ANNAPOLIS – State ethics laws are blocking vital partnerships between University of Maryland System institutions and private businesses — partnerships that could boost economic development, system officials told a House committee Tuesday.
Lance W. Billingsley, chairman of the Board of Regents, said Maryland laws are more restrictive than federal regulations in such cases.
The aim is to prevent conflicts of interest, said John Lippincott, associate vice chancellor for advancement. Administrators and researchers aren’t supposed to become focused on personal gain or abuse their relationships with the university, he said.
Currently, the State Ethics Commission decides whether any state agency may enter into a partnership with private business. But the university system and the state Department of Business and Economic Development have developed legislation allowing the campuses to skip that step.
Under the bill, the decision for system institutions would be shifted to the regents.
Campuses would still have to follow federal regulations, which require full disclosure of all significant relationships with private enterprise, management of the relationships by a supervisor and the institution, and full reporting so the relationship can be monitored.
Policy concerning patented inventions developed by a system researcher would remain the same: The first $5,000 in revenue goes to the professor and the rest is split 50-50 with the institution.
Billingsley offered an example of a possible conflict of interest to members of the House Committee on Commerce and Government Matters: The person responsible for purchasing drugs for a school of pharmacy is asked by a pharmaceutical company to sit on its board.
But Billingsley and Donald N. Langenberg, system chancellor, said the state now stops partnerships that would not be conflicts of interest. The result, they argued, is that Maryland is losing out.
“This is not giving us the ability to fairly compete within the federal ethical standards,” Billingsley said. “We are no longer on a level playing field.”
For example, Billingsley said Bell Atlantic has board members from public universities in West Virginia and Pennsylvania, while the State Ethics Commission would not allow a representative from the University of Maryland at College Park to sit on the board.
Rita R. Colwell, president of the University of Maryland Biotechnology Institute, said the institute has been forced to license technological developments to companies outside Maryland because of the strict regulation of partnership with private business.
Langenberg said this would not happen if control were turned over to the regents. The ethics commission is designed specifically to keep bad things from happening, he observed, while the regents also must ensure that good things happen.
The Board of Regents “will have to manage that balance,” Langenberg said.
Billingsley agreed, saying the ethics commission works in a “mode of restriction.”
“The operative word is no, you can’t do this, you can’t do that,” Billingsley said.
The Ethics Commission took no formal position on the bill. But John O’Donnell, executive director, said in a telephone interview that “it is difficult for high-level officials to police themselves.” The commission made two written recommendations concerning the legislation, O’Donnell said. One would ensure that the commission was given an annual report of university-business partnerships. The other would require senior administrators to continue answering to the commission. -30-