Timothy M. Stearns, the founding executive director of the Lyles Center for Innovation and Entrepreneurship at Fresno State, resigned Monday after an audit questioned his spending and business practices. He will continue to teach entrepreneurship with the Craig School of Business, Fresno State announced.
Stearns will also serve as a special assistant to Fresno State Provost Lynnette Zelezny until June 30. He will assist her with addressing the findings of a California State University audit released Feb. 12 that criticized cash-handling practices and found several conflicts of interests within the Lyles Center. He will also help with the search for a new director – a position he held since the center’s inception in 2003.
The search for a new director will begin immediately, the university said. Zelezny is expected to announce an interim director soon to oversee the center while the search is conducted.
An attempt to reach Stearns for comment was not successful.
Fresno State President Joseph Castro told The Bee in an emailed statement that he accepted Stearns’ resignation Monday “because we are both committed to the long-term success of the Lyles Center.”
Castro added that Stearns’ leadership has been key to the center’s growth and success.
He also addressed the audit.
“I was disappointed by the magnitude and seriousness of the audit findings,” Castro said. “There are lessons to be learned from the audit that will help the university to minimize such risks in the future.”
The audit found that Stearns used current and former business partners as consultants, and his business – a localized section of the international Kids Invent program – profited directly from Lyles Center labor.
Kids Invent partnered with the Lyles Center to develop a curriculum for fourth- to sixth-grade students in Fresno Unified School District. The center also employed Stearns’ Kids Invent partner as a consultant during this time.
The Lyles Center also kept a PayPal account that the Fresno State Foundation was not aware of. Online payments from parents and schools sending students to Lyles for business education summer courses were collected in this account, and auditors could not find definite reasons for at least $15,000 in expenditures and payments to the director.
Fresno State agreed with all of the auditors’ findings.
In an interview with The Bee on Friday, Stearns defended his practices.
He said that all of his expenses and reimbursement requests had a matching receipt or invoice. The PayPal account was managed by another employee, and he said he was unaware of a university policy that requires all payments to campus PayPals be sent directly to the Fresno State Foundation’s bank account.
Deborah Adishian-Astone, interim vice president for administration at Fresno State and executive director of the Fresno State Foundation, said the PayPal account was shut down. She also could not account for the $15,000, saying all of the account’s withdrawals and deposits were done without the foundation’s knowledge.
Al Smith, CEO of the Fresno Chamber of Commerce from 2005 to 2015, said that Stearns “was a tremendous asset to this community and the entrepreneurial programs at Fresno State.”
“He will be sorely missed and very hard to replace,” Smith said.
Stearns has been a professor at Fresno State since 1994. He is a tenured faculty member.