photo by: University of Kansas

The skyline of the University of Kansas is pictured.

No, the University of Kansas won’t be allowed to unilaterally sell Allen Fieldhouse or throw open the doors of the university to controversial private equity investors.

Not that there was ever any such proposals to do so.

However, a last-minute bill introduced Wednesday in the Kansas Legislature caused the Kansas Board of Regents to become concerned that its oversight powers regarding KU and the state’s other large universities would be significantly diminished. The Allen Fieldhouse and private equity scenarios were among the examples opponents of the bill cited as possibilities.

Now, such big changes seem less likely. The House Committee on Higher Education Budget did not kill the bill in question at a Thursday hearing, but members from both sides of the aisle agreed it needed to be reworked to make clear that the Kansas Board of Regents will maintain significant oversight of KU and the state’s other universities.

“We are open to changes,” House Majority Leader Chris Croft, R-Overland Park, told the committee of the bill, which he helped craft.

The leader of the Kansas Board of Regents also told the committee that the Regents were open to supporting the bill if some key changes were made. The largest change would remove language that states the Board of Regents would only be required to provide approval of certain university actions if they involved the spending of dollars from the state’s general fund.

As the Journal-World reported, when the bill was introduced Wednesday morning, that provision created such concern from the Board of Regents — which was conducting its regular monthly meeting — that it added an item to its agenda to formally vote to oppose the newly introduced bill.

The board’s unanimous opposition to the bill was centered around fears that universities would be able to make deals without much public oversight, given that universities receive the minority of their funding from the state general fund. Of KU’s $1.8 billion of revenue, about $1.5 billion of it came from sources like tuition, federal research grants and private donors last fiscal year, records show. About $330 million came from the state general fund.

Committee members agreed to meet again on Monday to consider amendments to the bill — HB 2798 — including one that makes clear that the Board of Regents would still be responsible for approving key policies that govern actions of the universities, even if those actions don’t involve the spending of state general fund money.

Not only did Croft express support for that amendment, so did the chief of staff for Gov. Laura Kelly. Thursday’s hearing made clear that the bill had been crafted behind the scenes not only by Republican legislators but also with the blessing of Kelly’s office. Her chief of staff, Will Lawrence, led meetings between lawmakers and university presidents and Chancellor Doug Girod, the committee was told.

Lawrence told the committee that the governor wants to see some change in how universities are governed in the state, but the bill was not meant to remove the Regents from the oversight process. The pending amendments to the bill should make that clear, he said.

“In terms of doing away with the Board of Regents and that structure, there is no support for that,” Lawrence said of the governor’s position.

While the amended bill is likely to keep the Regents’ oversight powers in place, the bill would make significant change to how business is done at KU and other universities. The bill would exempt universities from several state laws regarding the purchase of property, the sale of property, competitive bidding for services, and a variety of other regulations that typical state agencies must follow.

Instead of following those state laws, the bill would allow each university to create its own policy for each topic. For instance, instead of using existing state law when selling a piece of university property, the university would create its own policy for how such sales should be handled.

But the key provision in the bill is that the Kansas Board of Regents must first approve that university policy before it can be used. The proposed amendment to the bill will make clear that the Board of Regents must approve all such policies, regardless of whether the matter involves the spending of state general funds. The original bill left the Regents believing that universities could create their own policies without approval of the Regents, if the matter didn’t involve the expenditures of state general funds.

Given the change that the Regents are responsible for approving all policies, Blake Benson, chair of the Board of Regents, said the board would be supportive of the bill. He said the Regents have seen instances where university projects are unnecessarily delayed because of the large amount of bureaucracy they must navigate between multiple state agencies.

Croft said eliminating some of those layers of bureaucracy was the primary goal of the bill, which he said should allow universities to operate at the “speed of innovation.” He said the state’s major research universities need to be able to operate at that speed in order to establish themselves as national leaders in their fields.

The focus on research was the reason the original bill would only apply to KU, Kansas State and Wichita State. The remaining three Regents universities — Emporia State, Fort Hays State and Pittsburg State — would not be exempted from any state laws. Regent Chair Benson said the Regents also want that provision to change. He said ESU, Pitt State and Fort Hays State should be subject to the same exemptions from state law. The committee is expected to consider an amendment on Monday that would include those three schools in the bill.

If the bill is approved, the Kansas Board of Regents may become a busy entity very soon, and have some weighty issues to consider. For example, the bill would exempt universities from the state law requirement that before any public property can be sold, an independent appraisal must first be conducted to determine its fair market value.

Under the pending law, universities could craft a policy saying such an appraisal is not required before any sale. However, if Monday’s amendments are approved, the Regents would be assured of having the final say on any such policy. If the Regents, for instance, determined that appraisals are a needed step in sales, it could reject any university policy that says otherwise.

In addition to the appraisal law, the bill would exempt universities from more than a dozen other key laws.

Thursday’s hearing also raised the prospect that more changes regarding how the state’s universities are governed could be coming in future months. Lawrence said that there have been discussions about whether it would be prudent to hire an outside consultant to examine the entire governance structure of universities. How state universities are governed largely has not changed for decades in Kansas.

“There needs to be a longer conversation that probably involves bringing in an outside entity to look at our current system and make recommendations,” Lawrence told the committee.