NU'S NO-BID ARRANGEMENTS
Some current and former elected officials are calling for more transparency in response to no-bid arrangements the University of Nebraska has used on some of its biggest construction projects.
State Sen. Ernie Chambers of Omaha, former Gov. Dave Heineman and Omaha Mayor Jean Stothert were among those advocating for transparency and public bidding after an investigative report was published by The World-Herald Feb. 14.
It detailed how NU has built about $691 million in new facilities without the university issuing public bids by setting up private corporations and making other arrangements that shield spending details from the public.
The no-bid projects include the Baxter Arena and some dorms at the University of Nebraska at Omaha, the Nebraska Innovation Campus in Lincoln and the Fred & Pamela Buffett Cancer Center on the University of Nebraska Medical Center campus. About $264 million in public money has gone toward the building costs. The rest is from private investment and philanthropic dollars.
NU Board of Regents Chairman Kent Schroeder issued a statement last week that gave no indication the university might change its procedures. He said the university "will continue to leverage partnerships with the private sector for the benefit of the university and state of Nebraska."
Schroeder said the projects "cannot be viewed as anything other than tremendous success stories for the state."
"We are grateful to the private donors and public partners whose support makes initiatives likes these possible," he said.
Chambers said he believes the university should be bidding when the projects are built with public money. He said he plans to research the issue and propose a way to address the situation during the next legislative session.
"There is some direction that legislation needs to take to close loopholes, shine light in darkened corners and bring everything before the public," Chambers said.
While governor, Heineman helped usher through NU's big projects and supported their state funding requests. Heineman said he didn't know the development corporations were not using bidding procedures because, as governor, he didn't get involved in that level of management at the university.
Heineman said the university's future projects should be bid — or an alternative process should be thoroughly and publicly explained in advance when they are not.
"We always need to remember the University of Nebraska is a public institution funded by taxpayer funds, and as such, subject to full public scrutiny," Heineman said.
Gov. Pete Ricketts, who was not available for an interview, issued a statement that struck a similar chord. When an agency funded by taxpayer money is involved, Ricketts said, "transparency should be the guiding principle."
"New partnerships require a clearly communicated process ahead of time, and it is important to find a proper balance with regard to public accountability," he said in the statement.
Stothert noted that Omaha's charter requires open public bidding and that bidding rules were established more than a century ago to prevent cronyism.
"I do think when you're using taxpayer money, my position always is that you have to be as transparent as you can," Stothert said. "It's not our money we're spending."
State Sen. Mike Groene of North Platte said he, too, needs to research what to do next. But the accountability and transparency of taxpayer money needs to be investigated, Groene said.
"The University of Nebraska is owned by the citizens and should follow what their elected officials deem as proper behavior," Groene said. "There should be no loopholes that they decide, the management decides, they don't have to answer to the public."
Nebraska state law requires competitive bidding on public construction projects and purchases by state agencies. NU is exempt from that state law, but it is still required to bid purchases above $150,000 under its own rules, which were approved by the Board of Regents.
Jack Gould, issues chairman of the government watchdog group Common Cause Nebraska, said the public deserves to see its money spent through open bidding. How much contractors are getting paid for public projects, too, should be disclosed, Gould said. The university has declined to reveal details, saying those contracts aren't public information because using ground leases and private corporations it created shield them from the public.
"We ought to know whether others were considered and if the amount of money being paid is in the best interest of the public," Gould said.
Nebraska Attorney General Doug Peterson was not available for an interview. His spokeswoman said in an emailed statement that the arrangements made by the university "do not appear to be inconsistent" with Nebraska law.
"If the Legislature and the Board of Regents see fit to change the process by which public-private partnerships deliver projects for Nebraskans, that is certainly within their prerogative," the statement said. "Those bodies are best equipped to address such matters."
Nebraska State Auditor Charlie Janssen said his office could look into anything where public money is spent, but he declined to say whether he intended to examine the financial arrangements of the NU projects. The university was audited last year, Janssen said, and his office didn't find any problems when it tested how well they follow their procurement policies. He said he couldn't speak to whether his office ever inspected the no-bid arrangements.