Friday, June 08, 2007

Everything Old is New Again

[Editor's Note: The introduction to the post has been revised. I should know better than to read things late at night.]

I was surfing the web last night looking for commentary on Graham's balls-to-the-wall State Senate testimony concerning Senator Peliggi's Right-To-Know legislation when I came across a nine year old Pittsburgh Post-Gazette article posted on a Miami University of Ohio listserve. The story, which concerns a bid rigging scandal at the state-related Lincoln University,went into the history of efforts to extend Pennsylvania's Right-To-Know law to state-related universities.

The bid rigging scandal might explain why Lincoln University did not weigh in on Monday on Pileggi's legislation. The state-related schools may not have wanted to risk that Lincoln's presence would trigger someone's memory of that scandal.

Here is the article in its entirety. It should drive home what is at stake in the battle to shine a light on the recesses of Old Main and the other state-related schools

Schools exempt from scrutiny
By Bill Schackner, Post-Gazette Staff Writer

The resignation of Lincoln University's president amidcharges of bid rigging and mismanagement has once again raised a question that has been asked in Pennsylvania for years.

If taxpayers shell out tens of millions of dollars to help run universities,
do they have a right to see for themselves how their money is spent?

The answer consistently has been "no" when it pertains to Lincoln and three other schools -- the University of Pittsburgh, Penn State University and Temple University. Together, they receive more than half a billion dollars in state aid each year, yet much of their operations are shielded from public view.

Want to know how much Penn State pays Joe Paterno to coach football? Sorry, that's private.

Want to see documents that would explain why Pitt chose one food service vendor over another? Chances are, that's off limits, too.

The four schools submit to yearly audits and turn over limited financial data to the Legislature. But unlike full state universities and government agencies, these four schools, known as state-related institutions, are generally exempt from open-records laws.

Their trustees' boards are made up mostly of private citizens, and the fact that they get tax money does not change their status as private, nonprofit corporations, the state Supreme Court has ruled. As such, they "are not required to make public records available for examination."

Critics, though, say the arrangement allows the schools to have it both ways-- sometimes at the public's expense.

"They play both sides of the game," said Barry Kauffman, executive director of Common Cause Pennsylvania, which advocates a stronger Right To Know law. "They want to be covered by state funding laws when it's time to receive money, but when it's time to disclose how that money is spent, they don't want to becovered by state disclosure laws."

It's unclear if problems at Lincoln, which were discovered by employees, would have come to light sooner had the public been able to ask for documents showing how Lincoln awarded contracts and paid its bills. But the issue is likely to get close scrutiny in the months ahead.

Even before the Lincoln scandal surfaced, state Education Secretary Eugene Hickok had talked within his agency about the possibility of giving the public open access to data on tax dollars that flow into these quasi-public universities, Education Department spokesman Dan Langan said.

Facing a fight

"We do it for lower education. Perhaps it's time to start applying a very similar principle to higher education -- at least the commonwealth's
investment in higher education," Langan said.

If the secretary starts down that path, he's in for a long, hard fight.

Just ask state Rep. Ron Cowell, D-Wilkins, minority chairman of the House Education Committee, who wrote the state's first ethics law 20 years ago and is a former Pitt trustee.

After a public outcry in 1991 over the size of a retirement package given to then-Pitt President Wesley Posvar, Cowell introduced legislation to bring Pitt and the other state-related schools under the state's Right to Know law.

The bill passed the House, and the governor promised to sign it. But it died in the Senate.

In the years that followed, Cowell introduced amendments that would have tied all four schools' appropriations to their willingness to submit to the Right to Know law.

That effort failed, too.

What ultimately passed about four years ago was a far less sweeping legislative amendment to those schools' annual appropriations bill. It
requires that the schools each year give the governor and Legislature books of raw data on such items as expenditures and revenues by department, vendor payments and average faculty salaries on campus.

Cowell had wanted much more.

He said he was disappointed that, as legislators, "We haven't had the good sense to take what I consider to be a very modest step to promote more public accountability for a significant amount of tax dollars."

"I don't believe anyone is a crook, but I do believe the likelihood of public scrutiny influences your behavior, personally and as an institution," Cowell

The idea "that somebody is watching over your shoulder" is a strong deterrent to misbehavior, he said.

"The paradox is that we have legislators who, on the one hand, insist that we ought to have more accountability with respect to higher education and we ought to demand more efficiency and more effectiveness, but many of those same legislators will vote against what I consider to be a really simple tool --public disclosure," Cowell said.

The universities, though, say the data they now must provide amounts to ample disclosure. They say there are enough safeguards against abuse already in place.

Schools defend access

Pitt, for instance, says it now submits to the governor and Legislature
hundreds of pages of financial data each year. Copies are kept in the library where they can be reviewed by the public, Pitt spokesman Ken Service said.

Beyond that, the state auditor general every year reviews the state's
appropriation to the university, which at $158.2 million is about 18 percent of its budget. The university's entire operation is monitored by internal auditors and by an outside firm, whose annual report to the school's trustees is made public.

"We are confident that we are both providing sufficient information to the various governmental bodies and that we have safeguards in place to ensure that we are operating in an ethical manner," Service said. "We do account very well for the dollars that we receive."

Penn State President Graham Spanier said his school also releases sufficient data to the state and puts its budget online.

He said Penn State "is able to operate a much better university for the people of the state" without the Right to Know law.

Existing policies allow "a very, very, high degree of openness and
accountability" without "having a situation where we lose a faculty member or can't recruit a faculty member because their salary is being publicly debated," he said.

Some legislators agree.

State Sen. Vincent Fumo, D-Philadelphia, said he sees no need to expand the open-records law to Pitt, Temple and Penn State and doesn't want what happened at Lincoln to penalize those schools, said his spokesman, Gary Tuma. Fumo's office began an investigation and hired an accountant after getting complaints from Lincoln employees about work done on the president's campus home.

Tuma said the senator doesn't believe the open-records law would have made a difference in the Lincoln case because the Legislature and auditor general ultimately got the documents they needed.

"If you're suggesting that (the open records Law) would be a deterrent, people ought to be deterred anyway because that information can be obtained" by the Legislature and state auditors, Tuma said.

Lincoln's routine audits, however, apparently weren't enough to uncover the information that eventually led President Niara Sudarkasa to submit her resignation last week.

They involve her spending and accounting practices and those of Sudarkasa's husband, John Clark, former director of maintenance and construction operations at the school west of Philadelphia.

Lincoln's problems

Pennsylvania Auditor General Robert P. Casey Jr. concluded this month after an eight-month investigation that the school had been victimized by bid-rigging, administrative waste and mismanagement.

According to the allegations, Sudarkasa and her husband spent $531,694 to renovate the presidential residence without the knowledge of the full board of trustees. Also alleged is that Sudarkasa improperly received $34,000 in university money for legal help with her personal tax problems.

Casey, in a report, concluded that the campus operation that Clark had run offered preferred treatment to certain companies instead of seeking out the lowest bidder. Two office secretaries who worked under Clark said he ordered them to type bids and invoices for a private firm that wound up doing work for Lincoln, Casey said.

If Lincoln were covered under the Right to Know Law, those invoices and contracts would be public records. Anyone could have seen them, along with documents related to work on the president's home.

But as things stand now, such records are released only if the school chooses to do so, said John Feichtel, general counsel for the Pennsylvania Newspaper Publishers' Association, another group pressing the case for a stronger Right to Know law.

"If they do it now, it's voluntary," he said. "That's why we're concerned
about bringing them under the law.

"The purpose of the Right to Know is the public can act as a check and balance system against those agencies to make sure they are spending their money appropriately," Feichtel said.

Powered by ScribeFire.

No comments: