Legislature to hear resolution examining PSU-OHSU merger

The House Committee on Education is scheduled to hold a public hearing today on a resolution that would examine the possibility of merging Portland State University and Oregon Health and Sciences University.

The resolution, sponsored by Rep. Mitch Greenlick, D-Portland, wouldn’t actually merge the institutions, but would set up a task force to consider doing so. A bill introduced earlier this year that would have joined the two institutions did not receive a hearing.

At present, PSU and six other public universities are governed by the State Board of Higher Education, as was OHSU until 1995. Now, as an independent corporation, OHSU is governed by its own board of directors.

The Oregon University System, which oversees public universities in Oregon with the exception of OHSU, opposes a merger. So do the presidents of PSU and OHSU.

Leslie Lehman, vice president of the State Board of Higher Education, said someone would have to make a very strong case to convince the board that a merger was a good idea.

“To me, that’s not an obvious case at all,” she said.

So why does Greenlick, a professor emeritus at OHSU and an adjunct professor at PSU, persist?

“I think it’s inevitable that PSU and OHSU will merge,” said Greenlick, who called the two universities “a natural fit.”

Daniel Bernstine, president of PSU, and Peter Kohler, president of OHSU, voiced their objections to the resolution in a letter to the education committee dated April 29.

Citing OHSU’s recent independence from the State Board of Higher Education, which resulted in “a more entrepreneurial and nimble organization,” the presidents worried that merging the two schools might “jeopardize” this trend.

The emphasis on entrepreneurialism is telling. As state funding for higher education drops, OUS has focused on passing what it has termed “the efficiency act,” a bill before the Senate that would make higher education more efficient by giving greater autonomy to individual institutions.

University administrators hope that greater flexibility might attract more money from private businesses.

Last month, Octavian Scientific Inc., a semiconductor startup, announced that it would lease space at PSU and work with students and staff. Under ballot measure 10, Octavian will swap stock for the rights to technologies developed at PSU.

Rep. Steve March, D-Portland, said the current model doesn’t bring in as much money as it could. He said more companies would like to partner with PSU but “fear getting enmeshed in state contracting problems.”

March an adjunct professor at PSU, would like to take autonomy for institutions one step further.

Earlier this year, March sponsored a bill that would have examined establishing PSU as its own corporation. The bill would have removed PSU from the oversight of the State Board of Higher Education.

March’s bill did not receive a hearing, although he said he would continue to press the issue.

A committee created to deal with budget cuts at PSU is also investigating the possibilities of freedom from the OUS board.

At a hearing several weeks ago, David Johnson, who chairs the Budget and Priorities Committee, told state legislators they should “even consider allowing PSU to establish its own governing board.”

Johnson, who noted that he was speaking for himself, and not for the budget and priorities committee, also endorsed increasing enrollment, allowing PSU to offer its own benefits and allowing PSU to issue bonds.

The minutes of the April 9 Budget and priorities meeting suggest greater autonomy for PSU to be included in a policy the committee is writing. The minutes note that this autonomy “could mean freedom from OUS, or from the Legislature, or both, with all the implications of such a change.”

The implications would be significant.

Although PSU regularly lobbies the state Legislature, by law, PSU cannot take a position different from the Oregon University System, which opposes PSU’s withdrawal.

Deborah Murdock, PSU’s Salem lobbyist, said in an e-mail that PSU’s position on autonomy was consistent with OUS’s.

Bernstine said he wasn’t up to date on the Budget and Priorities Committee, and couldn’t speculate on what autonomy for PSU would mean.

Greenlick was more direct.

“PSU wants to get out from under the board,” he said.

There are many hurdles to this actually happening.

Both the governor and the State Board of Higher Education support keeping the system intact, said Grattan Kerrans, director of government relations for the Oregon University System.

Tom Imeson, who sits on the State Board of Higher Education, as well as the board of directors at OHSU, said OHSU’s tuition went up “fairly dramatically” when it incorporated.

“Public corporations by themselves don’t solve budget problems,” said Imeson, who added that state funding for OHSU also decreased.

“If PSU is going to look at (incorporation) then they need to look at it with their eyes open,” Imeson said.