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Regular Session, 2012
HOUSE BILL NO. 1133
BY REPRESENTATIVE CARMODY
HIGHER EDUCATION: Provides with respect to assets of any foundation, alumni
association, or nonprofit organization affiliated with a state institution of higher
education
AN ACT1
To enact R.S. 17:3130.1, relative to the powers of the Board of Regents; to require approval2
by the Board of Regents of any transfer of assets of a nonprofit affiliate of a3
postsecondary institution to the institution's management board; to provide for4
conditions and procedures with respect to such approval; and to provide for related5
matters.6
Be it enacted by the Legislature of Louisiana:7
Section 1. R.S. 17:3130.1 is hereby enacted to read as follows:8
ยง3130.1. Powers with respect to transfers of funds of affiliate organizations9
A. No management board of a Louisiana public postsecondary education10
institution system, hereafter in this Section a "management board", nor any nonprofit11
entity affiliated with a management board shall transfer, access, convert, or assume12
any control or possession, hereafter in this Section "transfer", any funds, property,13
donations, accounts receivable, or pledges, hereafter in this Section "assets", held,14
managed, administered, owned, or otherwise controlled by any foundation, alumni15
association, or any other nonprofit organization affiliated with a public16
postsecondary education institution, hereafter in this Section an "institution affiliate",17
without first obtaining the express approval of the Board of Regents and the18
governing authority of the institution affiliate which holds, manages, administers,19 HLS 12RS-2234 ORIGINAL
HB NO. 1133
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owns, or otherwise controls the assets. Failure to obtain Board of Regents approval1
of any transfer as provided in this Section prior to implementation of a transfer shall2
render the transfer null ab initio.3
B. The Board of Regents may grant such approval only by resolution4
adopted at a meeting of the board, properly noticed for that purpose.5
C. The legislature finds that it is likely that most donors and contributors to6
an institution affiliate are not aware of the possibility that their donations or7
contributions to an institution affiliate might be transferred to the institution's8
management board. Therefore, the Board of Regents shall not approve any such9
transfer of an institution affiliate's assets to a management board or nonprofit entity10
affiliated with a management board except as follows:11
(1) If a transfer is proposed by a management board then, prior to the12
implementation of the proposed transfer, the management board shall give written13
notice of the proposed transfer and the circumstances giving rise to the proposed14
transfer to the Board of Regents and the affected institution affiliate. Within ninety15
days of receipt of such notice by the institution affiliate, it shall notify its donors and16
contributors in writing of the proposed transfer and the circumstances giving rise to17
the proposal as identified by the management board, hereafter in this Section the18
"transfer notice".19
(2) The transfer notice shall inform each donor and contributor that he has20
ninety days to restrict the use of the donations or contributions he has made to the21
institution affiliate to the exclusive use by the institution affiliate solely for the22
benefit and furtherance of public postsecondary education only in the parish in which23
the governing authority of the institution affiliate is domiciled, subject to the24
continued ownership, administration, management, or control of the institution25
affiliate.26
(3) Within one hundred twenty days after distribution of the transfer notice,27
the institution affiliate shall issue a report to the Board of Regents identifying those28
assets of the institution affiliate that are restricted to use by the institution affiliate29 HLS 12RS-2234 ORIGINAL
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solely for the benefit and furtherance of public postsecondary education only in the1
parish in which the governing authority of the institution affiliate is domiciled or that2
are otherwise restricted pursuant to expressed wishes of the donor or contributor. If3
a response to the transfer notices is not received from a donor, contributor, or his4
legally authorized representative within the ninety-day period specified in Paragraph5
(2) of this Subsection or if such donor or contributor is deceased or otherwise cannot6
be located by the institution affiliate, then it shall be presumed that such donor or7
contributor restricted the use of his donation or contribution to the institution affiliate8
for its exclusive use solely for the benefit and furtherance of public postsecondary9
education only in the parish in which the governing authority of the institution10
affiliate is domiciled.11
(4) The Board of Regents may approve the transfer to the management board12
or a nonprofit entity affiliated with such management board of that portion of assets13
of an institution affiliate that are not restricted to exclusive use by the institution14
affiliate solely for the benefit and furtherance of public postsecondary education only15
in the parish in which the governing body of the institution affiliate is domiciled or16
that are not otherwise restricted pursuant to expressed wishes of the donor,17
contributor, or his legally authorized representative only after all of the following18
occur:19
(a) Receipt of the report from the institution affiliate provided for in20
Paragraph (3) of this Subsection.21
(b) An affirmative vote by the governing body of the affected institution22
affiliate in favor of the proposed transfer.23
(c) A determination by the Board of Regents that a budgetary necessity24
exists making the transfer in the interest of public postsecondary education in25
Louisiana.26
Section 2. This Act shall become effective upon signature by the governor or, if not27
signed by the governor, upon expiration of the time for bills to become law without signature28
by the governor, as provided in Article III, Section 18 of the Constitution of Louisiana. If29 HLS 12RS-2234 ORIGINAL
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vetoed by the governor and subsequently approved by the legislature, this Act shall become1
effective on the day following such approval.2
DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
Carmody HB No. 1133
Abstract: Requires the Board of Regents to approve any transfer of assets from a nonprofit
organization affiliated with a postsecondary institution (e.g., a foundation or alumni
association) to the institution's management board
Proposed law prohibits a postsecondary education management board and any nonprofit
entity affiliated with a management board from taking assets of a foundation, alumni
association, or other nonprofit organization affiliated with a public postsecondary education
institution without express approval of the Board of Regents and the governing authority of
the institution affiliate.
Provides that the Board of Regents may grant such approval only by resolution adopted at
a meeting of the board, properly noticed for that purpose.
Requires the following procedures before the Board of Regents may approval such a
transfer:
(1)The management board proposing the transfer shall give written notice of the
proposed transfer and the circumstances giving rise to the proposed transfer to the
Board of Regents and the affected institution affiliate. Within 90 days of receipt of
such notice by the institution affiliate, it shall notify its donors and contributors in
writing of the proposed transfer.
(2)The notice to the donors shall inform each donor and contributor that he has 90 days
to restrict the use of his donations or contributions to the exclusive use by the
institution affiliate solely for the benefit and furtherance of public postsecondary
education only in the parish in which the governing authority of the institution
affiliate is domiciled.
(3)Within 120 days after distribution of the notice, the institution affiliate shall issue a
report to the Board of Regents identifying those assets of the institution affiliate that
are restricted to use by the institution affiliate. If a response to the notice is not
received from a donor, contributor, or his legally authorized representative within the
90-day period or if such donor or contributor is deceased or otherwise cannot be
located by the institution affiliate, then it shall be presumed that such donor or
contributor restricted the use of his donation or contribution.
(4)The Board of Regents may approve the transfer of that portion of assets of an
institution affiliate that are not restricted only after: it receives the report from the
institution affiliate, the governing body of the affiliate has approved the transfer, and
the Board of Regents determines that a budgetary necessity exists making the
transfer in the interest of public postsecondary education in La.
Effective upon signature of governor or lapse of time for gubernatorial action.
(Adds R.S. 17:3130.1)