Monday, March 2, 2015

The Relationship Between PASSHE and PASCU


The Pennsylvania State System of Higher Education (PASSHE)

PASSHE is the 14-University system of taxpayer-supported institutions of higher education that includes Bloomsburg, California, Cheyney, Clarion, East Stroudsburg, Edinboro, Indiana, Kutztown, Lock Haven, Mansfield, Millersville, Shippensburg, Slippery Rock and West Chester Universities.
PASSHE’s statutory purpose, according to Act 188 of 1982 is: “To provide high quality education at the lowest possible cost to the students.”

The Pennsylvania Association of State Colleges and Universities (PASCU)
PASCU is a non-partisan, non-profit association of citizens founded in June of 2012 that is committed to preserving the historic purpose of public higher education in Pennsylvania so that individual students, communities, and society at large may be enriched in perpetuity.
 
PASCU’s Mission is: “To ensure that the statutory purpose of public higher education in Pennsylvania as specified by Act 188 of 1982: ‘High Quality Education at the Lowest Possible Cost to the Students,’ is indefinitely preserved and faithfully delivered.”
 
The relationship between PASSHE and PASCU has aspects of both harmony and discord as seen below:
·         PASSHE’s Act 188 statutory purpose is: “To provide high quality education at the lowest possible cost to the students;” while PASCU’s mission is “To ensure that the statutory purpose of public higher education in Pennsylvania as specified by Act 188 of 1982: ‘High Quality Education at the Lowest Possible Cost to the Students,’ is indefinitely preserved and faithfully delivered.”
·         Despite the great similarity in their purpose and mission, PASSHE and PASCU are philosophical opposites.  PASSHE, launched in 1983, may be seen as the Thesis (or original idea); PASCU which began three decades later in 2012 may be seen as the Antithesis (or rebuttal to that original idea).
·         PASCU is philosophically opposed to PASSHE because of overwhelming evidence that PASSHE has not delivered high quality education at the lowest possible cost to the students in recent years. 
·         PASCU’s opposition to PASSHE, however, is not personal but philosophical and rational.  
·         PASCU believes that PASSHE’s current 100% political leadership is guilty of: 1) failing to deliver PASSHE’s statutory purpose; and 2) refusing to acknowledge publicly that it has any obligation, intention or plans to deliver PASSHE’s statutory purpose, as mandated by Act 188.

As shown in the first bullet above, PASSHE’s statutory purpose and PASCU’s mission are almost word-for word identical to each other.  The central idea in both statements is “high quality education at the lowest possible cost to the students,” creating the impression that PASSHE and PASCU are in agreement.
Note however, that the only material difference between the two statements involves an additional five words which appear in PASCU’s mission “…to ensure that PASSHE’s statutory purpose is ‘indefinitely preserved and faithfully delivered.’”  These last five words describe the entire core of the disagreement.
PASCU believes and alleges, based on compelling evidence, that the PASSHE Board of Governors has not delivered PASSHE’s statutory purpose to the PASSHE students for many years; hence PASCU’s inclusion of the words “faithfully delivered” in its Mission.

PASCU also believes and alleges, based on compelling evidence, that the PASSHE Board of Governors has not preserved PASSHE’s statutory purpose for many years, as documented by its apparent longtime unwillingness to either publicly utter the words “high quality education at the lowest possible cost to the students,” or to include those words in its most recent Strategic Plan “2020: Rising to the Challenge.”
The compelling evidence just alluded to will be presented in detail in what follows.

A Brief History of the Fourteen PASSHE Universities
 
Act 188 of 1982 is the enabling legislation that created the public corporation now known as the Pennsylvania State System of Higher Education (PASSHE), which controls the 14 “PASSHE” universities.
 
The 14 PASSHE universities initially came into existence as individual private institutions between 1837 and 1893.  They were subsequently purchased by the Commonwealth of Pennsylvania in the years after 1910.  They were initially called “State Normal Schools;” in the late 1920s their names were changed to “State Teachers’ Colleges;” in the early 1960s their names were changed to “State Colleges;” and finally in 1983 their names were changed to “State Universities” [except for IUP which achieved its university status in 1965, some eighteen before Act 188 conferred university status on the other 13 institutions. Along with the name changes prior to the passage of Act 188, the missions of the 14 institutions evolved steadily in the years since their founding. 

Definitions
Pennsylvania Promise:  The promise freely given—by the Commonwealth of Pennsylvania to the Students of Pennsylvania—upon passing Act 188 with PASSHE’s very explicit statutory purpose.
The Pennsylvania Promise is “High Quality Education at the Lowest Possible Cost to the Students.”
 
Majority Financial Stakeholders:  The PASSHE students, parents and private donors, primarily alumni, now collectively provide 75% of PASSHE’s annual operating revenue.  Students and Parents provide 70% of the annual operating revenue while private donors now provide 5%, primarily through scholarships.
 
Minority Financial Stakeholder:  The Commonwealth of Pennsylvania, in the person of the State’s elected and appointed officials, now provides 25% of PASSHE’s annual operating revenue.
 
Majority Governance Stakeholder: The Commonwealth of Pennsylvania, in the person of the State’s elected and appointed officials, continues to control 100% of PASSHE’s 174 governance seats at the tables where all key PASSHE decisions are made.  That includes 20 out of 20 seats on the Board of Governors, as well as 154 out of 154 seats on the Councils of Trustees at the 14 PASSHE universities.
 
Minority Governance Stakeholder:  The PASSHE Students, Parents and Private Donors, primarily Alumni, control 0% of PASSHE’s 174 governance seats.  
 
Funding/Governance Disparity:  The disparity between the Funding Shares and the Governance Shares of different financial stakeholders.  For example, the Minority Financial Stakeholder, the State, has a funding/governance ratio of 25%/100%, while the Majority Financial Stakeholders, the Students, Parents and private donors, primarily alumni, have a funding/governance ratio of 75%/0%.

Privatization: A rapid defunding of public higher education by the State.  This defunding is happening to varying degrees all across America and results from powerful forces, both demographic (primarily an aging population) and economic (a weak recovery with high unemployment and stagnant wages). 

To be continued.

Monday, February 23, 2015

If Elected Officials Cared about PASSHE Students, What Would be Different? - Part 6

The Purpose by Law of the PASSHE System of Fourteen Universities

Based on official news releases over four years, PASSHE leaders can’t or won’t bring themselves to commit publicly to PASSHE’s statutory purpose¹ according to Act 188:  “Its purpose shall be to provide high quality education at the lowest possible cost to the students.” (Emphasis added.)
 
Recall from Merriam-Webster that “When used in law, the word ‘shall’ describes what is mandatory.”
 
Quoted PASSHE leaders, as we saw last time, will occasionally make a passing reference to “quality education” while almost never citing “high quality education” as a critical part of PASSHE’s purpose.
 
PASSHE versus Act 188 on the Subject of Cost
 
Even more revealing is the fact that PASSHE leaders rarely if ever utter these other words from PASSHE’s statutory purpose: “…at the lowest possible cost to the students.”
 
Instead, as we saw last week, PASSHE leaders take the following pathetic stabs at what Act 188 requires:

·         “…affordable education to our students.”

·         “…the most affordable cost possible.”

·         “…the most affordable cost available.”

Recall that these three statements have been included in official PASSHE news releases covering the last four fiscal years (2012 to 2015).  One can only assume, therefore, that these words, attributed to Guido Pichini, Chair of the PASSHE Board of Governors, reflect PASSHE’s official policy position on “cost.”
 
Recall that PASSHE’s new (2014) Strategic Plan “2020: Rising to the Challenge,” also makes no mention of PASSHE’s Act 188 statutory purpose: “To provide high quality education at the lowest possible cost to the students!”
 
Rather, PASSHE’s new strategic plan reveals that—despite Act 188—the PASSHE Board of Governors is taking a totally different path; one that ignores the PASSHE students and pursues the following Vision:
 
“The Pennsylvania State System of Higher Education seeks to be among the nation’s leading systems of public universities recognized for (1) excellence, relevance, and value in education; and (2) responsiveness to regional, state, and national needs through its programs, service, scholarship, and research.”
 
Note that there is no public commitment neither to “high quality education,” nor to any intention of providing that education at “the lowest possible cost to the students.”
 
The Cost to Whom?
 
To speak clearly about the “cost” of something, one must specify the entity that will pay that cost.
 
For example, the cost to a manufacturer of producing a certain car is one figure.  The cost to the person purchasing that car is a quite different, and larger, figure.  In order for the manufacturer to earn a profit and therefore remain solvent, the cost to the purchaser must be larger than the cost of production.    
 
Note then that both entities, the car manufacturer and the car purchaser, are both naturally concerned about their respective costs, but would also be wise to be concerned about the cost to the other entity.
 
The car manufacturer that can keep costs low—while maintaining car quality—will also be able to keep the cost to the purchaser low, while still being able to make a profit and remain in business.    
 
In the PASSHE system of 14 universities, the cost to PASSHE of producing a college graduate with a particular degree is a certain figure.  The cost in tuition and fees to the purchaser of that college degree should, on the average, be the same figure.  That’s because most educational institutions function on a “non-profit” basis, meaning that the cost of production and the average cost of purchase are equal.
 
Note that even in the world of non-profit higher education, which includes not only private colleges and universities but also PASSHE—which Act 188 created as a “public corporation”—both the producer and purchaser of the education in question will be concerned about their individual and respective costs. 
 
The producer of a college education (PASSHE in this example) must be concerned about both the quality of the education provided and their actual cost in providing it.  The purchaser of a PASSHE education must also be concerned about the quality of what they receive, as well as their cost in receiving it.
 
So even in a non-profit higher education setting, where the costs to the producer and purchaser are equal, for purposes of clarity one still must answer “The Cost to Whom?” question.
 
Act 188 Speaks Clearly on the Subject of Cost

Act 188 is a model of clarity on the subject of “The Cost to Whom?”  Act 188 mandates that PASSHE’s statutory purpose is: “To provide high quality education at the lowest possible cost to the students.”

PASSHE Speaks Obscurely on the Subject of Cost

PASSHE news releases with quotes from Board of Governors’ Chair Guido Pichini on “cost,” don’t differentiate between the cost to PASSHE as opposed to the cost to PASSHE students.  That leaves one to wonder “To whom is the cost of education—according to PASSHE—supposed to be affordable?”
 
Since neither PASSHE’s leader nor PASSHE’s Strategic Plan is willing to quote Act 188 on that subject—which unambiguously specifies the lowest possible cost to the students—one can only conclude that the PASSHE Board of Governors is committed to keeping affordable the cost of education to PASSHE, but not to individual PASSHE students!
 
Obscurity is the Refuge of Incompetence
                                                                                                                 Robert Heinlein³
 
When the Chair of the Board of Governors of PASSHE, a large ($1.5 billion) public organization, engages in obscure public statements about cost for four years in a row, that is a concern.  When those obscure public statements about cost are at odds with the clear language of Act 188, the law that created and ostensibly guides the operations of PASSHE, that is a major concern.
 
But when the statement of “Vision” in PASSHE’s official Strategic Plan contradicts the clear language in Act 188 as to PASSHEs statutory purpose, that moves beyond concerns to a potentially public scandal.
 
To be continued.
 
¹ https://www.keepandshare.com/doc/6772880/act188-pdf-405k.
² https://www.keepandshare.com/doc/7490741/strategic-plan-2020-rising-to-the-challenge-10-14-pdf-2-1-meg.
³ “Obscurity is the Refuge of Incompetence” may be a modern day version of an old Russian Proverb: “You can’t write in the chimney with charcoal.”

Monday, February 16, 2015

If Elected Officials Cared about PASSHE Students, What Would be Different? - Part 5

Malfeasance by the PASSHE Board of Governors
 
The following assertions were put forth last week regarding PASSHE governance board members:

·         “All 20 members of the PASSHE Board of Governors, and all 154 members spread across the 14 PASSHE Councils of Trustees, have taken a public oath of office that requires them to obey the law.”

·         “The PASSHE Board of Governors has since 2002 openly & shamelessly failed to live up to that oath.”

·         “Public officials commit ‘malfeasance’ when they do something illegal, unlawful, or contrary to law.”

·         “The malfeasance by the PASSHE Board of Governors is easy to document because the flawed actions by members of the Board of Governors violate not just the spirit but the letter of the law.”

·         “The details of that violation of the letter of the law (Act 188) involve, among other things, PASSHE leaders publicly acting as if the law requires the Board of Governors to maintain ‘the lowest possible tuition,’ i.e., sticker price, when in fact Act 188 explicitly requires them to maintain ‘the lowest possible cost to the students,’ i.e., ‘the lowest possible bottom line!’”  (Emphasis added.)

“Your words become your actions.”
                           Mahatma Gandhi
 
The degree of alignment between words and actions is quite revealing.  When actions are contradictory to or substantially different from ones words, deception is often indicated and may in fact be involved.  
 
But when ones words and actions are totally aligned, it suggests that the actions were intentional, and that the results of those actions were, in fact, the intended results 
 
In this case, we have provided compelling evidence from official PASSHE data which proves that the statutory purpose of Act 188, ‘High quality education at the lowest possible cost to the students,’ has not been delivered by the Board of Governors to the PASSHE students since 2002.
 
It logically follows that the actions taken by the PASSHE Board of Governors—the decision-makers of record—are the cause of PASSHE’s failure to deliver ‘High quality education at the lowest possible cost to the students.’  We will now attempt to ascertain if the results of those actions were in fact intended.
 
To do that, we must consider the words of PASSHE’s leaders and compare them to Act 188¹ in regard to PASSHE’s statutory purpose: “High quality education at the lowest possible cost to the students.”   

In Their Own Words

·         Quotes from the PASSHE News Release² of June 30, 2011: “Despite the severe fiscal challenges we face, we are committed to offering high quality, affordable education to our students,” said Board of Governors Chairman Guido M. Pichini.” (Emphasis added.)
 
“Affordable education to our students” is different from “the lowest possible cost to the students.”
 
·         Quotes from the PASSHE News Release³ of July 9, 2012: “This action demonstrates our ongoing commitment to our students and their families, and to the Commonwealth,” said PASSHE Board of Governors Chairman Guido M. Pichini. “PASSHE universities will continue to offer high-quality education at the most affordable cost possible.”  (Emphasis added.)
 
“The most affordable cost possible” is different from “the lowest possible cost to the students.”
 
·         Quotes from the PASSHE News Release⁴ of July 9, 2013:  “It is very important to our students and their families that we keep our tuition affordable,” said Board of Governors Chairman Guido M. Pichini. “With this action today, PASSHE universities will continue to provide outstanding value, combining high-quality educational opportunities with the most affordable cost available.”  (Emphasis added.)
 
The “most affordable cost available” is different from “the lowest possible cost to the students.”
 
·         Quotes from the PASSHE News Release⁵ of July 8, 2014: “’PASSHE universities offer tremendous value to students and their families, providing a unique combination of high-quality educational opportunities and the most affordable cost available,’ said Board of Governors Chairman Guido M. Pichini.”  (Emphasis added.)
 
The “most affordable cost available” is different from “the lowest possible cost to the students.”

PASSHE’s New Strategic Plan

The first paragraph of the January 23, 2014 News Release announcing the Board of Governors’ approval of PASSHE’s new Strategic Plan, “2020: Rising to the Challenge,” reads as follows:
 
“Harrisburg – The Board of Governors of the Pennsylvania State System of Higher Education (PASSHE) today approved a new strategic plan that will enhance and expand student learning opportunities and ensure the Commonwealth receives the greatest possible return on its annual investment in the System and its 14 universities.”  (Emphasis added.)
 
Note the Board of Governors’ concern about the Commonwealth’s return on its “minority” (25%) annual investment in PASSHE.  However, no concern is cited about the return on the majority (75%) investment each year by PASSHE’s “Majority Stakeholders,” i.e., by PASSHE’s students, parents and alumni donors.

Act 188 vs. PASSHE’s New Strategic Plan

Here is a direct quote from Act 188:
 
“Section 20-2003-A. Purposes and General Powers
(a) The State System of Higher Education shall be part of the Commonwealth’s system of higher education. Its purpose shall be to provide high quality education at the lowest possible cost to the students. The primary mission of the System is the provision of instruction for undergraduate and graduate students to and beyond the master’s degree in the liberal arts and sciences and in applied fields, including the teaching profession.” (Emphasis added.)

This paragraph from Act 188 contains two key sentences: the 2nd sentence describes the “statutory purpose” of PASSHE’s 14 Universities; and the 3rd sentence describes PASSHE’s “primary mission.” 
 
Below are two direct quotes from PASSHE’s new Strategic Plan that parallel Act 188’s two sentences:
 
“VISION
The Pennsylvania State System of Higher Education seeks to be among the nation’s leading systems of public universities recognized for (1) excellence, relevance, and value in education; and (2) responsiveness to regional, state, and national needs through its programs, service, scholarship, and research.”
 
Note that the text under “Vision” in the Strategic Plan is totally different from the first sentence of the “Purposes and General Powers” section of Act 188.  It makes no mention of Act 188, and totally leaves out PASSHE’s statutory purpose: “It’s purpose shall be to provide high quality education at the lowest possible cost to the students.”

“MISSION
‘The primary mission of the System is the provision of instruction for undergraduate and graduate students… in the liberal arts and sciences and in applied fields…’
Act 188 of 1982”
 
Note that the text under “Mission” in the Strategic Plan is a redacted version of the second sentence—Left out are these words from Act 188: “including the teaching profession.”

To be continued.

² https://www.keepandshare.com/doc/7490737/passhe-news-release-june-30-2011-pdf-129k.
³ https://www.keepandshare.com/doc/7490738/passhe-news-release-july-9-2012-pdf-133k.
https://www.keepandshare.com/doc/7490739/passhe-news-release-july-9-2013-pdf-133k.
https://www.keepandshare.com/doc/7490740/passhe-news-release-july-8-2014-pdf-147k.
https://www.keepandshare.com/doc/7490741/strategic-plan-2020-rising-to-the-challenge-10-14-pdf-2-1-meg.

Monday, February 9, 2015

If Elected Officials Cared about PASSHE Students, What Would be Different? - Part 4

Last week’s blog post ended with a documented assertion followed by a serious allegation:

A Documented Assertion

“All 20 members of the PASSHE Board of Governors, and all 154 members spread across the 14 PASSHE Councils of Trustees, have taken a public oath of office that requires them to obey the law.”

A Serious Allegation

“The PASSHE Board of Governors has since 2002 openly and shamelessly failed to live up to that oath.”
Malfeasance

Dictionary.com defines “malfeasance” as “the performance by a public official of an act that is legally unjustified, harmful, or contrary to law.”
 
Merriam-Webster’s definition of ‘malfeasance,’ on the other hand, is much harsher: “malfeasance is illegal or dishonest activity especially by a public official or a corporation.”
 
Both definitions however agree on the following notion:  “Public officials engage in ‘malfeasance’ when they do something illegal, unlawful, or contrary to law.”

Evidence of Malfeasance

The malfeasance of the PASSHE Board of Governors in this case is easy to document because the flawed actions by the members of the Board of Governors violate not just the spirit but the letter of the law.
 
The details of that violation of the letter of the law (Act 188) involve, among other things, PASSHE leaders publicly acting as if the law requires the Board of Governors to maintain “the lowest possible tuition,” i.e., sticker price, when in fact Act 188 explicitly requires them to maintain “the lowest possible cost to the students,” i.e., “the lowest possible bottom line!”
 
Anyone who knows anything about how American colleges and universities operate knows: 1) that for most students sticker price and bottom line are two totally different things; and 2) that all colleges and universities typically compete for students on the basis of bottom line = tuition minus grants & scholarships.
 
Most students and parents facing the prospect of paying for a college education care very little about the published “tuition,” i.e., sticker price, for the best of all possible reasons:  Most students and parents don’t pay the sticker price—they pay the bottom line, which is lower than, and often much lower than, the tuition/sticker price. 
 
When Act 188 states (as it does) that the purpose of the 14 PASSHE universities is “to provide high quality education at the lowest possible cost to the students, it is stating that the Board of Governors should be focusing on providing that high quality education at the “lowest possible bottom line.”

The Disconnect

As shown in Privatization Without a Plan¹ as well as in previous blog posts,² there is a huge, shocking and almost inexplicable disconnect between what Act 188 mandates and what the members of the PASSHE Board of Governors have been delivering to PASSHE students and parents since 2002.

·       Act 188 mandates that the PASSHE Board of Governors deliver high quality education at the lowest possible cost to the students, i.e., at the lowest possible “bottom line.”

·       But the PASSHE Board of Governors has been, and is today, delivering dubious quality education at the lowest politically acceptable tuition, i.e., a “sticker price” that is totally divorced from economic reality.
 
This is not a failure of law, but rather a failure of the PASSHE Board of Governors to obey the law.

Divided Loyalty and the Structure of the PASSHE Board of Governors

Whenever elected or appointed officials fail to perform sworn duties, it inevitably raises a question of divided loyalty, otherwise known as conflict of interest, which Merriam-Webster defines as “A conflict between the private interests and the official responsibilities of a person in a position of trust.”
Quite aside from the particular individuals serving at any given time, it is obvious from its very structure that the PASSHE Board of Governors is predisposed to “divided loyalty,” a.k.a., conflict of interest. 

Five of the twenty members on the Board of Governors are elected State officials (the sitting Governor, plus a State Senator from each political caucus, plus a State Representative from each political caucus.  To be reappointed to the Board of Governors, the Senators and Representatives must be reelected by their respective caucuses, meaning that to retain their seats, they must satisfy not the PASSHE students and parents (who now pay 70% of the cost), but the members of their respective political caucuses. 
The Secretary of Education also sits on the Board of Governors after being appointed by the Governor and confirmed by the State Senate.  The remaining 14 members of the Board of Governors are appointed by the Governor and confirmed by the State Senate.

To be reappointed, those final 14 members of the Board of Governors must be reappointed by the Governor and confirmed by the State Senate, meaning that to retain their seats, they must satisfy not the PASSHE students and parents, but the Governor and the leadership of the State Senate.
Recall that: “It is important to note that a conflict of interest exists whether or not decisions are affected by a personal interest; a conflict of interest implies only the potential for bias, not a likelihood.” ³

PASSHE’s Current Tuition-Setting Process
Although the Board of Governors has the legal authority, from Section 20-2006-A(a)(11) of Act 188, “To fix the levels of tuition fees,” and despite the fact that the law does not require or even mention any role for the Governor in the tuition-setting process, the Board of Governors awaits the official word from the Governor’s office as to the maximum allowable tuition rate increase each year! 

Question: Why would the Board of Governors ignore the clear language of the law and allow the Governor to determine the maximum politically acceptable tuition rate increase for any given year?
Answer: Divided Loyalty, both on the part of the Governor, and on the part of the members of the Board of Governors, who desperately want to be reappointed by the Governor—and hence pay their loyalty to those with the power to reappoint them, i.e., not the students or parents who pay most of the cost of education, but the Governor and the leadership of the State Senate. 

To be continued.     
¹ http://www.amazon.com/Privatization-Without-Plan-Leadership-Pennsylvania/dp/1491295244/ref=sr_1_1?ie=UTF8&qid=1408368767&sr=8-1&keywords=angelo+armenti.  Pages 25-31, and Chart 20 on page 66.
² See my Blog Post dated January 12, 2015.
³ http://ccnmtl.columbia.edu/projects/rcr/rcr_conflicts/foundation/#1_1.

Monday, February 2, 2015

If Elected Officials Cared about PASSHE Students, What Would be Different? - Part 3

We have previously described the first two fiduciary duties of university governance board members according to the Association of Governing Boards (AGB).  They are the Duty of Care and the Duty of Loyalty.  In today’s blog post, we will discuss the third duty of university governance board members.¹
The Duty of Obedience

The duty of obedience refers to the board member’s obligation to advance the mission of the college or university. It also includes an expectation that board members will act in a manner that is consistent with the mission and goals of the institution. Failure of this duty can result in a loss of public confidence in the institution.  (Emphasis added.)
 
Recall that PASSHE’s current governance board members—whether serving on the Board of Governors in Harrisburg, or on one of the Councils of Trustees at the 14 PASSHE universities—are currently not required to take a fiduciary oath of office.
 
Instead, PASSHE’s governance board members currently take the following oath² of office:  “I do solemnly swear (or affirm) that I will support, obey and defend the constitution of the United States and the Constitution of this Commonwealth and that I will discharge the duties of my office with fidelity.”
 
As noted previously, the object of their fidelity is not specified, meaning that the current oath taken by PASSHE governance board members doesn’t require, or even mention, that the object of their fidelity should be the PASSHE universities and the PASSHE students who rely so heavily upon them to provide “High quality education at the lowest possible cost to the students,” as promised by Act 188 of 1982.
 
The Pennsylvania Promise

From the text³ of Act 188, we see that the statutory purpose—i.e., purpose by law—of the 14 PASSHE Universities shall be “To provide high quality education at the lowest possible cost to the students.”
 
From the Merriam-Webster dictionary, when used in law the word ‘shall’ expresses what is mandatory.

Act 188 has been amended since its initial passage, but its statutory purpose remains unchanged.  
 
Therefore
“The Pennsylvania Promise”
is
A Promise Freely-Given
By the Commonwealth of Pennsylvania
To Current and Future Students of the 14 PASSHE Universities
 
“The Pennsylvania Promise: High Quality Education at the Lowest Possible Cost to the Students.”  

Note also that the Duty of Obedience requires governance board members to “advance the mission” and to “act in a manner that is consistent with the mission and goals of the institution.”
 
The Statutory Purpose of the PASSHE Universities

According to the literal text of Act 188—the enabling legislation that created and controls the PASSHE system of 14 universities—the statutory purpose³ of the PASSHE universities is “to provide high quality education at the lowest possible cost to the students.”
 
The fiduciary Duty of Obedience requires governance board members to “advance the mission” and to “act in a manner that is consistent with the mission and goals of the institution.”
 
So a Duty of Obedience would require PASSHE’s governance board members to advance PASSHE’s statutory purpose, and to act in a manner consistent with PASSHE’s statutory purpose.  
 
But PASSHE governance board members are not required to accept the fiduciary Duty of Obedience, meaning that they are not bound—at least not by their current oath of office—to deliver the “Pennsylvania Promise” which is to provide “high quality education at the lowest possible cost to the students.”  But that fact raises the following huge question:  
 
Do PASSHE Governance Board Members Have a Duty to Obey the Law?
 
The answer to that question is undoubtedly “Yes” for many reasons, including the following:  
 
Although their current oath of office doesn’t require PASSHE governance board members to accept the fiduciary duties of Care, Loyalty and Obedience—duties routinely accepted by thousands of governance board members across America—PASSHE governance board members do take an oath to “...support, obey and defend the constitution of the United States and the Constitution of this Commonwealth.”
 
This oath is very similar to the one required of those wishing to become citizens of the United States:  “That I will support and defend the Constitution and laws of the United States of America against all enemies, foreign and domestic; that I will bear true faith and allegiance to the same.”

It is well known that the U.S. Constitution explicitly enumerates many rights of U.S. citizens; but few responsibilities of citizenship are explicitly stated—while yet understood to be implicitly required.  

See the discussion of Responsibilities under the Constitution in which the following quote⁴ appears:
“For example, the Constitution presumes lawfulness. It is a responsibility, then, to obey the law. For those who do not, there are protections, but the presumption of lawfulness is apparent.”

A government of laws, and not of men
                                                                                                                     John Adams
 
That PASSHE’s governance board members are obligated to obey the law, even when they have not taken an oath to accept the fiduciary Duty of Obedience, is clearly required by the U.S. Constitution—to which each PASSHE governance board member has taken a public oath to “support, obey and defend.”

That is, all 20 members of the PASSHE Board of Governors, and all 154 members spread across the 14 PASSHE Councils of Trustees, have taken a public oath of office that requires them to obey the law.
 
The PASSHE Board of Governors has since 2002 openly and shamelessly failed to live up to that oath.

To be continued.

¹ http://agb.org/knowledge-center/briefs/fiduciary-duties.
² https://www.keepandshare.com/doc/6750603/oath-of-office-pdf-37k.
³ https://www.keepandshare.com/doc/6772880/act188-pdf-405k.
http://www.usconstitution.net/consttop_resp.html.

Monday, January 26, 2015

If Elected Officials Cared about PASSHE Students, What Would be Different? - Part 2

If Pennsylvania’s elected officials cared about PASSHE students, they would require every political appointee whom they place on PASSHE governance boards to take a fiduciary oath of office, and to be bound by that oath to maintain a fiduciary relationship between themselves and the PASSHE students.

Here are some of the benefits that PASSHE students would receive if the PASSHE Board of Governors (BOG) were to initiate and maintain a fiduciary relationship with the students, meaning that the BOG would accept and comply with the following three fiduciary duties¹ of governance board responsibility:

The Duty of Care

The duty of care requires the full attention to one’s duties as a board member, setting aside competing personal or professional interests to protect the assets of the institution. This includes financial assets to be sure, but it also includes the institution’s reputational, personnel, and tangible assets as well. The expectation is that a board member acts reasonably, competently, and prudently when making decisions as a steward of the institution.”  (Emphasis added.)
 
Because PASSHE governance board members currently take an oath of office that does not specify to whom they owe their fidelity, those very same governance board members can legally meet the requirements of their oath—even when ignoring the best interests of the PASSHE students, and even while being loyal instead to the elected officials who appointed or confirmed them to their positions.
 
And because they are exempt from the duty of care, PASSHE governance board members don’t have to set aside any “competing or professional interests.”  They don’t have to be concerned about protecting the assets of the institution.  Nor do they have to act “reasonably, competently, and prudently when making decisions as a steward of the institution”—because their current oath doesn’t require them to accept the responsibilities associated with being a “steward of the institution.”
 
If elected officials cared, however, students could expect their PASSHE governance board members to make decisions based—not on any competing personal or professional interests—but solely on the best interests of the PASSHE students and the PASSHE institutions themselves.   That would represent a huge change from the status quo, however, in which PASSHE governance board members have occasionally acted to put their personal interests above those of PASSHE students by, for example, securing multi-million dollar contracts with the PASSHE universities while “serving” on the Board of Governors.²

The Duty of Loyalty

The duty of loyalty requires board members to put the interests of the institution before all others. It prohibits a board member from acting out of self-interest. The board’s conflict of interest policy provides guidance on how a conflicted board member can avoid putting personal interests first.”
(Emphasis added.)
 
The duty of loyalty contains a provision for ensuring that a conflicted governance board member can avoid putting their personal interests first.  The operative provision in question, however, relies on guidance provided by the board’s conflict of interest policy. (Emphasis added.) 
 
We will now address the two key issues from the previous paragraph as they apply to PASSHE: 1) what constitutes a “conflicted” PASSHE governance board member; and 2) what guidance is provided to PASSHE governance board members by “the board’s conflict of interest policy?”
 
Conflict of Interest

Merriam-Webster defines “conflict of interest” as “a conflict between the private interests and the official duties of a person in a position of trust.”
 
Columbia University has provided additional insight into whether a person is in a “conflicted” position: ³

It is important to note that a conflict of interest exists whether or not decisions are affected by a personal interest; a conflict of interest implies only the potential for bias, not a likelihood.” 
 
The fact that in the past PASSHE governance board members have secured multi-million dollar contracts from PASSHE universities while serving on the PASSHE Board of Governors² suggests that there may be insufficient sensitivity regarding the issue of conflict of interest by PASSHE governance board members.
 
PASSHE Board of Governors’ Policy 2012-01: Conflict of Interest

The PASSHE Board of Governors adopted the above-cited conflict of interest policy⁴ on January 19, 2012.
 
The verbal presentation touting PASSHE’s new conflict of interest policy was so effusive prior to being moved, seconded and unanimously approved, that many of those in attendance at the public meeting—including members of the media—were convinced that the conflict of interest policy just passed actually applied to the members of the Board of Governors who had just approved it so enthusiastically.  But:
 
PASSHE’s Conflict of Interest policy does not apply to PASSHE’s governance board members!
 
That is, PASSHE’s conflict of interest policy doesn’t apply to either the 20 members of the Board of Governors, or to the 154 members of the 11-member Councils of Trustees at the 14 PASSHE campuses.
 
If you are surprised at the contradiction between the hoopla of January 19, 2012 on the one hand, and the fact that PASSHE’s conflict of interest policy doesn’t apply to PASSHE governance board members on the other, you are not alone.
 
Interestingly, and no doubt helping to create the false impression that the policy actually applied to PASSHE governance board members, the Definitions section of the policy prominently displays the following entry: Public official” is a person appointed by a governmental body or an appointed official of the government of the Commonwealth.
 
Although the above definition of “public official” certainly sounds exactly like the political appointees who end up with seats on the Board of Governors and the 14 Councils of Trustees—Surprise!  PASSHE’s conflict of interest policy applies only to some appointed officials—but not others  
 
In the Procedure section of the policy, only three types of persons “appointed by a governmental body or an appointed official of the government” are actually covered by PASSHE’s Conflict of Interest policy:  The PASSHE “chancellor,” the 14 PASSHE “presidents” and PASSHE’s “other employees.”

The bottom line: PASSHE governance board members can't get any guidance from the "board's conflict of interest policy" because in PASSHE's case, that policy doesn't apply to them!
 
To be continued. 

¹ http://agb.org/knowledge-center/briefs/fiduciary-duties.
² https://www.keepandshare.com/doc/7471137/tribune-review-article-pa-university-board-members-grab-14m-in-contracts-july-1-2012-pdf-2.
³ http://ccnmtl.columbia.edu/projects/rcr/rcr_conflicts/foundation/#1_1.
http://www.passhe.edu/inside/policies/BOG_Policies/Policy%202012-01.pdf.