The Palmetto Insider

The blog of the South Carolina Policy Council

Endowed Chairs Report Earns an ‘F’ for Transparency

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Given the fuzzy conclusions evident in the Centers of Economic Excellence (CoEE) program’s 2008-09 annual report, one might deduce that CoEE’s review board might want to consider pushing for an endowed chair in the area of philosophy.

Ponder the opening paragraph in program Chair Paula Harper Bethea’s message to the General Assembly and the Budget and Control Board:

At a time when much of the country is staring down the barrel of economic uncertainty, and the last thing anyone wants is “financial” in his or her job title, the Centers of Economic Excellence Program is celebrating unparalleled success. To date, more than $232 million in non-state funds have been invested into our state economy and nearly 3,200 jobs have been created through 45 public-private partnership research centers known as Centers of Economic Excellence, or CoEEs.

 Unparalleled success? One of the original concepts behind the endowed chairs program was that money from the lottery would be matched by in large part by private investment to secure positions for top professors in areas that have the potential for raising the university’s stature or bringing economic returns.

But according to the most recent report, South Carolina has invested $183.6 million in lottery funds in the endowed chairs program since its inception in 2003 while receiving $145 million in “non-state” matching pledges. Of that $145 million, about $39 million has come from corporations and another $26 million from individuals.

The remainder was from foundations and non-profits (a little more than $49 million), federal funding (nearly $22 million) and health care providers (nearly $9 million).

That means the business community is chipping in one dollar for every $4.69 the state puts toward the program. Even if you combine the corporate and individual pledges, state funding is outpacing private contributions by nearly 3-to-1.

As to the statement that “more than $232 million in non-state funds have been invested into our state economy,” this figure is difficult to substantiate based on the annual report because there’s no breakdown of sourcing. Still, it’s apparent that a good bit of the money is coming from taxpayer pockets.

For example, in October, the University of South Carolina’s Center for Healthcare Quality received a $4.8 million federal grant from the National Institutes of Health.

According to Bethea, $113 million of the $232 million is comprised of “dollar-for-dollar partnership matches which each CoEE must raise in order to access state award funds.” The other $119 million is “composed of research grants awarded from corporations and federal agencies over and above program matching requirements.”

Without a breakdown, it’s impossible to tell how much support the program is getting from the private sector and how much is government-directed economic development.

Finally, there is Bethea’s assertion that nearly 3,200 jobs have been created by the Centers of Economic Excellence.

Actually, just seven pages after Bethea’s claim the job-creation numbers are modified: “To date, the CoEE program has resulted in 1,224 high-paying, knowledge-based economy jobs,” the report states. It adds that, according to the Darla Moore School of Business, another 2,000 new jobs are likely to have resulted from the impact of $120 million in extramural research funding brought into the South Carolina economy by CoEE chairs and their research teams.

So, nearly two-thirds of the jobs touted as being created by the Centers of Economic Excellence are nothing more than a guesstimate, an approximation made by an arm of one of the universities that benefits from the program.

The Centers of Economic Excellence has been unable to produce a detailed listing of jobs created through the Endowed Chairs program when requested by the Policy Council.

The uncritical assessment given by Bethea, who is vice chair of USC’s Research Foundation, is particularly embarrassing given that the University of South Carolina, for one, prides itself on being a research university.

Were a USC science student to turn in a report completed with the same methodology – poor research, lack of sourcing and dubious conclusions – they’d likely earn a failing grade.

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Written by Cotton Boll Conspiracy

December 15, 2009 at 1:05 pm

One Response

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  1. […] But if the program were giving itself a report card, it might be accused of grade inflation. […]


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