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                                                      PRINTER'S NO. 1515

THE GENERAL ASSEMBLY OF PENNSYLVANIA


HOUSE BILL

No. 1327 Session of 1997


        INTRODUCED BY SCHULER, COY, FARGO, DALEY, B. SMITH, FAIRCHILD,
           BAKER, RUBLEY, GEIST, GORDNER, HORSEY, HENNESSEY, McCALL,
           HERSHEY, BELFANTI, MICOZZIE, BATTISTO, ZUG, TRUE, SEMMEL,
           CURRY, STEELMAN, TRELLO AND PISTELLA, APRIL 16, 1997

        REFERRED TO COMMITTEE ON EDUCATION, APRIL 16, 1997

                                     AN ACT

     1  Amending the act of March 10, 1949 (P.L.30, No.14), entitled "An
     2     act relating to the public school system, including certain
     3     provisions applicable as well to private and parochial
     4     schools; amending, revising, consolidating and changing the
     5     laws relating thereto," further providing for the operation
     6     of the State System of Higher Education; and making a repeal
     7     and editorial changes.

     8     The General Assembly of the Commonwealth of Pennsylvania
     9  hereby enacts as follows:
    10     Section 1.  Section 2002-A of the act of March 10, 1949
    11  (P.L.30, No.14), known as the Public School Code of 1949,
    12  amended or added November 12, 1982 (P.L.660, No.188) and June
    13  23, 1988 (P.L.457, No.77), is amended to read:
    14     Section 2002-A.  Establishment of the State System of Higher
    15  Education and its Institutions.--(a)  [Subject to the regulatory
    16  powers conferred by law upon the State Board of Education,
    17  there] There is hereby established a body corporate and politic
    18  constituting a public corporation and government instrumentality
    19  which shall be known as the State System of Higher Education,


     1  independent of the Department of Education, hereinafter referred
     2  to as the system, which shall consist of the following
     3  institutions and such other institutions, presently existing or
     4  newly created, as may hereafter be admitted by the board in
     5  concurrence with other agencies as required by law:
     6     [(1)  Bloomsburg State College;
     7     (2)  California State College;
     8     (3)  Cheyney State College;
     9     (4)  Clarion State College;
    10     (5)  East Stroudsburg State College;
    11     (6)  Edinboro State College;
    12     (7)  Indiana University of Pennsylvania;
    13     (8)  Kutztown State College;
    14     (9)  Lock Haven State College;
    15     (10)  Mansfield State College;
    16     (11)  Millersville State College;
    17     (12)  Shippensburg State College;
    18     (13)  Slippery Rock State College; and
    19     (14)  West Chester State College.]
    20     (1)  Bloomsburg University of Pennsylvania.
    21     (2)  California University of Pennsylvania.
    22     (3)  Cheyney University of Pennsylvania.
    23     (4)  Clarion University of Pennsylvania.
    24     (5)  East Stroudsburg University of Pennsylvania.
    25     (6)  Edinboro University of Pennsylvania.
    26     (7)  Indiana University of Pennsylvania.
    27     (8)  Kutztown University of Pennsylvania.
    28     (9)  Lock Haven University of Pennsylvania.
    29     (10)  Mansfield University of Pennsylvania.
    30     (11)  Millersville University of Pennsylvania.
    19970H1327B1515                  - 2 -

     1     (12)  Shippensburg University of Pennsylvania.
     2     (13)  Slippery Rock University of Pennsylvania.
     3     (14)  West Chester University of Pennsylvania.
     4     (b)  [Each of the said institutions shall hereafter be known
     5  as the (Name) University of Pennsylvania of the State System of
     6  Higher Education, except for Indiana University of Pennsylvania,
     7  which shall retain its name.] As successor institutions to the
     8  State Normal Schools, appropriations for their operation are
     9  ordinary expenses of government, requiring only a majority vote
    10  of each House of the General Assembly. The State System of
    11  Higher Education shall have the same preferred status for
    12  appropriations as is enjoyed by its constituent institutions.
    13  State funds appropriated to the system shall be allocated to the
    14  individual institutions, the Office of the Chancellor and other
    15  programs and facilities by the board on a formula based on, but
    16  not limited to, such factors as enrollments, degrees granted and
    17  programs. The board may create a system reserve, the balance of
    18  which shall not exceed one-half of one per cent (0.50%) of all
    19  available operating funds, which may be expended for emergencies
    20  and special projects in accordance with board policy. For
    21  purposes of this section, the term "operating funds" shall mean
    22  any Federal appropriation, any State appropriation, any student
    23  tuition fees and any student fees for room and board.
    24     Section 2.  Section 2003-A of the act, amended July 11, 1990
    25  (P.L.424, No.103), is amended to read:
    26     Section 2003-A.  Purposes and General Powers.--(a)  The State
    27  System of Higher Education shall be part of the Commonwealth's
    28  system of higher education. Its purpose shall be to provide high
    29  quality education at the lowest possible cost to the students.
    30  The primary mission of the system is the provision of
    19970H1327B1515                  - 3 -

     1  instruction for undergraduate and graduate students to and
     2  beyond the master's degree in the liberal arts and sciences and
     3  in applied fields, including the teaching profession. Graduate
     4  instruction at the doctoral level, except for doctoral programs
     5  provided for in the act of December 16, 1965 (P.L.1113, No.430),
     6  known as the "Indiana University of Pennsylvania Act," only may
     7  be offered jointly with Indiana University or an institution
     8  chartered to offer work at the doctoral level. Programs of
     9  research and service may be provided which are approved by the
    10  Board of Governors, and which are consistent with the primary
    11  mission of the system. Each institution shall provide
    12  appropriate educational facilities, student living facilities
    13  and such other facilities as deemed necessary by the board.
    14     (b)  The system is hereby granted and shall have and may
    15  exercise all the powers necessary or convenient for the carrying
    16  out of the aforesaid purposes, including, but without limiting
    17  the generality of the foregoing, the following rights and
    18  powers:
    19     (1)  To have perpetual existence as a corporation.
    20     (2)  To adopt, use and alter at will a corporate seal.
    21     (3)  To acquire, purchase, hold, lease as lessee and use any
    22  property, real, personal or mixed, tangible or intangible, or
    23  any interest therein, lease as lessor any property, real,
    24  personal or mixed, tangible or intangible, necessary or
    25  desirable for carrying out the purposes of the system, and to
    26  sell, transfer and dispose of any property acquired by gift,
    27  grant, devise or bequest, whether the property is real, personal
    28  or mixed, tangible or intangible, or any interest therein; to
    29  take, demand, receive and possess all moneys, real property and
    30  goods which shall be appropriated, given or granted to for the
    19970H1327B1515                  - 4 -

     1  use of the system and to apply the same according to the will of
     2  the donors; to sell, transfer and dispose of real property
     3  acquired by and titled to the system upon approval by the
     4  General Assembly as provided in section 2018-A; and by gift,
     5  purchase or devise to receive, possess, enjoy and retain forever
     6  any and all real and personal estate and funds, of whatsoever
     7  kind, nature or quality the same may be, in special trust and
     8  confidence that the same, and the profits thereof, shall be
     9  applied to and for the use and purpose of endowing the system,
    10  and shall have power to receive donations from any source
    11  whatever, to be exclusively devoted to the purposes of the
    12  system or according to the terms of donation: Provided, however,
    13  That the system shall have no power at any time or in any
    14  manner, to pledge the credit or taxing power of the
    15  Commonwealth, nor shall any of its obligations or debts be
    16  deemed to be obligations of the Commonwealth, nor shall the
    17  Commonwealth be liable for the payment of principal or interest
    18  on such obligations. Nothing herein shall empower the Board of
    19  Governors or the chancellor to take or receive any moneys, goods
    20  or other property, real or personal, which is given or granted
    21  to specific institutions.
    22     (4)  To negotiate joint ventures, consortia and partnerships
    23  with businesses, industries, organizations, local and State
    24  governments, the Federal Government and foreign governments,
    25  consistent with the general purposes of subsection (a).
    26     (5)  To borrow money, make and issue negotiable notes, bonds,
    27  refunding bonds and other evidence of indebtedness of
    28  obligations, herein called bonds, of the system, subject to all
    29  of the following conditions and limitations:
    30     (i)  The bonds shall have a maturity date not longer than
    19970H1327B1515                  - 5 -

     1  forty (40) years from the date of issue.
     2     (ii)  The system, by pledge or deed of trust of all or any of
     3  its revenues and receipts, may secure the payment of such bonds
     4  or any part thereof.
     5     (iii)  The system may make such agreements with the
     6  purchasers or holders of such bonds, or with others in
     7  connection with any such bonds, whether issued or to be issued,
     8  as the system shall deem advisable.
     9     (iv)  The system shall provide for the security for the bonds
    10  and the rights of the holders thereof.
    11     (v)  The system shall not issue bonds if, on the date of
    12  issuance, the aggregate principal amount of bonds to be
    13  outstanding shall exceed seventy-five per cent (75%) of the
    14  system's average annual gross revenues for the three (3)
    15  consecutive fiscal years preceding the fiscal year in which
    16  bonds are proposed to be issued, except that leases, capitalized
    17  or otherwise, entered into by the system, as lessee, in
    18  connection with the acquisition of real and personal property
    19  shall not be considered bonds for the purposes of these
    20  limitations.
    21     (vi)  The system shall have no power, at any time or in any
    22  manner, to pledge the credit or taxing power of the
    23  Commonwealth, nor shall any of the bonds or debts of the system
    24  be deemed to be obligations of the Commonwealth, nor shall the
    25  Commonwealth be liable for the payment of principal or interest
    26  on such bonds or other obligations.
    27     (c)  Collective bargaining agreements in force at the time of
    28  enactment of this act shall remain in force for the term of the
    29  contract. New collective bargaining agreements with professional
    30  employes shall be negotiated on behalf of the system by the
    19970H1327B1515                  - 6 -

     1  chancellor. The board shall make a coalition bargaining
     2  arrangement with the Commonwealth for the negotiation of new
     3  collective bargaining agreements with noninstructional employes.
     4     Section 3.  Section 2003-A.1(e) of the act, amended July 11,
     5  1990 (P.L.424, No.103), is amended and the section is amended by
     6  adding a subsection to read:
     7     Section 2003-A.1.  Project Contracts.--* * *
     8     (e)  (1)  Nothing in this section shall be construed as
     9  amending, repealing or otherwise modifying the provisions of the
    10  act of May 1, 1913 (P.L.155, No.104), entitled "An act
    11  regulating the letting of certain contracts for the erection,
    12  construction, and alteration of public buildings," or the act of
    13  August 15, 1961 (P.L.987, No.442), known as the "Pennsylvania
    14  Prevailing Wage Act."
    15     (2)  The statutes described in paragraph (1) shall apply only
    16  to projects funded in whole or in part by the Commonwealth.
    17  Projects funded with student fees, but where no Commonwealth
    18  funds are involved are exempt from these statutes.
    19     * * *
    20     (g)  Contractors awarded contracts in excess of twenty-five
    21  thousand dollars ($25,000) shall furnish performance bonds for
    22  one hundred per cent (100%) of the contract amount to insure
    23  faithful performance of all contractual obligations, payment
    24  bonds in the amount of one hundred per cent (100%) of the
    25  contract amount for the protection of persons providing the
    26  contractor labor, materials, supplies and services, and
    27  maintenance bonds in the amount of ten per cent (10%) of the
    28  contract amount for correction of warranty defects on such forms
    29  as the chancellor may specify. Such bonds shall be executed by
    30  surety companies authorized to do business in this Commonwealth.
    19970H1327B1515                  - 7 -

     1  All bonds shall be payable to the State System of Higher
     2  Education.
     3     Section 4.  Section 2004-A of the act, amended June 23, 1988
     4  (P.L.457, No.77), is amended to read:
     5     Section 2004-A.  Board of Governors.--(a)  The system shall
     6  be governed and all of its corporate powers exercised by the
     7  Board of Governors, which shall consist of twenty (20) members
     8  to be appointed as follows:
     9     (1)  The Governor, or [his] a designee of the Governor.
    10     (2)  The Secretary of Education, or [his] a designee of the
    11  Secretary.
    12     (3)  One (1) Senator appointed by the President pro tempore
    13  of the Senate.
    14     (4)  One (1) Senator appointed by the Minority Leader of the
    15  Senate.
    16     (5)  One (1) Representative appointed by the Speaker of the
    17  House of Representatives.
    18     (6)  One (1) Representative appointed by the Minority Leader
    19  of the House of Representatives.
    20     (7)  Fourteen (14) members shall be appointed by the Governor
    21  and, except for student members, these appointments shall be
    22  with the advice and consent of the Senate [of which six (6)
    23  shall be selected from the citizens of the Commonwealth]. Three
    24  (3) members of the fourteen (14) shall be students, no more than
    25  one (1) of whom may be a post-baccalaureate student, whose terms
    26  shall expire upon graduation, separation or failure to maintain
    27  good academic [standards] standing at their institution and five
    28  (5) of the fourteen (14) shall be trustees of constituent
    29  institutions, however, no more than one trustee representing a
    30  constituent institution. The student members shall be selected
    19970H1327B1515                  - 8 -

     1  from the [presidents] elected executive officers of the local
     2  campus student government associations, or their local
     3  equivalent. No student member shall simultaneously serve as a
     4  member of a council.
     5     (b)  All members of the board appointed by the Governor,
     6  except for the students, shall serve for terms of four (4)
     7  years[.], but no trustee member shall be eligible to serve after
     8  the expiration of that member's term and the appointment of a
     9  successor council member. The Governor and Secretary of
    10  Education shall serve so long as they continue in office.
    11  Members of the board appointed from the General Assembly shall
    12  serve a term of office concurrent with their respective elective
    13  terms as members of the General Assembly.
    14     (c)  The Governor or [his] a designee of the Governor, and
    15  the Secretary of Education or [his] a designee of the Secretary,
    16  and the members of the General Assembly shall be members of the
    17  board and shall be entitled to attend all meetings of the board
    18  and shall have the right to speak on all matters before the
    19  board, and to vote, but shall not be elected as an officer of
    20  the board.
    21     (d)  The board shall elect one (1) of its members to serve as
    22  its chairperson at the pleasure of the board. Members shall
    23  receive no compensation for their services but shall be
    24  reimbursed for the expenses necessarily incurred by them in the
    25  performance of their duties. The board shall meet quarterly and
    26  additionally at the call of the chairperson, or upon request of
    27  six (6) members of the board.
    28     (e)  The chancellor shall be the chief executive officer of
    29  the board and shall have the right to speak on all matters
    30  before the board, but not to vote.
    19970H1327B1515                  - 9 -

     1     (f)  Each board member shall attend an orientation during the
     2  member's first year of service which shall be conducted by the
     3  chancellor. The purpose of this orientation shall be to acquaint
     4  board members with their duties, the mission of the system and
     5  system operations. The chancellor shall certify attendance to
     6  the respective appointing authority.
     7     (g)  Any board member who is absent from three (3)
     8  consecutive regular meetings shall be removed by the respective
     9  appointing authority unless all such absences were caused by
    10  personal illness, the illness of a family member or the death of
    11  a family member. The chairperson of the board shall notify the
    12  respective appointing authority when a board member has
    13  unexcused absences from three (3) consecutive regular meetings.
    14     Section 5.  Section 2005-A(7) and (10) of the act, added
    15  November 12, 1982 (P.L.660, No.188), are amended and the section
    16  is amended by adding clauses to read:
    17     Section 2005-A.  The Chancellor.--The chief executive officer
    18  of the system shall be a chancellor, who shall be employed by
    19  the board in accordance with clause (1) of section 2006-A. In
    20  addition to those prescribed by the board, the chancellor shall
    21  have the following duties:
    22     * * *
    23     (7)  The chancellor shall be responsible for the
    24  administration of the central office, systemwide business
    25  procedures and for the overall organization of maintenance of
    26  the physical plants and security at all institutions. The
    27  chancellor, in consultation with the commission and the approval
    28  of the board, may organize centrally provided administrative and
    29  professional support services and allocate charges for same to
    30  users.
    19970H1327B1515                 - 10 -

     1     * * *
     2     (10)  The chancellor shall serve as an ex officio member of
     3  the council of each institution in the system, without voting
     4  privileges.
     5     * * *
     6     (12)  The chancellor shall create and conduct orientation
     7  programs for new board members and trustees in consultation with
     8  representatives of the board, the commission and the councils
     9  and shall certify attendance to the respective appointing
    10  authority.
    11     Section 6.  Section 2006-A of the act, amended or added
    12  November 12, 1982 (P.L.660, No.188), July 1, 1985 (P.L.103,
    13  No.31), June 23, 1988 (P.L.457, No.77) and July 11, 1990
    14  (P.L.424, No.103), is amended to read:
    15     Section 2006-A.  Powers and Duties of the Board of
    16  Governors.--(a)  The Board of Governors shall have overall
    17  responsibility for planning and coordinating the development and
    18  operation of the system. The powers and duties of the Board of
    19  Governors shall be:
    20     (1)  To employ the chancellor to serve at the board's
    21  pleasure under fixed term or contract of fixed duration of not
    22  longer than five (5) years; to fix [his] the chancellor's
    23  salary; to prescribe and delineate [his] the chancellor's duties
    24  and responsibilities; prior to the renewal of such term or
    25  contract, the board shall conduct an evaluation of the
    26  chancellor's service to determine whether such term or contract
    27  should be renewed and for what period of time.
    28     (2)  To appoint from the list submitted by the chancellor,
    29  pursuant to section 2005-A(4), presidents of the constituent
    30  institutions to serve at the board's pleasure under fixed terms
    19970H1327B1515                 - 11 -

     1  or contracts of fixed duration, to fix the salaries and other
     2  terms of appointment of each president and prior to renewal of
     3  such term or contract consider the results of the evaluation of
     4  each president's service submitted by the chancellor.
     5     (3)  To establish policies and procedures to be applied by
     6  the chancellor, the board and each local council in evaluating
     7  the president and recommending the selection, retention and
     8  dismissal of the president of its respective institution.
     9     (4)  To establish broad fiscal, personnel and educational
    10  policies under which the institutions of the system shall
    11  operate.
    12     (5)  To create new undergraduate and graduate degree
    13  programs, which shall not be subject to the rules and
    14  regulations of the State Board of Education; to approve
    15  [extension campuses] establishment of branch campuses and
    16  extension centers and new external degree programs subject to
    17  the rules and regulations of the State Board of Education; to
    18  promote cooperation among institutions, including the
    19  development of consortia within the system and other educational
    20  institutions and agencies; to approve the creation of joint
    21  ventures, consortia and partnerships between system institutions
    22  and businesses, industries, organizations, local and State
    23  governments, the Federal Government and foreign governments,
    24  consistent with the general purposes of section 2003-A(a).
    25     (6)  To establish general policies for the admission of
    26  students and to assure procedural protection for the discipline
    27  and expulsion of students. The actual admission of students
    28  shall remain the province of the individual institutions.
    29     (7)  To coordinate, review, amend and approve the annual
    30  capital budget requirements of the system, the annual operating
    19970H1327B1515                 - 12 -

     1  budgets of the individual institutions and the operating budget
     2  of the chancellor and the board. The board shall present these
     3  annual budgets with comments to the secretary for presentation
     4  to the State board. The State board shall return such budget
     5  requests, recommending approval or disapproval with comments, if
     6  any, to the secretary prior to their submission to the Secretary
     7  of Budget and Administration. The board may also submit its
     8  budget recommendations and findings to the General Assembly
     9  subsequent to the submission of the Governor's budget to the
    10  General Assembly. For the purpose of administration, the system
    11  shall be subject to Article VI of the act of April 9, 1929
    12  (P.L.177, No.175), known as "The Administrative Code of 1929,"
    13  except for section 615.
    14     (8)  To establish general personnel policies under which the
    15  institutions shall operate consistent with merit principles; to
    16  determine equivalent degree and teaching experience
    17  qualifications for appointment or promotion of faculty employes
    18  within the classifications enumerated in the act of January 18,
    19  1952 (1951 P.L.2111, No.600), referred to as the State College
    20  Faculty Compensation Law, to include, but not be limited to, the
    21  Degrees of Juris Doctor and Master of Fine Arts; and to enter
    22  into collective bargaining agreements pursuant to the act of
    23  July 23, 1970 (P.L.563, No.195), known as the "Public Employe
    24  Relations Act," in accordance with section 2003-A of this act.
    25     (9)  To recommend approval or disapproval of all system
    26  building projects to the Secretary of the Budget which are not
    27  within the contracting authority of the system under section
    28  2003-A.1.
    29     (10)  To represent the system before the General Assembly,
    30  the Governor and the State board.
    19970H1327B1515                 - 13 -

     1     (11)  To fix the levels of tuition fees, except student
     2  activity fees. Tuition fees shall include a differential for
     3  such charges between students who are residents of the
     4  Commonwealth and students who are nonresidents.
     5     (12)  To adopt general policies with regard to student
     6  activity fees and to provide for student participation in the
     7  formulation of these policies.
     8     (13)  To establish policies regarding waiver, deferment and
     9  refund of tuition fees and other charges and fees.
    10     (13.1)  To set the amounts for fines for violations of rules
    11  respecting parking and operation of motor vehicles on system
    12  facilities, which shall not exceed the amounts which
    13  municipalities are authorized to assess for such offenses under
    14  75 Pa.C.S. (relating to vehicles).
    15     (13.2)  To establish policy concerning expenditures from the
    16  system reserve and to approve all expenditures therefrom.
    17     (13.3)  To establish policy concerning the organization of
    18  centrally provided administrative and professional support
    19  services, including allocation of charges therefor and to
    20  approve the chancellor's recommendations for the establishment
    21  of such services.
    22     (14)  To make all reasonable rules and regulations necessary
    23  to carry out the purposes of this article and the duties of the
    24  board.
    25     (15)  To do and perform generally all of those things
    26  necessary and required to accomplish the role and objectives of
    27  the system.
    28     (b)  The Board of Governors shall provide for the holding of
    29  regular and special meetings. Eleven (11) governors attending
    30  shall constitute a quorum for the transaction of any business
    19970H1327B1515                 - 14 -

     1  and, unless a greater number is required by the bylaws of the
     2  board, the act of a majority of the governors present at any
     3  meeting shall be deemed the act of the board.
     4     Section 7.  The act is amended by adding a section to read:
     5     Section 2006-A.1.  Powers and Duties Relating to Bonds.--(a)
     6  The bonds of the State System of Higher Education authorized to
     7  be issued shall:
     8     (1)  Be authorized by resolution of the Board of Governors of
     9  the system.
    10     (2)  Be of such series, bear such date or dates, mature at
    11  such time or times, not exceed forty (40) years from their
    12  respective dates.
    13     (3)  Bear interest at such rate or rates as shall be
    14  determined by the system as necessary to issue and sell the
    15  authorized bonds.
    16     (4)  Be in such denominations, in such form, either coupon or
    17  fully registered without coupons and carry such registration,
    18  exchangeability and interchangeability privileges as the system
    19  may determine.
    20     (5)  Be payable in such medium of payment and at such place
    21  or places as the system shall determine.
    22     (6)  Be subject to such terms of redemption and be entitled
    23  to such priorities in the revenues or receipts of the system as
    24  such resolution or resolutions may provide.
    25     (7)  Contain such other terms and conditions as shall be
    26  deemed advisable by the system.
    27     (b)  The bonds shall be signed by or shall bear the facsimile
    28  signature of such officers as the board shall determine. Coupon
    29  bonds shall have attached thereto interest coupons bearing the
    30  facsimile signature of the chief fiscal officer of the system.
    19970H1327B1515                 - 15 -

     1     (c)  Any such bonds may be issued and delivered,
     2  notwithstanding that one or more of the officers signing such
     3  bonds or the facsimile or whose signature shall be upon such
     4  bonds, the coupons or any part thereof shall have ceased to be
     5  such officer or officers at the time when such bonds shall
     6  actually be delivered.
     7     (d)  The bonds may be sold at public or private sale for such
     8  price or prices and at such rate of interest as the system shall
     9  determine.
    10     (e)  Pending the preparation of the definitive bonds, interim
    11  receipts may be issued to the purchaser of such bonds and may
    12  contain such terms and conditions as the system may determine.
    13     (f)  Any resolution or resolutions authorizing any bonds may
    14  contain provisions which shall be part of the contract with the
    15  holders thereof as to:
    16     (1)  The terms and provisions of the bonds.
    17     (2)  Limitations on the purposes to which the proceeds of the
    18  bonds then or thereafter to be issued, or of any loan or grant
    19  by the United States, may be applied.
    20     (3)  The setting aside of reserves or sinking funds and the
    21  regulation and disposition thereof.
    22     (4)  Limitations on the issuance of additional bonds.
    23     (5)  The terms and provisions of any deed of trust or
    24  indenture securing the bonds or under which the same may be
    25  issued.
    26     (6)  Any other or additional agreements with the holder of
    27  the bonds.
    28     (g)  The system may enter into any deeds of trust indentures
    29  or other agreements, with any bank or trust company or other
    30  person or persons in the United States having power to enter
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     1  into the same, including any Federal agency as security for such
     2  bonds, and may assign and pledge all or any of the revenues or
     3  receipts of the system thereunder. The deed of trust, indenture
     4  or other agreement may contain such provisions as may be
     5  customary in such instruments or as the system may authorize,
     6  including, but without limitation, provisions as to:
     7     (1)  The construction, improvement, operation, maintenance
     8  and repair of any project and the duties of the system with
     9  references thereto.
    10     (2)  The application of funds and the safeguarding of funds
    11  on hand or on deposit.
    12     (3)  The rights and remedies of said trustee and the holders
    13  of the bonds, which may include restrictions upon the individual
    14  right of action of such bondholders.
    15     (4)  The terms and provisions of the bonds or the resolutions
    16  authorizing the issuance of same.
    17     (h)  Except to the extent that the rights herein given may be
    18  restricted by resolution passed before the issuance of the
    19  bonds, or by the trust indenture, any holder of bonds issued
    20  under the provisions of this section, or any of the coupons
    21  attached thereto, and the trustee under the trust indenture, if
    22  any, may either at law or in equity, by suit, action, mandamus
    23  or other proceedings, protect and enforce any and all rights
    24  granted hereunder or under such resolution or trust indenture
    25  and may enforce and compel performance of all duties required by
    26  this act or by such resolution or trust indenture to be
    27  performed by the system or any officer thereof.
    28     (i)  All system bonds shall have all the qualities of
    29  negotiable instruments under the law merchant and the negotiable
    30  instruments law of the Commonwealth.
    19970H1327B1515                 - 17 -

     1     (j)  The accomplishment by the system of the authorized
     2  purposes stated in this article being for the benefit of the
     3  people of this Commonwealth and for the improvement of their
     4  education and prosperity, in which accomplishment the system
     5  will be performing essential governmental functions, the system
     6  shall not be required to pay any taxes or assessments on any
     7  property acquired or used by it for the purposes provided in
     8  this article, and the bonds, notes or other obligations issued
     9  by the system, their transfer and the income therefrom,
    10  including any profits made on the sale thereof, shall at all
    11  times be free from taxation within the Commonwealth.
    12     Section 8.  Section 2008-A(c) of the act, amended June 23,
    13  1988 (P.L.457, No.77), is amended and the section is amended by
    14  adding subsections to read:
    15     Section 2008-A.  Councils of Trustees.--* * *
    16     [(c)  The members of each board of trustees of a former State
    17  college or university serving in such capacity on the effective
    18  date of this act shall continue to serve for the balance of
    19  their respective terms.]
    20     * * *
    21     (e)  (1)  Any trustee who is absent from three (3)
    22  consecutive quarterly meetings shall be removed by the
    23  respective appointing authority, unless all such absences were
    24  caused by personal illness, the illness of a family member, or
    25  the death of a family member.
    26     (2)  The chairperson of the council shall notify the
    27  respective appointing authority when a council member has
    28  unexcused absences from three (3) consecutive regular meetings.
    29     (f)  Each trustee shall attend an orientation during the
    30  first year of service which shall be conducted by the
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     1  chancellor. The purpose of this orientation shall be to acquaint
     2  trustees with the duties of their office, the mission of the
     3  system and their respective universities and the operations of
     4  their respective universities and the system. The chancellor
     5  shall certify attendance to the respective appointing authority.
     6     Section 9.  Section 2010-A(5)and (10) of the act, added
     7  November 12, 1982 (P.L.660, No.188), are amended to read:
     8     Section 2010-A.  Power and Duties of Institution
     9  Presidents.--The president of each institution shall be
    10  appointed by the board. The president shall be the chief
    11  executive officer of that institution. He shall have the right
    12  to attend all meetings of the council of that institution and
    13  shall have the right to speak on all matters before the council
    14  but not to vote. Subject to the stated authority of the board
    15  and the council, each president shall have the [power and his
    16  duties shall be] following powers and duties:
    17     * * *
    18     (5)  To establish policies and procedures governing the use
    19  of institutional facilities and property [in accordance with
    20  guidelines established by the local council].
    21     * * *
    22     (10)  Within the limitations of the operating budget and
    23  other available funds in accordance with the procedures
    24  established by the board and with the approval of the local
    25  council, to negotiate and award all contracts for equipment,
    26  services and supplies in excess of a cost of [five thousand
    27  dollars ($5,000)] ten thousand dollars ($10,000) on a
    28  competitive bid basis and to purchase instructional,
    29  educational, extracurricular, technical, administrative,
    30  custodial and maintenance equipment and supplies not in excess
    19970H1327B1515                 - 19 -

     1  of a cost of [five thousand dollars ($5,000)] ten thousand
     2  dollars ($10,000) without competitive bidding, except that such
     3  items shall not be bought in series to avoid the dollar ceiling.
     4     * * *
     5     Section 10.  Funding for the Board of Governors and the
     6  chancellor shall be derived from all operating funds available
     7  to the State System of Higher Education but shall not exceed
     8  0.50% of such funds. For purposes of this section, the term
     9  "operating funds" shall mean any Federal appropriation, any
    10  State appropriation, any student tuition fees and any student
    11  fees for room and board.
    12     Section 11.  (a)  Section 3 of the act of November 12, 1982
    13  (P.L.660, No.188), entitled "An act amending the act of March
    14  10, 1949 (P.L.30, No.14), entitled 'An act relating to the
    15  public school system, including certain provisions applicable as
    16  well to private and parochial schools; amending, revising,
    17  consolidating and changing the laws relating thereto,'
    18  establishing the State System of Higher Education and
    19  designating its institutions; creating and defining the powers
    20  and duties of the Board of Governors; establishing the office
    21  and duties of the chancellor of the university system; defining
    22  the powers and duties of presidents and the Councils of Trustees
    23  of the University Institutions; relating the powers and duties
    24  of the State Board of Education with the university system; and
    25  making certain repeals," is repealed.
    26     (b)  All other acts and parts of acts are repealed insofar as
    27  they are inconsistent with this act.
    28     (c)  Except as otherwise provided, nothing in this act shall
    29  be construed to repeal the act of April 9, 1929 (P.L.177,
    30  No.175), known as The Administrative Code of 1929, but only as
    19970H1327B1515                 - 20 -

     1  provided in this act and to the extent that the State System of
     2  Higher Education or its constituent institutions are expressly
     3  referred to therein, or the act of January 18, 1952 (1951
     4  P.L.2111, No.600), referred to as the State College Faculty
     5  Compensation Law.
     6     Section 12.  This act shall take effect immediately.
















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