Senate leader says UNC’s chief fundraiser should quit outside work

David Routh, UNC-Chapel Hill’s’s chief fundraiser, should end a moonlighting gig with a Charlotte-based investment firm because it raises an appearance of a conflict of interest, state Senate leader Phil Berger said.

Berger said UNC officials’ approval of Routh’s outside work is part of what he considers a pattern of poor management. That includes an academic-athletic scandal that took years to be fully revealed and the disclosure of a $100 million structural deficit several months ago.

“It looks to me that we have a flagship that’s rudderless,” said Berger, referring to problems uncovered at UNC-Chapel Hill over many years.

The News & Observer reported last week that Routh, vice chancellor for university development, is working as a consultant and senior advisor to New Republic Partners, a firm formed last year that has strong political and university connections.

Routh, 61, took the consulting gig despite university officials boosting his pay by more than 35% in 2019. Campus officials gave him $225,000 in special compensation, bringing his total pay last fiscal year to more than $850,000 so that he would see through the university’s $4.25 billion fundraising campaign.

Outside work is permitted at UNC and at other campuses in the state’s system. UNC policy allows employees to take on side jobs as long as they don’t pose conflicts of time or interest with their campus work.

UNC officials reviewed and approved Routh’s written request. The News & Observer obtained it through a public records request. UNC officials redacted information from the document that helps explain any conflicts, citing state personnel law.

The document also indicates a conflict of interest “management plan” was in place. Routh will not be paid, but he is receiving stock options whose value, he said, was impossible to estimate.

Berger said the May 3 dated New Republic Partners letter describing Routh’s role indicated an obvious appearance of a conflict.

“In this role, David will be closely following the progress of our firm and will be available to talk with successful families and individuals, as well as endowments and foundations, about the investment management solutions, wealth advisory offerings and concierge financial services New Republic Partners provides those who join the firm as partners,” the letter states.

“The fact that the chancellor apparently doesn’t see that is a problem,” Berger said, referring to UNC Chancellor Kevin Guskiewicz, who started his position as interim chancellor in 2019.

In the form Routh filed with UNC officials, he said he would be a “sounding board and advisor” to the leadership team.

Routh told UNC officials he would only work three hours per week for the investment firm during off hours and on vacations. But three experts told the N&O the moonlighting position still raises the appearance of conflicts regarding his time and duties.

Neither Guskiewicz nor Routh could not be reached to respond to Berger’s criticism. Joanne Peters Denny, a university spokeswoman, said the chancellor would be happy to talk this over with the Senate leader.

“Chancellor Guskiewicz welcomes any opportunity to discuss Senator Berger’s concerns directly with him,” Denny wrote in an email. “The University followed all policies and processes for conflicts of interest in approving this external activity, and the UNC System policy manual allows for employees – currently in the hundreds at Carolina – to take part in external activities for pay.”

New Republic’s letter announcing Routh’s work was dated the day before the UNC human resources director signed that she had reviewed Routh’s written disclosure about the work.

Two trustees also weighed in on Routh’s outside work. Trustee Charles Duckett praised Routh’s contributions to the fundraising campaign and didn’t see a need to shut off his outside work.

“David is a consummate professional,” Duckett said in a text message. “He has cleared the process of checks and balances that are needed and fair.”

Trustee John Preyer said top UNC officials shouldn’t be working second jobs, something university policy has allowed, within limits, for many years.

“This is just one more self-inflicted wound by the administration that should have been avoided,” he said in a statement.

Regarding Berger’s comments about UNC-Chapel Hill’s deficit, Denny said the university is “on track” to balance the budget by June 2022, and recently earned a AAA bond rating from all three major agencies.

She said the university put in place more than 70 academic reforms and actions in response to the academic scandal, which was exposed in 2011. It involved 18 years of sham classes that athletes took in disproportionate numbers.

UNC System President Peter Hans declined an N&O reporter’s request for an interview about Routh’s moonlighting. Art Pope, who is both a UNC system Board of Governors member and a New Republic Partner’s board member, also declined to discuss Routh’s work for the company.

Pope, a former state lawmaker and prominent Republican donor, did say in an interview that outside work was a UNC-Chapel Hill campus matter, not a system board topic.

And being a New Republic board member, he said, he could not discuss private matters at the company.

Staff writer Kate Murphy contributed to this report.