Compliance Status

Louisiana State University and A&M College is in compliance with this principle.

Narrative

Louisiana State University and A&M College (LSU) has the legal authority and operating control that clearly defines the institution’s mission, fiscal stability of the institution, and institutional policy. These are set forth by a variety of policies and legal documents that define each of these components.

3.2.2.1: Mission

Article VIII, Section 7 of the Louisiana Constitution of 1974 recreated the LSU Board of Supervisors with corporate powers and with enumerated authorities listed in Louisiana Revised Statutes (R.S.) 17:3351 and 17:3352, including the ability to determine the mission of the institutions under its control (R.S. 17:3351E(1))  [1] [2] [3] [4]. The mission statement for LSU was adopted by the board on December 8, 2006 [5] (Item 8B of the minutes). The role, scope, and mission of the university was reviewed and reaffirmed by the board in conjunction with a Board of Regents review and in accordance with Permanent Memorandum 38 (board minutes, February 3, 2012, Item 11D1) [6] [7]. Additional information on the institutional mission is found in Core Requirement 2.4.

Additional roles for the university have been approved by the board and reaffirmed in legislation, such as: land-grant status (R.S. 17:3221), flagship institution of the state (R.S. 17:3215), the home of the Louisiana Geological Survey (R.S. 17:1492), and the fire training institution (R.S. 40:1541) [8] [9] [10] [11].

3.2.2.2: Fiscal Stability

Article VIII, Section 7 of the Louisiana Constitution of 1974 recreated the LSU Board of Supervisors with corporate powers, and R.S. 17:3351 lists the powers of the board including the authority to accept and manage assets for the well-being of the LSU System. Article VIII, Section 12 of the Louisiana Constitution of 1974 clearly indicates that appropriations from the legislature are made directly to the management boards of which the LSU Board of Supervisors is one [1] [2] [3] [12]. Through annual action, the board allocates state appropriated funds to the university for operations as well as approving expenditure authority. The university reports quarterly to the Board of Supervisors on its budget status and expenditures to-date [13]. After the completion of the fiscal year, the university submits its annual financial report for public inspection, and the report includes use of state general fund appropriations, statutorily dedicated state funds, interagency transfers, self-generated revenues (including tuition and fee revenue), auxiliary operations, and plant investments [14]. The university participates in a budget preparation process for the ensuing fiscal year, which is transmitted to the executive officer of the state, the governor, for inclusion in a preliminary executive budget initiating legislative review and approval. In addition to state appropriations and other funds, state law gives the board the right to own property and to act to defend the assets of the LSU System. These authorities collectively ensure fiscal stability.

Numerous governmental agencies and private groups external to the university regularly audit and report on the university’s stability. The financial records of the university are subject to the Public Records Laws (R.S. 44:1) and are open to public inspection at any time. LSU was even the first higher education institution to place its financial records on the Louisiana Transparency & Accountability (LaTRAC) web portal [15] [16]. The university’s financial operations and financial statements are audited regularly by the Louisiana Legislative Auditor for compliance with state law [17]. The Louisiana Board of Regents reviews and compiles reports on each public university’s budget [18]. The university’s finances are also analyzed by Moody’s and Fitch rating agencies to assure investors of LSU’s financial stability in maintaining a manageable debt burden. Additional detailed financial information is considered in Core Requirement 2.11.1 and Comprehensive Standards 3.10.1 and 3.10.2.

3.2.2.3: Institutional Policy, including policies concerning related and affiliated corporate entities and all auxiliary services

The fiscal stability of the university is also guaranteed through the use of its assets. The LSU System establishes policy through Permanent Memoranda, and the university operationalizes those mandates through Policy Statements issued by the chancellor, as well as Finance & Administrative Services Operation Procedures (FASOPs) mandated by the Vice Chancellor of Finance & Administrative Services.

The protection and handling of money is directed through the system’s Permanent Memorandum 9, “Banking Services, Deposits, Investments, & Reporting Policy,” last amended in March 2012 [19]. The LSU System is designated by the state as a depositing authority through R.S. 49:319, meaning the system can retain, deposit, and invest its revenues [20]. Pursuant to Permanent Memorandum 9, the LSU Office of Accounting Services manages the university’s investments through the implementation of FASOP AS-17 [21].

Financial allocations to people for services are handled through direct approval of the board, as is the case with permanent employees of the university. Financial disbursements to individuals for services beyond employment terms or temporarily contracted personnel are guided by various policy statements including the following. Employee compensation is primarily the directive of the chancellor, with Permanent Memorandum 3 being the only limitation on increases [22]. The university’s Policy Statement 61 outlines the use of overtime and pay [23]. Policy Statement 106 pertains to the “Administration of Scholarship, Fellowship, and Fee Exemption Programs” (also see FASOP AS-04) [24] [25]. Contract employees providing services on a limited time are controlled under Title 39, Subpart E of the Louisiana Revised Statutes, and the System’s Permanent Memorandum 40 delegates contracting authority to the chancellor, who in turn, outlines the contracting policy to the university through Policy Statement 5, “Remuneration for Professional, Personal or Consulting Services” (also see FASOP AS-04­­) [25] [26] [27] [28]. The LSU System complies with all of the contracting rules set forth by the State Office of Contractual Review [29].

The university is also tasked with facilities management under the system’s Permanent Memorandum 14, which calls for proper maintenance and under Permanent Memorandum 32, which outlines the appropriate use of facilities, including the educational mission as the primary use of facilities [30] [31]. Permanent Memorandum 19 empowers the university to efficiently utilize facilities to hold classes, and Permanent Memorandum 42 mandates utilization studies to ensure optimal use [32] [33]. Permanent Memorandum 60 regulates contracting for infrastructure development and the threshold that triggers board review [34]. Permanent Memorandum 2 dictates rules associated with the naming of facilities [35]. Consistent with Permanent Memorandum 32, Policy Statement 82, “Use of LSU Facilities and Premise,” outlines the permissible use and protection of facilities [36]. Each facility has a designated “building coordinator” responsible for monitoring and reporting on its condition. For the university, the Office of Facility Services maintains numerous operating instructions [37]. The lease of land is regulated by Permanent Memorandum 6, and leases and contracts related to houses of Greek organizations are outlined in Permanent Memorandum 68 [38] [39].

The procurement and control of moveable property is regulated and enforced by the Louisiana Division of Administration, and the LSU Office of Purchasing is responsible for keeping the university in compliance [40]. Title 39 of state statutes mandates procedures for acquisition of goods [41]. The purchase of goods and services is outlined by the university in FASOP PUR-01 (Non-Competitive Purchases) and FASOP PUR-02 (Competitive Limits and Delegated Authority) [42] [43]. While the property is in use, Part XI of Revised Statutes (R.S. 39:321) mandates the procedures related to property control (inventory) and reporting [44]. Once the property no longer serves a purpose, the LSU Office of Purchasing handles the surplusing of equipment with guidelines set out in the Property Management Procedures, which are consistent with the parameters set out by the Louisiana Property Assistance Agency [45]. Policy Statement 101 protects the moveable property of the university from misuse [46]. Title 39 also dictates the procurement of vehicles, and Permanent Memorandum 21 outlines the policies regulating the use of the vehicles [41] [47].

Intellectual property also constitutes an asset of the LSU Board of Supervisors. Permanent Memorandum 64 is the LSU System’s policy on ownership claims of intellectual property and distribution of any proceeds, and the university’s related policy on intellectual property is Policy Statement 68 and Policy Statement 77 for distribution of royalties [48] [49] [50]. Permanent Memorandum 16 lays out the technology transfer process, including reference to the share of proceeds [51]. The LSU System maintains several template agreements related to the various types of technology transfer, facilitating collaborations [52]. Permanent Memorandum 11 requires disclosure of all outside employment, which is important for reporting any potential conflicts, and the university’s Policy Statement 98 goes one step farther by requiring disclosure of financial interest (regardless of employment status) in a research project to protect the university and the employee and to prevent both research bias and potential litigation [53] [54].

The research cost recovery process related to research represents a receivable to the LSU System. In exchange for personnel, facilities, and equipment, granting agencies or sponsored program contractors typically agree defray some of the costs associated with maintaining those assets. Permanent Memorandum 10 pertains to the cost recovery policy of the LSU System and is operationalized at the university through FASOP AS-05, FASOP AS-06, and FASOP AS-07 [55] [56] [57] [58].