Richard Lipsey Baton Rouge

Amid audit, businessman Richard Lipsey calls for renewed leadership, removal of LSU president, CFO

Richard Lipsey

Monday’s audit report questioning LSU management’s ham-handed efforts to sell software developed by the university prompted renewed demands Tuesday for the wholesale removal of the flagship’s leadership by a former Board of Regents chairman.

Auditor: LSU may have violated state Constitution in handling of contract with private company

Auditor: LSU may have violated state Constitution in handling of contract with private company

LSU management did not follow its own practices, choosing instead to create a private nonprofit to commercialize potentially lucrative softwar…

Baton Rouge businessman Richard Lipsey, a prominent donor to political causes who in December stepped down from the higher education’s top policy-making body, said LSU President F. King Alexander and Dan Layzell, the university system’s chief financial officer, must go.

“Just the facts presented in the audit are certainly disturbing enough to immediately bring an end to the tenure of King Alexander and Dan Layzell at LSU,” Lipsey said Tuesday in a statement. He plans to post the statement on his Put Louisiana First website. His posting will include a “sound off” link to collect the opinions of others. Lipsey has been calling for a sweeping change in leadership since LSU unilaterally changed its admissions policies last year.

LSU released a response through spokesperson Ernie Ballard.

“LSU is focused on being the best university it can be, period,” the statement read. “It is unfortunate that Mr. Lipsey is focused on a personal grudge he has against LSU leadership. That is the opposite of putting LSU and Louisiana first.”

Legislative Auditor Daryl Purpera’s investigation, released Monday, found that LSU management jettisoned its usual practices and chose instead to try to market a potentially lucrative computer program through a private nonprofit controlled by members of the Board of Supervisors.

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Commonly called LaHIT and formed in September 2014, the Louisiana Health Information Technology Foundation entered into contracts that didn’t maximize royalties for the university and ultimately were cancelled in March 2017. The deal cost taxpayers at least $410,000 in legal fees while at the same time creating a web of conflicts of interest along with possible violations of the ethics laws and the state Constitution, according to the audit.

LaHIT controlled the licenses of software developed in 2009 by the LSU Health Care Services for use at the Charity Hospital in New Orleans. CLincial InQuiry, or CLIQ, provides access for physicians, via an internet web portal, to individual patients’ information, history, laboratory results, allergies, medications and other data. The thought was that a program that would allow easy access to such information in one location was intellectual property that other healthcare providers might want.

Lipsey faulted the audit for not going deeper into the connections between the LSU Board and the board of LaHit, which was formed in September 2014.

The LaHIT board was chaired by Dr. Frank Opelka, LSU’s Executive Vice President for Health Care and Medical Education Redesign and a prime mover of the privatization effort; and included Bobby Yarborough, a member of the LSU Board of Supervisors; Beverly Moore Haydel, daughter of LSU Supervisor James Moore; and Tim Barfield, who was secretary of the Department of Revenue from 2012 to 2016, under Gov. Bobby Jindal.

Yarborough was replaced on advice of counsel and Haydel was replaced in 2016, according to LSU.

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The auditor’s office said putting members on the board of a private affiliate is standard practice and wasn’t an issue. “They’re working for the same mission,” said Barrett Hunter, assistant director of financial audit services.

But one of the findings in Monday’s audit report was that the Board of Supervisors did not have a chance to review and approve three agreements related to the licensing of the CLIQ software. Lipsey points out that at its June 19, 2015 meeting the LSU Board canceled discussion of LaHIT that had been scheduled by the board committee in charge of the relationship, which was chaired by Yarborough.

Alexander, who called for Purpera’s office to investigate last year, wrote to Purpera in April that Opelka overstepped his authority and that appropriate policy reforms were being put in place to avoid such an incident in the future.