Fearing donors would cut off financial support of Maryland's public colleges, University System of Maryland officials urged lawmakers in Annapolis yesterday to kill a bill that proposes letting the state review financial records of nonprofit organizations affiliated with government agencies.
The university system's opposition to the bill, which will likely come up for a vote in the next few weeks, renewed a decade-long debate about whether such authority is warranted.
"These audits will damage donor confidence," said system Chancellor Donald N. Langenberg, speaking to the Senate Economic and Environmental Affairs Committee. "These audits, we believe, will add expense but little value."
Ted Peck, a board member of the University of Maryland Foundation, the largest foundation directly linked to Maryland's public universities, said that as a donor he does not want the state reviewing his contributions. "Donors may simply vote their opposition with their checkbooks," Peck told the committee.
Sen. Ulysses Currie, a Prince George's Democrat who co-chairs the joint legislative audit committee, sponsored the bill that would give the state legislative auditor the authority to scrutinize the financial records of what amounts to about 20 of Maryland's 4,300 charitable groups.
Most of the targeted nonprofit organizations are foundations tied to the university system that raise money to support scholarships, research and professorships at more than a dozen state schools.
The fund-raising foundations have come under fire recently because of articles last year in The Sun that showed misspending by foundation and college officials at the Bowie State University and Salisbury State University foundations.
Currie and supporters of the bill assured the Economic and Environmental Affairs Committee and university system officials that donor confidentiality would be protected, and the cost to taxpayers would be minimal, if any.
"The identity of donors has been an issue," Bruce A. Myers told the committee yesterday. "I can assure you that's no problem."
University officials argued during several sessions this decade against proposals similar to Currie's, primarily because of concern that donors will be more reluctant to give if they know the state can tap into the information.
But universities in such states as Massachusetts and California have maintained successful fund-raising operations, even with the legislative auditor scrutinizing the records of foundations affiliated with state government.
Secretary of State John T. Willis said in a two-page statement to the Economic and Environmental Affairs Committee that the legislative auditor's ability to review financial records of the private, nonprofit groups will help his agency police misspending by charitable organizations.
Willis' support and concern about the universities' ability to police the foundations yesterday appeared to win favor with some committee members, who questioned why the schools and the fund-raising groups would oppose having the state look at their books.
Pub Date: 3/10/99