AB 370

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