OPEN GOVERNMENT — The Assembly Higher Education Committee on Tuesday approved SB 330 – a reintroduction of last year’s SB 218 – to apply
the California Public Records Act (CPRA) to nonprofit 'auxiliary'
organizations that perform government functions at campuses of the University of
California, California State University, and California’s community
colleges, reports the office of Senator Leland Yee (D-San Francisco), author of both bills.

To address the Governor’s veto message from last year,
the new bill has been amended to exempt from disclosure the names of
volunteers and donors who wish to remain anonymous provided they do not
receive something of value greater than $500 in exchange for their
donation or service.  The bill will also exempt information obtained in
the process of soliciting donations.

“It is imperative that we
pass this bill to help rid the UC and the CSU of waste, fraud, and
abuse,” said Yee.  “Through this legislation, we will give the Governor a
second chance to do the right thing.  Taxpayers and students deserve to
know how their public universities are run.”

“The time has come
to bring transparency and accountability to our public colleges and
universities,” said Lillian Taiz, President of the California Faculty
Association and a history professor at CSU Los Angeles.  “Because of
state funding cuts to public higher education, we must ensure that what
money the system has is spent as it was intended – in the classroom
educating students.”

Most recently, the CSU Stanislaus Foundation,
which is fully staffed by taxpayer-funded employees, negotiated a
speaking engagement contract with Sarah Palin but refused to disclose
her compensation for this Friday’s gala.  Then, email correspondence by
administrators regarding the visit were uncovered and students also
found pages 4 through 9 of the Palin contract in the administration’s
dumpster, which showed her visit requirements include a hotel suite,
first class airfare or a private Lear jet, pre-screened questions, and
“bendable straws.” 

The incident has spurred an investigation by
the Attorney General, a lawsuit by Californians Aware, and several hate
messages sent to the office of Senator Yee, who had made a public records
request to the University for such information.

The UC and CSU
have often evaded the public records act by shifting some
responsibilities to foundations and other auxiliary organizations
operating on campuses.  Several recent examples demonstrate the need for
increased public oversight and accountability provided by SB 330:

  • At Sonoma State, a $1.25 million loan issued to a former foundation
    board member two days after he resigned.  Recently a bankruptcy court
    forced the Sonoma State Foundation to return a portion of that loan
    which the former board member attempted to pay outside of the bankruptcy
    court proceedings.  The Attorney General and the FBI are investigating a
    number of auxiliaries at Sonoma State.
  • At Fresno State, a
    no-bid managing contract was given to a foundation member for a theatre
    complex in which he held a financial interest.  In addition, the Fresno
    Bee newspaper was denied information in 2001, specifically concerning
    the identity of individuals and companies that received luxury suites at
    the Save Mart Center arena.  The denial resulted in CSU v. Superior
    Court (McClatchy Company), in which the Court opined that although it
    recognized university auxiliaries ought to be covered by the CPRA and
    that its ruling was counter to the obvious legislative intent of the
    CPRA, the rewriting of the statute was a legislative responsibility.
  • At San Francisco City College, a campus executive has been indicted for
    using money from the San Francisco City College Foundation for personal
    and political purposes. 
  • At San Jose/Evergreen Community College, the
    Chancellor was found to have engaged in lavish travel and other examples
    of financial impropriety that prompted her resignation. Since local
    community college campus auxiliaries are already subject to the CPRA,
    these instances of waste and abuse have led to the parties being held
    to account.
  • Sacramento State President Alexander Gonzalez
    recently acknowledged his campus is being investigated by the Attorney
    General in relation to inappropriate expenditures of campus auxiliary
    money, including $200,000 to remodel President Gonzalez’ kitchen in
    2007.  Additionally at Sacramento State, $6.3 million of public funds
    was transferred to University Enterprises Inc., a campus auxiliary, to
    backfill losses from a property acquisition.
  • Campus
    leadership at Cal Poly San Luis Obispo appears to be under the influence
    of a well-heeled donor.  In October, Cal Poly eliminated a guest
    lecture at the request of executives from the Harris Ranch Beef Company,
    who threatened to withhold $500,000 in support for a new campus
    meat-processing center.  Emails recently obtained by the San Luis Obispo
    Telegram Tribune also found that Harris Ranch may have also forced the
    resignation of a faculty member who taught a course on sustainable
    farming.  Harris officials are now requesting a meeting with Cal Poly
    administrators to determine whether or not they will continue with their
    donation.

According to the CSU Chancellor’s Office, 20 percent of
its $6.7 billion budget, or $1.34 billion, is held in their 87
auxiliaries and foundations, and out of public view.

“SB 330 would
remove the cloak of secrecy that prevents the public from understanding
whether significant amounts of educational funding for public colleges
and universities is being spent for the benefit of all Californians or
just a privileged few,” said Jim Ewert, Legal Counsel for the California
Newspaper Publishers Association.

“In just the past few months,
the scandals involving these foundations have expanded significantly to
reveal that money has been used inappropriately for personal expenses,
questionable loans, no-bid contracts, and executive perks for college
administrators,” said Taiz.

“If government agencies can spin off
front groups to handle their income with no transparency, those who
provide that funding will never know quite where their money goes,” said
Terry Francke, General Counsel for Californians Aware.

Before
heading to the Governor, SB 330 must be approved by the full Assembly.