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US: Our Lady of Discord

by Susan HansenThe New York Times
July 31st, 2006

It takes a singular sense of purpose to turn a lone Michigan pizza joint into a multibillion-dollar global brand. Yet the founder of Domino’s Pizza, Thomas S. Monaghan, certainly had it more than four decades ago, when he bought his first restaurant in Ypsilanti, Mich., near Detroit — and he has brought that same sense of mission to the task of giving his pizza fortune away.

Since netting about $1 billion from the 1998 sale of Domino’s to Bain Capital, Mr. Monaghan, 69, has become one of the leading philanthropists in the country and the biggest benefactor of conservative Catholic institutions.

In the past eight years, his Ave Maria Foundation, based in Ann Arbor, Mich., has donated $140 million to promote conservative Catholic education, media and other organizations, including Detroit-area parochial grade schools, a law school and small regional colleges in Michigan and Nicaragua, along with radio stations and a fellowship group for Catholic business leaders.

His boldest charitable venture by far, however, is Ave Maria University, a four-year liberal arts campus under construction 30 miles northeast of Naples, Fla., to which Mr. Monaghan has donated or pledged $285 million so far. Along with the university, which enrolled its first students three years ago on a temporary campus, he and a local developer are building an adjoining new town called Ave Maria.

The bar for the school has been set high, with plans to eventually attract up to 6,000 students to what supporters, including Gov. Jeb Bush of Florida, predict will be a top-tier academic institution devoted to the Catholic faith.

Mr. Monaghan, who has called the Florida campus and town “God’s will,” has even loftier intentions. He has said that he sees the university, which says it adheres to a strict interpretation of Catholic doctrine, as a chance to save souls. “I’m a businessman. I get to the bottom line,” Mr. Monaghan, who declined to be interviewed for this article, told The Orlando Sentinel in 2004. “And the bottom line is to help people get to heaven.”

Yet as he aims for the divine, Mr. Monaghan has been facing some unexpected earthly trials, including a revolt at his law school in Ann Arbor and sharp criticism by many of the conservative Catholics who once supported his foundation’s projects.

In many ways, Mr. Monaghan’s troubles illustrate how difficult it can be for wealthy, driven entrepreneurs to make the transition to full-time philanthropy, particularly when they have single-minded ideas about how they want their money spent. Traits that make successful business leaders — ego, ambition, determination, even a touch of imperiousness — do not necessarily go over well in charitable work, causing even the most well-intentioned projects to founder.

As the legendary investor Warren E. Buffett recently noted when he donated most of his $40 billion fortune to an established foundation rather than create one of his own, making a mint — as difficult as that is — can be easier than giving it away.

As he tries to build a new university and town in his own image, Mr. Monaghan has been experiencing some of those difficulties firsthand. Faculty members, students and parents tied to his Detroit-area schools have complained that he runs his charitable foundation like a sole proprietorship, starting and abandoning projects as whim strikes him. And they characterize his new Florida university as a vanity venture that could well prove to be a colossal waste of cash.

“It all belongs to Tom Monaghan; that’s the problem,” said Therese M. Bower of Cincinnati, whose son attended Ave Maria College, one of the schools Mr. Monaghan founded in Michigan. His foundation moved to close the school’s Ypsilanti campus to focus on building his university in Florida.

“If Tom were a real philanthropist,” said Jay W. McNally, the former director of communications and advancement at the college, “he would donate his money and step off.” Mr. McNally said the school let him go after he told federal officials that some financial aid for students in Michigan had been diverted to Florida; Ave Maria University later returned $259,000 in federal money.Mr. Monaghan’s many defenders, including Bowie K. Kuhn, the former baseball commissioner, and Michael Novak, a Catholic theologian, dismissed much of the criticism as carping by academics. “If it weren’t Monaghan, it would be dissatisfaction with whomever,” says Mr. Novak, an Ave Maria University trustee.

Mr. Kuhn, who is on the board of the Ave Maria School of Law, said Mr. Monaghan had every right to use his money as he wished. “Tom makes very good judgments, and he sticks to his guns,” he said.

Mr. McNally, a former editor of the Detroit archdiocese’s newspaper, said he too had admired Mr. Monaghan’s determination. Back in the 1980’s, Mr. McNally recalled, he and other conservative Catholics cheered Mr. Monaghan’s donations to anti-abortion causes and his refusal to withdraw that support even when abortion-rights groups called for a boycott of Domino’s.

He and other conservative Catholics were equally enthusiastic when Mr. Monaghan’s foundation began its push into higher education eight years ago, starting Ave Maria College in Ypsilanti and the Ave Maria School of Law in neighboring Ann Arbor, and taking over the administration of St. Mary’s College in nearby Orchard Lake, Mich.

Many Detroit-area Catholics said they gave up jobs and teaching posts elsewhere to work at the schools, with some faculty members moving from hundreds of miles away because, as a former Ave Maria College biology professor, Andrew J. Messaros, recalled, they were committed to promoting a faithful version of core Catholic teachings.

“I bought into the whole vision lock, stock and barrel,” Professor Messaros said. He added that he took a $16,000 pay cut from a tenure-track position at the West Virginia University School of Medicine to teach at Ave Maria in mid-2003.

Mr. Monaghan had considered building Ave Maria University, along with a 250-foot crucifix, in Ann Arbor Township, but local officials denied him the necessary zoning changes in 2002. That fall, he announced that the Barron Collier Company, a Florida developer, had donated 750 acres of farmland to the university on the northwest edge of the Everglades. His new plan was to build Ave Maria University in Florida, while investing another $50 million in a separate partnership with Barron Collier to build the adjoining Ave Maria town.

NICHOLAS J. HEALY JR., who was president of Ave Maria College in Michigan and is now president of the Florida university, promptly set up a temporary campus near Naples. It opened with about 100 students in a retirement complex in fall 2003; enrollment has grown to nearly 400 students.

“We’ve tried to create an environment traditional Catholics can be comfortable with,” Mr. Healy said, adding that the devotion to the faith was put into action in many ways: from single-sex dorms and daily rosary walks to a scholarship that the school, in keeping with what it describes as its strong pro-life ethic, recently began offering in the name of Terri Schiavo, the brain-damaged Florida woman whose husband won a bitter court fight in 2004 to authorize doctors to stop life support.

While Mr. Healy was opening the Florida university, financing for Mr. Monaghan’s projects in Michigan began to disappear. In late 2002, the foundation said it would no longer support St. Mary’s. An expected shutdown of the school was averted only when another Catholic institution, Madonna University in nearby Livonia, Mich., agreed to take it over.

In Ypsilanti, the news that Ave Maria College would be merged into the new university in Florida went down a little easier — at least initially — given that Mr. Monaghan pledged to keep the Michigan campus open until 2007, so that the school’s 230 students could stay and finish their degrees.

Despite that assurance, however, Professor Messaros said that by the fall of 2003 school officials were pressuring him and other faculty members to move to Florida quickly — or risk losing their jobs. “Their attitude was, ‘This is what we’re going to do. Take it or leave it,’ ” he said.

Mrs. Bower, whose son Paul was a junior at Ave Maria College when the move to Florida began to accelerate, said she became concerned that the Michigan campus was being deserted. She grew more anxious in 2004 when word got out that school administrators in Florida had tried to have most of the books at the Michigan campus’s library shipped to Naples.

“I thought, ‘Wait! There are still students there. They can’t just take all the stuff,’ ” said Mrs. Bower, who created a Web site — geocities.com/aveparents — to help keep the Michigan campus intact.

Another parent — Edward N. Peters, who taught canon law in a theology program now based at Ave Maria University — threatened to sue if the campus was dismantled.

“It has become clear that Tom Monaghan regards Ave Maria not as a kind of public trust but rather as his personal domain which he can effectively treat however he wants,” Professor Peters, whose son attended the college, wrote in a June 2004 letter to the college board. He added that since Mr. Monaghan shifted his attention to Florida, he had cut support for several of his Michigan projects, including a weekly Catholic newspaper and a new convent. “Ironically, the very legacy that was being built up with Monaghan’s help is now being torn down at his will,” Professor Peters wrote. “It is a tragic and scandalous waste of the human and financial resources given by God.”

In late 2004, Father Neil J. Roy, Ave Maria College’s academic dean, actually did sue Mr. Monaghan and the school’s trustees in a bid to stall the Michigan campus’s closure, but a state court judge dismissed the suit last September. The exodus of faculty and students to Florida and elsewhere continued, and last year school officials began making cash buyout offers to the 30 or so students who had planned to continue studies on the Ypsilanti campus in 2007.

Paul R. Roney, executive director of Mr. Monaghan’s foundation, said he understood that the decision to shift resources to Florida was difficult for some in Ypsilanti to accept. But he added that Mr. Monaghan had honored his promise to keep the campus operating through 2007 — albeit now with just three students and a handful of professors. “Any pledges that were made have been more than fulfilled,” Mr. Roney said.

Despite all the criticism, Mr. Healy, Ave Maria University’s president, said that most professors in Michigan happily relocated to Florida.

For a while, the Ave Maria School of Law seemed immune to the strife. Its enrollment, now about 380, was growing, and the American Bar Association had granted it full accreditation. But Mr. Monaghan wants to relocate that school to Florida, too, upsetting teachers, students and alumni. Opponents say it is crazy to leave an intellectual center like Ann Arbor, home of the University of Michigan, for an undeveloped outpost on the edge of the Everglades.

“There’s nothing there yet, with all due respect,” said Chris McGowan, a law school alumnus who noted that students in Ann Arbor have easy access to a federal courthouse and many local internship opportunities.

He and others who are fighting the move said the only reason the school’s board was even considering it was that Mr. Monaghan, the chairman, had invested more than $330 million in the Florida university and town and wanted the law school there to shore up that investment.

One veteran board member — Charles E. Rice, an emeritus professor of law at Notre Dame University — tried to make the case against the move. But he said that Mr. Monaghan and other board members, including the law school’s dean, Bernard Dobranski, “did not want a contrary voice,” so last fall they adopted term-limit bylaws and ejected him from the board.

Dean Dobranski denied the bylaws change was directed at Professor Rice, noting that three other members left the board at the same time.

Faculty members, students and alumni rallied around Professor Rice, however, and since last fall they have mounted a campaign that has included pointed attacks against Mr. Monaghan and resolutions calling on Dean Dobranski to resign.

“The bigger issue is school governance,” said Jason B. Negri, president of the law school’s alumni association. Specifically, he criticized Mr. Monaghan’s insistence on operating the school like a private business and what he said was the board’s failure to stand up to him.

MR. KUHN rejected that criticism. “This is not a bunch of trained dogs,” he said of his fellow directors, adding that the board would not make any decision on relocating the law school to Florida until a feasibility study on the move was completed and members had seen the results.

“The key question is where we will thrive in the long term,” said Dean Dobranski. He pointed out that Mr. Monaghan had given the law school $50 million, so “it’s not unreasonable for him to say ‘I think the move is a good idea.’ ” Dean Dobranski added, “He’s to be commended for how he’s used his wealth.”

At the university’s construction site in Florida, the fruits of Mr. Monaghan’s generosity are coming into view. Miles of pipes and electricity lines have been laid, and buildings are going up. Mr. Healy, the president, said the school should be out of its temporary home and on the new campus by August 2007.

Not that the process has been easy — or cheap. Mr. Healy said damage from hurricanes last year and the year before, along with strong demand for raw materials in China has sent labor, cement and steel prices soaring — nearly doubling building costs and eating up Mr. Monaghan’s money faster than expected. Indeed, in the next year, Mr. Roney said, the Ave Maria Foundation’s assets might drop to as little as $15 million from $251 million in 1999.

As a result, school officials have had to scale back plans. For now, they have settled for putting up only about half of the 14 buildings they originally intended to complete in the first phase of campus construction. Mr. Healy is counting on more money from Mr. Monaghan as houses are sold in the adjoining town, because Mr. Monaghan has promised to donate his share of profits, expected to exceed $100 million, to the university. “Very few schools have this kind of start-up capital,” Mr. Healy said.

But it could be several years or more before the university sees much of that cash, given that home sales will not start until later this year, amid a cooling housing market, and the whole town — which has been planned to include 11,000 homes, a retail district and an 18-hole golf course — will not be completed until around 2015.

IN the meantime, Mr. Novak, the Ave Maria trustee, said the university would have to raise millions of dollars to cover salaries and other operating expenses and to keep construction, expected to cost at least $1 billion over the next 50 years, moving forward. The school has raised about $20 million in the last three years and is now expanding efforts to sell “naming opportunities” for campus buildings. Mr. Novak said he was hopeful that that initiative would attract some major donors, but he added, “until you actually get them in the door you don’t have them.”

Kate Cousino, the 2004 salutatorian of Ave Maria College, said she would not be writing any checks. In fact, she said that she and other Ave Maria graduates recently started an alternative alumni group because they didn’t want fund-raisers for the Florida campus asking them for donations.

She and other critics of Mr. Monaghan say that other like-minded Catholics will hesitate to hand over money now that, at least in conservative Catholic circles, word of his troubles has gotten out. “I think he’s really turned off a lot of his target market,” said Terrence L. McKeegan, an Ave Maria law school graduate.

Mr. McKeegan, who now works for a human-rights group at Franciscan University of Steubenville in Ohio, said recent fund-raising letters suggested that the university may be facing a cash crunch. One letter signed by Mr. Monaghan, for example, said that steeper construction costs had hampered the university’s ability to buy books for its library, and urgently appealed for donations. Mr. McKeegan and others predicted that the university would wind up amounting to far less than the first-rate institution Mr. Monaghan has envisioned in spite of all the money he has put into it.

Professor Messaros called the millions that Mr. Monaghan has spent “mind-numbing.” His fortune could have been spent helping the poor or assisting established universities or on any number of better causes, instead of on building what he called “a ‘Citizen Kane’ monument to waste,” Professor Messaros added.

Mr. Healy, the university president, and Mr. Novak, the trustee, denied that that the controversy had hurt fund-raising efforts. “We haven’t seen any decline in our support at all,” Mr. Healy said, adding that the extra attention could even help. “The more publicity there is,” he said, “the better off you are.”

Mr. Novak said that many of the difficulties Mr. Monaghan and university officials have faced are not surprising. “All good things are fraught with troubles,” he said. “You just have to work through them.” The school already has a standout theology program, a strong sacred music program and a devoted student body, he said. He said he had faith the university would thrive over time.

“I feel very strongly,” Mr. Novak said, “that this is something the Lord wants.”





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