California University audit findings false, deposed president says
Deposed California University of Pennsylvania President Angelo Armenti Jr. was angered and surprised by the state audit that preceded his firing, claiming it is riddled with “false accusations and misleading legal conclusions which were never — repeat, never — mentioned” during his exit interview.
Armenti’s comments came in a six-page rebuttal to the highly critical audit report, issued one day after he was ousted following nearly 20 years at the helm of the Washington County institution.
“At no time during the audit process were we ever shown any of the complaints that ostensibly prompted the audit,” Armenti wrote. “The false accusations of fraud and money laundering are so incendiary that we would certainly have rebutted them — and clearly remembered doing so — had they in fact been mentioned at the exit interview, thereby giving us early opportunity to respond.”
John Cavanaugh, chancellor of the State System of Higher Education, which oversees the 14 state schools, ordered a special audit of university finances after receiving complaints about spending, mainly for construction projects and related cost overruns. Cavanaugh could not be reached for comment on Friday.
State system spokesman Kenn Marshall did not respond to questions about Armenti’s rebuttal. Armenti also could not be reached for comment.
Armenti, 72, took issue with findings on funding for the $59 million Convocation Center, which was the crown jewel of his plan to revamp the Cal U campus. He disputed accusations of wasteful spending of public money to build the center.
He challenged auditors’ findings that the university “distorted” revenue projections for a $20 million parking garage and accusations that he laundered public funds through the Foundation for California University, a private, nonprofit arm of the school.
Cost overruns at the convocation center were more than $6.2 million and resulted in an increase of annual debt payments from $1 million to more than $2.5 million, according to the audit.
Accountants questioned the practice of funneling money received as rent from students who live in residence halls that went to the landlord, Student Association Inc., which gave the money to the foundation rather than the university.
Armenti argued that rental payments are “institutional funds” rather than state or public money. They do not become “public” until they are deposited into a university account, he wrote.
“They remain private funds until they come into the university at a later date as private scholarship dollars leveraging other tuition dollars from students and then are merged to pay various university bills,” he wrote.
Armenti questioned complaints about blurred lines among the university, Student Association Inc. and the Foundation for California University since auditors charged that university employees do work for the two organizations. He said he “has made changes in the relationships between affiliates and the university based on evolving legal interpretations.”
Meanwhile, the chairman of the university’s Council of Trustees called the state’s treatment of Armenti a “hatchet job” and said he deserved better treatment after 20 years of service.
Robert Irey said state system officials purposely withheld Armenti’s rebuttal to the audit when it was released to the media on Thursday. When Irey discovered the reply was not part of the information released, he made it public.
“I was told the system’s Board of Governors would accept Armenti’s rebuttal,” Irey said.
“To fire Dr. Armenti the way they did is nothing short of a lynching,” Irey said. “I refuse to permit that kind of garbage to be spewed on Dr. Armenti. He doesn’t deserve it.”
Irey said Cavanaugh targeted Armenti because the two men had clashed about the future of state universities.
“Angelo was systematically targeted to be railroaded out of the state system,” Irey said. “He believed it was coming from the top.”