Major University of Louisville Foundation donor questions spending, calls for audit

LOUISVILLE, Ky. (WDRB) --  As the information technology manager for the president’s office at the University of Louisville, Ryan McDaniel earns an annual salary of $74,256, according to a state database.

But for the last five years, McDaniel has also been paid an average of $12,576 annually from University Holdings Inc., an organization created, funded and controlled by the University of Louisville Foundation.

McDaniel, who is due to receive $13,112 from University Holdings this year, is one of four rank-and-file employees in the university president’s office who have received supplemental payments from University Holdings since 2012 -- despite no apparent rationale for the compensation. 

For more than a month, top university and foundation officials have not responded to WDRB’s questions about why president’s office staffers are on University Holdings’ payroll.

The mission of UHI, as the organization is known, is to “hold and manage real and personal property” for the foundation. Like many other foundation subsidiaries and affiliates, UHI is run by foundation staff and exists only on paper.

Kathleen Smith, U of L’s presidential chief of staff, has been the biggest beneficiary of UHI’s payments over the last five years, records show. She is due to receive $51,100 from the organization this year. Smith’s total foundation compensation was $859,181 in 2014.

WDRB has previously reported that Smith received money from UHI based on the organization’s annual nonprofit tax return. For example, UHI paid Smith $64,297 -- and former university Provost Shirley Willihnganz $78,685 -- each for working an average of two hours a week in 2011, according to an earlier tax return.

But the foundation produced the full roster of employees on the UHI payroll in response to a recent open records request by WDRB.

Besides Smith and McDaniel, the other president’s office employees who have received payments from UHI are:

  • Aria Razavi, the office’s director of financial affairs, whose UHI compensation has grown steadily from $18,000 in 2012 to $19,667 this year. Razavi’s regular pay is $105,020, according to the state database. Razavi handles the movement of funds through the president’s office and processes expense reports, according to sources.
  • Trisha Smith, the office’s director of administrative affairs, whose UHI compensation has exactly mirrored McDaniel’s since 2012 at an average of $12,576 per year. Smith’s regular pay is $100,776, according to the state database.
  • Debra Dougherty, who used to be an administrative assistant to former U of L president and current foundation president James Ramsey – as well as to Kathleen Smith, according to sources. Dougherty received $18,000 from UHI in 2012, $18,360 in 2013 and a final payment of $9,360 in 2014. U of L now lists her as a senior program coordinator in the department of “commissions.”  The state database, which still has her title as “Asst to Pres,” lists her regular salary at $75,000.

On July 21, WDRB submitted a number of questions in writing about UHI -- including the role of each employee on the payroll -- to Kathleen Smith, foundation chief financial officer Jason Tomlinson and David Saffer, the foundation’s outside attorney.

The payroll questions have gone unaddressed despite multiple offers for an in-person interview and a subsequent email request on Monday.

UPDATE, 5 p.m.: Following a meeting of the Board of Trustees on Thursday, interim President Neville Pinto said he didn't know about the foundation payments, but that he would look into the situation. Pinto noted that he has only been in charge a few weeks after the abrupt resignation of former President James Ramsey on July 29.

"I really don't know about a lot of the business affairs of the president's office," Pinto told reporters. "But I will systematically start to look into these affairs ... You have my commitment that we will get to these affairs, and be transparent."

McDaniel, for his part, referred comment to Kathleen Smith and Tomlinson. Razavi, Trisha Smith and Dougherty did not respond to emails and phone calls.  

Tomlinson has described UHI as the “managing entity” overseeing the foundation’s projects, such as the “Nucleus” innovation campus downtown; the ShelbyHurst office buildings in eastern Jefferson County ; and the planned engineering research park just south of the Speed School of Engineering.

But UHI has no staff or office space of its own. Its board is made up of foundation board members, and Tomlinson is its principal officer.

The foundation is the university’s fundraising arm and the custodian of its $680 million endowment. 

It has also paid millions of dollars to Ramsey, Smith and other top U of L officials over the years. Those revelations helped spark a forthcoming examination by the state auditor’s office.

Ramsey, who resigned as university president in July in exchange for a $690,000 settlement, has said he wants to remain as president of the foundation.

Ten employees on UHI payroll

In all, ten U of L or foundation employees have received payments from UHI since 2012, according to information the foundation turned over in the open records request.

Unlike the president’s office employees, the other five people who have been paid by UHI over the years have more obvious connections to the foundation or its subsidiaries.

Tomlinson, for example, will get $42,383 from UHI this year. His total compensation from the foundation itself was $192,052 in 2014, according to the organization’s latest tax return.

Tomlinson worked an average of 3.5 hours per week for UHI in 2014, according to UHI’s latest tax return. UHI paid him $40,362 that year.

The UHI payroll list also includes former foundation employee Ellen Briscoe and current foundation employee Jake Robertson; as well as Steve Gailar, the former CEO of the now-defunct foundation entity MetaCyte; and Kaitlin Rapson, who briefly worked at MetaCyte as a student, according to a LinkedIn profile.

Briscoe managed construction projects for the foundation before retiring for health reasons in the spring of 2015, according to her husband, Danny Briscoe.

In an interview, Danny Briscoe said he noticed when his wife began getting additional pay from UHI years ago.

“After about her fifth year of employment, they gave her that instead of a pay raise,” Briscoe said in phone interview this week. “At least, that’s the way it was explained to me.”

Copyright 2016 WDRB News. All rights reserved.

Digital Reporter

Chris Otts reports for about business and economic topics, higher education and local / state government. He joined WDRB News in 2013 after seven years with The Courier-Journal. Got a tip? Chris is at 502-585-0822 and