When is $15 million really $10 million, but actually only $5 million?

Welcome to the world of higher education in which “gift” and “gift commitment” can be parsed so billionaires can claim to give what they haven’t, and dictate whatever they want.

On this Makeover Monday, let us pretend—because there will be more than a little smoke-and-mirrors pretend in this column—that it is actually the morning of Thursday, Oct. 20, 2011. On that day, according to Dalhousie News, the official public relations organ of Dalhousie University, this happened:

Though it was pouring rain outside, the thunderous sound emanating through the halls of the Rowe Building were actually coming from inside the atrium.

It was the cheering and applause following President Tom Traves’ announcement that the man after whom the building is named, Kenneth C. Rowe, was making a $15 million gift to the School of Business.

The major gift, the latest in Dalhousie’s Bold Ambitions campaign, is the largest donation ever to Dalhousie from a Nova Scotian.

“I think our audience has said it all, Ken,” said Dr. Traves with a smile, when the roar of approval had died down at this morning’s celebration event.

Uh… The only problem with the article, which appears below an ALL CAPS, no-mistaking-this headline — “KEN ROWE DONATES $15 MILLION TO THE SCHOOL OF BUSINESS” — is that it simply wasn’t true.

There may have been rain pouring down outside and thunderous applause inside the Rowe Business School that day, but there was no $15 million gift.

The actual figure, which all parties at the podium knew but failed to mention, was just $10 million.

Rowe is the founder of IMP Group, the Nova Scotia-based multinational aerospace company. His personal net worth is estimated at $1.8 billion, ranking him 79th on a recent Canadian Business magazine listing of Canada’s richest folk.

He could afford $15 million, certainly $10 million. But then there’s this. The true amount Rowe gave to the university is closer to $5 million — that’s five million less than actually promised, 10 million less than advertised.

In 2018, Rowe cancelled what was supposed to be his $1 million a year donation over 10 — not 15 — years, apparently because he was in a snit about how Dal was spending their/his money.

Dal didn’t officially copped to its donation shell game — or change its website to reflect (some of) the facts — until last week after I asked the university to comment on this flat, factual assertion in a January 4th story in allnovascotia.com by journalist Rebecca Brown:

It was during that [Bold Ambitions] campaign that both Dal and Rowe falsely announced the billionaire’s gift as $15 million, despite a formal gift agreement for $10 million over 10 years.

To its credit, allnovascotia, the regional business news subscription website, has been on this story since July 2018 when Brown first asked Rowe to explain the discrepancy.

Rowe’s blasé response is instructive. He told the website he had “no current plans to top up his $10 million gift with an additional $5 million, which he says is “‘discretionary’ and could ‘go to anywhere in the university… I don’t plan anything. I just write a gift, terms and conditions. I might not give it.’” Why wasn’t that made clear, publicly, at the time? “You don’t lay out all the terms and conditions of a gift in a press release,” he told Brown. “That’s ridiculous.”

Peter Fardy, Dal’s vice president for fundraising, agreed. “In the interests of making things sound simpler,” he told allnovascotia, “you’ll see universities and charities across the country talk about gift commitments and gifts synonymously, even though they’re not synonymous because most people who make large gifts do so over time.”

Why would the university do this? Why would Rowe?

From the university’s perspective, of course, touting “the largest donation ever to Dalhousie from a Nova Scotian” offers a way to stroke the ego of a (still) big donor while pricking the egos of Rowe’s fellow billionaires in hopes one will one-up him with an even bigger “largest donation ever.” For Rowe, there is ego. And there is power. He not only gets to decide how much he really gives but he can also use his leverage with the difference to squeeze the university to spends the donation the way he dictates. And so it goes.

So, let’s restate. Ken Rowe made a gift commitment of $15 million — $10 million on paper, $5 million in a secret, nudge-nudge, wink-wink handshake deal — got all the free philanthropic publicity Dal could generate for his $15 million gift (The Globe and Mail, CBC, CTV, Global, Canadian Business Magazine, etc., etc.) — and then only really donated $5 million.

Sounds like false advertising, or at least a variation of the old bait-and-switch flim flam.  Which led me back to the original Dal press release. Despite several stories by allnovascotia over the past two years, the release hadn’t been corrected or even “clarified.”

So I emailed Dal’s PR department to ask about Brown’s report that the donation had been “falsely announced.” Here is the official response from Peter Fardy, the Dalhousie VP:

Thank you for the opportunity to clarify this matter.

It’s inaccurate to say the $15-million gift from Mr. Rowe was ‘falsely announced.’

Dalhousie University and Mr. Rowe publicly announced his $15-million gift commitment to the School of Business on October 20, 2011.

At the time, Dalhousie and Mr. Rowe agreed to break the total commitment down into two components: a written, formal agreement concerning the first $10 million and a verbal agreement regarding the remaining $5 million.

The first $10 million was to be paid over 10 years.

With respect to the remaining $5 million, there was a verbal agreement made by Dalhousie and Mr. Rowe to defer any decisions about how that money would be directed until after the initial 10-year term ended.

In 2018, it became clear that the funds from the gift were not delivering the intended impact and both Dalhousie and Mr. Rowe agreed to pause to reconsider the school’s strategy, after having spent just under half of the initial $10 million commitment.

We have had a decades-long supportive relationship with Mr. Rowe, characterized by a high level of trust and commitment to make Dalhousie and the Rowe School of Business stronger.

We have no intention of requesting further support from Mr. Rowe until we have a solid plan to significantly strengthen the Rowe School and have it take its place as one of the top business schools in the country. The Faculty of Management, under the leadership of Dean Kim Brooks, has undertaken a strategic review that we have every confidence will set the Rowe School on the right track.

Dalhousie must live up to the expectations we establish with donors and be held to account. Mr. Rowe, who has achieved great success in business and life by adhering to high standards of integrity and performance, should not expect anything less.

Thank you for highlighting the story at dal.ca. We will update the piece to reflect the clarification I have made here.

To save you the trouble of clicking on the link, which doesn’t actually link to the story, here is the “update” that now appears at the bottom of the original Dal News article:

Addendum, January 2021: At the time of the Rowe Gift announcement, Dalhousie and Mr. Rowe agreed to break the total $15-million commitment down into two components: a written, formal agreement concerning the first $10 million and a verbal agreement regarding the remaining $5 million. The first $10 million was to be paid over 10 years. With respect to the remaining $5 million, there was a verbal agreement made by Dalhousie and Mr. Rowe to defer any decisions about how that money would be directed until after the initial 10-year term ended.

In 2018, Dalhousie and Mr. Rowe agreed to pause to reconsider the school’s strategy, after having spent just under half of the initial $10 million commitment. The Faculty of Management, under the leadership of Dean Kim Brooks, has undertaken a strategic review focused on strengthening the Rowe School and have it take its place as one of the top business schools in the country.

I will leave it to others to parse whether $10 million is really $15 million with just a different second numeral. Others can also decide for themselves whether “Dalhousie and Mr. Rowe agreed to pause” after just half the $10 million had been spent accurately reflects reality, or if it should more accurately be translated as Mr. Rowe told Dal he was not going to give it any more money until and unless the university did what he wanted, and, even then, he might not give another penny ever.

There’s lots one could say, but let me make a few points.

Our economic system is so out of whack that, by 11:17 a.m. on. Jan 4, Canada’s top CEOs had already pocketed more than the average Canadian worker will earn this entire year. That gives billionaires enormous power over every aspect of our life, including the priorities of universities.

We need to change our tax system so billionaires don’t have enough spare change in their pockets to unilaterally decide which university programs are worthy of funding, and which aren’t, and to determine exactly how that money should be spent. What if Dal decided its faculty of humanities and social sciences needed that $15 million (or $10 million, or $5 million) more than the already well-endowed school of business?

Don’t hold your breath.

A version of this column originally appeared in the Halifax Examiner

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