Tuesday, November 01, 2011

UT president: School didn't seek MyEdu deal

Updated: 5:58 a.m. Tuesday, Nov. 1, 2011

The president of the University of Texas said Monday that the university didn't seek an unusual partnership with MyEdu Corp., an Austin-based company that operates a website on which students can plan classes, rate professors and exchange comments.

"Would I have had different priorities for that $10 million?" UT President William Powers Jr. said at a meeting of the Faculty Council, referring to the investment of endowment funds by the UT System Board of Regents in MyEdu. "Yes."

He did not say what his priorities would have been. But Powers made it clear that it wasn't his decision to partner with MyEdu.

"That was a decision of the board. That was not a decision of the campus," Powers said. "We didn't choose to bring this to the campus. It was brought to us."

UT System regents voted unanimously Aug. 25 to invest in the privately held company and to sign on with it for customized website functions for each of the system's nine academic and six health campuses.

The American-Statesman reported in Sunday's editions that a former UT System chancellor, William Cunningham, is an investor in MyEdu and that his son, John, is a co-founder and a senior official of the company.

UT System officials and regents did not disclose the Cunninghams' involvement with the company and in some cases were unaware of it.

The elder Cunningham, who teaches corporate governance at the Austin campus, was chancellor from 1992 to 2000 and president of the campus from 1985 to 1992.

System officials said no law, rule or sense of ethics required disclosure of the Cunninghams' involvement. William Cunningham, as well as UT System and MyEdu officials, said he had no role in negotiating the partnership or even any knowledge of it until it was a done deal.

It is rare, if not unprecedented, for the Board of Regents to invest endowment funds directly in a company. Investments from the multibillion-dollar Permanent University Fund are generally made by money management firms chosen by an arm of the governing board, the University of Texas Investment Management Co.

Powers said the tools on were demonstrated for him last week, and he observed that they can be optimized by users in various ways — for example, to offer a student the easiest courses.

"The first question I asked was, 'Can you turn some of these things off?'\u2009" he said, adding that he was assured it could be done. He said other tools on the website "seem OK to me" and could be valuable to students.

Alan Cline, a professor of computer science, asked Powers about Cunningham, the former president and chancellor.

"I don't see any influence" from Cunningham in the partnership, Powers said.

"I've known President Cunningham for a long time, and he's given great service to this university," Powers said.

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