UT trustees grumble about ‘slaps in the face’ to Haslam outsourcing plans

Members of the University of Tennessee board of trustees have slammed a decision by UT Knoxville Chancellor Beverly Davenport to not participate in facilities outsourcing even though Davenport argued the university wouldn’t save as much by privatization as promised, reports the News Sentinel.

In a presentation to the board (Friday), Davenport said UT Knoxville would only save $906,654 in the first year of outsourcing with private company Jones Lang LaSalle, compared to the $5.2 million the company estimated.

The university is already making its own improvements in efficiency; an outside company would not be able to handle the complexity of work associated with facilities management in research departments and the change could be harmful to the local economy, Davenport listed as additional reasons for her decision.

Trustees criticized the decision saying it lacked financial justification and would make it hard to go to the state to ask for money in the future.

Outsourcing of facilities work on college campuses is part of a plan by Gov. Bill Haslam to expand an existing state contract with JLL for what was originally estimated to be an additional $35 million in annual cost savings across the state.

“I’m not worried that this governor and (Finance and Administration Commissioner Larry Martin) will do the right thing in the best interest of the UT system, regardless of the slaps in the face that we gave them,” said board Vice Chair Raja Jubran in a statement read at Friday’s board meeting. “They are committed to the state. They are committed to the right thing whether we do the wrong thing or not.”

Jubran and other members of the board were mainly critical of Davenport’s decision to not outsource facilities work at that campus, though the UT Health Science Center in Memphis also stood to save close to 10 percent of its facilities budget but is choosing to only use some of the services offered by JLL.

…Trustee Sharon Pryse said that while she appreciated Davenport keeping in mind the impact on the community, the university’s primary duty should be to its constituents and that rejecting the proposal could be a hindrance to fundraising.

“We work long and hard to raise dollars and we have to make sure we are spending our dollars as efficiently as possible when we are going to donors and asking for more money,” she said. “I wish you could prove we are actually saving dollars by doing this.”

Trustee Brad Lampley said the decision will also make it hard for the university to approach the state and ask for additional funding.

“They’ll say, ‘Wait, you had $5.2 million in savings and you said, ‘Thanks but no thanks,'” Lampley said. “My concern is that unless we find a way to save similar amounts of money we could have problems down the road. This is a campus decision and I absolutely support that, but it’s a concern.”

A non-binding recommendation was made at the suggestion of Trustee John Tickle, who asked that UT President Joe DiPietro issue a directive to each campus to come up with the savings indicated in the JLL proposals.

…DiPietro, meanwhile, said he respects the campus leaders’ decisions and would not suggest that they back down from them. However, he said it is important that they are held accountable for cost savings.

5 Responses to UT trustees grumble about ‘slaps in the face’ to Haslam outsourcing plans

  • Cannoneer2 says:

    Wasn’t each one of these grumbling trustees appointed by Haslam? Crony capitalists supporting a crony capitalist. More should also be made of the fact that the Governor had a personal financial interest in JLL, which creates a CONFLICT OF INTEREST!

  • Linda says:

    Cannoneer 2,

    If the plan saves ANY large amount of money, then it should be seriously considered. I hope someone over-rides Davenport’s decision and Tennessee can continue to be one of only a handful of states that is fiscally responsible.

    • Cannoneer2 says:

      I’m all for fiscal responsibility too. In this case, I think that we should look at the bigger picture rather than just at dollar figures. Aside from the conflict of interest, we are sending tax dollars out of state. On the other hand, maybe we should be able to look out of state for top talent for future university trustees. I have a hard time believing that effective facilities management can’t be found here in Tennessee. Also, keeping these services under state control results in better accountability. Furthermore, no one mentions the fact that the gravy train is still rolling along at the top echelons of state government. For example, the Tennessee Star has an article that details the rapid escalation of the cost of “administration” over at TDOT. From 2011 to present, these costs have increased by approximately $30 million. This administration, along with several previous ones, has attempted to save money on the backs of those who earn the least, and provide basic, needed services to our citizens. I think the savings push is in entirely the wrong place.

  • John G. Stewart says:

    Chancellor Davenport showed great deliberation and thought in coming to her decision that outsourcing would be in neither the short-term nor long-term interest of UTK. I dare say the trustees being busy people only heard what the Haslam Administration had to say, even though extensive evidence existed that JLL’s case was not solidly grounded. Rather than truly hear and evaluate both sides, the trustees played Monday-morning quarterback. Time will tell who is correct but I am confident the wisdom of the Chancellor’s decision will be vindicated. She showed all of us what leadership is all about. Three cheers for her.

  • Connie Wallace says:

    I fully support Chancellor Davenport. The Governor’s conflict of interest is outrageous, and JLL never presented detailed financial analysis. The purported cost savings is illogical given higher private wages and necessity of profitability.

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