Bailout for Embattled Dickinson State University May Bog Down Efforts to End Legislative Session


Earlier today I wrote about some lawmakers in Bismarck expressing doubt that they can complete their legislative session on Tuesday.

They already blew past their goal of being done on day 70 last week.

Contributing to the delays in finishing up is a surprise Senate Majority Leader Rich Wardner  dropped on his colleagues on Friday.

Wardner, with assistance from others, offered an amendment to HB1015 which is the budget for the Office of Management and Budget. The OMB budget is often the last bill passed in a given legislative session and is used as a sort of “Christmas tree” on which lawmakers hang last-minute policy or appropriations amendments.

The amendment Wardner tacked on represents a  bailout for Dickinson State University. Wardner, it should be noted, is from Dickinson.

The folks at DSU are still reeling from that diploma mill scandal from a few years back, and the utter mismanagement of the school’s foundation (which was forced into receivership), and Wardner wants a bailout. His amendment gives the school millions in additional funding:

There’s a lot to dislike about this maneuver.

For one thing, Wardner sneaked this into the OMB budget when the higher education budget, SB2003, is still in conference committee. I’m told that Wardner didn’t bother to offer his amendment to that bill.

For another, Wardner’s amendment represents yet another bailout for these supposedly private university foundations. These foundations like to say that they’re separate from the institutions they support, and that they’re private, and yet when they go belly up it’s the taxpayers who bail them out. That’s what we saw with when the UND Research Foundation went belly up in Grand Forks, and now Wardner wants to do the same with DSU’s foundation.

And lastly, bailing out DSU is hardly fair at a time when all of the state’s universities are taking big budget cuts.

To give some context to that last point, consider this chart created by Legislative Council which shows the budget cuts for the state’s institutions of higher education:

Now here’s what things look like with Wardner’s amendment:

Note that there is a couple of million dollars wroth of overlap between Wardner’s amendment and what’s before the conference committee on SB2003.

If Wardner gets his way DSU would go from getting the same sort of budget haircut every other institution is getting to getting really no budget cut at all.

Even more troubling is that among the millions of additional dollars DSU would get is nearly $1 million in challenge grant funds dedicated to the school’s operational expenses.

That’s something the challenge grants, which were created as state matching dollars for private donations to the university foundations, have never been used for. They weren’t intended to be used that way.

I get that DSU is in rough shape, but Wardner should have started this discussion before day 74 of the legislative session. He should have brought the issue to the conference committee discussing the higher education budget instead of hanging it on the OMB “Christmas tree.”

And at some point we’re going to have to decide, as a state, if we’re going to start treating these university foundations as though they’re as private as they say they are when they want to avoid public scrutiny and accountability of if we’re going to keep bailing them out.