The first way Rhode Island's newly named chief innovation officer will change state government is the name that signs his paycheck.

When he starts work this month as the newest member of Governor Raimondo's cabinet, South Kingstown native Richard Culatta will do so as an employee of the Rhode Island College Foundation, the state college's private, nonprofit fundraising body.

While unusual to pay a non-education-based state official from public college fundraising, it was the second time within a week that Raimondo tapped a public school foundation to pay for state business.

On Wednesday, Raimondo announced that her trip this week to the World Economic Forum in Davos, Switzerland, with staff member Matt Bucci would be paid for with approximately $7,000 from the University of Rhode Island Foundation.

The use of public college foundations for state government work quickly raised concerns from the education world and government watchdogs.

"When people are donating to the foundation, they think students will benefit from this, but it is not exactly clear how [the innovation officer and Davos] is going to directly benefit students," said Thomas Izzo, a member of the Rhode Island Council on Postsecondary Education and former state senator from Cranston. "If we are going to begin to use foundation dollars for state purposes, there needs to be a conversation about it."

Izzo said he was not necessarily opposed to the Culatta hiring or the Davos trip, but thought the funding method deserved more attention and brought it up at the Postsecondary Council meeting last week.

In addition to protecting the intent of donors, Izzo, a RIC graduate, said potential areas for concern included whether foundation money would be used to replace state financing for the colleges and whether it could be used to circumvent General Assembly oversight, such as the requirement for Senate confirmation of many cabinet-level positions.

John Marion, executive director of Common Cause Rhode Island, said Raimondo's use of college fundraising raised a number of red flags, including transparency issues.

Although both URI and RIC are public institutions, their foundations are private and not subject to public records laws.

As a result, while the foundations publish the names of many donors in their annual reports, they don't publish the specific dollar amounts of each donation, what restrictions are placed on them or when they were made. And contributors can opt to be totally anonymous.

"We know where the money that comes to state government comes from: taxes and fees," Marion said. "In a private foundation it comes from private donors who don’t have to be disclosed and may have any number of motives, including ingratiating themselves to elected officials. That lack of transparency does not serve the public's interest in knowing who is paying for the government that is acting on our behalf."

Foundation employment also means an official is not subject to the state employee code of ethics, which prohibits things such as acting with a conflict of interest. In the case of an innovation officer charged with recommending new ways to use technology in state government and building partnerships with the private sector, the potential for conflicts can't be ruled out, Marion said.

Culatta, who stepped down as executive director of the U.S. Department of Education's Office of Educational Technology, is to be paid $210,000 in annual salary plus a $550 monthly car allowance and a $21,000 annual supplemental retirement payment plus benefits.

Before he accepted the Rhode Island innovation job, Culatta had started a paid "design residency" with IDEO, a Silicon Valley consulting firm, said Raimondo spokeswoman Joy Fox. The residency is mostly "virtual," Culatta will do it primarily on his free time, and this is the kind of tech-sector collaboration Raimondo expects the innovation officer to do, she said. Fox said Culatta is expected to spend a lot of time traveling and there is no minimum amount of time that he is to spend in Rhode Island.

Raimondo administration officials had recruited Culatta for the state commissioner of education position that went to Ken Wagner, Fox said. Fox could not say whether Culatta formally applied for the position, and a list of applicants is being kept confidential, she said. Fox said Culatta was not a finalist.

Senate confirmation is required by state law for many senior cabinet jobs, but this newly created position will not be brought before the Senate.

The innovation officer position and trip to Switzerland are being paid out of RIC and URI foundation unrestricted funds — pots of donations that can be used at the administrator's discretion.

Edwin R. Pacheco, RIC Foundation associate vice president of development and external relations, acknowledged that unrestricted funds are highly valued because many large donations come with strings attached, but said excitement, not concern, has been the overwhelming campus reaction to the creation of the innovation office.

"I think any unique, innovative change is going to generate questions and concerns, but when it comes from the opportunity to participate in an initiative like this that advances the college's profile — which means more attention from students, researchers, and overall development — that opportunity is generating a level of excitement and buy-in here that is in itself going to initiate innovation," Pacheco said Friday. "If we attempt the traditional avenues for change, things won't get done."

panderson@providencejournal.com

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