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American U. Board Split On Keeping President

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By Susan Kinzie and Valerie Strauss
Washington Post Staff Writers
Sunday, September 25, 2005

A schism among American University trustees is widening over the future of suspended President Benjamin Ladner, with some beginning private negotiations with his attorneys for a new contract and others pressing for his ouster.

"There have been discussions between a group of trustees and Dr. Ladner, which are designed, we understand and hope, to restore him as president, resolve all of the issues and establish a new contract under which he can go forward," said David Ogden, one of Ladner's attorneys. "We are hopeful those will succeed."

Complicating an already tangled process, Ladner supporters on the board have divided themselves into three strategy groups, according to two sources familiar with the negotiations. One group reviewed some of the more than $500,000 of the president's spending questioned in an independent report and determined that he should reimburse the university roughly $21,000. Another group is bringing in a tax expert for advice. And a third is putting together terms of a new contract for Ladner that would reduce his compensation while adding controls over his spending and other activities, the sources said.

His opponents, meanwhile, said it is time for new leadership.

The 25-member board would have to approve an agreement with Ladner by a majority vote. Some trustees said it's too close to call, with sources estimating that the president's staunch advocates number anywhere from five to a dozen.

Yesterday, trustees, lawyers, students and faculty continued to talk about Ladner, who was put on administrative leave in August, and the future of the private university in Northwest Washington. An investigation of presidential spending was sparked by an anonymous letter sent to some board members in the spring, with complaints of lavish trips and dinners charged to the nonprofit institution.

And lawyers and trustees continued to debate just what terms Ladner had been working under, a question that makes hundreds of thousands of dollars' difference to auditors and that could have a huge impact on whether he stays.

Three years after Ladner came to AU, the then-chairman of the trustees signed a second contract with him that never was presented to or approved by the full board, according to a report by a law firm retained by the board. The second contract added perks and plenty of latitude.

Unlike the original contract, the 1997 agreement included payment for "first-class travel expenses." All costs for dining, housekeeping services and staff at the president's university-owned residence were to be paid by the university. And his wife's expenses "related to her role conducting University business" were to be covered.

So when people look at the spending detailed in the report -- thousands of dollars for limousine service for Nancy Ladner, for example -- they have completely different interpretations.

The university's travel policy requires receipts for reimbursable expenses (which do not include personal expenses or alcohol) and encourages economy when possible -- rental cars only when necessary, shuttles rather than taxis to the airport, moderate hotel costs.

Ladner has argued that the wording in his 1997 contract supercedes the university travel policy and that "first-class travel" doesn't mean just better plane tickets.

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