AUDITOR CRITICAL OF CHANCELLOR LIVING IN OHIO

State Auditor Claire McCaskill criticized Chancellor Dale Nitzschke's contract with Southeast Missouri State University Wednesday because it allows the school's former president to live in Ohio.

The long-distance relationship doesn't concern top school officials, who view it as a small price to pay to secure private and federal funding for the institution.

But McCaskill questioned the decision by the Southeast Board of Regents to allow Nitzschke to handle university fund-raising duties from his home in Milford, a Cincinnati suburb.

McCaskill released an audit report Wednesday that focused on taxpayer-funded contracts involving Nitzschke, former Central Missouri State University president Ed Elliott and former University of Missouri basketball coach Norm Stewart.

Southeast's contract with Nitzschke was the least objectionable of the three, McCaskill said.

The contract includes termination clauses if Nitzschke didn't live up to the terms of the agreement, the auditor said.

The audit reviewed 14 contracts from seven of Missouri's four-year colleges but only closely examined the contracts involving Nitzschke, Stewart and Elliott.

Nitzschke's contract was one of two examined from Southeast. The other was a two-month consulting contract involving Dr. SueAnn Strom, former vice president of student affairs.

After resigning as vice president, Strom continued to work at Southeast for two months in the summer of 1998 under a consulting contract.

McCaskill said Strom worked as a consultant to the university from July 1 to Aug. 31. Strom was paid $15,673.

Nitzschke said he hired Strom as a consultant to advise him in reorganizing the student affairs division. The regents approved the contract. She was paid at the same rate she previously was receiving as vice president, he said.

Auditors found no problems with the consulting contract, but the audit raised questions about Nitzschke's contract.

"Having a chancellor who lives in Ohio should raise taxpayers' eyebrows and certainly raises the eyebrows of auditors," McCaskill told reporters. "Your eyebrows go up when you see someone called a chancellor who lives two states away. It is not normal," she said.

The audit report said allowing Nitzschke to work out of his suburban Cincinnati home creates additional costs for the university. "These would include travel expenses between the remote location and the university, expenses that would not be incurred if the chancellor had stayed on campus."

The audit also pointed out that Nitzschke's contract:

* Doesn't detail any specific dollar amounts for travel and entertainment expenses.

* Doesn't stipulate that the university's fund-raising foundation is paying the cost of providing Nitzschke with membership in a Cincinnati area country club. The foundation also provides Nitzschke with a car. School officials said they would amend the contract to reflect the foundation's involvement.

* Stipulates the university will pay travel and entertainment expenses for Nitzschke's wife, Linda, when she participates in a fund-raising event.

McCaskill said she would prefer the university use private money to pay for the fund-raising position rather than taxpayer dollars.

She also questioned the board's decision to give Nitzschke the title of chancellor.

"I would hope in the future they would not hire someone and call him chancellor when he lives two states away," McCaskill said. "If he is a fund-raiser and lives two states away, I think his title should reflect that."

But Nitzschke said it is important for him to have the title of chancellor in seeking large donations. "It has to be a title with clout," he said.

Nitzschke said prospective donors don't want to deal with a "fund-raising consultant."

Nitzschke was hired as Southeast's 16th president in 1996. He served three years as president before resigning to spend more time with his family.

In stepping down in 1999, he agreed to continue working for Southeast for two years as chancellor.

He is making a salary of $95,000, which is $43,250 less than he made as school president. In salary and annuity combined, he is slated to receive total compensation of $118,000 this fiscal year.

The university has budgeted $25,000 for travel, entertainment and operating expenses for the chancellor's office, but the amount isn't written into the contract.

School officials defended the board's decision to let Nitzschke work out of his Ohio home.

Nitzschke said he wouldn't have accepted the chancellor's post if he had not been allowed to live in Milford.

He justified the board's decision to pay travel and entertainment expenses for his wife when she accompanies him to fund-raising events. He said he often attends fund-raising events that involve couples.

School officials said Nitzschke's wife also has been instrumental in raising money for the university.

Dr. Ken Dobbins succeeded Nitzschke as Southeast's president. Dobbins said the board's decision to hire Nitzschke as chancellor has paid off for the school.

Dobbins said Nitzschke has secured more than $3 million in private and federal money for the university this fiscal year and could bring in another $18 million next fiscal year.

Dobbins said there are safeguards in place to ensure that Nitzschke performs his fund-raising duties.

Don Dickerson, president of the Board of Regents, said Nitzschke's performance will be judged by how much money he raises. "I don't know of a better barometer than that."

Nitzschke's fund-raising efforts take him all over the country. He said the job requires traveling regardless of where he lives.

He also said he can make telephone calls and communicate via faxes just as easily in Milford as he could in Cape Girardeau.

When he returns to the Southeast campus on business, he stays in Wildwood, which formerly served as the official residence of the university president.

Nitzschke said he couldn't work out of Ohio if he were still university president. "If I were managing the campus, to live someplace else would be ludicrous."

Staff writer Marc Powers contributed to this report.