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VCU President Didn’t Consult Board Before Endorsing Navy Hill Project

Virginia Commonwealth University President Michael Rao speaks at the podium next to Richmond Mayor Levar Stoney at an event in February 2018. (Adam Hamza/Capital News Service)
Virginia Commonwealth University President Michael Rao speaks at the podium next to Richmond Mayor Levar Stoney at an event in February 2018. (Adam Hamza/Capital News Service)

In a  Richmond Times-Dispatch column published late last year, VCU President Michael Rao said “we are happy to endorse” the proposed $1.5 billion Navy Hill redevelopment deal. But Rao never consulted the Board of Visitors before giving the university’s rubber stamp to the controversial project.

Keith Parker, chair of VCU’s Board of Visitors, said at a September 14 meeting that board members had not talked about the Navy Hill development project that Rao endorsed in the Times-Dispatch piece. VPM reported last month that the column was  ghostwritten by a spokesman for the developer.

“The board of the VCU academic campus has not discussed that proposal,” Parker said.

The Board of Visitors is the main governing body of the university, consisting of 16 members that are appointed to four-year terms by the governor of Virginia. Under state law, the board debates and approves new majors, buildings, and classes. They are also responsible for appointing the university president who serves at the pleasure of the board.

The separate VCU Health System Board of Directors talked with Rao about the coliseum deal during closed sessions in March, October, and December of 2018. Pam Lepley, vice president of university relations, said she could not disclose the specifics of what was discussed in a closed session, including whether an endorsement was mentioned.

The VCU Health System signed a letter of intent with the Navy Hill developer to discuss potential partnerships, according to Lepley. That letter of intent has now expired. The university declined VPM’s Freedom of Information Act request for the letter, citing potential harm to “to the competitive position of the [VCU Health System] Authority.”

The developer, NH District Corp., has proposed building a “built-to-suit” office building that could serve as “a flagship Health Sciences Center” for VCU. Likewise, the One VCU Master Plan outlines a possibility for the university to benefit from the project.

While Rao never asked the board to officially discuss his endorsement of the Navy Hill proposal, Lepley said the two boards expect Rao to serve as a spokesperson for the university’s interests.

“Board members of each institution historically have supported the continued role of the university and the health system in the betterment of the community,” said Pam Lepley, Vice President of University Relations.

Lepley also said that Rao’s endorsement didn’t require board approval. 

Even if Rao had alerted the Board of Visitors of his intention to endorse the project, it’s unclear how many board members could ethically share their input about it. Generally, board members recuse themselves from discussions that present a conflict of interest. 

Six board members have donated to Richmond Mayor Levar Stoney’s campaign, including Stuart Siegel, the former CEO of S&K Famous Brands, who gave $3,200 to Stoney and his associated One Richmond PAC in 2018. Stoney has championed the project and pushed for its speedy passage by City Council. 

Board member Todd Haymore is a managing director at the law firm Hunton Williams & Kurth, which has Dominion Energy as one of its clients. Tom Farrell, Dominion Energy’s CEO, heads the development company proposing the Navy Hill deal.

The VCU Health System Board of Directors includes two politicians — Speaker of the House Kirk Cox (R-Colonial Heights) and Senator Ryan McDougle (R-Hanover) — who have received tens of thousands of dollars in campaign donations from Dominion. The energy monopoly’s Director of Diversity Ethics and Compliance, Lisa Hicks-Thomas, also serves on the VCU Health System board.

Justin Thompson, an expert on higher education administration at UVA’s Curry School of Education, said Rao’s endorsement probably should have been discussed by the board.

“With a development of that size and magnitude, I think it would be uncommon for a university leader to give the impression that they endorsed it before consulting their governing body,” he said. 

But Thompson was wary of calling Rao’s lack of disclosure unethical, saying there is confusion around exactly what the endorsement entails. 

“What ‘endorse’ means in this instance is really at the crux of it,” Thompson said. “While [the endorsement] may lead to a financial decision or commitment, it is not necessarily one at this time.”

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