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University, foundation target of public records lawsuit
State Senator, CSUS president trade barbs over shredding allegations
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A Carmicheal, Calif. based nonprofit has filed suit against California State University, Stanislaus and the CSU Stanislaus Foundation, seeking a court order forcing the organizations to release documents relating to Sarah Palin’s upcoming June 25 appearance at the University’s 50th Anniversary Gala Fundraiser.
Californians Aware, an organization dedicated to open government and the free exchange of information, filed the petition in Stanislaus County Superior Court on Thursday.
The suit argues that under the California Public Records Act, the University and its Foundation — a nonprofit auxiliary that oversees private gifts to CSU Stanislaus — are required to release documents related to Palin’s upcoming visit, including her speaking fee. In the past, Palin has commanded as much as $100,000 for speaking engagements.
“The law is clear and the courts have ruled — foundation documents are to be made public if they are held by the university, which by the administration’s own admission is the case here,” said State Senator Leland Yee (D – San Francisco) who has been leading a campaign for the release of documents regarding Palin’s visit. “Our public university executives need to stop acting like they are running private country clubs and personal slush funds.”
The University and the Foundation have rejected earlier Public Records Act requests. Campus Compliance Officer Gina B. Leguria responded to CalAware on April 6 that CSU Stanislaus had “no documents that are responsive to” the organization’s request. The Foundation has argued that they are a nonprofit, not a state agency, and are not subject to the Public Records Act.
According to CalAware’s lawsuit, three university staff members — President Hamid Shirvani, Vice President for University Advancement Susana Gajic-Bruyea and Vice President of Business and Finance Russ Giambelluca — were required to review the Foundation’s contract with Palin. While all three hold non-voting roles within the Foundation — chairman, executive director and treasurer, respectively — each was required by state law and the Foundation’s own policies to review the Palin contract in their role as University employees, per the suit.
If state employees working for a state organization reviewed the contract, the lawsuit argues, it becomes public record regardless of the Foundation’s nonprofit status.
The University maintains it has followed the law.
“The University has complied with all legal obligations when responding to Public Records Act requests regarding the University’s 50th Anniversary Gala,” Shirvani said. “The CSU Stanislaus Foundation also responded to Public Records Act requests for a copy of the Palin contract and speakers fee by stating that as a 501c3 foundation, it is not subject to the Public Records Act.”
Foundation President Matt Swanson went on to state that the auxiliary’s contract with the Washington Speakers Bureau, who represents Palin, included a non-disclosure clause that “legally prohibits us from disclosing the details of her speaking engagement.” Public agencies are prohibited from engaging in such non-disclosure clauses under the California Public Records Act.
“Raising money to support university and student programs is exactly why the California Legislature established the ability for universities to create private foundations,” Shirvani said. “The CSUS Foundation’s sole aim is to raise private funds to support student scholarships and programs. Given declining state support for higher education, private fund raising is more vital than ever.”
According to Shirvani, the Gala will raise more than any single fundraiser in the history of the University, generating between $100,000 and $200,000 for CSU Stanislaus programs and student services. The $500 per ticket event, with sponsorships available for up to $50,000, is already sold out with a waiting list, Swanson said.
“That is money that would otherwise not be available to support our students,” Shirvani said.
Thursday’s filing by CalAware capped off a week of back-and-forth between Yee and the university, sparked by Tuesday’s announcement that Attorney General Jerry Brown had launched a broad investigation into the Foundation’s finances and an alleged dumping of sensitive documents, including Palin’s contract.
The Attorney General investigation came as a result of Yee forwarding information to Brown’s office that two CSU Stanislaus students, Alicia Lewis, 26, and Ashli Briggs, 23, had allegedly found evidence that the University was destroying documents.
The students said a friend informed them that “suspicious activity” was ongoing at the CSU Stanislaus Administration Building — despite a state-mandated furlough day — and that “administrators were destroying documents.” The students said they went to investigate and witnessed another student carrying a bag of garbage to a university Dumpster.
Lewis and Briggs examined the contents of the Dumpster and found shredded finance department documents dated March 28, mixed in with the unshredded pages 4 through 9 of a contract with the Washington Speakers Bureau. That contract does not name Palin or include the speaker’s fee, but dates, times, and locations in the document appear to point to Palin’s June 25 appearance at the University’s 50th Anniversary Gala fundraiser.
According to Shirvani, Yee’s — and the students’ — story doesn’t match up with reality.
The university issued a statement that the addendum of the campus’ contract with Palin was left in a recycling bin in the office of Gajic-Bruyea. After hearing the allegations made at Tuesday’s press conference, the university said Gajic-Bruyea searched for the document in her private recycling bin but found nothing.
Campus police are now looking into the document’s disappearance, the University said.
“We welcome the (Attorney General) investigation and expect it will clarify how a Foundation document could have ended up in a state senator’s hands,” Shirvani said.
Yee responded to the statement arguing that Shirvani had admitted the document was once in the possession of Gajic-Bruyea, who serves as vice president for University Advancement. As such, Yee says Shirvani’s statement proves the University failed to properly respond to Public Records Act requests.
“How can you lose something you said you didn’t have?” Yee asked.
Yee questioned Shirvani’s story, asking why students wouldn’t have stolen pages 1 through 3 of the contract. Yee also revealed that the students had found two versions of the contract in the Dumpster — one not on Washington Speakers Bureau letterhead — and pondered why the university initially claimed that only the version released by Yee’s office was stolen.
“President Shirvani needs to stop the double-talk and start explaining the vast irregularity and impropriety surrounding his office,” said Yee. “California taxpayers and CSU students deserve answers now.”
Shirvani volleyed back, stating that Gajic-Bruyea had reviewed Palin’s contract only in her role as Foundation executive director. He also said that Gajic-Bruyea had already notified the Stanislaus County District Attorney, City of Turlock Police and University Campus Police that discarded drafts of the contract — presumably those found on plain paper — were missing from her office.
“It is unfortunate that Senator Leland Yee is conveniently using a legal response from the University for further political gain,” Shirvani said. “The fact is that the contract with the Washington Speakers Bureau to retain Gov. Palin is between the Bureau and the University Foundation. That is why in the response to the Public Records Act request, our campus compliance officer stated ‘The University has no documents that are responsive to your request.’”
Shirvani also said that the Foundation hopes to remain transparent, despite the Foundation not being subject to the Public Records Act and being barred from releasing details of Palin’s contract due to the non-disclosure agreement.
“The Foundation has clearly stated that it will be happy to provide the net costs and net revenue of the event, which would be sufficient for anyone whose true goal is transparency,” Shirvani said. “The Foundation has made it clear that no public funds are being used to support the event. The Board president has also made it clear that no existing foundation funds are being used to support the event. Every dime used to pay for this gala is new, privately-raised money.”
Even though courts have upheld that university foundations are not subject to the Public Records Act, Yee argued back that past legal decisions have required universities themselves to disclose sensitive documents.
“The law is clear and the courts have ruled — foundation documents are to be made public if they are held by the university, which by the administration’s own admission, is the case here,” Yee said.
According to Yee, even if courts find CSU Stanislaus does not have to release the Palin documents, the University will still have to explain why it was shredding records.
“Irrespective of the Palin documents, the university has failed to explain why hundreds of other public documents — some shredded and others intact — were placed in the Dumpster during an employee furlough day,” said Yee.  “CSU policy and state law clearly calls for retention of such documents.”
Government Code states that records should only be destroyed if they have no further administrative, legal, or fiscal value and the Secretary of State has determined that the record is inappropriate for preservation in the State Archives.
According to the University the law was followed.
“No one was instructed to destroy vital information, and no one did so,” Giambelluca said.
Shirvani chalked Yee’s myriad complaints up to political posturing. Yee is currently sponsoring a bill in the State Senate clarifying that campus foundations and auxiliary organizations are subject to the Public Records Act. Yee also has announced his candidacy for the San Francisco mayoral race this year.
“The CSU Stanislaus Foundation is not interested in political theater or in being used as a political pawn. Its mission is to raise money to support the university, and it is doing just that by bringing a speaker to campus like Sarah Palin who is driving ticket sales to unprecedented levels,” Shirvani said.
To contact Alex Cantatore, e-mail or call 634-9141 ext. 2005.