Regular Session 2015-2016 Senate Bill 0800 P.N. 0969

PRINTER'S NO. 969

THE GENERAL ASSEMBLY OF PENNSYLVANIA

SENATE BILL

No.

800

Session of

2015

INTRODUCED BY YUDICHAK, WILLIAMS, WILEY, FONTANA, WARD, STEFANO,

TEPLITZ, RAFFERTY, COSTA, BREWSTER, BOSCOLA, ARGALL, VANCE,

MENSCH, LEACH, YAW, FARNESE, KITCHEN, BARTOLOTTA, SCHWANK,

TARTAGLIONE, SCARNATI, WOZNIAK, HUGHES, WHITE, BAKER,

DINNIMAN, BROWNE, GREENLEAF, HAYWOOD AND VULAKOVICH,

MAY 28, 2015

REFERRED TO STATE GOVERNMENT, MAY 28, 2015

AN ACT

Reaffirming the establishment and operation of The Pennsylvania

State University as an instrumentality of the Commonwealth to

serve as a State-related university in the higher education

system of the Commonwealth; providing for the composition of

the board of trustees, for terms of trustees, for powers and

duties of the board of trustees, for preference to

Pennsylvania residents in tuition and for public support and

capital improvements; authorizing appropriations in amounts

to be fixed annually by the General Assembly; providing for

the auditing of accounts of expenditures from appropriations;

authorizing the issuance of bonds exempt from taxation within

the Commonwealth; and requiring an annual report.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1. Short title.

This act shall be known and may be cited as The Pennsylvania

State University – Commonwealth Act.

Section 2. Legislative findings and declaration of policy.

It is hereby determined and declared as a matter of

legislative finding:

(1) The General Assembly created the Farmers' High

School of Pennsylvania as a corporation with perpetual

existence under the act of February 22, 1855 (P.L.46, No.50),

entitled, "An act to incorporate the Farmers' High School of

Pennsylvania."

(2) The institution's name was changed to the

Agricultural College of Pennsylvania in 1862, to the

Pennsylvania State College in 1874 and to The Pennsylvania

State University in 1953.

(3) The General Assembly, in 1905, enacted legislation

statutorily establishing the membership of the university's

board of trustees. Subsequent thereto, in 1939, the General

Assembly again enacted legislation addressing the composition

of the university's board of trustees.

(4) The Pennsylvania State University owns and maintains

land, buildings and other facilities which are used, together

with land and buildings owned by the Commonwealth for higher

education, which land, buildings and other facilities are

under the entire control and management of the board of

trustees.

(5) For over 159 years, the Commonwealth has recognized

The Pennsylvania State University as an instrumentality of

the Commonwealth and an integral part of the system of higher

education in Pennsylvania.

(6) The Commonwealth's commitment to its partnership

with The Pennsylvania State University as an instrumentality

of the Commonwealth to provide quality higher education

opportunities for Pennsylvania residents and nonresidents has

been reaffirmed by the Commonwealth's designation of The

Pennsylvania State University as a State-related university.

(7) The Commonwealth's commitment to its partnership

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with The Pennsylvania State University as an instrumentality

of the Commonwealth to provide quality higher education

opportunities for Pennsylvania residents and nonresidents is

reaffirmed annually through appropriations to the university

from the Commonwealth's General Fund.

(8) It is desirable and in the public interest to

perpetuate and extend the relationship between the

Commonwealth and The Pennsylvania State University for the

purpose of improving and strengthening higher education by

reaffirming and continuing The Pennsylvania State

University's designation as a State-related university and

the benefits associated with that designation.

(9) It is declared to be the purpose of this act to

continue to extend Commonwealth opportunities for higher

education by reaffirming The Pennsylvania State University's

legal status as an instrumentality of the Commonwealth to

serve as a State-related institution in the Commonwealth

system of higher education.

Section 3. Board of trustees.

(a) Composition.--Beginning July 1, 2016, the Board of

Trustees of The Pennsylvania State University shall consist of

36 voting members. The Governor, the Secretary of Education and

the Secretary of Agriculture shall serve as nonvoting ex officio

members of the board. Except as provided in subsection (b)(2),

elective and appointive members shall serve for four-year terms.

(b) Commonwealth trustees.--

(1) Fourteen of the trustees shall be designated

Commonwealth trustees and appointed as follows:

(i) Six shall be appointed by the Governor, with the

advice and consent of a majority of all of the members of

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the Senate.

(ii) Four shall be appointed by the President pro

tempore of the Senate in consultation with the Minority

Leader of the Senate.

(iii) Four shall be appointed by the Speaker of the

House of Representatives in consultation with the

Minority Leader of the House of Representatives.

(2) The Governor shall submit nominees for appointment

to the Senate no later than January 1, 2016. Appointing

authorities under paragraph (1)(ii) and (iii) shall make

their initial appointments no later than May 1, 2016. For

appointments made under paragraph (1)(i), one appointment

shall be for a term of four years, one appointment shall be

for a term of three years, two appointments shall be for a

term of two years and two appointments shall be for a term of

one year. For appointments made under paragraph (1)(ii) and

(iii), one appointment shall be made by each of the

appointing authorities for a term of four years, one for a

term of three years, one for a term of two years and one for

a term of one year commencing July 1, 2016. Annually

thereafter, one appointment shall be made by each of the

appointing authorities for a term of four years and until a

successor is appointed and qualified.

(1) Except as provided in paragraph (2), 10 of the

trustees shall be designated at-large trustees and shall be

elected to the board in accordance with section 4. One of the

at-large trustees shall be a member of the faculty of the

university, and at least one of the at-large trustees shall

be a student enrolled in good standing at the university

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elected by the student body. Qualifications for at-large

trustees, including the faculty and the student

representatives, shall be established by the board.

(2) For the period July 1, 2016, through June 30, 2017,

the at-large trustees shall consist of the following:

(i) Four members representing the Commonwealth's

agriculture industry elected in accordance with the

university charter.

(ii) Four members representing business and industry

endeavors elected or appointed in accordance with the

university charter.

(iii) One member representing the student body of

the university elected or appointed in accordance with

the university charter.

(iv) One member representing the faculty of the

university elected or appointed in accordance with the

university charter.

(d) Alumni trustees.--Twelve of the trustees shall be

designated alumni trustees and shall be elected by the alumni of

the university in accordance with the university charter. The

following shall apply:

(1) Except as otherwise provided in paragraph (2), and

notwithstanding section 1 of the act of March 24, 1905

(P.L.50, No.35), entitled "An act to reorganize the Board of

Trustees of The Pennsylvania State College," beginning with

an election for alumni board members in calendar year 2016,

and in each election thereafter, alumni elected under that

act shall be elected for a term of four years.

(2) Any election for alumni members held in calendar

year 2016 shall, in addition to any election of alumni

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members serving under paragraph (1), include the election of

three new alumni trustees as added to the board under this

act. One new alumni member shall be elected for a term of

three years, one elected for a term of two years and one

elected for a term of one year commencing July 1, 2016.

Annually thereafter, each alumni trustee added to the board

under this act shall serve a term of four years.

(e) Vacancies.--

(1) An appointment to fill a vacancy in the office of a

member appointed under subsection (b) shall be made within 30

days of the vacancy and shall be for the remainder of the

unexpired term.

(2) A vacancy created in any office of a member serving

on the board under subsection (c) or (d) shall be filled for

the remainder of the unexpired term and in the same manner as

the original position in accordance with the university

charter.

(f) Prohibited membership.--The Lieutenant Governor,

Attorney General, Auditor General, State Treasurer and the

president of the university shall be prohibited from serving on

the board during their terms of office.

Section 4. Selection of at-large trustees.

(a) Qualifications of at-large trustees.--Beginning July 1,

2016, the following shall apply to at-large trustee board

members to be elected to the board under this section:

(1) One at-large trustee shall be a member of the

faculty of the university.

(2) At least one at-large trustee shall be a student

enrolled in good standing at the university and elected by

the student body.

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(3) Qualifications for at-large trustees, including any

faculty trustee and the student trustee, shall be established

by the board.

(b) Selection committee; composition.--Beginning July 1,

2016, the board shall establish a nine member selection

committee to review and recommend to the full board the

individuals to be appointed to the board under section 3(c). The

committee shall be comprised of:

(1) The chairman of the board.

(2) Two members of the board selected by the chairman of

the board.

(3) One Commonwealth trustee appointed by the Governor

and selected by all Commonwealth trustees appointed by the

Governor under section 3(b)(1)(i).

(4) One Commonwealth trustee appointed by the President

pro tempore of the Senate and selected by all Commonwealth

trustees appointed by the President pro tempore of the Senate

under section 3(b)(1)(ii).

(5) One Commonwealth trustee appointed by the Speaker of

the House of Representatives and selected by all Commonwealth

trustees appointed by the Speaker of the House of

Representatives under section 3(b)(1)(iii).

(6) Three alumni trustees elected to the board under

section 3(d) and selected by all members of the board elected

by members elected under section 3(d).

under subsection (b) shall be by majority vote of the selection

committee and shall be made no later than January 1, 2017, and

January 1 of each year thereafter.

(d) Appointments to board.--Appointments to the board based

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on recommendations from the selection committee under this

section shall be by majority vote of the board.

(e) Terms.--The board shall make its initial selections of

at-large trustees no later than May 1, 2017. Two selections

shall be for a term of four years, two selections shall be made

for a term of three years, two selections shall be made for a

term of two years and two selections shall be made for a term of

one year commencing July 1, 2017. The student at-large and the

faculty trustee shall be appointed for a two-year term

commencing July 1, 2017. Annually thereafter, selections of at-

large trustees shall be made no later than May 1 of each year

for a term commencing July 1 of that year and, other than the

student at-large and the faculty trustee, shall be for a term of

four years. A student at-large and the faculty trustee shall

serve a term of two years.

Section 5. Powers and duties of board of trustees.

The entire management, control and conduct of the

instructional, administrative and financial affairs of the

university is vested in the board of trustees. The board may

exercise all the powers and franchises of the university and

make bylaws for its own government, as well as for the

university.

Section 6. Public support and tuition.

The university shall maintain such tuition and fee schedules

for Pennsylvania resident and nonresident full-time students as

are provided annually in the act of the General Assembly which

makes appropriations to The Pennsylvania State University,

provided:

(1) The amounts appropriated by the act are sufficient

for the maintenance of the schedules by the university.

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(2) For any given year, in the event the amounts

appropriated are not sufficient for the maintenance of the

tuition and fee schedules, the university shall have the

right to alter the schedules to the extent necessary to

provide required income equal to the amount not provided by

the appropriation act.

Section 7. Capital improvements.

The benefits of all Commonwealth or Commonwealth authority

programs for capital development and improvement shall be

available to the university under terms and conditions

comparable to those applicable to other State-related

universities and the State System of Higher Education. In

accordance with legislative appropriations made as provided by

law, the Commonwealth may, by agreement with the board of

trustees, acquire lands, erect and equip buildings and provide

facilities for the use of the university.

Section 8. Appropriations.

(a) Procedure.--

(1) The sums appropriated by the Commonwealth shall be

paid to the board of trustees only upon presentation by the

board of trustees of certified payrolls and vouchers showing

expenditures in accordance with the appropriations. The

Auditor General shall draw a warrant upon the State Treasurer

for payment of approved expenditures.

(2) All expenditures made by the board of trustees in

respect to such appropriations shall be subject to audit by

the Auditor General.

(b) Commonwealth Appropriation Account.--

(1) For the purpose of assuring the proper

accountability on the part of The Pennsylvania State

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University for the expenditure of the amounts appropriated by

the Commonwealth, The Pennsylvania State University shall

establish a Commonwealth Appropriation Account into which

only the amounts appropriated by the Commonwealth shall be

credited when received. The Pennsylvania State University

shall apply the money in the Commonwealth Appropriation

Account only for such purposes as are permitted in the act

appropriating the same and shall at all times maintain proper

records showing the application of such money.

(2) Not later than 60 days after the close of the fiscal

year to which the specific appropriation relates, The

Pennsylvania State University shall file with the General

Assembly and with the Auditor General, a statement stating

the amounts and purposes of all expenditures made from both

the Commonwealth Appropriation Account and other university

accounts during that fiscal year.

(3) The statement of expenditures shall be reviewed by

the Auditor General who shall have the right, in respect to

the Commonwealth Appropriation Account, to audit and disallow

expenditures made for purposes not permitted by the

appropriation act and to cause such sums to be recovered and

paid by The Pennsylvania State University to the State

Treasurer.

(4) In respect to expenditures made by the university

from accounts other than the Commonwealth Appropriation

Account, the Auditor General shall have the right to review

only and shall file annually with the General Assembly such

information concerning said expenditures as the General

Assembly or any of its committees may require.

Section 9. Issuance of bonds.

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(a) General rule.--The board of trustees may provide for the

issuance of bonds in the name of the university for any proper

purpose in the same manner as provided by law prior to the

effective date of this section.

(b) Liability of Commonwealth.--The university shall have no

power at any time or in any manner to pledge the credit or the

taxing power of the Commonwealth or any political subdivision

nor shall any of its obligations be deemed to be obligations of

the Commonwealth or of any of its political subdivisions, nor

shall the Commonwealth or any political subdivision be liable

for the payment of principal of or interest on such obligations.

secured by mortgages, their transfer and the income therefrom,

including any profits made on the sale thereof, shall at all

times be free from taxation within this Commonwealth.

Section 10. Reports.

The president of the university shall each year, not later

than the first day of October, make a report of all the

activities of the university, instructional, administrative and

financial, for the preceding scholastic and fiscal year, to the

board of trustees, who shall transmit the report to the Governor

and to the members of the General Assembly.

Section 11. Status of board members.

(a) Commonwealth officials.--

(1) The Secretary of Conservation and Natural Resources

and the president of the university shall automatically be

removed from the board on the effective date of this section.

(2) The Governor, the Secretary of Education and the

Secretary of Agriculture shall become nonvoting ex officio

members of the board upon the effective date of this section.

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(b) Other members.--

(1) The term of the member of the board representing the

Penn State Alumni Association elected by the board under the

Resolution of the Board of Trustees dated November 14, 2014,

shall expire on the effective date of this section.

(2) The terms of each of the three at-large members

elected by the board under the Resolution of the Board of

Trustees dated November 14, 2014, shall expire on the

effective date of this section.

(3) The term of the member of the board representing the

faculty of the Pennsylvania State University elected by the

board under the Resolution of the Board of Trustees dated

November 14, 2014, shall expire June 30, 2016.

(4) Notwithstanding any other provision of law or any

provision of the university charter, constitution or bylaws

to the contrary, beginning July 1, 2016, through June 30,

2017, the number of board members representing business and

industry endeavors and agricultural societies and

organizations shall be reduced from six to four,

respectively. To implement this reduction, the following

shall apply to elections or appointments of individuals

representing business and industry endeavors and agricultural

societies and organizations to the board in 2016:

(i) Two members shall be elected by delegates

representing county agriculture societies and

organizations in accordance with the university bylaws

for a one-year term beginning July 1, 2016, and ending

June 30, 2017.

(ii) Two members shall be elected representing

business and industry endeavors in accordance with the

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university bylaws for a one-year term beginning July 1,

2016, and ending June 30, 2017.

(5) Board members representing the interest of alumni

under the act of March 24, 1905 (P.L.50, No.35), entitled "An

act to reorganize the Board of Trustees of The Pennsylvania

State College," shall continue to hold office as members of

the board for the term for which they were elected.

(6) Notwithstanding any other provision of law or any

provision of the university charter, constitution or bylaws

to the contrary, terms of board members representing business

and industry endeavors, agricultural societies and

organizations, the student body of the university and the

faculty of the university on the effective date of this

section shall expire June 30, 2017.

Section 12. Amendment of bylaws.

Within 90 days after the effective date of this section, the

university's bylaws shall be amended to reflect the provisions

of this act.

Section 13. Repeals.

All acts or parts of acts are repealed to the extent they are

inconsistent with this act.

Section 14. Effective date.

This act shall take effect immediately.

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