2019 - 2020 LEGISLATURE
September 5, 2019 - Introduced by Senators Cowles, Jacque and Stroebel,
cosponsored by Representatives Murphy, Kerkman, Nygren, Felzkowski,
Zimmerman, Pronschinske, Ramthun, Knodl and Tusler. Referred to
Committee on Universities, Technical Colleges, Children and Families.
SB388,1,8 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.
Analysis by the Legislative Reference Bureau
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
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
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:
1. A chancellor, dean, or director.
2. Responsible for signing a contract on behalf of the institution.
3. Also an officer or board member of a UW-affiliated organization on an
ongoing basis.
The bill provides that information provided by a UW-affiliated organization to
a UW institution employee is considered a public record, not including donor
For further information see the state fiscal estimate, which will be printed as
an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
SB388,1 1Section 1 . 18.01 (4) (intro.) of the statutes is renumbered 18.01 (4) (am) (intro.)
2and amended to read:
SB388,3,53 18.01 (4) (am) (intro.) “Public debt" or “debt" means every voluntary,
4unconditional undertaking by the state, other than an operating note, to repay a sum
SB388,2 6Section 2 . 18.01 (4) (bm) of the statutes is created to read:
SB388,3,87 18.01 (4) (bm) “Public debt” does not include any agreement by the state to
8guaranty the debt of another.
SB388,3 9Section 3 . 18.05 (2) of the statutes is amended to read:
SB388,4,310 18.05 (2) The last determination made by the department of revenue of the full
11market value of all general property of the state liable to taxes pursuant to s. 70.575

1shall be the aggregate value of all taxable property in the state. The department of
2revenue shall certify such value when requested for use in connection with the
3contracting of state public debt.
SB388,4 4Section 4 . 18.05 (3) of the statutes is amended to read:
SB388,4,105 18.05 (3) The legislative audit bureau shall annually determine the amounts
6under sub. (1) (b) 1. and 2. and shall certify such amounts when requested for use in
7connection with the contracting of state public debt. It shall use in making such
8determination the fair market value of all property on hand in the sinking funds of
9the bond security and redemption fund. It shall take into account any anticipatory
10contracts under s. 18.10 (1).
SB388,5 11Section 5 . 18.06 (8) (am) 2. of the statutes is amended to read:
SB388,4,1512 18.06 (8) (am) 2. The interest exchange agreement must identify by maturity,
13bond issue, or bond purpose the public debt or obligation to which the agreement is
14related. The determination of the commission included in an interest exchange
15agreement that such agreement relates to a debt or obligation shall be conclusive.
SB388,6 16Section 6 . 18.10 (1) of the statutes is amended to read:
SB388,4,2517 18.10 (1) Anticipatory contracts. After adoption of an authorizing resolution
18for a purpose which is to be accomplished wholly or in part through performance of
19an executory contract by some other contracting party, such contract may be entered
20into prior to the contracting of the public debt authorized by such resolution with like
21effect as if the funds necessary for payments on the contract were already available.
22In such cases the public debt authorized by such resolution shall be deemed to have
23been contracted pursuant to such resolution in the amount necessary to make such
24payments on the date such contract is entered into and the authority of such
25resolution shall promptly thereafter be exercised.
1Section 7. 18.10 (8) of the statutes is amended to read:
SB388,5,142 18.10 (8) Trustees and fiscal agents. The commission may appoint one or
3more trustees and fiscal agents for each issue of bonds or notes. The secretary of
4administration may be denominated the trustee and the sole fiscal agent or a cofiscal
5agent for any issue of bonds or notes. Every other such fiscal agent shall be an
6incorporated bank or trust company authorized by the laws of the United States or
7of the state in which it is located to do a banking or trust company business. There
8may be deposited with a trustee, in a special account administered as provided in this
9chapter, moneys to be used only for the purposes expressly provided in a resolution
10authorizing the issuance of public debt or an agreement between the commission and
11the trustee. The commission may make such other provisions respecting trustees
12and fiscal agents as it deems necessary or useful and may enter into a contract with
13any trustee or fiscal agent containing such terms, including compensation, and
14conditions in regard to the trustee or fiscal agent as it deems necessary or useful.
SB388,8 15Section 8 . 18.10 (9) of the statutes is amended to read:
SB388,5,1816 18.10 (9) Prepayment. The commission may authorize public debt having any
17provisions for prepayment deemed necessary or useful, including the payment of any
SB388,9 19Section 9 . 18.11 of the statutes is created to read:
SB388,5,22 2018.11 Guaranty agreements unenforceable. Unless otherwise expressly
21provided by law, an agreement by the state to guaranty the debt of another is
SB388,10 23Section 10 . 18.14 (title) of the statutes is amended to read:
SB388,5,24 2418.14 (title) Validation of public debt.
1Section 11. 19.32 (2) of the statutes is renumbered 19.32 (2) (a) and amended
2to read:
SB388,6,63 19.32 (2) (a) “Record" means any material on which written, drawn, printed,
4spoken, visual, or electromagnetic information or electronically generated or stored
5data is recorded or preserved, regardless of physical form or characteristics, that has
6been created or is being kept by an authority.
SB388,6,10 7(b) “Record" includes, but is not limited to, handwritten, typed, or printed
8pages, maps, charts, photographs, films, recordings, tapes, optical discs, and any
9other medium on which electronically generated or stored data is recorded or
SB388,6,19 11(d) “Record" does not include drafts, notes, preliminary computations, and like
12materials prepared for the originator's personal use or prepared by the originator in
13the name of a person for whom the originator is working; materials that are purely
14the personal property of the custodian and have no relation to his or her office; donor
15information provided by a UW-affiliated organization, as defined in s. 36.11 (59) (a)
163., to an employee of a University of Wisconsin System institution;
materials to which
17access is limited by copyright, patent, or bequest; and published materials in the
18possession of an authority other than a public library that are available for sale, or
19that are available for inspection at a public library.
SB388,12 20Section 12. 19.32 (2) (c) of the statutes is created to read:
SB388,6,2321 19.32 (2) (c) “Record” also includes budgets, meeting minutes, and other
22information provided by a UW-affiliated organization, as defined in s. 36.11 (59) (a)
233., to an employee of any University of Wisconsin System institution.
SB388,13 24Section 13. 19.42 (10) (t) of the statutes is created to read:
SB388,6,2525 19.42 (10) (t) A state public official described under sub. (13) (q).