UT Southwestern response to CBS 11 news report

DALLAS — February 22, 2008 — A CBS 11 reporter, Robert Riggs, requested the response of UT Southwestern Medical Center to suggestions by CBS 11 and certain “experts on nonprofit organizations” that some of the institution’s expenses are inappropriate.

All of the expenditures questioned by CBS 11 and its “experts,” without exception, are totally legal, ethical, appropriate and in conformance with UT Southwestern, UT System and State of Texas policies and regulations.

CBS 11 and Robert Riggs once again have demonstrated the most negative attributes of investigative journalism — portraying facts out of context and making highly misleading allegations.  The principal insinuation in a CBS 11 broadcast on February 21, 2008 by Robert Riggs was that donor contributions are being used by UT Southwestern for purposes not intended by the donors.  This is absolutely and completely false, and CBS 11 and Robert Riggs know so.  UT Southwestern has provided unequivocal information to them that the philanthropic funds used for these purposes (fund-raising, donor entertainment and recognition, community involvement, memberships, executive travel, etc.) are specifically intended by the donors for these purposes.  Unknown and requiring an answer is: why are CBS 11 and Robert Riggs purposely misleading viewers?

The expenditures and business practices of UT Southwestern and its senior executives are not only appropriate, but as regularly proven by both internal and external audits and reviews, are indicative of industry best practices.  All use of philanthropic funds conforms fully with the specific intentions of our donors and with IRS regulations.  Implications to the contrary are serious misrepresentations of the truth.

UT Southwestern’s expenditures spanning community and international activities (which involve no tax dollars and which are funded from philanthropic gifts designated explicitly for these purposes by donors) are routine and typical of other leading academic medical centers and universities whose scale of activities is both local and global and whose activities require major philanthropic support.  The only significant difference in this regard between UT Southwestern and other similar institutions is that UT Southwestern’s total annual expenses related to fund-raising, community relations, and donor appreciation are unusually small for an institution of our size and scope; for decades our expenses in these areas have been less than one-third of the average costs incurred by our peers, expressed as a percentage of total funds raised, as attested by annual reports by the Chronicle of Philanthropy on the top 400 non-profit organizations in America.  Specifically, UT Southwestern spends less than three cents on all its development-related activities for every philanthropic dollar raised — one of the very lowest ratios in the nation.

UT Southwestern’s fund-raising costs are so remarkably low in large part because the institution relies heavily on its president and its vice president for external relations to interact personally with the Dallas civic and philanthropic community, along with the assistance of volunteer civic leaders, and because of careful control of its expenditures.  Most similar institutions, in contrast, rely on a much larger, highly paid staff of professional development officers, and many more large social events involving past and prospective donors.

Even with the exceptionally low levels of expenditures associated with our donor-related activities, UT Southwestern has produced record-setting results in fund-raising.  Annual philanthropic receipts have risen from $11 million in 1986 to $166 million in 2007, and the institution’s endowment has grown from $40 million to over $1.4 billion — a major testament to the cost-effectiveness and appropriateness of our development efforts and to our donors’ approval of the integrity of our activities.

It is further noteworthy that personal philanthropic gifts and pledges made to UT Southwestern by its executives have been considerably greater than the expenses incurred by the institution for the travel, entertainment, and donor-relation activities in which they have been personally involved. 

Indeed, President and Mrs. Kern Wildenthal’s personal gifts and pledges to UT Southwestern have been in excess of $1 million, the majority of which has been designated by them to support donor recognition and development expenses — a fact well known to CBS 11 and Robert Riggs, but conspicuously omitted from their report.

UT Southwestern is a world-class institution whose research, education and patient care activities benefit not only North Texans, but fellow researchers, physicians and patients around the globe.  Our institution is one of the world’s most distinguished and influential academic medical centers, and as part of their duties our leaders are involved in many local and international non-profit organizations and activities.

To meet their mission and ultimately improve the lives of patients, all academic medical centers must be part of their communities.  Indeed, community involvement is not only important in fund-raising, but in public education.  University presidents and senior administrators commonly belong to community organizations, and the costs associated with memberships and similar activities are entirely appropriate institutional expenditures. 

The UT System, and academic governance groups in general, recognize the importance of the involvement of its academic leaders in national and international organizations and events.  Such activities not only enhance the reputation of the institution, but also build bridges for future collaborations in education and research.  UT Southwestern is an institution with international scope and impact, and international travel is an essential part of accomplishing our mission.  It is entirely appropriate and customary for institutions such as UT Southwestern to pay for the travel expenses of their executives when they are engaged in official activities overseas, including service on non-profit boards and organizations abroad.

UT Southwestern’s success in becoming a preeminent international institution and in serving our community has been dependent to a major extent on generous gifts from philanthropists in the metroplex and from around the world.  Their donations underwrite an enormous amount of indigent patient care, medical research, and education.  A number of donors also make contributions specifically to enable UT Southwestern to participate in important local, national, and international activities that cannot be funded with state tax dollars, including travel expenses, involvement in other community organizations, fund-raising activities, and providing appropriate expressions of appreciation to our supporters.  These activities are undertaken with philanthropic contributions in full accord with the donors’ explicit intentions, and in full conformance with IRS regulations.

Expenditures of private dollars given for these purposes at UT Southwestern have been of great importance for the institution’s remarkable success in earning the support of our community’s philanthropic leaders.  Contrary to the assertions of CBS 11 and its “experts,” the amounts of funds donated to UT Southwestern and the unusually low cost of the institution’s development activities have been widely cited as national models of excellence and cost-effectiveness.  Philanthropic dollars that are given for the purpose of supporting the development activities of a non-profit organization such as UT Southwestern are of vital importance, and unquestionably qualify as fully legitimate tax-deductible gifts.  Indeed, donations to underwrite development activities lead directly to other contributions that are much greater than the original investment — in UT Southwestern’s case, a 30-fold return.

We continue to question the motives behind CBS 11’s baseless allegations against UT Southwestern, and why the station continues to air stories largely characterized by incorrect and incomplete information and facts taken out of context.  In contrast to the expenditures focused on by CBS 11, which appropriately support our mission in a cost-effective manner, the expenditures and lost time UT Southwestern has incurred in responding to a voluminous series of inquiries from this media-entertainment outlet have imposed a significant cost on the taxpayers of Texas, and have significantly detracted from the time we are able to commit toward serving the public and accomplishing our mission.

UT Southwestern will continue to operate in the way we have so successfully operated in the past, to ensure that, with the help of our philanthropic supporters, we can continue to be one of the world’s leading institutions, providing exceptional educational opportunities, unsurpassed research advances, and exemplary clinical care for all our patients.