PEER suggests additional guidelines for university foundations

JACKSON – The Mississippi University for Women Foundation created “an appearance of impropriety,” though it broke no law, because one of its board members served as an executive at a bank where the board conducted a financial transaction, a legislative watchdog group reported Thursday.
The Joint Legislative Committee on Performance Evaluation and Expenditure Review released a report on the MUW Foundation based on complaints from three alumnae.
In general, the PEER report called for the MUW Foundation to provide more transparency, to take additional steps to avoid even the appearance of impropriety and to enact processes to ensure the foundation’s funds are secured.
The state College Board last week discussed policy issues related to private foundations that provide support to public universities. It’s expected to refine those policies in the coming months.
A document released last week by the College Board said the foundations, which raise private funds to aid the universities, need a certain amount of independence, but “on the other hand, a system of complete independence of foundations from universities ignores the reality that the foundations are inextricably linked to the universities. The foundations only exist to serve and promote the missions of universities.”
Problems with the foundations would reflect on the universities with which they are affiliated, the report noted.
College Board member Alan Perry of Jackson, who is heading up the policy review, said, “I adopt a position of trust everybody and verify.”
Part of what Perry and the board are considering is what would occur if a dispute arose between a foundation board of directors and the university president. A system might be put in place to require the foundation to turn over disputed documents to the College Board.
Plus, another draft proposal could force a foundation to replace its board of directors if it is determined the board and the university president cannot agree.
Perry pointed out a fine line must be walked to protect donors who do not want to be identified while providing the proper transparency to ensure that foundation funds are being spent legally and efficiently.
A foundation issue went all the way to the state Supreme Court last year after MUW President Claudia A. Limbert disassociated the university from its more than 100-year association with the MUW Alumnae Association. The court upheld the position of Limbert and the board that they acted within their rights to disassociate from the foundation.
The PEER report said the MUW Foundation did not act illegally in taking out a line of credit with a bank where one of its board members was a executive. And it did not violate Internal Revenue Service rules, as was alleged.
In addition to providing more transparency, PEER said the MUW Foundation and all others should be required to maintain a record of work done by university staff on behalf of the foundations.

Contact Bobby Harrison at (601) 353-3119 or bobby.harrison@djournal.com.

Bobby Harrison/NEMS Daily Journal