Regents Order Further Investigation Into UT Law School

By Andrew Roush in Promote & Protect on March 20, 2013 at 2:34 pm | 2 Comments

A narrowly divided Board of Regents has approved hiring an external party to investigate UT Law and the Law School Foundation.

Less than a day after a prominent Texas legislator accused the UT System Board of Regents of “witch hunts,” a divided Board narrowly voted to hire a third party to conduct yet another investigation into the relationship between UT Law and the Law School Foundation. The independent foundation has faced scrutiny for offering forgivable loans to top law faculty members.

The Law School Foundation has supplemented faculty salaries since 1952, but the size of the most recent loans and some irregularities in how those loans were reported to the public prompted a UT System investigation. Barry Burgdorf, the UT System general counsel, led the internal review. His report recommended phasing out the forgivable-loan program and largely faulted former dean Larry Sager for not getting his personal loan of $500,000 approved. Sager disputes that UT officials didn’t know about his loan.

After Burgdorf delivered his report, the UT System had the Texas attorney general’s office review it, and the report was largely corroborated. Burgdorf announced his resignation earlier this month.

Members of the Board of Regents’ audit committee, chaired by Regent Brenda Pejovich, recommended a third review to the full board Wednesday. Despite strong objections from regents Dannenbaum, Hicks, and Stillwell, the decision to fund a further review passed, 4-3. Regents Cranberg, Hall, and Pejovich voted in favor, and Vice Chair Paul Foster cast the final tie-breaking vote.

UT President Bill Powers said that UT-Austin has cooperated with each successive level of investigation.

“The Burgdorf report looked into this. The Attorney General looked into this. The audit committee is now auditing. That’s still in progress. We have cooperated and been forthcoming with information at every stage,” Powers said.

Regent Steven Hicks, critical of the estimated $500,000 price tag of the proposed review—as well as the motivation behind it—said the law school issue had been fixed, and that regents were spending an inordinate amount of time attempting to “lay some blame on Bill Powers.”

Hicks spoke at length on the tone and motivation of the board’s actions since 2011.

“There have been times in the past few years that I have been ashamed to be a UT regent,” Hicks said.

Regent James Dannenbaum noted that regents should ensure that UT System institutions can remain competitive and urged  the board to show caution before taking any action that might have a chilling effect on donors or put the system at a competitive disadvantage. Regent Robert Stillwell said he didn’t agree with the audit committee’s conclusion, noting that the board had investigated the issue and established a best practices task force to help govern affiliated foundations throughout the system.

“There’s been plenty of time and money and attention committed to this issue already,” Stillwell said.

Regent Alex Cranberg said that money spent to ensure governance and transparency is well worth it.

“I think it would be the first true, external review we’ve asked for,” Cranberg said.

“It would be wonderful if cheering for our institutions were the sum total of our responsibilities,” said Regent Wallace Hall, “but it isn’t.” Hall noted that documents requested from UT-Austin had arrived as late as Tuesday night, and that a thorough external review was needed.

Hall also seemed to speak directly to Hicks’ concerns, saying he wouldn’t be in this position if he didn’t love UT-Austin.

Regent Paul Foster—who cast the final, tie-breaking vote—also spoke to Hicks’ remarks, saying that the move is not an indictment of a particular person or campus, and that he believes he has a responsibility to vote for what he views as a necessary investigation.

Photo of UT Law School by Valerie Cook.

Tags: bill powers, board of regents, Law School Foundation, UT Law School, ut system