The Cracks In Stanford's Ivory Tower

For Donald Kennedy, last year's Big Game was one to remember. As the annual football contest with archrival University of California at Berkeley neared the end, Stanford University's president could no longer bear to watch from the stands. Kennedy raced down to the sidelines, where he watched with elation as Stanford scored to narrow Cal's lead to 25-24 in the final minutes. When Stanford kicked a game-winning field goal with no time remaining, Kennedy rushed onto the field to celebrate amid the jubilant Stanford players and fans. Says senior Cameron Macky, a sportswriter for the Stanford Daily : "He's even more enthusiastic than I am."

But Kennedy, 59, hasn't had much else to cheer about lately. Stanford gets some $175 million a year in direct research funding from the federal government. Like other schools that receive these grants, it also gets reimbursed by Uncle Sam for overhead or indirect costs associated with the research. In Stanford's case, that's an additional $85 million or so a year, or roughly 20% of its operating budget. Last year, however, U. S. Navy accountant Paul Biddle took a close look at Stanford's books and alleged that the university may have overstated costs by as much as $200 million in the 1980s. Worse, Biddle discovered on the government's tab a long list of expenses related to Kennedy's university-owned home, such as $3,000 for a cedar-lined closet, as well as about $4,000 for a trustees' party following Kennedy's 1987 wedding.