Kansas University has released documents showing correspondence between Art Hall, the executive director of the KU Center for Applied Economics, and the Koch Foundation. Hall was previously the chief economist for the Public Sector Group of Koch Industries Inc.

Newly released documents paint only a partial picture of how — and by whom — Kansas University’s Center for Applied Economics is funded.

The clear part of the picture is that the Koch Foundation has, through KU Endowment, given the Center at least $430,000 since 2008, which Executive Director Art Hall used for what he describes as “reform-oriented” research projects with a goal of creating “intellectual products that will enlighten public policy debates in a way that helps promote smaller government and a more robust free-enterprise policy platform.”

Critics of Koch’s contributions to universities nationwide say that’s an obvious indication of political lobbying under the guise of academia.

Hall says he’s exercising his own academic freedom and producing legitimate research.

KU isn’t making a call on whether the correspondence indicates anything out of line, saying instead that, in general, academic freedom and academic integrity are important to balance.

The documents, which KU shared publicly on Thursday, number just 15 pages.

They include a KU Endowment fund administration agreement for the KU Center for Applied Economics Fund, a research grant funding request by Hall to the Koch Foundation and several emails between Hall and Koch representatives. In the emails, Hall discusses grant amounts and how he is using and plans to use the money.

Hall said the Koch Foundation does not direct his teaching or research, although he is grateful for their funding and corresponds about his activities as a courtesy.

“There is this underlying assumption — that is completely misplaced — that there is all this control, and it’s completely not true,” Hall said.

Long path to few documents

The Center for Applied Economics is a public policy think-tank within KU’s School of Business, one of six research centers housed there. Hall is its executive director and also a lecturer who teaches classes in the business school. Previously he was chief economist for the Public Sector Group of Koch Industries Inc.

?In 2014, a KU student group called Students for a Sustainable Future and Schuyler Kraus, its president, filed — and paid $1,800 for — a Kansas Open Records Act request for documents related to the hiring of Hall and two other business school teachers, as well as correspondence between them and the Koch Foundation and various affiliated organizations, dating back as far as 1995.

Schuyler Kraus is a KU senior and president of a student group that is attempting to uncover how the billionaire Koch brothers influence KU.

KU released some documents to the students and was poised to release the rest when Hall sued the university in December 2014, and a judge temporarily blocked KU from releasing the remaining records. Kraus intervened and became a third party in the lawsuit.

The case appeared headed to trial, during which the court would decide whether the documents should fall under the Kansas Open Records Act. But last week, KU announced that the three sides had settled out of court.

Under the settlement agreement, KU released a limited number of the disputed documents, and Kraus agreed to drop her Kansas Open Records request.

KU spokesman Joe Monaco said KU spent time preparing the records and that the students’ fee would not be waived or refunded. He declined to say how many pages of the disputed records were not released, or specifics about what they say.

“We strongly support First Amendment rights of faculty but at the same time we have to fulfill our obligations under the open records act,” Monaco said. “That can be a difficult balancing act, as this case has demonstrated.”

‘Never stopped lobbying for Koch’

Students for a Sustainable Future is part of a network of groups nationwide investigating the influence Koch has on academia, with Greenpeace as one of its partners.

Connor Gibson in Washington, D.C., is a researcher for Greenpeace’s investigations team who, according to his Greenpeace bio, focuses on polluting industries and their “front groups and PR operatives,” particularly the Koch brothers.

Gibson said the “smoking gun” from the new KU documents is Hall’s “predetermined mission” to create intellectual products promoting smaller government and free enterprise.

“In my eyes, Art Hall never stopped lobbying for Koch Industries,” Gibson said. “That is the part that I think is completely inappropriate, that the Koch Foundation is essentially able to buy the university’s legitimacy through their former lobbyist.”

Since KU announced the settlement on Thursday, Kraus has not responded to messages from the Journal-World.

The Koch Foundation supports the academic freedom of faculty and makes grants in line with university policies on hiring and curriculum, a representative has previously told the Journal-World.

Research to reform policy

Hall is the Center’s only employee, and his salary — $111,000, according to KU’s 2016 budget — makes up almost all of the Center’s annual budget.

In addition to the Center for Applied Economics fund, Hall said the Center also gets money from a second KU Endowment fund — the Kansas Economic Reform Initiative Fund — primarily set up to pay stipends to other researchers who contribute to Center reports. Both funds are mentioned in the newly released documents from KU.

Several years ago, grants from the Koch Foundation paid for most of his salary, Hall said. Now, most of his salary is paid by KU for his teaching (he’s teaching three classes/four sections this semester, according to the business school, and usually teaches in the summer, too).

Art Hall, KU School of Business

Hall said he’s never tried to hide his personal belief that “markets work,” and he often begins a research project with that assumption.

He said he does hope for policy reform. He said the Center’s reports have addressed making Medicaid and the school system more effective and changing policy to improve the dynamics of Kansas.

Typically, tenure-track professors research and publish results in academic journals, which require peer review of articles by others in the field. Center for Applied Economics research by Hall and other contributors is published in reports that are publicly available on the Center’s website, business.ku.edu/center-applied-economics.

Hall said his career path has been in policy by choice. “I purposely did not choose a tenure track because I like doing this kind of work. It has a different audience, and it’s a different market.”

Hall stands by the quality of his research and said he would not put his name — or KU’s — on something that wasn’t sound.

As for his equivalent of peer review, Hall said his publications “are out there for public consumption and anybody can engage them … it is not intended to be a peer-reviewed product, it’s intended to be an economic analysis that’s accessible to a policy maker.”

‘Vigilance’ needed to ensure integrity

Jim Guthrie, associate dean of academic affairs for the KU School of Business, said that like other teachers, Hall reports to an academic director and is evaluated each semester. In the classroom, Hall is an effective teacher who shares a variety of perspectives in addition to his own opinion, Guthrie said.

When it comes to research, while supervisors may give opinions and feedback, researchers have the freedom to study and publish without a supervisor approving it, Guthrie said. Guthrie said most researchers, including himself (his focus area is the ramifications of layoffs and downsizing), pursue things they find interesting and that they think will have implications for real-world practice and policy.

“Art clearly is someone who has an idea in mind as to how things ought to be done at the policy level, so I think the exchange of emails reflects that,” Guthrie said.

When asked whether he thought the emails indicated inappropriate influence, Guthrie did not answer specifically. He said business school leaders had not discussed whether anything might need to change with the Center.

“It’s fair to ask questions and insist that academic integrity is preserved,” Guthrie said. “It’s also fair to ensure that academic freedom is preserved.”

Guthrie said the Students for a Sustainable Future records request and ensuing lawsuit — as well as the shift from public universities’ reliance on state funds to more donations and partnerships — has illuminated a need for “vigilance.”

“It’s not always black and white in terms of what works,” Guthrie said. “As the level of private support continues to increase at a state university then we need to, as keepers of this enterprise, make sure that things are done above board … to make sure there is no undue influence.”

What’s in the records?

The documents Kansas University recently released following a settlement in the Art Hall v. KU case total 15 pages. Here is a summary of what they are and what they say.

•••

Document: KU Endowment Association Fund Administration Agreement for “KU Center for Applied Economics Fund”

Dated: February 2004

Signed by: Roger Ramseyer, vice president and managing officer, Fred C. and Mary R. Koch Foundation; Dale Seuferling, president of KU Endowment Association.

Pages: 1

Summary: The agreement establishes guidelines for the administration of the KU Center for Applied Economics Fund.

It says the Koch Foundation intends for KU Endowment to administer the expendable fund to support the Center for Applied Economics at the KU School of Business, including supporting Center operations and promotion; conducting and distributing economic analysis and related research; facilitating economics education workshops; hosting events for economics educators; salary, benefits and expenses of Center personnel; support for fundraising; and salary and other support for the Koch Professorship in Business Economics.

The agreement says the Center shall have a director who will report to the School of Business Dean, and the dean or a designee must approve fund expenditures.

•••

Document: Grant proposal and cover letter from Center for Applied Economics Executive Director Art Hall

Dated: August 2007

Addressed to: Ryan Stowers, director of University Programs at the Charles G. Koch Charitable Foundation

Pages: 8

Summary: Hall requests a grant of $108,400 to fund a third of the cost for an a research project to “investigate the economic determinants of county-to-county population (and income) migration in the United States.”

He explains in the letter that a team of Center-affiliated economists want to use a not-yet-exploited dataset to “create hard evidence related to the true drivers of sub-state economic development” as measured by migration. “The research team’s goal is to create intellectual products that will enlighten public policy debates in a way that helps promote smaller government and a more robust free-enterprise policy platform.”

The proposal also includes a statement on the Center’s mission and lists names of four board of directors members.

Additional notes: Hall said ultimately the Koch Foundation funded half the study and the Cortopassi Institute funded the rest. The resulting report, entitled “The County-to-County Migration Patterns of Kansas Taxpayers, 1985-2004,” is available on the Center for Applied Economics website, business.ku.edu/center-applied-economics.

•••

Document: “KU Center for Applied Economics – FMK Grant Update Request,” email chain

Dated: August 2008

Between: Susan Addington, with email ending in @kochind.com, and Art Hall

Pages: 1 (3 messages)

Summary: In this email chain, Addington requests an update on Hall’s research project, specifically to see preliminary data that has been collected, which she says would be helpful to update “Rich and others on FMK grants.” Hall responds, saying the migration project is running under budget, with a current balance of $55,000 and a projected balance of about $63,000. In the third email, Hall corrects a calculation from the previous email regarding upcoming payments expected from “TCI” (The Cortopassi Institute).

•••

Document: Grant request letter from Art Hall for Center for Applied Economics

Dated: November 2009

Addressed to: Susan Addington, Community Relations Manager, Fred C. and Mary R. Koch Foundation

Pages: 1

Summary: Hall requests a grant to continue the Kansas Economic Reform Initiative. He asks for $100,000 for 2010 (sic), saying, “if acceptable to the Foundation, the Center will direct this sum toward payroll to continue the Center’s economist-at-large activities, manage the current pipeline of research projects, and to develop new research projects.”

He says the previous year’s grant of $250,000, which inaugurated the initiative, helped “establish a pipeline of reform-oriented research projects and allowed Center personnel to actively engage in a variety of ‘economist-at-large’ initiatives that helped prepare in intellectual foundation for policy change.”

•••

Document: Grant request letter from Art Hall for Center for Applied Economics

Dated: October 2010

Addressed to: Susan Addington, Community Relations Manager, Fred C. and Mary R. Koch Foundation

Pages: 1

Summary: Hall requests a grant to continue the Kansas Economic Reform Initiative in the amount of $100,000 for 2010, which will be directed toward payroll to “continue the Center’s economist-at-large activities, manage the current pipeline of projects, and develop new research projects.”

Hall also mentions past year’s grants. He says a 2008 grant of $250,000 inaugurated the initiative and helped established a “still-ongoing pipeline of reform-oriented research.” He says the 2009 grant of $100,000, dedicated to payroll, allowed the Center to continue work and inaugurate a Capitalism course in the KU School of Business for honors students from across the university.

Additional notes: The Capitalism course was offered just one semester, Hall said. It was taught by multiple instructors from the KU schools of business and law.

•••

Document: “Center for Applied Economics,” email chain

Dated: November and December 2013

Recipient: Art Hall and Laura Hands, with email ending in @kochind.com

Pages: 3 (3 messages)

Summary: Hall writes to Hands that the FMK grant is labeled at KU Endowment as the Kansas Economic Reform Initiative Fund. He says that for calendar year 2013, FMK authorized $40,000 for Center payroll and that a “substantial” portion of that financed background research on “Renewable Portfolio Standard” and work on a survey project related to the local business environment in Lawrence. He said he intended for people to take the survey in early 2014.

Hall also requests if the fund can support another $40,000 of payroll for 2014, primarily the summer portion of the Center’s payroll.

Hands responds that FMK would authorize the additional $40,000 and said she met with Kacy Schmidt from KU Endowment and discussed “rolling the balance into the agreement that is currently being finalized.”