The Senate Interim Committee on Education and Workforce Development, consisting of
Chair Senator Mark Hass, Vice-Chair Senator Tim Knopp, Senator Lee Beyer, Senator Jeff Kruse, and Senator Arnie Roblan
- The Board of Trustees will have significant power. It sets tuition, issues bonds, hires and fires the president, and sets her pay.
- UO, rather than the state, gets stuck with all past and future liabilities – think football and CTE, the O’Bannon case against the NCAA, etc.
- Board appointed by governor, not self-perpetuating. “The university” can recommend a slate.
- No faculty or staff will be allowed on the board, except UO Pres is ex-officio. Token student.
- The board can take away existing faculty power by fiat.
“SECTION 18. The president and professors constitute the faculty and as such have the immediate government and discipline of a university with a governing board and the students therein, except as otherwise provided by law or action of the governing board. The faculty may, subject to the supervision of the governing board and section 8 of this 2013 Act, prescribe the course of study to be pursued in the university and the textbooks to be used.
How will this interact with the rights of the faculty assembly and the UO constitution?
“SECTION 1. (1) The Legislative Assembly finds that the State of Oregon will benefit from having public universities with governing boards that: “(a) Provide transparency, public accountability and support for the university.
“(b) Are close to and closely focused on the individual university.
“(c) Do not negatively impact public universities that do not have governing boards.
“(d) Lead to greater access and affordability for Oregon residents and do not disadvantage Oregon students relative to out-of-state students.
“(e) Act in the best interests of both the university and the State of Oregon as a whole.
“(f) Promote the academic success of students in support of the mission of all education beyond high school as described in ORS 351.009.
“(2) The Legislative Assembly also finds that: “(a) Even with universities with governing boards, there are economy-of-scale benefits to having a coordinated university system.
“(b) Even with universities with governing boards, shared services may continue to be shared among universities.
“(c) Legal title to all real property, whether acquired before or after the creation of a governing board, through state funding, revenue bonds or philanthropy, shall be taken and held in the name of the State of Oregon.
“(d) The Legislative Assembly has a responsibility to monitor the success of governing boards at fulfilling their missions, their compacts and the principles stated in this section.
UO accepts all past and future liabilities:
“SECTION 2. As used in sections 1 to 23 of this 2013 Act: “(1) ‘Governing board’ means a governing board established by a university under section 3 of this 2013 Act that manages the affairs of the university by exercising and carrying out all of the powers, rights and duties that are expressly conferred upon the board by law, or that are implied by law or are incident to such powers, rights and duties.
“(2) ‘University with a governing board’ means a public university listed in section 3 of this 2013 Act that has established a governing board.
“SECTION 2a. (1) A university with a governing board is a governmental entity performing governmental functions and exercising governmental powers. The university is not considered a unit of local or municipal government or a state agency, board, commission or institution for purposes of state statutes or constitutional provisions.
“(2) A claim against a university with a governing board is not a claim against the State of Oregon. All liabilities of a university with a governing board are the sole responsibility of the university with a governing board. This subsection applies to all liabilities existing on or arising after the operative date of this section.
“SECTION 3. (1) A governing board is established for each of the following public universities: “(a) University of Oregon;
“(b) Portland State University; and “(c) Oregon State University, if the president of Oregon State University notifies the Governor that the university will become a university with a governing board in the manner set forth in section 168 of this 2013 Act.
“(2)(a) The University of Oregon governing board shall be known as the Board of Trustees of the University of Oregon.
“(b) The Portland State University governing board shall be known as the Board of Trustees of Portland State University.
“(c) The Oregon State University governing board shall be known as the Board of Trustees of Oregon State University, if the president of Oregon State University notifies the Governor that the university will become a university with a governing board in the manner set forth in section 168 of this 2013 Act.
“SECTION 4. Upon a request to the Governor by the president of Eastern Oregon University, Oregon Institute of Technology, Southern Oregon University or Western Oregon University to establish a governing board for the university, or upon a request made by the president of Oregon State University after January 1, 2014, to establish such a board, the Higher Education Coordinating Commission shall: “(1) Evaluate and determine whether: “(a) There is clear evidence of support for a governing board by the university community;
“(b) The university has the capacity and capability to be governed by a governing board; and “(c) A governing board of the university will function in accordance with the findings set forth in section 1 of this 2013 Act.
“(2) Make recommendations to the Legislative Assembly as to whether, in addition to the public universities with governing boards listed in section 3 of this 2013 Act, a governing board should be established for the university.
“SECTION 5. (1) On an annual basis, the Higher Education Coordinating Commission shall submit to the Legislative Assembly an evaluation of each university with a governing board. The commission may make recommendations to the Legislative Assembly regarding the ability of the university to meet academic goals and fulfill its fiduciary responsibilities.
“(2) The evaluation must include: “(a) A report on the university’s achievement of outcomes, measures of progress, goals and targets as described in the university’s achievement compact with the Oregon Education Investment Board;
“(b) An assessment of the university’s progress toward achieving the mission of all education beyond high school as described in ORS 351.009; and “(c) An assessment as to how well the establishment of a governing board at the university comports with the findings set forth in section 1 of this 2013 Act.
No faculty allowed. “The University” nominates, the governor appoints.
“SECTION 6. (1) A governing board for a public university must be formed and maintained as provided in this section.
“(2)(a) The Governor shall appoint 11 to 15 members of the governing board, subject to confirmation by the Senate in the manner provided in ORS 171.562 and 171.565.
“(b) For each appointment, the university shall nominate a slate of candidates and shall forward the recommended candidates to the Governor for consideration.
“(c) The governing board must include one person who is a student enrolled at the university.
“(d) The president of the university shall be an ex officio nonvoting member of the governing board.
“(3)(a) The term of office for each appointed nonstudent member of the governing board is four years.
“(b) The term of office of each student member of the governing board is two years.
“(c) A member appointed to the governing board may not be appointed to serve consecutively more than two full terms as a board member.
“(d) The Governor may remove any appointed member of the governing board at any time for cause, after notice and public hearing, but may not remove more than three members within a period of four years, unless it is for corrupt conduct in office.
“(e) Vacancies shall be filled by appointment by the Governor for the remainder of the unexpired term.
“(4) Except for the president of the university and the student member of the governing board, a member of the board may not be an employee of the university.
“(5) The governing board shall select one of its members as chairperson and another as vice chairperson for such terms and with duties and powers as the board considers necessary for the performance of the functions of those offices. The governing board shall adopt bylaws concerning how a quorum is constituted and when a quorum is necessary.
“(6) The governing board shall meet at least once quarterly, and may meet at the call of the chairperson or a majority of the voting members of the board.
“(7) A newly formed governing board shall convene for the first time between the beginning of January and the end of July of an even-numbered year.
“SECTION 8. (1) A university with a governing board shall enter into an achievement compact with the Oregon Education Investment Board for each fiscal year.
“(2) The governing board shall adopt a mission statement for the university, which shall be forwarded to the Higher Education Coordinating Commission for approval.
“(3) A university with a governing board shall submit any significant change in the university’s academic programs to the Higher Education Coordinating Commission for approval. The commission shall establish, by rule, what constitutes a significant change to a university’s academic program. The commission shall further ensure that approved programs: “(a) Are consistent with the mission statement of the university;
“(b) Do not unnecessarily duplicate academic programs offered by Oregon’s other public universities;
“(c) Are not located in a geographic area that will cause undue hardship to Oregon’s other public universities; and “(d) Are allocated among Oregon’s public universities to maximize the achievement of statewide needs and requirements.
“(4)(a) On or before May 1 of each even-numbered year, a university with a governing board shall submit to the Higher Education Coordinating Commission a funding request applicable to the biennium beginning on July 1 of the following year.
“(b) Pursuant to ORS 351.052, the Higher Education Coordinating Commission shall submit a funding request to the Governor on behalf of all public universities listed in ORS 352.002, including universities with governing boards.
“(c) The Governor’s biennial budget submitted to the Legislative Assembly may include funding requests from public universities, including universities with governing boards. Funding approved by the Legislative Assembly must specify that the moneys be appropriated to the Higher Education Coordinating Commission for distribution to public universities listed in ORS 352.002.
“(5) As part of a funding request submitted under subsection (4) of this section, a university with a governing board may request, and appropriations may include, funding for education and general operations, statewide public services, state-funded debt service, capital improvements, deferred maintenance, special initiatives and investments.
Board hires and fires President:
“SECTION 9. (1)(a) In consultation with the Governor, or the Governor’s designee, the governing board shall appoint and employ a president of the university.
“(b) The governing board shall prescribe the president’s compensation and terms and conditions of employment.
“(2) The president of the university is the president of the faculty.
The president is also the executive and governing officer of the university, except as otherwise provided by statute or action of the governing board. Subject to the supervision of the governing board, the president of the university has authority to direct the affairs of the university.
“(3) Except in the case of an interim or acting president, the hiring committee for the president of a university with a governing board shall include representatives of the university community and at least one other president of a public university based in Oregon.
“(4) The governing board is responsible for the reappointment or removal of the president of the university.
“(5) A university with a governing board may appoint and employ any instructional, administrative, professional, trade, occupational and other personnel as are necessary or appropriate and establish their compensation and terms and conditions of employment, subject to the limitations set forth in section 14 (1) and (2) of this 2013 Act.
Board controls tuition:
“SECTION 10. (1) Except as set forth in this section, the governing board may authorize, establish, eliminate, collect, manage, use in any manner and expend all revenue derived from tuition and mandatory enrollment fees.
“(2) The governing board shall establish a process for determining tuition and mandatory enrollment fees. The process must provide for participation of enrolled students and the recognized student government of the university.
“(3) Before a university with a governing board authorizes, establishes or eliminates any incidental fees, the governing board shall request that the president of the university and the recognized student government transmit a joint recommendation of the change in fees to the student body and faculty.
“(4) In determining tuition and mandatory enrollment fees for undergraduate students who are enrolled in a degree program and are qualified to pay resident tuition: “(a) The governing board may not increase the total of tuition and mandatory enrollment fees by more than five percent annually unless the board first receives approval from: “(A) The Higher Education Coordinating Commission; or “(B) The Legislative Assembly.
“(b) The governing board shall attempt to limit annual increases in tuition and mandatory enrollment fees for undergraduate students who are enrolled in a degree program and have established residency in Oregon to a percentage that is not greater than the percentage increase in the Higher Education Price Index, as compiled by the Commonfund Institute.
“(5) The governing board may not delegate authority to determine tuition and mandatory enrollment fees for undergraduate students who are enrolled in a degree program and are qualified to pay resident tuition.
Board can borrow money, sign contracts:
“SECTION 11. (1) Subject to the limitations set forth in sections 12, 15 and 19 to 23 of this 2013 Act, a university with a governing board may: “(a) Acquire, receive, hold, keep, pledge, control, convey, manage, use, lend, expend and invest all funds, appropriations, gifts, bequests, stock and revenue from any source.
“(b) Subject to the limitations set forth in Article XI, section 7, of the Oregon Constitution, borrow money for the needs of the university in such amounts and for such time and upon such terms as may be determined by the university or the governing board.
“(c) Make any and all contracts and agreements, enter into any partnership, joint venture or other business arrangement and create and participate fully in the operation of any business structure, including but not limited to the development of business structures and networks with any public or private government, nonprofit or forprofit person or entity, that in the judgment of the university or the governing board is necessary or appropriate.
“(d) Establish, collect and use charges, fines and fees for services, facilities, operations and programs.
“(e) Purchase, receive, subscribe for or otherwise acquire, own, hold, vote, use, sell, mortgage, lend, pledge, invest in or otherwise dispose of and deal in or with the shares, stock or other equity or interests in or obligations of any other entity. The State of Oregon may not have any proprietary or other interest in investments or funds referenced in this paragraph.
“(f) Acquire, purchase, purchase on a contractual basis, borrow, receive, own, hold, control, convey, sell, manage, operate, lease, lease-purchase, license, lend, invest in, issue, improve, develop, use, expend and dispose of personal property, including intellectual property, of any nature, tangible or intangible.
“(g) Establish employee benefit plans of any type, subject to the university’s continuing obligation to provide deferred compensation plans to the university’s employees under ORS 351.094.
“(h) Take, hold, grant and dispose of mortgages and other security interests on real and personal property.
“(i) Spend all available moneys without appropriation or expenditure limitation approval from the Legislative Assembly, except for moneys appropriated from the General Fund by the Legislative Assembly and the proceeds of general obligation bonds.
“(j) Acquire, purchase, purchase on a contractual basis, borrow, receive, own, hold, control, convey, sell, manage, operate, lease, lease-purchase, license, lend, invest in, improve, develop, use, expend and dispose of real property.
“(k) Erect, construct, improve, remodel, develop, repair, maintain, equip, furnish, lease, lend, convey, sell, manage, operate, use and dispose of any building, structure, land or project.
“(L) Acquire, by condemnation or otherwise, private property that is necessary or convenient. The right to acquire property by condemnation shall be exercised as provided by ORS chapter 35.
“(m) Establish policies for the organization, administration and development of the university which, to the extent set forth in those policies, shall have the force of law and may be enforced through university procedures and in any court of competent jurisdiction.
“(n) Sue in its own name, be sued in its own name and issue and enforce subpoenas in its own name.
“(o) Hire or retain attorneys for the provision of all legal services.
A university with a governing board shall reimburse the State Treasurer for legal fees incurred in connection with borrowings done at the request of the university.
“(p) Purchase any and all insurance, operate a self-insurance program or otherwise arrange for the equivalent of insurance coverage of any nature and the indemnity and defense of its officers, agents and employees or other persons designated by the university.
“(q) Subject to the procedures set forth in section 8 of this 2013 Act, establish, supervise and control academic and other programs, units of operation and standards, qualifications, policies and practices relating to university matters such as admissions, curriculum, grading, student conduct, credits, scholarships and the granting of academic degrees, certificates and other forms of recognition.
“(r) Enforce and recover any fees, charges and fines, including but not limited to mandatory enrollment fees.
“(s) Make available and perform any and all services on such terms as the governing board considers appropriate.
“(t) Delegate and provide for the further delegation of any and all powers and duties, subject to the limitations expressly set forth in law.
“(2) The budget for a university with a governing board shall be prepared in accordance with generally accepted accounting principles and adopted by the governing board in accordance with ORS 192.610 to 192.710.
“(3) A governing board or university with a governing board may perform any other acts that in the judgment of the board or university are required, necessary or appropriate to accomplish the rights and responsibilities granted to the board or university by law.
UO property belongs to State, controlled by board:
“SECTION 12. (1) Legal title to all real property acquired by a university with a governing board shall be taken and held in the name of the State of Oregon acting by and through the governing board.
Legal title to all real property conveyed to a university with a governing board is considered to be conveyed to and vested in the State of Oregon, acting by and through the governing board. Authorized conveyances of all real property, other than university lands, acquired by or vested in the State of Oregon for the use or benefit of the university must be executed in the name of the State of Oregon, acting by and through the governing board, by the chairperson of the governing board.
“(2) The governing board has custody and control of and shall care for all real property used for university purposes. Management, maintenance and preservation of all real property used for university purposes is the responsibility of the university. Real property taken and held under this section may only be encumbered by the State of Oregon in accordance with state law and in a manner that would not impair the financial condition of the university or the rights of the holders of any obligations of the university issued or incurred under any master indenture or other financing agreement.
Parking, police, Board is a “criminal justice agency”:
“SECTION 13. (1) A governing board may, in its sole discretion, do all of the following: “(a) Police, control and regulate traffic and parking of vehicles on university property.
“(b) Establish a police department and commission one or more employees as police officers in the manner and with all of the privileges and immunities set forth in ORS 352.383. When a governing board establishes a police department and commissions one or more employees as police officers, the president of the university, in cooperation with the chief of the police department, shall establish a process by which the university will receive and respond to complaints involving the policies of the police department and the conduct of the police officers.
“(c) Commission special campus security officers who, when acting in the scope of their employment, shall have stop and frisk authority as set forth in ORS 131.605 to 131.625 and probable cause arrest authority and the accompanying immunities as set forth in ORS 133.310 and 133.315. Special campus security officers may not be authorized to carry firearms as police officers and, except as provided in subsection (2) of this section, may not be considered police officers for purposes of ORS 181.610, 238.005, 243.005 or 243.736.
“(2) A university with a governing board, acting by and through its special campus security officers, is a criminal justice agency for purposes of rules adopted pursuant to ORS 181.730 (3).
“SECTION 14. (1) A university with a governing board shall engage in collective bargaining with local bargaining organizations of the employees of the university.
“(2) A university with a governing board shall participate in a collective bargaining partnership with other public universities in this state for the purpose of engaging in collective bargaining with existing statewide bargaining organizations of the employees of the public university. The collective bargaining partnership shall be established by written agreement.
“(3) Subject to the authority of the Secretary of State to audit public accounts, a university with a governing board may conduct an independent audit if the governing board considers the audit advisable.
Subject to ORS 297.250, the independent audit is subject to the exclusive discretion and control of the university. The independent audit is subject to disclosure pursuant to ORS 192.410 to 192.505.
“SECTION 15. (1) All moneys collected or received by a university with a governing board, placed to the credit of the governing board and remaining unexpended and unobligated on the date that the board is established, and all moneys collected or received by a university with a governing board after the date that the governing board is established, may be deposited into one or more accounts established by the board in depositories insured by the Federal Deposit Insurance Corporation or the National Credit Union Share Insurance Fund. The governing board shall ensure that sufficient collateral secures any amount of funds on deposit that exceeds the limits of the coverage of the Federal Deposit Insurance Corporation or the National Credit Union Share Insurance Fund. All moneys in the account are continuously appropriated to the governing board making the deposit for the purpose of carrying out the functions of the board.
“(2) Upon request of the State Treasurer, a university with a governing board shall enter into a written agreement with the state that provides for the State Treasurer to receive, hold, keep, manage and invest any amounts under the control of the university that the State Treasurer determines should be held by the State Treasurer to provide for payment of state borrowings and other state obligations that are to be paid from moneys under the control of the university. The agreement may, at the request of the State Treasurer, require the university to pay the costs incurred by the State Treasurer in connection with entering into and carrying out the agreement.
“(3) Upon request of a university with a governing board, the State Treasurer shall enter into a written agreement with the university that provides for the State Treasurer to receive, hold, keep, manage, and invest any or all funds, appropriations, gifts, bequests, and revenue from any source in accordance with the policies and procedures established by the State Treasurer, including the recoupment of costs incurred by the State Treasurer in carrying out these tasks.
“(4) As used in this section, ‘depository’ has the meaning given that term in ORS 295.001.
Who knows?
“SECTION 16. (1) The following entities are not subject to any provision of law enacted after January 1, 2013, that is unique to governmental entities unless the following entities are expressly named: “(a) A university with a governing board; and “(b) Any not-for-profit organization or other entity if the equity of the entity is owned or controlled exclusively by a university with a governing board and if the organization or entity is created by the university to advance any of the university’s statutory missions.
“(2) Notwithstanding subsection (1) of this section, the provisions of ORS 30.260 to 30.460, 200.005 to 200.025, 200.045 to 200.090, 236.605 to 236.640, 279.835, 279.840, 279.850, 297.040, 307.090 and 307.112 and ORS chapters 35, 190, 192, 244 and 295 apply to a university with a governing board under the same terms as they apply to public bodies other than the state.
“(3) Except as otherwise provided by law, the provisions of ORS 35.550 to 35.575, 180.060, 180.210 to 180.235, 184.305 to 184.345, 190.480, 190.490, 200.035, 243.696, 357.805 to 357.895 and 656.017 (2) and ORS chapters 182, 183, 240, 270, 273, 276, 278, 279A, 279B, 279C, 282, 283, 291, 292, 293, 294 and 297 do not apply to a university with a governing board.
“(4) Notwithstanding subsections (1) and (3) of this section, ORS 240.167, 279C.600 to 279C.625, 279C.800, 279C.810, 279C.825, 279C.830, 279C.835, 279C.840, 279C.845, 279C.850, 279C.855, 279C.860, 279C.865, 279C.870 and 292.043 apply to a university with a governing board under the same terms as they apply to public bodies other than the state.
“(5) Notwithstanding subsection (2) of this section, ORS 190.430 and 192.105 do not apply to a university with a governing board or any organization or other entity described in subsection (1) of this section.
“(6) Except as set forth in subsection (3) of this section, ORS 243.650 to 243.782 apply to a university with a governing board under the same terms as they apply to the state.
“(7) ORS 351.065, 351.067, 351.642, 351.643, 351.644, 351.646, 351.656, 351.658, 352.012 and 352.375 apply to a university with a governing board, except that the board or university shall exercise the responsibilities and authorities of the State Board of Higher Education or the Oregon University System.
“(8) A university with a governing board and its agents and employees remain subject to all statutes and administrative rules of this state that create rights, benefits or protections in favor of military veterans, service members and families of service members to the same extent as an agency of this state would be subject to such statutes and administrative rules.
“(9) ORS 351.692, 351.695 and 351.697 apply to a governing board, except that the board has the responsibilities and authorities with respect to the university it governs that the State Board of Higher Education and the Oregon University System have with respect to the public universities identified in ORS 351.011. A university with a governing board may not issue a tax credit certificate under ORS 351.692, 351.695 and 351.697 that will cause the university to owe the General Fund more than $2.4 million at any one time under ORS 351.692, 351.695 and 351.697.
“(10) Nothing in this section may be construed so that statutory provisions that are not set forth in this section apply to a university with a governing board.
“SECTION 17. A university with a governing board may open, establish, lay out and dedicate to the public use any streets through lands owned by or used for the university. When such streets are opened, established and laid out, they are declared to be dedicated to the public use. The university may declare that it is the road authority pursuant to ORS 810.010 (4) for any or all roads through lands owned by or used for the university.
“SECTION 18. The president and professors constitute the faculty and as such have the immediate government and discipline of a university with a governing board and the students therein, except as otherwise provided by law or action of the governing board. The faculty may, subject to the supervision of the governing board and section 8 of this 2013 Act, prescribe the course of study to be pursued in the university and the textbooks to be used.
“BONDING AUTHORITY OF GOVERNING BOARDS “
SECTION 19. As used in sections 19 to 23 of this 2013 Act: “(1) ‘Bond-related costs’ means: “(a) The costs of paying the principal of, the interest on and the premium, if any, on revenue bonds.
“(b) The costs and expenses of issuing, administering and maintaining revenue bonds, including, but not limited to, the costs and expenses of: “(A) Redeeming revenue bonds.
“(B) Paying amounts due in connection with credit enhancement devices or agreements for exchange of interest rates.
“(C) Paying the fees, administrative costs and expenses of a university with a governing board related to revenue bonds, including the costs of consultants or advisers retained by the university.
“(c) The costs of funding reserves for the revenue bonds.
“(d) Capitalized interest for the revenue bonds.
“(e) Rebates or penalties due to the United States in connection with the revenue bonds.
“(f) Any other costs or expenses that a university with a governing board determines are necessary or desirable in connection with issuing and maintaining the revenue bonds.
“(2) ‘Credit enhancement device’ means an agreement or contractual relationship between a university with a governing board and a bank, trust company, insurance company, surety bonding company, pension fund or other financial institution or entity providing additional credit on or security for a revenue bond.
“(3) ‘For the benefit of a university with a governing board’ means, in relation to bonds, as defined in ORS 286A.001, of the State of Oregon issued by the State Treasurer: “(a) Before the effective date of this 2013 Act, the portion of the proceeds of the bonds that was used to finance property, projects or liabilities on behalf of the State Board of Higher Education and for the benefit of a university with a governing board in pursuing the purposes and missions of the university.
“(b) On or after the effective date of this 2013 Act, the portion of the proceeds of the bonds a university with a governing board is eligible to receive under section 20 of this 2013 Act to finance property, projects or liabilities on behalf of and for the benefit of a university with a governing board in pursuing the purposes and missions of the university.
“(4) ‘Obligation’ means: “(a) A revenue bond;
“(b) The commitment of a university with a governing board in connection with a credit enhancement device; or “(c) An agreement for exchange of interest rates.
“(5) ‘Operative document’ means a bond declaration, trust agreement, indenture, security agreement or other document in which a university with a governing board makes a pledge.
“(6) ‘Pledge’ means: “(a) To create a lien on revenue or property.
“(b) A lien created on revenue or property.
“(7) ‘Revenue’ means tuition, fees, charges, rents, revenues, receipts and other income of a university with a governing board, except moneys received by the university from taxes collected by the State of Oregon.
“(8) ‘Revenue bond’: “(a) Means a contractual undertaking or instrument of a university with a governing board to repay borrowed moneys, which undertaking or instrument is secured by a pledge of all or part of the revenue of the university.
“(b) Does not mean a credit enhancement device.
“SECTION 20. (1) A university with a governing board may elect to remain eligible to receive proceeds of bonds, as defined in ORS 286A.001, of the State of Oregon issued by the State Treasurer pursuant to Article XI-F(1) of the Oregon Constitution by seeking review by and obtaining approval of the State Treasurer for all plans to issue revenue bonds of the university and to execute other obligations related to the revenue bonds.
“(2) The State Treasurer shall limit the scope of review and approval under subsection (1) of this section to consideration of periodic cash flow projections and other information necessary to determine the sufficiency of the cash flow of the university with a governing board to pay bond-related costs for: “(a) Bonds, as defined in ORS 286A.001, issued for the benefit of the university with a governing board pursuant to Article XI-F(1) of the Oregon Constitution; and “(b) Revenue bonds issued pursuant to sections 19 to 23 of this 2013 Act.
“(3) A university with a governing board that issues revenue bonds of the university, or executes other obligations related to the revenue bonds, without the approval of the State Treasurer as provided in subsection (2) of this section is not eligible to receive proceeds of bonds, as defined in ORS 286A.001, issued by the State Treasurer pursuant to Article XI-F(1) of the Oregon Constitution on or after the effective date of this 2013 Act.
“(4) For the purposes of ORS chapter 286A, a university with a governing board is a related agency with respect to bonds, as defined in ORS 286A.001, of the State of Oregon that: “(a) Were issued before the effective date of this 2013 Act for the benefit of a university with a governing board and that have not been retired or defeased; and “(b) Are authorized under ORS 286A.035 and issued on or after the effective date of this 2013 Act for the benefit of a university with a governing board.“SECTION 21. (1) A university with a governing board: “(a) May issue revenue bonds for any lawful purpose of the university in accordance with ORS chapter 287A.
“(b) May issue under ORS 287A.360 to 287A.380 refunding bonds of the same character and tenor as the revenue bonds replaced.
“(2) For the purposes of ORS chapter 287A, a university with a governing board is a public body.
“(3) ORS 287A.150 does not apply to revenue bonds issued by the university with a governing board.
“(4) A university with a governing board: “(a) May grant leases of real property held by a trustee or lender for a term that ends on the date on which all amounts due under the operative documents have been paid, or provision for payment has been made, or for a term of up to 20 years after the last scheduled payment under the operative documents, whichever is sooner. The leases may grant the trustee or lender the right to evict the university and exclude the university from possession of the real property for the term of the lease if the university fails to pay when due the amounts scheduled to be paid under the operative documents or otherwise defaults under the operative documents. Upon default, the trustee or lender may sublease the real property to third parties and apply any rents to payments scheduled to be made under the operative documents.
“(b) May not mortgage, pledge or grant a security interest in, or otherwise encumber, real or personal property that has been pledged or leased to provide security for bonds, as defined in ORS 286A.001, of the State of Oregon that remain outstanding.
“(5) Revenue bonds and other obligations authorized by this section: “(a) Are revenue bonds or obligations of a political subdivision of the State of Oregon.
“(b) Are not an indebtedness or obligation of the State of Oregon and are not a charge upon revenue or property of the State of Oregon, except as provided in subsection (4) of this section.
“(c) Are not a charge upon any revenue or property of a university with a governing board unless the revenue or property is pledged to secure the revenue bonds or other obligations.
“(d) Are not payable from, and may not be secured by a pledge of or lien on, any amounts a university with a governing board is required to: “(A) Deposit with the State Treasurer pursuant to section 15 (2) of this 2013 Act; or “(B) Pay to the State Treasurer pursuant to a schedule described in section 23 of this 2013 Act.
“NOTE: Section 22 was deleted by amendment. Subsequent sections were not renumbered.
“SECTION 23. (1) Sections 19 to 23 of this 2013 Act do not impair the obligations or agreements of the State of Oregon or the State Board of Higher Education with respect to bonds, as defined in ORS 286A.001, issued before the effective date of this 2013 Act for the benefit of a university with a governing board.
“(2) A university with a governing board and the Oregon University System shall take all actions necessary to ensure full compliance with the operative documents executed with respect to bonds, as defined in ORS 286A.001, issued before the effective date of this 2013 Act by the State Treasurer for the benefit of the university with a governing board.
“(3) The State Treasurer and the Oregon University System shall promptly provide a university that acquires a governing board with a schedule of outstanding bonds, as defined in ORS 286A.001, of the State of Oregon and other obligations for which the university must pay, including the payment dates and amounts, or methods for determining the amounts. The schedule must include amounts sufficient to pay principal, interest and premium, if any, on the bonds, and to pay administrative and other costs of the State of Oregon that are related to the bonds or other obligations. In the absence of manifest error, the schedule provided by the State Treasurer and the Oregon University System to a university with a governing board is binding on the university. The university with a governing board shall pay the amounts specified in the schedule provided by the State Treasurer and the Oregon University System on or before the dates specified in the schedule from the first legally available revenue of the university.
“(4) At the request of the State Treasurer, a university with a governing board shall provide the State Treasurer with periodic cash flow projections and other information that allow the State Treasurer to review and approve the sufficiency of the university’s cash flow to pay amounts specified in the schedule described in subsection (3) of this section.
“(5) Moneys deposited with the State Treasurer, the Controller of the Oregon University System or the Oregon Department of Administrative Services in a debt service reserve account or otherwise for the portion of the debt service associated with obligations entered into before the effective date of this 2013 Act for the benefit of a university with a governing board must remain with the State Treasurer, the Controller of the Oregon University System or the Oregon Department of Administrative Services until the obligations have been retired or defeased. Earnings on moneys described in this subsection must be credited to the university with a governing board.
Section 18 is a threat to meaningful Shared
Governance as formalized in our Constitution. With respect to University
Governance, the only, and very important, role of the Board should be to hire
Presidents and to can them when they do a bad job.
Someone who has guessed the Old Man’s identity has urged me
to expand on the nature of the threat posed by Section 18, which gives the
proposed Board of Directors the power to intrude upon university governance.
The threat is two fold. I present the lesser one first.
Members of the Board may not like something
they see and may take intrusive actions to change it. Although this could
happen under Section 18, it presupposes that the Board Members have so much
free time that they will actually pay attention to the ongoing internal
governance of the University. Possible, but unlikely.
A President may not like actions
proposed by the Faculty (or its Constitutionally authorized agent, the Senate).
Rather than conducting an honest negotiation with the Faculty as prescribed by
the Constitution, Prexy may ask the Board to issue a ruling that blocks the
proposed action. Judging from the actions of a past president, this possibility
must be considered seriously. In fact, it is such a serious possibility, and
would involve such a poisonous abuse of power, that our current President must
block Section 18. Mike’s failure to do
so would immediately and seriously decrease the prospect of a mutually
respectful relationship operating within a Constitutional framework.