Government Relations

UM Legislative Update Newsletter

February 17, 2006

Link from President, chancellors testify for Senate Education Committee hearing on MOHELA

University of Missouri President Elson S. Floyd, MU Chancellor Brady Deaton and UMR Chancellor John F. Carney III were among the college and university leaders testifying before the Senate Education Committee on Tuesday, Feb. 14. The committee, chaired by Sen. Gary Nodler (R-Joplin), conducted a hearing on the proposed sale of a portion of MOHELA assets to support higher education capital improvements and scholarships. Although no formal legislation has been filed, senators took the opportunity to hear from the university leaders, as well as representatives of the Department of Higher Education, the Department of Economic Development and MOHELA. The higher education leaders testified in support of Gov. Matt Blunt’s Lewis & Clark Discovery Initiative. Read President Floyd’s testimony.

Greg Fitch, commissioner of higher education, testified that just having a conversation about capital improvements is in and of itself positive. “The best part of this is that we have an open dialogue,” Fitch said.

Fitch discussed both the governor’s Lewis and Clark Discovery Initiative and the Access Missouri proposal, which was outlined last week by House Speaker Rod Jetton (R-Marble Hill) and Speaker Pro-Tem Carl Bearden (R-St. Charles) with a different mix of spending that includes paying down state debt and using some of the funds for community college maintenance and repair. Fitch said both plans recognize higher education as an investment while also protecting students, but shared concerns about using MOHELA proceeds generated by students to pay down state debt. He added that the state debt is incurred by all Missourians, not only by higher education.

“Missouri gets an ‘F’ in affordability,” Fitch said. “The scholarship money would address the affordability issue and the capital improvement projects would allow our campuses to grow, addressing the state’s ability to physically expand into the plant and health sciences.”

Raymond Bayer Jr., executive director of MOHELA, told senators the agency wanted to make it clear that any new loans purchased from MOHELA in the future will continue to receive the same benefits as those purchased in years past. Additionally, any loans sold during this process will retain the same interest rate. MOHELA is only selling selected assets of its agency and will continue to provide services to Missourians. MOHELA representatives noted that the agency’s current growth potential would allow the agency to possibly be “whole” as soon as three years from now.

Greg Steinhoff, director of the Department of Economic Development, testified that the governor’s proposal provides a balanced mix to achieve desired economic development goals in the state. Steinhoff reiterated that the proposal would create 4,880 new jobs in the state, 3,000 of which would be generated almost immediately. The state’s economic development officer also noted that moving our higher education institutions’ research into the business community is a key, and that the incubators proposed as part of the governor’s proposal will help facilitate that transition. Steinhoff added that similar incubators already have proven track records in Missouri, offering examples like the Center for Emerging Technologies in St. Louis.

Two representatives of the Attorney General’s office concluded the hearing by raising questions about whether MOHELA violated the state’s Sunshine law. Attorney General Jay Nixon announced later on Tuesday, Feb. 14 that he was filing suit against MOHELA for violations of the open meetings law.

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