Having written extensively in these virtual pages about the prior and illegitimate president of the University of Iowa, former businessman J. Bruce Harreld — who, shortly after signing a three-year contract extension, distinguished himself by quitting on the school and fleeing to his multi-million-dollar chalet near Vail, Colorado, hopefully never to be heard from again — I was surprised in writing this post that I had to look up how long it’s been since he left office. Whether because of the time-dilation effect of the COVID-19 pandemic, which has expanded the past three years into an epoch in my mind, or because my protective subconscious blanked out the convergence of those dark times, I did not remember that it has only been, and at the same time already been, a little less than two years since Harreld left office. Specifically, Harreld’s last day at what I now think of quite distantly as my collegiate alma mater was May 16th of 2021.

While there are plenty of lingering questions about Harreld’s shocking appointment and controversial tenure, short of guilt-ridden confessions or questioning under oath by the principals who conspired to impose him on the school — despite his jaw-dropping lack of qualifications or experience — I hold no illusion that any of those questions will ever be answered. (And even if they were, I would be hard-pressed to believe any statements made by the perpetrators.) Even with the disorienting passage of time, however, there was one issue I did expect to learn more about, and from a credible source. That issue was the billion-dollar, fifty-year, public-private energy partnership (P3) that the University of Iowa and Iowa Board of Regents entered into in December of 2019, toward the end of Harreld’s entrepreneurial reign.

As might be expected of a complex financial arrangement documented in an 1,800-page contract, let alone one that was hammered out behind closed doors by legions of shadowy bankers and attorneys, when that deal was finally disclosed there were multiple aspects of the UI P3 which required translation into plain English, including the basic premise of the deal. Although willfully misrepresented by the university and board as a massive up-front “payment” to the school from its private-sector energy partners, the UI P3 essentially amounted to the state borrowing roughly $1.2B in cash — through statutory powers granted to the board — on the pretext of leasing the university’s utility system for fifty years. After retiring $158M in outstanding debt, paying $12M in consulting fees, and absorbing another $8M in associated costs, the remaining $986M was deposited in a university endowment to then be gambled in the markets, to hopefully generate the $3B necessary to turn a profit for the school, pay the school’s annual utility costs, and service that massive loan over half a century.  [ Read more ]

Following years of bureaucratic and legal obstruction by the University of Iowa and the Iowa Board of Regents, in mid-December the Iowa State Auditor finally concluded his review of UI’s celebrated public-private utility partnership. (Excellent reporting and context here, from the Gazette’s indefatigable Vanessa Miller.) Because that partnership was a notable administrative act perpetrated by former illegitimate UI president J. Bruce Harreld, I began writing a post reviewing and commenting on the state audit, and whenever life stops dropping hammers I intended to finish that post to put a black bow on Harreld’s legacy.  [ Read more ]