JE* ig n
One hundredfve years of editoralfreedom
in back taxes
The Internal Revenue Service has
claimed for years that the University
owes it $7.7 million in back taxes.
But a court settlement reached last
week requires the University to pay
only $124,366 in additional taxes, about
1.6 percent of the IRS' original claim.
In December 1994, the IRS assessed
the University with the multi-million
dollar charge, which it said came from
taxes the University owed from fiscal
years ending in 1989, 1990 and 1991.
The IRS brought the claims after a 1992
audit of the University.
"The IRS questioned a number of ex-
penses associated with activities at major
universities," University President James
Duderstadt told The Michigan Daily yes-
terday. "We believe the activities they
were questioning were legitimate."
The University filed an appeals case,
claiming the IRS was wrong in its claim for
additional taxes and that the expenses in
question were all lawfully tax-exempt. In
the case, which was filed March 21, 1995,
with the U.S. Tax Court in Chicago, the
University challenged the assessment.
The University also argued the IRS
actually owed a refund of$536,734 from
taxes paid during the same three years.
At issue was whether revenues re-
ceived from University business opera-
tions such as the golf courses should
receive the same tax-exempt status as
purely educational activities.
IRS officials claimed the University .
had improperly deducted expenses and
tried to get
$7.7 million in
back taxes from
but settled for
1.6 percent of
the total. Dollar
. are in millions.
Camping out for ... school?
Ann Arbor residents line up outside the Ann Arbor Public Schools' Balas Administration Building yesterday to reserve a spot for their children in the entering
Community High School class. Harriet Teller, ninth in line, has one son at Community High and said she went through the same process three years ago. See
story Page 3.
LW School re acts to racial incident
underreported income on several non-
academic activities, including ice skat-
ing at Yost Ice Arena, concerts through
the major campus events office, and
revenues from the University's two golf
courses. The IRS also said the Univer-
sity had incorrectly reported expenses
for the Go-Blue Shop and recreational
and computer facilities at both the Ann
Arbor and Flint campuses.
The improper deductions for 15 op-
erations in all, the IRS said, meant the
University owed $2.9 million for 1989,
$2.3 million for 1990 and $2.5 million
in 1991, in addition to the taxes the
University had already paid.
'They contended that in a number of
our recreational and sports facilities
we should have been paying unrelated-
See IRS, Page 2
By Heather Miller
Daily Staff Reporter
Wearing black ribbons, Law students
spilled into the hallway outside a packed
lecture room yesterday afternoon, wait-
to voice concerns to the faculty and
administration over the recent surfac-
ing of racial tensions.
Law School Dean Jeffrey Lehman
held the "special faculty meeting" to
address student opinions in an open
forum about racial tensions within the
The black ribbons pinned to students'
shirts expressed support for changing
t e sexual orientation, racial and gen-
climates within the Law School.
The meeting comes after the racial
epithet "NiggerGo Home" was painted
during spring break on the wall leading
to assistant Law Prof. Lance Jones'
office. The Department of Public Safety
Use of epitaph leads to 'reflection
is still investigating the incident.
"This incident disappointed me. It
did not shock or surprise me" Jones
said. "It's reflective of the way society
Lehman said he and many Law stu-
dents perceived the incident as a "po-
larizing threat to the community."
"The reason why people do what the
perpetrator did is to divide the commu-
nity along racial lines," he said.
Lehman said the bes: response to this
was to hold a meeting in which all
facets ofthe Law School could meet "to
show we are able to come together as a
community to talk about race and our-
"I believe that in the aftermath of the
racial incident last week, it is important
for us as a faculty to reflect," he said.
Law first-year student Tony Miles
opened the meeting with a statement
from the Ad Hoc Committee of Issues
of Race, Gender and Sexuality.
"We are unable to agree with Dean
Lehman that the racial epithet graffiti
that was painted here is 'manifestly
inconsistent with the norms' of the Law
School community. Bias incidents grow
out of ideas already present in the com-
munity in which they occur," he said.
The committee also presented a list
of four proposals that they feel would
help remedy some of the racial prob-
lems within the school. The proposals
include hiring a Director of Diversity,
creating a Standing Committee on Edu-
cational Environment, holding an inde-
pendent outside review of the school,
and increasing faculty diversity.
Miles asked that comments about
these proposals be addressed at a sepa-
During the meeting, many students
said the epithet directed at Jones is part
ofa larger problem ofracism within the
"This is a problem that is pervasive
throughout the Law School commu-
nity," said Akin Harrison, chair-elect
for the Black Law Students' Alliance.
"You really feel a feeling of tiredness
and frustration, because you deal with
(racism) every day at the Law School."
Other students stressed the impor-
tance of a faculty composed of more
"I want there to be so many
black faculty that a person's hand
See LAW, Page 2
Vainer to leave
board after 16 years
By Anupama Reddy.
Daily Staff Reporter
Out of a pool of eight, Senate Assem-
bly members chose four professors to fill
cant seats on the Senate Advisory Com-
ttee on University Affairs yesterday.
Assembly members elected Profs.
Bunyan Bryant, William Ensminger, f
Samuel Gross and Carol Loveland-Cherry
to join the ranks of SACUA's nine-mem-
ber committee, effective May1.
The newly elected officials will serve
full three-year terms. Law Prof. Gross is
additionally slated to complete the re-
maining year of SACUA member
Alfredo Montalvo's term.
The members-elect expressed pleasure on their
election and acknowledged various challenges
confronting SACUA and Senate Assembly in the
Gross said the road to choosing the next Univer-
sity president would be difficult and require strong
commitment from SACUA.
"The process for choosing a president has just
begun," Gross said. "It's going to be hard to go
through the process.
"My hope is that SACUA will play a construc-
*e role in the changing of the guard."
School of Natural Resources and Environ-
ment Prof. Bryant, a current Senate Assembly
member, said the faculty's role should be
strengthened in the midst of major organiza-
"It seems to me the University is in a flux,"
0n4 -M "U an nutn - + nth tn, .n- fiir-A_
Bryant, an SNRE
expected to be
Dole predicted to win
By Stephanie Jo Klein
Daily Staff Reporter
By Jeff Eldridge
Daily Staff Reporter
Regent Nellie Varner (D-Detroit) told
The Michigan Daily yesterday that she
will not seek another term on the Uni-
versity Board of Regents.
Varner, the longest-serving Democrat
on the board and its only African Ameri-
can, was first elected in 1980. The eight-
member governing body of the Univer-
sity is elected on a statewide basis. Two
seats are up for election every two years.
"It will be 16 years this fall," Varner
said. "It's long enough. It's time to
move on and let some new people and
fresh ideas in."
University President James
Duderstadt said he appreciates the time
and energy Varner has comimitted to the
"She has been one of the most dedi-
cated and thoughtful regents in our his-
tory," Duderstadt said.
Regent Rebecca McGowan (D-Ann
Arbor) said Varner had informed her of
her intentions to leave the board.
"I have served with Nellie Varner for
only three of her 16 years on the board,
but there is no one else quite like her,'
McGowan said. "She is a strong-minded.
fair, articulate friend ofmine, anda frienC
of the University of Michigan."
has appeared less
aggressive in meet-
ings than some of
Varner has always
the regents when
she thought it was
sometimes ap- Varner
peared on the sur-
face to be a quiet but strong presence,'
McGowan said. "But if the discussion i
veering off in a direction Regent Vamer
thinks isn't constructive for the Univer-
sity, she will right that situation immedi
ately, forcefully and definitively."
Former Regent Thomas Roach saic
the board tends to be free from partisar
politicking. Roach said the upcoming
See VARNER, Page
cology, said he was pleased with SACUA's grow-
ing involvement in faculty concerns.
"Certainly, in the last three years, SACUA and
Senate Assembly have been more proactive in
reacting with the administration," Ensminger said.
"The faculty and Senate Assembly have become a
more vital part of the institution."
Current SACUA members said they were pleased
with the caliber of the incoming members and said
there will be a lot of hard work ahead for SACUA.
Art Prof. Montalvo said he reviewed the candi-
dates personally and was not worried about any of
them being elected.
"I found that no one on the slate is not up to the
task," Montalvo said. "They will rise to the occa-
sion one way or another."
SACUA chair-elect Thomas Dunn said he was
pleased with the addition of a woman and an
African American to SACUA and encouraged the
members-elect "to give honest opinions as faculty
m-mhi-rcad it n toPar oter"o
Although many say Michigan voters will overwhelmingly
support Sen. Bob Dole (R-Kan.) in today's Republican
presidential primary, members of the College Republicans
say student voter turnout may not be large.
In the past week, Dole has received the endorsements of
many state Republican leaders, includ-
ing Gov. John Engler, Sen. Spencer
Abraham (R-Auburn Hills), state House
Speaker Paul Hillegonds (R-Holland),
and state Sen. Majority Leader Dick
In a statement last week, Abraham
expressed his support for Dole.
"Unfortunately, Bill Clinton is the one
person standing in the way of our reform
agenda," Abraham said. "If the Ameri-
can people want to see the changes we've Dole
passed in Congress become a reality,
Bob Dole is the person to lead that mission."
College Republicans President Angela Jerkatis, an LSA
junior, said Michigan is "a unified force behind one candi-
Evan Knott, an LSA first-year student, said he does not
think students will show any support for conservative com-
mentator Pat Buchanan.
"I think a lot of people on campus are alienated by Mr.
Buchanan," Knott said, noting his exclusionary stances on
trade. "He's way out of line. He's got the wrong vision for