Criticism Mounts As New College Faces Financial Oversight Challenges
Sarasota, FL — Recent changes in leadership and financial management at New College have raised serious concerns over the institution’s oversight practices. Two former key finance officers of the New College Foundation, Ron McDonough and Declan Sheehy, reported that they were ousted after voicing objections to plans by college administrators to use donor-restricted funds for the salary of the institution’s new president, Richard Corcoran. This alarming development has sparked wider calls for transparency among alumni, former board members, and financial watchdogs.
Ouster of Key Officials Amid Financial Concerns
McDonough, who served as the foundation’s director of finance, along with Sheehy, the former director of philanthropy, claimed they faced termination because they raised alarms about potential misuse of the Peterson Trust—a significant donation made to the college. The Peterson Trust is reportedly the largest single donation in New College’s history and was intended primarily for student aid, academic programs, and other student services, rather than administrative payroll.
“During my tenure, I consistently reminded the administration that we didn’t have discretionary funds available for this purpose,” McDonough stated. “But their need to find a solution to pay the president’s salary took precedence.”
Their dismissals have combined with a series of other departures in the college’s foundation, prompting growing fears regarding the college’s financial accountability and commitment to honoring donor intent.
Background Context: Changes Under New Leadership
The upheaval at New College can be traced back to early 2023 when Governor Ron DeSantis appointed a new board of trustees, leading to significant institutional changes. Under this new governance structure, one of the first actions taken was to install Corcoran as the college president, a move that included approving a lucrative compensation package making him the highest-paid leader in the school’s history.
However, since state regulations cap salaries for university administrators at $200,000, the college has increasingly relied on the foundation to supplement its leaders’ pay. Critics argue that this financial scheme conflicts with the intended use of donor funds and undermines the institution’s integrity.
Rising Tensions Around Financial Practices
The financial oversight concerns escalated when a group of former foundation board members issued a demand letter for an audit regarding the handling of restricted donor funds. This letter also threatened legal actions should their request go unaddressed. Alongside this, former board members pointed to the administration’s decreasing checks on financial practices as a sign of deteriorating governance.
Hazel Bradford, a former board member who resigned over these issues, articulated the significance of maintaining good governance: “Good practices are fundamental—they are not just a peripheral concern when it comes to handling other people’s money."
Calls for Transparency and Accountability
In a response to the critical narrative surrounding its financial management, New College released a statement assuring stakeholders of its fiscal responsibility. The college cited a “clean audit” from the Florida Auditor General, though many critics demand more transparency and a clearer accounting of how funds are being used—particularly those that are donor-restricted.
The palpable unease continues as New College embarks on broad changes in its programs, including the elimination of its Gender Studies program and the establishment of a new and costly athletics department. Lawmakers and financial experts alike emphasize the importance of adhering strictly to donor intent, especially as the college grapples with rising operational costs.
John Griswold, founder of the Commonfund Institute, noted that it is essential for institutions to safeguard the use of donor funds. He articulated that restructuring administrative salaries can become problematic when it begins to exploit donor intent.
Conclusion
As New College navigates these controversial waters, its immediate future will likely depend on its ability to rebuild trust among alumni, former board members, and the broader community. The calls for an audit and increased transparency reveal a growing tension that the institution must address, lest it faces legal implications and erodes public confidence in its financial stewardship. The repercussions of these recent changes will continue to unfold, casting a shadow over New College’s aspirations to emerge as a leader in liberal arts education.
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