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July 29, 1999
Spending by VMI head questioned
Records show that Superintendent Josiah Bunting overspent a discretionary account by $120,000 during his first 3 years at the school.
By MATT CHITTUM
THE ROANOKE TIMES
Josiah Bunting, the charismatic and erudite superintendent of Virginia Military Institute, is being investigated by state authorities for allegedly misspending VMI funds.
Auditors are examining records of purchases ranging from bouquets of pricey Casablanca lilies to novels and books for his personal reading and gift giving to a $1,500 retirement party at a posh Richmond private club. The investigation comes at a bad time for VMI, which is trying to cultivate donors in advance of the fall 2000 launch of a $150 million to $200 million fund-raising campaign with Bunting as the point man.
Alumni and members of the board of visitors have expressed disappointment and dismay. Bunting declined to comment.
A report from the state Auditor of Public Accounts could come by the end of this week.
"We've fully cooperated with the auditors," said VMI spokesman Mike Strickler. "Our records have complete detail, and we certainly don't have anything to hide. There isn't anything that can't be fixed, and of course we'll comply with whatever the auditor reports."
The auditors are examining purchases from a $100,000 discretionary account assigned to Bunting.
The superintendent, hired four years ago, overspent that account by $120,000 during his first three years there, VMI business office records show.
Receipts, vouchers and purchase logs reviewed by The Roanoke Times show Bunting has used the account to buy everything from office supplies and flowers in memory of King Hussein of Jordan to a set of silver spaghetti spoons.
The $1,555 monthly rent on Bunting's quarters is paid from that account, as are hundreds of other clearly legitimate expenses.
Few of the expenses appear to have been for Bunting's private benefit.
Whatever the audit shows, Bunting's expenditures are at the least in conflict with VMI's image as a Spartan institution, said departing board member Thomas Hudson of Richmond.
"I do not know how we, the board of visitors and the administration, can be credible role models for cadets where the spending appears so out of line with the public persona of the institute," he said.
If the spending in question is really a problem, said board member Charlie Lindsey, "I'm disappointed that it occurred."
The president of the private VMI Foundation, which provides much of Bunting's discretionary funds, supports the way Bunting has handled the account.
"Money being spent by the superintendent's office is money spent on enhancing the image of VMI," said Gil Minor. He said VMI has been especially successful at that goal during Bunting's tenure.
Board members are bothered by the lack of information given to them about the audit and what it may find.
"It disturbs me that a lot of these things are coming as a surprise," said member Anita Blair of Alexandria. "The acknowledgement from the school seems to come very belatedly after the event."
Board Chairman Bruce Gottwald felt he knew enough to call the problems a "procedural blip," but declined to elaborate. David Parker of Lexington, a 1984 VMI graduate, said Bunting should be held to the same standard to which VMI cadets are held: the honor code. Cadets are taught to "not place personal gain above personal honor," Parker pointed out. The degree of personal gain is immaterial, he said.
VMI became concerned about some of Bunting's purchases after an internal audit in April, VMI Director of Post Services Ron McManus said.
Later that month, they told their concerns to auditors from the Department of General Services, which oversees purchasing and procurement programs in state agencies like VMI. After their own review raised more concerns, those auditors notified the VMI business office, who told Gottwald.
In compliance with state law, Gottwald called the state auditor of public accounts and the state police.
Much of the money in the superintendent's account comes from alumni donations. None of it comes from taxpayers.
VMI annually boasts of having the highest per student endowment of any public college in the country, but alumni may not be so quick to give if they learn their donations are being misspent.
"Alumni who learn about this, they might say, 'What is he going to do with my money if he's got a blank check?'" Parker said.
Regardless of the source of the money, it must be spent within state and VMI regulations, which are nearly identical.
Expenses that "do not clearly support the agency mission" are not allowed, according to the Commonwealth Accounting Policies and Procedures manual produced by the state's General Accounting office.
Flowers, books, parties
The list of prohibited expenses includes gifts and flowers. Among Bunting's receipts, though, are about $16,000 in flowers bought since January 1997. About half were used to decorate his quarters or other places on campus for ceremonies and receptions. The bulk of the rest went to either funerals for alumni or friends of the college, or were gifts for similar people.
Some of the receipts show that the flowers were delivered with cards that gave no indication they were from the college.
"Happy Birthday, Best Love, Si and Diana Bunting," says one. "Warmest regards, Si Bunting," says another that was sent to an address in Lawrenceville, N.J., where Bunting was a prep school headmaster.
The Buntings also bought magazine subscriptions to Harper's, The New Yorker, and Arts and Antiques in December 1996 for a list of people that included cadets, faculty and one board member and her husband. The cards said the subscriptions were from "Si and Diana Bunting."
VMI business manager John Rowe said the expense was questioned. The expense went through anyway, with a note on the voucher that said "approved for payment per direction of superintendent."
Bunting bought about $12,000 worth of books in the same period. Purchase logs show many were for gifts. Other entries give only titles, such as "Teach Yourself Sanskrit," "The Conservative Mind," "The Last Picture Show" and "Plain Pictures: Images of the American Prairie." Several entries say only "Books for the superintendent." Bunting also used college money to buy 46 copies of his own book, "An Education for Our Time," according to purchase logs.
In September 1998, Bunting made it clear he did not want royalties from sales of the book at the VMI book store or through "VMI agencies," correspondence on file in the VMI business office shows. He ordered that the royalties be held in a fund for cadets who want to be public school teachers.
But four months later, Bunting bought 39 copies of his book direct from the publisher at a cost of $583. They were for the members of Gov. Jim Gilmore's Blue Ribbon Commission on Higher Education.
State and VMI regulations bar the purchase of alcohol, but receipts show numerous orders of $350 or more for Tanqueray gin and Chivas Regal scotch and other liquors that were bought for Bunting's quarters, where he frequently entertained college guests.
Retirement parties are also listed as improper under state and VMI regulations. Yet Bunting used his account to pay $1,500 for a gathering at Richmond's Commonwealth Club to honor retiring VMI board chairman William Berry.
Rowe - whose office handles Bunting's bills- blamed the "lack of procurement control" on a change in purchasing procedures a few years ago. For purchases less than $2,000, state agencies can use an American Express card - something Bunting has done since January 1997. Prior to that, a purchase order system was used.
Rowe said he disliked the credit card system because it doesn't give his office a chance to "advise on the practicality and the appropriateness" of a purchase before it's made.
Some expenses were refused, Rowe said, including a request for a travel advance for several cadets to visit VMI rival The Citadel in South Carolina to "at best, do college pranks, at worst, do something that might break the law."
As it turned out, the cadets stole a brass bulldog statue but returned it after police became involved.
VMI has had a clean audit for three years running, so even board members like Roanoke realty executive Bob Copty, who heads the audit and finance committee, seemed surprised by the investigation.
"I think that the board was under the impression that we were doing things by the book and were following all the rules," he said. "We may have been. We will find out from the auditors whether we have a problem or not."
But Lindsey, another member of the audit and finance committee, was quick to point out that the board is ultimately responsible. "It's up to the board to see that the rules are adhered to," he said.
Asked why the board was unaware some potentially improper spending has been going on, and that Bunting routinely overspends his discretionary fund, Lindsey said, "It might have been insignificant in the overall budget."
When dealing with a $39 million budget, an overrun of $60,000 "doesn't come to our attention," he said. "Maybe it should."
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