Tuesday, October 7

Barry Fenchak: CDT LTE: Stand Up, Penn Staters

In a Letter to the Editor of the CDT, Barry Fenchak writes about the disgraceful power grab by the OGP -- proposal A+ should be called F-

Board reform? Or board manipulation and control?
Later this fall, the “leadership” of the Penn State board of trustees will be cramming down the A+ board reform proposal (hereinafter referred to by the more appropriate moniker of F- board manipulation and control proposal).
Fearing the impending ouster of Tom Corbett from the governor’s office, the board’s leaders know that — barring this cram down — they will lose their majority control of the board.
With the current structure in place, the leaders know they will gradually see Corbett’s proxies removed from the governor-appointed seats as Tom Wolf fills those seats (presumably with trustees who actually seek to serve the university’s interests).
Nine elected trustees plus the nine voting seats held by governor appointees eventually will result in the board leaders holding control of only 12 of 30 voting seats.
This fear led to the leaders’ attempts to reduce the number of elected trustees through the proposal put forward by Richard Dandrea.
After failing in that attempt, the board resorted to plan F-, eliminating voting privileges for three of the governor appointments, while adding six leadership-appointed sycophants to the board and allowing them to maintain control of 18 of 33 voting seats on the “new” board.
Are Penn Staters that naïve? That gullible? That disinterested? At what point do Penn Staters stand up and demand an end to this?

Read more here: http://www.centredaily.com/2014/10/07/4391638/letter-to-the-editor-stand-up.html?sp=/99/145/330/#storylink=cpy


  1. Ray,

    What is it that the OGP faction is fighting so hard to protect? Are certain board members from B&I using their connections and influence as CEO's of major corporations to utilize Penn State's facilities and resources free of charge for their own corporate and personal gain. For example, Frazer, being CEO of Merck, having Penn State's labs and facilities used for R&D for Merck free of charge. Or Peetz, being CEO of BNYMellon, having Penn State deposit Penn State money in BNYMellon accounts at below-market interest rates while BNYMellon uses that money to invest in other activities, some activities perhaps being high-risk to which Penn State could lose a substantial amount of money. This seems like an abuse of power and a conflict of interest, and well as a breach of fiduciary duty.

    What can we do, all of us, to ensure that no changes are made to the board until after the election and Corbett is booted out of office? We need to stop this. Enough damage to OUR university has been done.

    1. Ab -
      If I may chime in - I know your addressed your comment to Ray:

      It would certainly be helpful if "we" could prevent the OGP from taking further actions to insulate themselves from accountability - i.e. prevent the cram down of the F- proposal. I do think there are some tactics which might be successful. For the most part, this would require actions by existing Board members - which means for all intents and purposes the "Alumni" trustees. I have tried (thus far, in vain) to communicate these avenues to some of the existing Alumni Trustees. Maybe they have other plans in the works - and that is why they have been unresponsive......I don't know.
      Failing that, I imagine two other options are:
      1- Advocating strongly to PA legislative representatives. Letting them know what is going on, and asking that they make it clear to the OGP that the Commonwealth will not look kindly on further Board manipulation.
      2 - Showing up - in number - to the next Board meeting and forcing a very public expression of outrage at the Board's actions.....with the idea of casting enough light on the issue that the OGP may be overwhelmed with negative PR.
      Other than that......I don't know what to suggest, but I would certainly be open to discussion of alternatives.

    2. Ab,
      There are any number of ways the trustees can make a buck off of their positions, especially considering that the BOT By-Laws permit conflicts of interest. I won't get into specifics here, but their methods are included here....


      As for Merck, they are not listed as a grantor on the A-133 for PSU, however, that doesn't mean they don't have their fingers in the pie via a third party.

      Peetz/BNY Mellon has already been fingered for a conflict of interest over a land purchase by Toll Brothers. Of course, PSU could use BNY Mellon to underwrite loans or bonds. And there is nothing in the BOT By-Laws that prohibits BOT members from purchasing PSU bonds.

      I think the most needed thing is to DEMAND that the conflict of interest policy be changed to prohibit any and all conflicts of interest and then demand full financial disclosures based on the new policy.

  2. Do the Trustees have the authority to restructure the board or does the state legislature have that authority?

    1. Tim,
      To restructure to a number other than 32, the BOT would have to revise the charter. The charter makes no mention of approval by the legislature being needed.

      However, this was just a quick review. There may be other legal precedents involved of which I have no knowledge.