As Oklahoma State University leaders celebrate a $250 million appropriation to overhaul the College of Veterinary Medicine and tout their decision to hold tuition flat for the sixth time in seven years, stakeholders are still watching a slow trickle of answers about the accounting scandal that spurred February’s presidential transition and shuttered operations of the nebulous Innovation Foundation.
Amid scrutiny about OSU’s mismanagement of $41 million in state appropriations, the Board of Regents for the Oklahoma Agricultural and Mechanical Colleges tapped Jim Hess to succeed Kayse Shrum as OSU president and approved the hiring of Chris Kuwitzky as chief financial officer — just one of Hess’ attempts to straighten out a messy portion of the university’s broader budget and improve fiscal transparency.
With the last six months featuring significant wins as well as lingering questions, OSU stakeholders have witnessed a slate of developments:
- In early March, Hess hired Kuwitzky as OSU’s new chief financial and administrative officer;
- That same week, Hess announced the defunding and closure of the Innovation Foundation;
- The same restructuring involved layoffs of IF employees;
- Although OSU leaders withheld the news from legislative leaders amid budget discussions, the American Veterinary Medical Association lifted the College of Veterinary Medicine’s accreditation probation in late March;
- In April, Gov. Kevin Stitt appointed Tracy Poole — the founder of Forty-Six Venture Capital — to the OSU A&M Board of Regents;
- In May, the Legislature approved a $250 million appropriation to renovate the College of Veterinary Medicine’s teaching hospital complex. OSU had requested $295 million;
- The Legislature also approved $8 million to support the development of a Level 1 Trauma Center at Tulsa’s Saint Francis Health System, a project the involves partnership with the OSU Medical Authority; and
- OSU released email records to News 9 showing how the Innovation Foundation helped Cowboy Technologies, LLC — a private venture capital firm it controlled — pay lobbying contracts. “It is difficult to ascertain with clarity which funds were used to make such payments,” a spokesman said.
In addition, OSU officials released a slate of records to NonDoc over the past six months, including a revelation about the four formal complaints — EthicsPoint Case Nos. 1750, 1751, 1754 and 1846 — filed in 2024 that spurred the Innovation Foundation audit and Shrum’s resignation.
Although NonDoc requested the text of the complaints and their intake summary reports, OSU officials said “there is no written record” of the formal complaints.
“Regarding the complaint referenced in your original open records request, it was a verbal complaint received by a board employee and passed along to the board verbally in executive session,” OSU’s associate director of enterprise brand management Shannon Rigsby wrote April 3. “There is no written record of the content of the complaint and any discussion would have been in executive session.”
Asked how there could be “no written record” of the complaints listed on the board agenda that prompted the investigation, Rigsby eventually responded with a brief document stating that complaint documentation is “confidential.”
“The Ethics Point complaints, like whistleblower and other types of confidential personal complaints by persons to a governmental entity seeking redress of grievances, are exempt from production pursuant to [Title 51, Section 24A.14], and the attorney general opinions and reported case law construing that statute,” Rigsby’s document stated, with legal citations. “Although the specific confidential employee reports are exempt from disclosure, we can share that these confidential reports expressed concerns about potential actions and oversight functions performed by the leadership of Oklahoma State University and of the Innovation Foundation.”
Records requests fulfilled by the university also answered questions about the Innovation Foundation’s external bank accounts, budget details, and OSU’s most recent public relations contracts:
- The Innovation Foundation’s 2023-2024 annual performance report offered statistics — 66 employees, 50 news releases published and 15 patents issued. It also outlined Cowboy Technologies’ 35 venture investments worth $3 million. Relationships were highlighted with Plasma Bionics (veterinary device manufacturing), Roll-2-Roll Technologies (web guide systems) and Weaver Labs (PFAS water remediation);
- OSU staff said the Innovation Foundation’s main cash reserve at the Oklahoma State Treasury contained a balance of more than $10 million at the end of 2024. Additionally, OSU staff said the Innovation Foundation held a small amount of funds via Cowboys Technologies, LLC at Exchange Bank and Trust Company in Stillwater;
- A 25-page presentation (embedded below) contextualized the August 2024 Innovation Foundation Board of Directors meeting attended by regent Jennifer Callahan after she was “briefed” about employee concerns with the entity’s “internal audit review.” Emails provided to the Tulsa World indicated that internal auditors had issued corrective instructions “for months,” and Callahan said in March that she “became concerned about [the foundation’s] governance structure and its failure to comply with the Open Meetings Act.”
- OSU released its contracts with public relations firms during the Innovation Foundation audit debacle. The documents detailed a $17,500 monthly contract between OSU Brand Management and SixPR, Inc, effective April 1 through June 30, 2025; as well as a $15,000 monthly contract between Cowboy Technologies and the Pinkston Group, which was effective January 2024 through December 2024. A subsequent contract was also issued between the OSU A&M Board of Regents and Pinkston for $10,000 a month from February 2025 through January 2026.
While unwinding OSU budget, Chris Kuwitzky defends OU firing
Although Kuwitzky’s appointment did not take effect until March 17, Hess announced the decision in a March 11 press release that caught the attention of those who recalled the revelation of significant financial problems at the University of Oklahoma in 2018 and 2019.
“Chris’s extensive background in higher education finance and his deep understanding of Oklahoma’s fiscal landscape make him an ideal addition to the OSU team,” Hess said. “His proven track record of sound financial management and strategic thinking will be invaluable as we continue to strengthen OSU’s financial foundation and enhance our service to students. Chris shares our commitment to putting students first in everything we do, ensuring our financial decisions support their success and experience.”
But while Kuwitzky had impressed OSU A&M regents during his time as Langston University’s vice president for fiscal and administrative affairs, his July 2018 termination as OU’s chief financial officer underscored issues identified when former OU President Jim Gallogly succeeded longtime President David Boren.
In the final years of the Boren administration, Kuwitzky helped orchestrate OU’s controversial Cross Village housing project, which quickly became plagued by financial losses and legal disputes. The public-private partnership convinced investors to finance the facility with promises to pay back the bonds with OU housing and parking leases. The convoluted business deal included a $20 million up-front payment to OU requested by Boren to help address a revenue gap amid limited cash reserves. Ultimately, the project’s bonds turned to junk and investors lost 30 percent of their money in a controversial settlement agreement that saw OU regain the property from creditors thanks to a bridge loan financed by a Chickasaw Nation company.
In an April 24 interview, Kuwitzky defended his 30-year tenure at OU, claimed Gallogly had released financial information “without any context” and said investors frustrated by the outcome of the Cross Village project “chose to accept that risk.”
“Everything on the Cross Village project, again, was reviewed through legal counsel and approved by the Board of Regents,” Kuwitzky told NonDoc. “Every bond issue was approved by the Board of Regents. Every bond issue was supported by an internally pledged revenue stream that was performing at or above expectations. And we followed board policy in everything that we did — and even on the new money bond issues, those are approved by the State Senate, but that was never said publicly.”
Revenue at Cross Village fell far short of expectations as it opened with dismal occupancy rates that derailed the financial model. Even before Gallogly decided not to renew OU’s leases at Cross Village, he terminated Kuwitzky and a half-dozen other OU executives on his first day as president in July 2018.
While Kuwitzky said the topic has come up during interviews for his subsequent jobs at Washburn University, Langston and OSU, he said he has chosen to “just address it proactively.”
“I’ll give you an example of this perception that the University (of Oklahoma) was losing $30-plus million a year. What that referred to was 2016 when you may recall that the state of Oklahoma cut appropriations to agencies during May business, right? So, six weeks before the end of the fiscal year, OU took a — I think it was a $22 million or $24 million — reduction in appropriations, and we reported a loss that year, and it was over $30 million, right?” Kuwitzky recalled. “But there really wasn’t anything we could have done at that point, right? You can’t recover $24 million in six weeks. And so that was actually the first loss. There were 16 [fiscal] years that I served as CFO. In 14 of those 16 years, we reported an audited surplus, OK, the only two years we didn’t were ’16 and ’17, and ’16 was primarily because of that reduction in state appropriations that I mentioned, and then in the next year, in ’17, with the board’s approval, we took half of it into consideration and used reserves to fund the other half so we could bridge that gap over two years, rather than making draconian kind of cuts across our academic mission.
“But again, that was in full view, completely transparent and with the approval of the board. But that was portrayed as though the university had this systemic loss of funds.”
While Kuwitzky said other issues at OU about misreporting donor-data and in-kind contributions involved the development department instead of his realm as CFO, he described his frustrations with how he and his terminated OU colleagues were criticized by Gallogly and others.
“Jim held himself out as a financial expert, and he said that publicly to the Board of Regents and others that he was a financial genius, and so he chose to make finances his issue,” Kuwitzky said. “My point is that he made comments without context, right? Like, again, ‘OU’s losing $30 million a year.’ And I would say that that’s not true, right? We lost money in two of the 16 years that I was CFO, and we just talked about what gave rise to that. He might make a comment about, ‘Did you know the university has $1 billion in debt?’ Well, to the lay person on the street, that sounds incredible that we would have that much debt, you know? But in reality, it was very consistent with institutions that are of similar size. (…) But that was never said publicly, and so the only thing that troubled me were those kind of things.”
Kuwitzky said he is “not going to carry grudges around” and that he hopes to let his work “stand for itself” in front of an OSU community looking for answers about their university’s own confusing financial picture.
“I’m not going to carry a ball and chain around,” he said. “I just thought that was really disappointing, that people were characterized — for whatever reason — were characterized in a way that discredited people. And so, I felt that was unnecessary.”
At OSU, Kuwitzky has succeeded former interim CFO Eric Polak, who served in numerous executive positions at OSU. In the Innovation Foundation audit report, Polak’s employment was highlighted because he held “simultaneous executive role assignments” that created potential conflicts of interest. Polak had been the CEO of Oklahoma State University Medical Authority as well as the board director of the Innovation Foundation.
Polak had taken over for retiree Joe Weaver — a longtime OSU administrator who also contributed to the growing concerns regarding blurred governances in the OSU system for his simultaneous roles serving as OSU senior vice president for administration and finance and a member of the Innovation Foundation’s board.
Polak’s LinkedIn has been updated to show his interim status as CFO has ended, but it lists him as continuing to serve as CEO for the medical authority.
Inherting Weaver’s former administrative team, Kuwitzky said he looks forward to lowering duplication efforts by the university, establishing effective policies, and directing more resources to students through the institution’s academic mission.
“We want to take a fresh look at everything that we do from a process perspective, a procedure perspective,” Kuwitzky said. “I think there’s some best practices that we need to look at in terms of how we do business. We’ve been doing things kind of in a similar way for a long time, and so I think bringing fresh eyes and always bringing into play — not just to OSU and its constituent agencies, but also the impact that those policies have on the [agricultural and mechanical] institutions, because they’re structured very differently.
“I use the word ‘reimagine’ a lot, and really, what I mean is, let’s just rethink everything that we do, and let’s never be content or satisfied with where we are.”
Innovation Foundation dissolved, state investments continue
Suffice it to say, the OSU A&M Board of Regents was neither content nor satisfied with what it learned about the Innovation Foundation around the turn of the year. While former OSU President Kayse Shrum has defended her tenure by saying “most importantly, no money is missing” and “no state money has been taken,” Hess moved swiftly to shutter the nebulous foundation that had generated virtually no revenue compared to its big budget.
In a March 10 email to students, faculty and staff, Hess announced his decision to cut all funding to the Innovation Foundation and addressed the executive changes he has made since his Feb. 7 appointment:
As many of you have seen in recent news coverage, a state funds audit revealed financial concerns regarding The Innovation Foundation at OSU. While the financial decisions and transactions that occurred are concerning, they were isolated and do not impact OSU’s overall financial foundation, which remains the strongest among Oklahoma’s institutions of higher education.
As part of our work to address issues raised in the audit, we have made the difficult decision to discontinue funding for the The Innovation Foundation at OSU and the shared services and facilities positions within it. This decision was necessary as the financial structure of The Innovation Foundation is simply not sustainable. We are working closely with affected employees to provide transition support during this challenging time.
Specifically, OSU executives laid off 12 Innovation Foundation employees effective June 1. According to reporting from Oklahoma Voice, the university provided a runway for their employment to end but did not offer severance pay. OSU has not disclosed the identity of the employees.
Now partnered with Kuwitzky, Hess is charged with implementing corrective measures recommended in the March 5 audit, including financial reimbursements to the proper entities. With the OSU A&M Board of Regents set to meet at 10 a.m. this morning on the campus of Langston University, updates on those measures and repayment deadlines could be discussed.
On today’s meeting agenda, regents are set to “increase the budget and scope for the design, construction and renovations of facilities at the College of Veterinary Medicine” to a total $349 million project. The agenda item notes that between $79 million the Oklahoma Legislature had provided for the college one year prior and the $250 million appropriated this year, the university has $329 million available — meaning only a $20 million estimated funding gap exists.
Nonetheless, work is beginning to upgrade and replace the current, dilapidated facility — named for Boren — that partially led to the college’s prior accreditation probation. It is unclear whose name may appear on the new facility once it is fully funded and constructed. OSU had requested an additional $45 million for the project from the Legislature, but lawmakers landed on the $250 million figure when annual negotiations concluded in May.
OSU also is involved in another major initiative funded by the Legislature this year. HB 2784 and HB 2793 approved and provided $8 million for a public-private partnership between Saint Francis Health System and the OSU Medical Authority to establish a Level 1 Trauma Center for both adult and pediatric patients in eastern Oklahoma.
“The OSU Medical Authority is proud to participate in a public-private partnership with Saint Francis Health System to enhance both medical education and trauma services across eastern Oklahoma,” said Jay Helm, chairman of the OSU Medical Authority. “Since 2016, Saint Francis has been a vital partner in supporting OSU Medical Center, our teaching hospital in downtown Tulsa. This initiative supports our ability to prepare future physicians while addressing a critical health care need in our region.”
Outside of OSU’s efforts in medical academia, the A&M Board of Regents met Aug. 22 at the “University House” in Stillwater for a future-focused discussion and retreat. Topics ranged from an upcoming strategic planning process, which Hess said should focus on what the board wants OSU to look like in 2030. After prompting from Hess, regents reacted with thoughts ranging from the need to improve housing options and affordability to embracing artificial intelligence and preparing students to enter the workforce.
“One of our bigger challenges is the waste that is in the system but also the ability to attract and retain people with national expertise,” Callahan said. “I think we are falling way behind the private sector, and in order to effectively implement AI and things like that, we kind of have to resupply our national talent.”
For success to continue, the board must work to set OSU apart, according to Hess.
“We have to differentiate ourselves and differentiate ourselves on price, by keeping it affordable, and differentiating ourselves by what a student’s employable skill set will be come graduation,” Hess said.
Records show Innovation Foundation finances, bank accounts
On May 15 — the day after Oklahoma’s Fiscal Year 2026 legislative budget deal was announced — OSU responded to one of NonDoc’s Open Records Act requests seeking information about what bank accounts that contained Innovation Foundation funds.
OSU staff said the Innovation Foundation’s cash was held in the Oklahoma State Treasury and had a balance of more than $10 million at the end of 2024. That balance included “state legislative funds restricted and intended for” the Oklahoma Aerospace Institute for Research and Education and the Human Performance and Nutrition Research Institute. Additionally, OSU staff said the Innovation Foundation was the sole member of Cowboy Technologies, LLC, a “separate and distinct entity” intended to invest in STEM-based development at OSU.
“[Cowboy Technologies, LLC] has one bank account at Exchange Bank and Trust Company, which was created in December 2014 and is located next to the OSU Research Park,” an OSU communications staffer wrote. “The balance of the cash held at this bank was $6,681.02 at 12/31/24.”
Exchange Bank and Trust Company — which held the only external bank account containing funds for the OSU Innovation Foundation — is owned by Senate Appropriations Committee Chairman Chuck Hall, whose district touches the far west side of Stillwater.
Hall (R-Perry) was first elected to the State Senate in 2018 — four years after Cowboy Technologies opened the account — and he said May 27 that he did not even know it existed.
“It doesn’t surprise me. We have two branches in Stillwater. I would think that we have a lot of businesses that want to do their banking locally. This is the first I’m hearing of it. I’m not involved in day-to-day activities. I’m chairman of the board. I don’t have my CEO role anymore,” Hall said. “I can honestly tell you I would have had no knowledge of it, and number two, it’s not unrealistic for a Stillwater operation to bank locally in Stillwater, where I have two branches. I don’t think there’s any ‘there’ there. I certainly wasn’t out shopping for that business. That’s not my role at the bank anymore.”
In response to an open records request for the most recently approved Innovation Foundation budget, on June 6, university officials provided an undated document containing a Fiscal Year 2025 budget presentation. Asked to clarify the origin of the presentation, OSU associate director of media relations Mack Burke said it was unclear when and where the information had been presented.
On June 12, however, Burke followed up with an email containing a second presentation, and he confirmed that former Innovation Foundation CEO and President Elizabeth Pollard presented the second set of slides to the Innovation Foundation Board of Directors during the August 2024 board meeting — the same board meeting Callahan attended in an unofficial capacity, which began the regents’ inquiry into how state funds were being used.
Although the second set of slides is significantly longer and provides additional information about the foundation’s goals and performance reports, the information about the FY 25 budget significantly decreased.
The originally provided budget presentation included slides stating that the Innovation Foundation was “still working through funding source clarity on $10.2 million to align with approved FY 25 budget,” and that there was a $6.6 million funding gap “in labor expenses.” The following slide then explained how the gap would be addressed using OSUMA funds.
The second presentation — shown to the board — does not include two of the four slides from the other presentation. Notably, the missing slides provided additional information regarding the $6.6 million gap and a cost of breakdown of the use of OSUMA dollars and “carry forward” funds to address the gaps.
‘Never intended to be used for those purposes
On May 26 — one day before Hall said he did not know Cowboy Technologies had an account at his bank — News 9 reported on an email chain obtained through an open records request that revealed one example of the unapproved co-mingling of state funds that lead to the Innovation Foundation audit investigation.
According to News 9, the email chain included various employees working for OSU, the Innovation Foundation and the “unaffiliated” OSU Foundation. Those looped discussed financial needs for Cowboy Technologies, the for-profit venture capital arm of OSU that “makes returns-based investments in internal OSU technology development projects and growth startups affiliated with OSU.”
Burke described the role of Cowboy Technologies as a “vehicle for OSU to invest in and support technology-based start-ups and intellectual property developed at OSU” by holding equity in the those companies. Although the company acted as a subsidiary of the Innovation Foundation, Cowboy Technologies remains an active entity within the OSU system.
“The Innovation Foundation still exists as the umbrella organization for Cowboy Technologies and the OSU Research Park, though the shared services unit of the Innovation Foundation has been dissolved,” wrote Burke in a June 9 statement. “To that end, Cowboy Technologies remains active and continues to serve the same function.”
The email conversation released to News 9 started in early January when April Collier, the executive financial assistant for Shrum, reached out to Daniel Will, associate vice president of Cowboy Technologies. Collier requested that funds to pay the organization’s lobbyist invoices be transferred from an alternative account, rather through the president’s account or the OSU-Center for Health Sciences account at the OSU Foundation.
Dawn Barnard, vice president and chief financial officer for the OSU Foundation, informed those included in the chain Jan. 8 that the OSU Foundation could not pay the lobbyist invoices from the aforementioned accounts based on the “consulting/lobbying nature of the invoices.”
“Terri Tinkler and I are working together to get the consulting services invoice from Cowboy Technologies paid,” Collier wrote Jan. 7, referencing a colleague who is listed online as an employee for OSU-Center for Health Sciences. “I was contacted by the OSU Foundation and they would like to handle this a little bit differently than in the past. They would prefer that we transfer the money into your OSU Foundation account. Please let me know what that number is.”
Will told Collier he did not know of a Cowboy Technologies account with the OSU Foundation, but he emphasized the need to find a quick solution because Cowboy Technologies had utilized all of its working capital to pay previous lobbyist invoices from July 2024.
Collier then replied suggesting the funds be transferred from the Innovation Foundation’s OSU Foundation account.
Acting as a private fundraising organization for OSU, the OSU Foundation operates as a separate entity outside of the university and the Innovation Foundation — a distinction reiterated in state law by the Legislature in 2021.
The email chain seemingly created confusion around certain uses of appropriated funds, and it highlighted the convoluted arrangement that had been created at OSU: A private venture capital firm housed under the OSU Innovation Foundation was paying contracts for lobbyists seeking favorable state appropriations that were ultimately co-mingled into activities beyond their original intent.
The internal audit into the Innovation Foundation’s Fiscal Year 2024 finances found that the Innovation Foundation wrote Cowboy Technologies a $500,000 check to help bridge the gap to pay the outstanding lobbyist invoices.
“At this time, we’ve identified at least $11.5 million in restricted funds that should not have been commingled,” Burke wrote in a June 5 statement. “Additionally, at least $2 million in expenses, which did not align with their intended purpose, will need to be reimbursed from university funds. These expenses include, but are not limited to, salaries for Innovation Foundation employees, a transfer to a for-profit entity, Innovation Foundation employee clothing, consulting, Innovation Foundation furniture, Innovation Foundation marketing, etc. These expenses were paid via legislatively restricted funds — a funding source that was never intended to be used for those purposes.”
(Editor’s note: Tres Savage and Kevin Eagleson contributed to this story, which was updated at 12:10 p.m. Friday, Sept. 12, to add additional context regarding a bank account.)
Read OSU’s response to the EthicsPoint records request
Read the August 2024 Innovation Foundation board presentation
