AB370,1,8 1An Act to renumber and amend 18.01 (4) (intro.), 19.32 (2) and 36.09 (1) (f);
2to amend 18.05 (2), 18.05 (3), 18.06 (8) (am) 2., 18.10 (1), 18.10 (8), 18.10 (9),
318.14 (title), 36.115 (1) and 36.17 (1); and to create 18.01 (4) (bm), 18.11, 19.32
4(2) (c), 19.42 (10) (t), 19.42 (13) (q), 36.09 (1) (f) 1. a., 36.09 (1) (f) 1. b., 36.09 (1)
5(f) 2., 36.09 (3) (c), 36.11 (59) and 36.115 (9) of the statutes; relating to: state
6debt guaranties; delegations by the Board of Regents of the University of
7Wisconsin System; organizations affiliated with the UW System; and
8standards of conduct for certain UW System employees.

This bill provides that any agreement by the state to guaranty the debt of
another is not a debt of the state and is unenforceable except as expressly provided
otherwise by law. The bill also makes the following changes regarding the University
of Wisconsin System.

Delegations of authority. The bill makes changes to the delegation authority
of the Board of Regents of the UW System. The bill requires the Board of Regents
to make all limited appointments, except for those that current law requires the
president of the UW System to make, and prohibits the Board of Regents from
delegating its authority to make limited appointments. The bill also prohibits the

Board of Regents from delegating its governance powers or duties to the president
of the UW System or a chancellor or other administrative officer of a UW institution.
“Governance powers or duties” is defined as those powers or duties that rise above
duties related to administration or operation and include the power to approve
policies or budgets or to specify the mission of the UW System or a UW institution.
The bill also prohibits the Board of Regents from delegating the authority to enter
into a guaranty, financial agreement, or obligation involving an affiliated
organization. Subject to the foregoing prohibitions, the bill allows the Board of
Regents to adopt policies that explicitly delegate authority it considers appropriate
to a committee of the Board of Regents, an institutional board, a committee of an
institution, or another group.

UW-affiliated organizations. The bill prohibits a chancellor or
administrative officer or other employee of an institution to make a guaranty or enter
into a financial agreement or obligation with a UW-affiliated organization without
the express written consent of the Board of Regents. The bill defines a
“UW-affiliated organization” as an entity that 1) is legally distinct from a UW
institution; 2) is organized and operated for the benefit or in support of a UW
institution; and 3) is either permitted to use a UW institution's name (name
permission) or is provided use of a UW institution's space, resources, or employees
(institutional use). However, excluded from the definition is the UW Hospitals and
Clinics Authority and its affiliated entities. Also excluded is any “state agency,”
which is defined as any office, department, agency, institution of higher education,
association, society, or other body in state government that is 1) created or authorized
to be created by the state's constitution or any law and 2) entitled to expend moneys
appropriated by law. “State agency” is also defined to include any authority, but to
exclude the legislature and the courts.

The bill provides that a violation of the above prohibition is malfeasance and
requires the violator to be dismissed for cause. The bill also provides that a guaranty,
financial agreement, or obligation made or entered into in violation of the prohibition
is void and unenforceable, except the violator is personally liable for any obligation
incurred on behalf of a UW institution in the guaranty, financial agreement, or
obligation.

The bill imposes other requirements regarding UW-affiliated organizations.
The bill requires UW institutions to annually report to the Board of Regents the
name permission and institutional use provided to UW-affiliated organizations and
the payments made for the name permission and institutional use. The bill defines
“payment” to include any payment in cash, goods, services, or any other thing of
value. The report must also include the difference between the monetary value of
the payments and the fair market value of the name permission and institutional
use. In addition, the report must describe and set forth all payments made by a UW
institution to a UW-affiliated organization. The bill also requires the Board of
Regents to establish requirements for regularly evaluating the relationship between
UW institutions and UW-affiliated organizations.

The bill prohibits an individual employed by a UW institution from being
employed at the same time by a UW-affiliated organization, unless the dual

employment is approved by the Board of Regents and the institution's chancellor.
The prohibition is prospective, as it applies to UW institution employees whose
employment by a UW-affiliated organization commences on the bill's effective date.
If approval is granted for an individual, the bill prohibits the UW institution and
UW-affiliated organization from compensating the individual for the same time
worked. The bill imposes reporting requirements to ensure compliance with that
prohibition.

Ethics and public records. Under the bill, an employee of a UW institution
who is any of the following is considered a state public official subject to the state code
of ethics and required to file an annual statement of economic interests with the
Ethics Commission: