Walz's temporary digs haunted by historic cost scandal

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The enormous overrun of costs for the renovation of the Governor's Residence in St. Paul recalls a somewhat similar, if less expensive, imbroglio at the University of Minnesota 35 years ago which cost the institution's president his job.

Today's planned upgrade of the gubernatorial facility, a publicly owned, 111-year-old English Tudor mansion on Summit Avenue a few miles from the Capitol, was initially estimated to cost about $7 million, including construction and design expenses for the home lived in by Gov. Tim Walz and family, and many governors before him.

But an administrative staffer, Stacie Christensen, an interim commissioner with the Department of Administration, told the Legislature at the end of September that the latest cost estimate has ballooned to $12.8 million, nearly double the projection from three months ago. She attributed the difference to "more expensive replacement of mechanical, electrical and plumbing system components … along with additional security upgrades, necessary to satisfy current health and life-safety requirements."

In other words, it's going to cost a lot more than planners thought.

Some officials reacted with a shrug. Speaker of the House Melissa Hortman, a fellow DFLer from Brooklyn Park, said she had no concerns, a view apparently shared by the oversight agency known as the Governor's Residence Council.

Not so the governor himself. His office issued a statement that it was "concerned about the increased cost" and asked for guidance from the Legislature to the department of administration before making a "decision to proceed with this project."

Republicans jumped on that, expressing how "concerning it was to see that the project has nearly doubled in costs in just a few short months," according to the Senate minority leader, Mark Johnson, a Republican from East Grand Forks. Taxpayers, he declared, "can't afford to be treated as a bottomless source of money to provide perks for politicians."

It remains to be seen how this will play out, but Minnesotans with long memories may feel as if they've seen this drama before — in a somewhat different context and with a decidedly unpleasant outcome.

The saga concerned the costly renovation of Eastcliff, the capacious home located on Mississippi River Boulevard, just over the St. Paul border, a couple of miles from the Minneapolis campus of the University of Minnesota. It has been the official residence for university presidents since 1921 — the visionary leaders, the less competent bureaucrats, at least one academic with questionable racist proclivities, and others who have been at the U's helm over the years.

Although the U recently has tried to shed Eastcliff to save costs, it remains an imposing and impressive edifice, not only as a residence but for gatherings of dignitaries, ceremonies and other institutional events.

Twenty five years ago, in the third year of his tenure as the 12th president of the university — and its first Jewish one — Kenneth Keller found himself on the defensive amid revelations about the high cost of revamping heavily used portions of the aged facility.

The story broke initially in the student newspaper on campus, the Minnesota Daily, which uncovered the incidents that led to a major brouhaha with the Board of Regents and ultimately resulted in Keller's resignation. The former well-regarded chemical engineering professor and high-level administrator at the U had been credited with doing a good job in a difficult position in rough economic times since his appointment in 1985.

His signature initiative, a program called "Commitment to Focus," was aimed at directing more attention to the university's areas of strength, while retrenching or eliminating less outstanding academic programs. The overture, seeking to elevate the more complex units of the university, perhaps at the expense of others, was greeted with mixed reactions and not particularly favorable ones from many in legislative oversight roles. Critics viewed it as minimizing aspects of the school's core mission.

A firestorm ensued when the Daily reported that Keller had incurred some $1.7 million in renovation costs (about $4.5 million in today's dollars), which more than quadrupled the projected $400,000 budget, much of it spent for lavish expenses redesigning the kitchen, dining room and other living quarters. It also came to light that Keller had incurred a $20,000 expense for redesigning his administrative headquarters on campus, and that the university had undisclosed reserves, called a "slush fund" by critics, of some $50 million from which the Eastcliff expenses were absorbed without formal regent approval. Existence of the secret fund stoked the public's unease at a time when Keller's administration was cutting academic programs.

Keller apologized "profoundly" for what he termed "mismanaged" projects, but he nevertheless took the brunt of the furor and, after a lengthy tête-à-tête with Gov. Rudy Perpich, he resigned. In departing, he drew praise for his stewardship from Board of Regents President David Lebedoff who nevertheless recognized that Eastcliff had become a "symbol of elitism," which led to Keller's downfall.

Keller stayed active in academia at other institutions. He returned for a time as a professor in the Humphrey Institute on campus here and was later named a professor emeritus at the U. In 2010 the electrical engineering/computer science building on the East Bank campus was named Keller Hall in his honor.

Keller went on to teach at the School of Advanced International Studies in Bologna, Italy, operated by Baltimore-based Johns Hopkins University, his graduate school alma mater.

Walz won't likely depart under fire. He is assured of at least three more years in office before he completes his second term, and he may have other political goals before returning to his home base in Mankato.

Meanwhile, while the planned renovations are underway on Summit Avenue, Walz and his family are temporarily, and one trusts comfortably, living elsewhere. The state is paying his rent to live in another mansion: Eastcliff.

Marshall H. Tanick is a Twin Cities constitutional and employment law attorney.