Review of Loan Program at University of Texas School of Law Released

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Summary: A review of the forgivable loan program at the University of Texas School of Law by the attorney general’s office has been released. 

A review conducted by the attorney general’s office found that a defunct forgivable loan program at the University of Texas School of Law “set into motion a lack of transparency that ultimately led to a lack of accountability,” according to The Texas Tribune.

  

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“This new report was based on many more interviews than the earlier one, but its major findings and conclusions are the same,” said Ward Farnsworth, the current dean of the law school. “We’ve long since corrected the issues raised in both reports.”

Professors were issued forgivable loans by the University of Texas Law School Foundation. Former law dean Larry Sager received a $500,000 loan. The practice came under fire in 2011 when UT-Austin President Bill Powers demanded that Sager resign from his post as law school dean.

To read more about the University of Texas School of Law, click here.

The regents of the school system asked then-Attorney General Greg Abbott to investigate the relationship between the law school and the foundation back in April of 2013. Abbott is now the governor-elect.

The school system released the findings of the report late last week.

“The board of regents appreciates the hard work and attention of the office of the attorney general in its review of the issues related to the relationship between the UT-Austin Law School and the Law School Foundation,” Paul Foster, the chairman of the UT System Board of Regents, said in a statement. “The report identifies areas for improvement related to transparency, alignment of university and foundation missions, and compliance with records production. The problems highlighted in the attorney general’s report have been or will be addressed.”

To read more law school news stories, click here.

A review quite similar to this one was released in 2012 by the school system’s then-general counsel, Barry Burgdorf. In Burgdorf’s report, he recommended that the loan program be terminated.

The foundation does not provide faculty members money directly anymore. Money is contributed to the law school through the university.

The program began back in 2003, when Powers was serving as the dean of the law school. He never received a loan from the foundation, but did receive a deferred compensation package it.

The report from the attorney general’s office said, “Sager wanted to — and in fact did — increase the use of forgivable loans to recruit and retain faculty” and that, where the loans were concerned, he “supported a lack of transparency.”

To read more about the former Texas attorney general, Greg Abbott, click here.

Gary Susswein, a spokesman for UT-Austin, released the following statement:

“The recent attorney general’s investigation recognizes the foundation’s valuable relationship with the school but also identifies ways that both entities could have been more transparent and more effectively followed their own protocols in the past. The attorney general’s review also confirms the problems that faculty members first identified and brought to President Powers’ attention in 2011, shortly before he made a change in leadership at the law school. Since then, the university and foundation have improved their procedures to promote greater transparency and accountability while ensuring UT has the resources needed to remain one of the best public law schools in the nation.”

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Source: Texas Tribune