On Sunday, the Austin American-Statesman reported that, while UT President William Powers Jr. served as dean of the Law School, he received $325,000 under a deferred compensation agreement that was apparently not approved by the UT System Chancellor.
Although receiving the money without the Chancellor’s approval violated no laws, it did go against a UT System regents rule which states that “no [UT-System] officer or employee … shall accept remuneration” from an external entity whose primary objective is to support the UT System or any of its 15 academic and health institutions without explicit approval of the Chancellor.
Powers' past misstep was revealed by the Statesman just as student groups began calling once again for the resignation of Regent Wallace Hall, the embattled member of the board of regents who is currently under investigation by the House Select Committee on Transparency in State Agency Operations. That committee is considering recommending Hall’s impeachment, an unprecedented move, and recently issued a report claiming that Hall may have illegally viewed confidential student data.
It’s worth noting, however, that this student data was compromised in the course of Hall’s massive open records requests to the University, which he has said he made in an effort to find information on alleged misdeeds committed by UT officials in regard to admissions decisions and loans gifted to employees of the law school.
So what does Powers’ violation of this rule mean for the battle between Powers and the UT System regents? Given that Powers’ action broke no laws and, by many indicators, appears to be an unintentional mistake, probably not much. It also says little about the ultimate intentions of Hall. But the revelation does demonstrate how much money is being exchanged between higher-level administrators at the University and how much UT depends on obscure rules to keep these transactions fair and above ground.
The regents’ rule against System officials receiving large sums of money without the Chancellor’s approval, which Powers violated, is an attempt to avoid the problem of conflicts of interest in the dispersal of University funds. As recent history will tell us, that problem is very real: Larry Sager, Powers’ successor in the law school, was asked by the president to resign from his position after it was revealed that he had received a $500,000 forgivable loan from the same nonprofit foundation from which Powers received money while dean at his own suggestion.
Powers and Sager, however, were not the only faculty members that received retention payments from the UT Law School Foundation without a chancellor’s sign-off. According to the Statesman, about 20 professors received such forgivable loans, ranging from about $75,000 to $500,000 between 2006 and 2010.
It’s likely that Powers did not realize he was violating a rule in taking the money. Although he failed to mention the lack of disclosure to the Statesman when the paper inquired about it a year ago, Powers has since provided them with the necessary information, calling his initial failure to do so an “honest mistake.”
The recent revelation may not point to wrongdoing on the part of Powers, but it should certainly cause students to reflect on the recent efforts to “Stand with Powers” and stand against Hall. Powers’ lack of disclosure, although potentially accidental, is yet another reminder of how much money is being exchanged at the highest levels of University administration and how few eyes — of Texas or otherwise — are watching these transactions.