orleans for years without any success (and might very well make a play for  L.J. Chabert Medical Center in Houma, Lallie Kemp Regional Medical Center in Hammond or the Bogalusa Medical Center before it’s over). Considering that the new reality in medical services and indigent health care is that the money now follows the patient, it makes less and less sense for LSU to operate hospitals all over the state other than the ones directly attached to the medical schools in New Orleans and Shreveport.

But that will be a very, very ugly fight, and it’s in all likelihood the final step in collapsing LSU’s empire down into a main campus bent on competing nationally. It’s doubtful any effort will be made to offload the Charity facilities in whole next year.

What will happen much sooner, though, is a preparation of the ground before these moves are made. In fact, this June there are no less than seven of the 16 LSU Board of Supervisors seats which will come up for reappointment – and while some of those seats will probably be filled by the same people who currently sit on the board, most will not. Most of those seats will be filled by people who are on board with the governor’s vision for LSU’s future – much of which can be seen in the emanations from the Flagship Coalition, though so far its stated agenda is largely limited to advocating more freedom from statewide higher ed policies. Jindal and the Flagship Coalition folks aren’t joined at the hip per se, though a look at the members of the LFC indicates very many of them are prominent supporters of the governor, but behind the scenes there has been a lot of buzz to indicate they’re on the same page.

And when Kevin Reilly is starting to talk about using the University of Florida as a structural model for LSU, it’s a good bet that’s something the governor would be on board with.

So let’s say Jindal gets his new board this summer, and it’s made up of Flagship Coalition types who want a main campus rather than an expansive system for LSU. How do you handle the transition?

Bear in mind that LSU has a chancellor and a system president, and they’re not the same person. If the move is made, either Michael Martin (the chancellor) or John Lombardi (the system president) is going to have to go. Or maybe both will. The Board of Supervisors would have to decide how to collapse those two positions into one.

The Advocate piece has some interesting stuff on that…

Lombardi’s contract runs at least through the end of this December. Martin will receive $225,000 in extra, lump-sum deferred pay — on top of his $400,000 in annual base pay — if he stays at LSU through June 2013. Martin is 65 and Lombardi turns 70 later this year.

“What I want is what’s best for LSU,” Martin said in an interview. “I don’t know if I’d be best for it (president-chancellor). I’m 65. There’s only so much more of this I can take,” he added with a laugh.

Lombardi previously hired Martin at Florida and also played a pivotal role in Martin becoming chancellor at LSU. But the two have butted heads the last couple years as budget cuts led the LSU System to shift dollars generated by the Baton Rouge flagship campus to assist other units, like the AgCenter, that have no tuition dollars to help offset the reductions in state funding.

Martin and the Flagship Coalition have opposed such shifts.

While not outwardly supporting the organizational proposal, Martin said he likes the model that works at Florida and other flagship universities.

“We don’t have a system,” Martin said. “We have a gaggle.”

That would indicate Lombardi is a short-timer, and it would also indicate Martin doesn’t necessarily relish the idea of shepherding the institution through such a big change. You might want a younger, more dynamic guy to fill that role.

So that could indicate not only that LSU would see a change in its governing structure but an overhaul of its leadership as well.

And that’s a huge, huge deal if it happens. It could affect the university all the way down to things like how it handles transfer credits and tuition for students, or even athletics – if men’s basketball and baseball continue to underperform over the next year and the university has new leadership, what would that mean for Joe Alleva as the athletic director, for example?

From a quality and competitiveness standpoint where the university is concerned, a new structure could be a good thing or a bad thing. If it enables more efficiency and a better use of its resources, that would make LSU less subject to the vagaries of the state general fund – and that, combined with an increasing model of the university’s finances relying on tuition rather than the general fund, could make LSU’s position vis-a-vis the state legislature less relevant to its survival than it is now.

But the folks who come from the old mindset would answer that it had better be – because when LSU can’t romance the state senator from Houma to make sure the Ole War Skule gets adequate funding for Chabert, or the state rep from Alexandria to make sure LSUA is taken care of, the worry is that the leges outside of the Baton Rouge area might seek to pick the flagship clean while loading up the local regional university in or near their districts.

In other words, it’s a gamble. LSU currently struggles to fulfill its vision as a nationally-competitive flagship school with all its current accoutrements and it’s not unreasonable to see the school get a major advantage if it’s a lean, mean, focused institution, but without them in the wrong circumstances it could end up as just another campus in a mediocre state higher ed system.




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