Daily Nebraskan

Issue date: 2/15/07 Section: News

In the private world, businesspeople can use a position with one company to benefit their interests with other companies.

State officials aren’t so lucky. By state law, they are required to file potential conflict-of-interest statements to the Nebraska Accountability and Disclosure Commission when their duties in office could affect their interests or the interests of other businesses they’re associated with.

When a University of Nebraska-Lincoln partnership with Lincoln-based student lender Nelnet was approved in 2004, in which the lender would provide graduate and professional student loans, some officials at the University of Nebraska Foundation appear to possibly have had overlapping interests in the deal.

Both Michael Dunlap and Thomas Henning sit on the board of directors of both Nelnet and the NU Foundation.

The foundation owned more than 800,000 shares of Nelnet stock in 2004, when the partnership was approved.

Neither Dunlap nor Henning are state employees, and neither would be required to file a potential conflict of interest with the commission.

But, according to the definition of a conflict of interest on the commission form, a regent involved with the foundation in 2004 might have been required to file a potential conflict-of-interest statement.

The conflict-of-interest form from the accountability and disclosure commission says:

“A potential conflict of interest exists when you, in the discharge of your official duties, would be required to take an action or make any decision that may cause benefit or detriment to you, a member of your immediate family or a business with which you are associated.”

The form explicitly includes members of the board of regents in its “who must file” category.

NU Regent Jim McClurg, who was an elected voting trustee for the NU Foundation in 2004 and also a regent at the time, was not required to file a conflict-of-interest form because his role with the foundation was disclosed in the board of regents agenda in advance of the Nelnet vote, said University of Nebraska senior associate for general counsel John Wiltse.

McClurg voted in favor of the UNL-Nelnet partnership.

Such a vote could have benefited the foundation, of which he was a trustee, because the foundation owned stock in Nelnet.

McClurg preferred not to comment, citing that general counsel didn’t see a need for him to file a conflict of interest.

Wiltse said in an e-mail that because McClurg’s personal interests didn’t conflict with those of the university, he wasn’t required to file a conflict-of-interest statement. McClurg himself did not own stock in Nelnet.

“The foundation’s ownership of stock would not personally benefit Regent McClurg, he was, after all, not paid by the foundation,” Wiltse said in an e-mail.

Frank Daley, the executive director of the Nebraska Accountability and Disclosure Commission, wouldn’t comment on a specific case, but he noted that his office recommends officials abstain from voting when a potential conflict of interest arises.

“There are prohibitions against using personal office for personal gain for yourself, relative or business you’re associated with,” Daley said.

Daley said state officials are obligated to disclose conflicts of interest to his office by a state statute.

“Any violation of the Accountability Act results in a civil penalty up to $2,000,” Daley said.

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