UC president didn't bail, he was pushed out, sources say

Phillip Matier,Andrew Ross, Chronicle Staff Writers
Wednesday, August 15, 2007

Members of the University of California's governing Board of Regents, unhappy with what they saw as persistent management problems in the UC system, pushed university President Robert Dynes into announcing his resignation this week, sources involved in the move said Tuesday.

Board Chairman Richard Blum met with the 64-year-old Dynes over dinner at Trader Vic's in Emeryville three weeks ago to tell him the regents had grown impatient with his lack of progress in reforming a dysfunctional university hierarchy, the sources said.

Dynes, who has been criticized by state lawmakers for UC's practice of handing out hidden perks and bonuses to top executives, offered to step down next year. Blum, however, told him it would be better if he did it sooner rather than later.

In announcing his resignation Monday, Dynes said he would leave no later than June, explaining that he wanted to spend time with his new wife. However, UC Provost Wyatt "Rory" Hume immediately was put in charge of the system's day-to-day operations while the university searches for a permanent successor.

Blum, husband of Sen. Dianne Feinstein, D-Calif., confirmed that he had met with Dynes at the Emeryville restaurant but would not comment on details, saying only that "Bob told me he wanted to spend more time with his family."

"I know you have a job to do," Blum told The Chronicle, "but the answer to everything else is going to be, 'No comment.' "

Dynes issued a statement late Tuesday saying that "at dinner with Dick Blum, he asked me what my plans were as president. I told him then that I was planning to step down by June 2008. I have had this timing in mind for some time."

One state official familiar with the meeting said several regents had concluded that after nearly four years on the job, Dynes, a former physicist and UC San Diego chancellor, was in over his head at the top of the 10-campus system.

"But then, what do you expect?" said the official, speaking on condition of anonymity. "Spending 17 years in laboratories doesn't exactly set you up for running what is, in effect, a multibillion-dollar corporation."

Financier Warren Hellman, a major UC donor who was Dynes' father-in-law until the university president divorced Hellman's daughter last year, said of the fallout between Dynes and the regents: "Everybody sort of got tired of each other."

Blum told Gov. Arnold Schwarzenegger about his meeting with Dynes on July 27, a few days after the dinner, sources said. The governor's chief of staff, Susan Kennedy, also was told.

Last week, other UC regents, state Senate President Pro Tem Don Perata and Assembly Speaker Fabian Núñez were alerted that Dynes was about to announce his resignation.

Blum, who heads a multibillion-dollar investment firm and sits on a number of corporate and charity boards, reportedly is putting together a reorganization plan himself for the UC president's office - something critics say is long overdue.

For all of his accomplishments - including presiding over the opening of UC Merced and retaining UC management of national laboratories at Livermore and Los Alamos, N.M. - Dynes probably will be best remembered for the public relations disaster unleashed by revelations in The Chronicle that UC was handing out millions of dollars in bonuses and benefits to top university executives without telling lawmakers or taxpayers.

The money represented only a small fraction of the system's budget, but the disclosures came at a time when student fees were rising and lower-paid UC workers were being stonewalled on raises.

"This guy had 70 lawyers on staff, and not one of them gave him a heads-up about the problems they were creating with these deals," said one regent, who asked not to be named. "It just goes to show how dysfunctional the whole place is."

Several regents made it clear that they had zero tolerance for repeats of such PR fiascoes as the revelation that the university had paid $30,000 to install a dog run at the UC Santa Cruz chancellor's home.

But there is concern that more is on the way. Just this week, it was disclosed that UC San Diego is the target of an Internal Revenue Service audit of its payroll and accounting systems. The IRS is believed to be looking into whether business income or employment taxes were appropriately reported or paid in 2005.

Taken together, the problems could make the search for Dynes' successor more difficult, UC watchers say. Whoever gets the job is certain to face endless scrutiny - and a lot less autonomy - in everything from dealing with UC's budget to hiring assistants.