The News Journal | by Natalia Alamdari
Both the University of Delaware and Delaware State University receive millions in state tax dollars each year, with UD taking home the bulk of that higher education funding.
Both offer lower tuition rates and prioritized scholarships for students from Delaware.
Both are categorized as public universities on national college ranking lists.
Most people would assume that Delaware’s largest universities are public institutions.
But they’re not.
UD has a private charter and DSU is a private corporation.
That means that even though both schools receive regular state support in the tens of millions, taxpayers are largely kept in the dark about the school’s finances and business practices.
“They have the law written on their side,” said Rep. John Kowalko, D-Newark. “We can’t have a fair, open, transparent process when we have these artificial restrictions on what we’re doing.”
In early February, UD officials made the case before lawmakers for the school to receive nearly $128 million in state funding this fiscal year, in line with the governor’s recommended budget. At the same joint finance committee hearing, Delaware State University requested $39 million.
The day before, the private Wesley College was approved to receive up to $3 million from the state, after having already been given $3.375 million in public funds.
With Wesley’s last push for state funding, constituents and lawmakers asked why the state was giving public dollars to a private college struggling to stay afloat financially.
Wesley supporters in the legislature pointed to UD and DSU and said the idea of the state underwriting private colleges isn’t new.
“It suddenly became this major controversy that, God forbid, we give a little bit of money to Wesley College to help them bridge the gap,” Sen. Trey Paradee, D-Dover, said during UD’s funding hearing. “But, the reality is, we are giving almost $18,000 a year per in-state student at the University of Delaware, which is a ‘private university.’”
UD traces its private status to 1833, when it was issued a private charter by the state. The General Assembly went on to establish Delaware State University in 1891 as a private corporation to offer black students a separate-but-equal alternative to UD, according to DSU’s website.
For decades, Delaware open records law has allowed the schools to work in near secrecy. This exemption is unique — Pennsylvania is the only other state that has a special classification for state-assisted, private universities.
In Delaware, taxpayers are able to request university information specifically related to the expenditure of public funds and attend semi-annual board meetings.
“I would say that the access is not limited,” said Jen Becnel-Guzzo, associate vice president and deputy general counsel at UD. “Citizens under FOIA (the Freedom of Information Act) have access to any documents that relate to our expenditure of public funds. When the state appropriates money to us, we have to answer for that. We have to be prepared to explain the expenditure of those funds.”
But state appropriations only account for about 10 percent of UD’s operating funds, leaving majority of the school’s financial dealings behind closed doors because of Freedom of Information exemptions in state law.
Employee salaries are kept secret, save for the top earners reported in federal Form 990s, which are often 18 months to two years out of date. Emails sent by university staff are off limits, as are detailed annual budgets and spending records.
Want to know how much UD officials spend on travel? Or contracts DSU has with vendors or contractors? If it’s not funded by state dollars, requesting that information from either school is usually denied.
“I think transparency is to their benefit,” Paradee said in an interview Monday. “To be able to demonstrate why they are worthy of receiving taxpayer funds and what we as taxpaying Delawareans are getting in return. I would like to see more transparency in their admissions process, the granting of financial awards to in-state students. I’d like to know how they are spending our money. It’s pretty simple.”
UD and the legislature have also sparred over the state’s ability to audit the school. In a recent audit of university procurement cards, used for purchases and travel, UD was the only school to decline participation. While DSU complied, the results are still pending as the state auditor’s office awaits additional documentation.
Only Delaware Technical Community College underwent a complete audit. Delawareans account for 96% of DelTech’s full-time student population, but the school receives $40 million less than UD’s most recent request.
This year, the governor recommended DelTech receive $88 million, compared to UD’s $128 million. As a state agency, the statewide community college is obligated to release information that UD and DSU can choose to keep secret.
“You want to be a private institution? Good, then don’t take a penny of public money,” Kowalko said. “You can’t be calling yourself public on Thursday and private on Friday.”
Preserving the status quo
In 1976, the General Assembly exempted UD from the Freedom of Information Act, save for board meetings and documents directly related to state funds. DSU was granted the same exemptions in 1990.
For years, Kowalko has been trying to reverse that. But his attempts at legislation have never made it past legislative committees.
“They get quite a bit of money. A lot more than we’ve given Wesley. It’s very disturbing that we have these giveaways of taxpayer money without any recourse of ensuring that they use it appropriately,” Kowalko said. “Every argument that has been made, in my eyes, is a bogus argument made to preserve the status quo.”
Shielding information from the public isn’t exclusive to the state’s universities — it’s reflected in Delaware’s overall culture of government and corporate secrecy.
Delaware consistently ranks at or near the bottom when it comes to state government accountability and transparency. Just like emails from UD or DSU staff, lawmakers’ and their staffer’s emails are not considered public record.
While some public General Assembly committee meetings are recorded, they are only accessible to the public through a Freedom of Information request. Some meetings are not recorded at all, and only written minutes are available.
Members of the legislature have proposed live-streaming floor debates and committee meetings, but a bill that would begin that process has received pushback from lawmakers.
“This is widespread. It’s not just Wesley or UD,” Kowalko said. “It’s a lot of different entities. This is ingrained in our own culture as legislators.”
UD’s status as a private institution has played out in Delaware courts as well.
When the university was sued in 1950 for denying the admission of black students, there was confusion as to whether the school was considered a state entity.
Delaware Chancery Court eventually ruled that beyond a reasonable doubt, the state had in fact formed a state agency through its relationship with the university. As it does now, UD received annual state appropriations and had the power of eminent domain. The state also appoints members to the university’s Board of Trustees.
However, Delaware’s Freedom of Information Act still exempts the university as a public body.
“The school probably has some good lobbyists there,” said Mike Hiestand, senior legal counsel at the Student Press Law Center. “State lawmakers are the ones that have jurisdiction and authority to make the rules. There’s nothing in the federal Constitution that says UD or DSU have to open their books to anybody. There’s no obligation that they do until [the General Assembly fixes] the law.”