Thursday, January 25, 2007

We Would Be in Your Debt If You Answer These Questions.

Last October Provost Rodney Erickson was to make a presentation to the University Faculty Senate on the University's budget. His Power Point presentation was posted by the Senate, but Erickson was not able to attend the meeting. Therefore no questions could be asked of him. On Tuesday January 30th, 2007 he will appear before the Senate to accept questions on the budget. I should note that anyone in the University community can ask questions at a Senate meeting. Here is what must be done to get the floor.

Members of the University community may attend this meeting. Any member of the University community not a member of the Senate may request the privilege of the floor on any item of business already before the Senate. Such a request must be made to the chair, through the executive secretary of the Senate, at least four calendar days before the meeting at which the individual wishes to speak.

I would hope that someone in attendance would grill him about the amount of debt that the University has incurred. Typically, Old Main can give incomplete or misleading answers to such questions because the faculty doesn't have access to the detailed budget. With regard to the debt, we now have pretty good numbers from the Virgina Tech report. However, the report only gives aggregate numbers. Here is a list of question which could be asked of Erickson.

  • A report prepared for Virgina Tech last summer by Lehman Brothers gives Penn State's outstanding debt as $849 million. What is the current number?
  • What is debt as a percentage of the total endowment?

  • What is the yearly debt service?
  • What is the yearly debt service as percentage of the operating budget?

  • What is the yearly debt service per student?
  • Please explain the item in the budget labeled "Capitol Improvement". Are you, as it appears, asking the Commonwealth for help in paying off outstanding debt? If so, why?

  • Could you prepare a complete list of all outstanding bond issues, the size of each issue, and the purpose of each issue?
I think that would be a good starting point and would give everyone some real numbers to chew on.

By the way, Erickson might try to dodge the last question by accerting that the University does not make such information public. This argument does not hold water, since anyone can pay a bond rating service, such as Standard and Poors, for the information. Why should members of the University community have to pay a third party for the information?

Oh, and for bonus points, someone should as Erickson about the University's position the Mahoney open record law.

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