UT System Votes for External Review of Law School Foundation

One day after a lawmaker accused University of Texas System regents of engaging in a "witch hunt" aimed at University of Texas at Austin President Bill Powers, the board voted Wednesday during a tense meeting to seek an external review of the university's relationship with the University of Texas Law School Foundation.

The arrangement has come under scrutiny since 2011, when Larry Sager, then the dean of the University of Texas School of Law, was asked by Powers to resign. Concerns later surfaced about the foundation's forgivable loan program that some faculty had benefited from, including Sager, who received $500,000.

In the rare split vote, the regents voted 4-3 to set aside their previous report conducted by outgoing vice chancellor and general counsel Barry Burgdorf. That report, which was reviewed by the attorney general's staff, concluded that the way the forgivable loan program was conducted was "not appropriate" and recommended ceasing it. The report drew a sharp contrast between the way the program was run while Sager was dean as opposed to Powers, who served as dean of the law school when the program began.

On the motion to seek another report, the tie was broken by Vice Chairman Paul Foster, who presided over the specially called meeting in the absence of Chairman Gene Powell, who was on vacation. Regent Printice Gary and student regent Ashley Purgason were also absent.

The motion to have another review conducted by an outside firm cited as issues of concern "fact matters which may affect legal opinions regarding the independent status of the Law School Foundation, including that of the Attorney General" and "fact discrepancies regarding transparency and disclosure of or consent to material compensation matters that have affected the confidence of the Law School faculty, the Board, and the public at various times."

In previous interviews, Powers indicated that he was not aware of the loan at the time. In Wednesday's meeting, Regent Wallace Hall, who has requested massive open records to dig into the matter further, said he had found evidence that Powers had been notified of Sager's forgivable loan and that requests to review faculty compensation had gone unheeded.

"Any implication in what occurred today that I have not been transparent or forthcoming with information to the system or when asked of regents is simply false," Powers told reporters following the vote.

Among the regents, the strongest opposition to moving forward with the external review, among other actions of the board, came from Regent Steve Hicks. He said that the system had already reviewed the situation, that the program has stopped and compensation practices have been changed at UT-Austin's law school.

"I just can’t imagine we should spend $500,000 of the taxpayers' money to beat this dead horse," he said.

While he disagreed with the "witch hunt" comments made by state Rep. Jim Pitts, R-Waxahachie, Hicks also observed that the tone on the board had changed and said that some members were too focused on the flagship university. He said there were times in the last two years when he had felt "ashamed" to be a member of the board.

"I don’t think there’s any doubt in my mind where this is headed," he said, indicating that the destination was a referendum on Powers.

He suggested putting that to a vote rather than spending the money on another external review.

After the meeting, Regent Alex Cranberg, who supported seeking a review, told the Tribune that the vote was not about Powers.

"This is about the law school foundation and the priceless trust that our donors and faculty have in us," he said, adding, "and the taxpayers."