The departure of Rick Stansley as chief administrator of University of Toledo Innovation Enterprises (UTIE) enables university officials to reboot the nonprofit economic development agency subsidized by UT revenue.
That evaluation should include an analysis of the return to UT — and the community it serves — on UTIE’s investment of nearly $10 million, mostly in technology start-ups. The process must start with a full, public review of what Mr. Stansley personally accomplished in return for his generous compensation.
Mr. Stansley, a former chairman of UT’s board of trustees and UTIE board member, became the agency’s head in mid-2010. He worked under a $1,200-a-day consulting contract that earned him nearly $1 million; that agreement had more than a year to run before he quit last week to pursue a private business opportunity. He also held several administrative posts at UT.
The nature of his contract, as well as Mr. Stansley’s progression of titles, suggested to some university critics that he owed his UTIE position in large part to his campus and Columbus connections. As they search for Mr. Stansley’s successor, UT officials will want to consider whether his compensation model yielded the best results.
While he ran UTIE, Mr. Stansley also remained board chairman of Rocket Ventures, a separate venture capital fund that invests in start-ups and works with businesses in northwest Ohio to improve their planning. Although they are distinct entities — Rocket Ventures cut its ties to the university last month — they share a common address and UTIE has supported Rocket Ventures financially.
The links between these two agencies also warrant a fresh review. UT should not permit a successor to replicate Mr. Stansley’s dual role.
A recent report by an independent accounting firm examined UTIE’s relations with several companies in which it invested. Mr. Stansley was listed as a director of one of those companies and a board member of another, although he said he received no compensation from any company with which UTIE did business.
Even so, UT officials must be sensitive to even the appearance of potential conflicts in UTIE’s operations. The accounting report noted that some of the companies in which the agency invests — and, for that matter, UTIE itself — have not been subject to separate, independent audits. They need to be.
Under Mr. Stansley’s leadership, UTIE’s largest investment was the $3 million it provided to Xunlight, a Toledo-based maker of solar panels that emerged from UT research. The Blade reported last December that UTIE had to write off $1 million of that investment as a loss.
UT President Lloyd Jacobs, a member of the UTIE board, conceded that he “didn’t see the meltdown of the solar industry coming.” Neither did a lot of other local investors. But such foresight presumably was part of Mr. Stansley’s job.
Providing seed money for alternative-energy companies is vital to the region’s economic growth. But UT also has a fiduciary duty when it invests its revenues, even if that money come from “auxiliary” sources rather than tuition and fees.
All these matters merit full examination by UT executives and trustees. A more-streamlined organizational chart for UTIE, to replace the current spider’s web of interlocking connections among the agency and the companies it supports, seems in order.
The first step, though, is a complete, detailed accounting of UTIE’s performance under Mr. Stansley’s leadership.