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House of Representatives
Session of 2023 - 2024 Regular Session

MEMORANDUM

Posted:	January 11, 2023 02:00 PM
From:	Representative Perry A. Stambaugh
To:	All House members
Subject:	Protecting Private Donations That Support the Universities of the Pennsylvania State System of Higher Education (PASSHE) Former HBs 2195 & 2196

I will soon reintroduce two pieces of legislation (HB 2195 and HB 2196 from last session) intended to protect private donations made in support of Pennsylvania’s 14 state-owned universities and the affiliated university foundations that raise and manage private donations for PASSHE students, faculty, and the institutions themselves.  Act 50 of 2020 provided the PASSHE Chancellor and Board of Governors with the authority to force the consolidation of universities, programs, and services.  During debate on this legislation, PASSHE and its legislative supporters stated that nothing would impact the individual university foundations, whose mission is to generate private financial support for their associated university. The oft-repeated position of the proponents of the legislation and PASSHE is that the university foundations were not part of or formed by Act 188 of 1982, which created PASSHE. Therefore, the university foundations are not to be impacted by Act 50. However, the university integration plans approved by the PASSHE Board of Governor in July 2021 identified fundraising and advancement functions as one of eight (8) Key Functional Areas of the integrations.  Although it is technically correct to state that the university foundations are independent of the universities from a legal perspective – that is, they are private, non-profit corporations with independent boards of directors – their relationships with the State System universities are subject to legislative and regulatory controls. That’s because the General Assembly passed the Higher Education Modernization Act (HEMA, Act 104 of 2012) to establish the requirements by which universities can continue these relationships, and the PASSHE Board of Governors implemented detailed policies pursuant to HEMA that further impose limits on the foundations. Critically, HEMA’s criteria for operation of the university foundations is inconsistent with the expressed goals of consolidation and coordination under Act 50, because it presumes 14 separate and distinct universities, and does not account for the possibility of integration or merger of the member institutions.  Please join me in co-sponsoring this legislation to reflect the changing composition of the Pennsylvania State System of Higher Education and enhance the university foundations’ ability to provide the private, external financial support that PASSHE-member universities need to thrive.

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Document #1

Description:

Amends the Higher Education Modernization Act to clarify who is permitted to raise and utilize non-public funds to benefit and promote the Pennsylvania State System of Higher Education (PASSHE), and modernizes those requirements to reflect recent changes to PASSHE through Act 50 of 2020 and approved university integration plans. Further, this legislation confirms the original intent of the Right-To-Know Law that university foundations, just like any non-public entity, are not subject to the law.

Document #2

Description:	Amends the Public School Code to incorporate the revised definition of an “affiliated entity” from the Commonwealth Higher Education Modernization Act to ensure consistency between the two laws that impact university foundations.