Thursday, October 13, 2016

Price for larger Iowa State plane $500K higher than reported


This undated photo provided by the Bloomington Normal Airport Authority shows a damaged wing of a Cirrus SR22 (N176CF) plane at the Central Illinois Regional Airport in Bloomington, Ill. Iowa State University President Steven Leath caused "substantial damage" to the university airplane he was piloting when it made a hard landing at the Illinois airport last year — a costly incident kept quiet for 14 months.

The Iowa State University Foundation paid nearly half of a million dollars more than previously reported for a twin-engine aircraft it purchased in 2014 and gifted to the university, according to documents released Wednesday night by Iowa State.

The purchase, sales, listing and acquisition agreements show the foundation paid $2.875 million to buy a 2002 Beechcraft King Air 350 for use by ISU Flight Service. University officials previously told the Des Moines Register the foundation paid $2.4 million for the plane.

University officials released a number of documents Wednesday related to the operation of ISU Flight Service and the use of university-owned aircraft by ISU President Steven Leath. The release came nearly three weeks after officials confirmed Leath, who has a pilot’s license, had damaged the university's single-engine Cirrus SR22 plane during a hard landing last year in Bloomington, Ill.

The incident has since raised questions related to Leath flying the plane for at least four trips that mixed personal and university business. It also has raised questions about how Leath has used the King Air plane as a passenger and how both planes were purchased in 2014.

The purchase of the King Air is the only occasion in the past five years in which a foundation for any of Iowa’s three public universities has purchased such high-priced piece of equipment to be gifted to its university.

The purchase of the King Air had been a priority for the ISU Department of Athletics, according to an FAQ released Wednesday by the university. The money for the purchase came from discretionary funds from the ISU Foundation that are designated for that purpose.

Information released Wednesday also shows that the title for the King Air was transferred directly from the seller — the Canadian-based PIC Flight Services Inc. — to the university and not to the foundation.

Officials with foundations for the University of Iowa and the University or Northern Iowa reported last month having no such purchase of equipment costing more than $1 million in the past five years. UI officials later clarified that the UI Foundation has not purchased any equipment to gift to the university; the foundation provides the funding for the university to make such purchases.

Officials with the ISU Foundation confirmed Thursday that they have not made any other $1 million-plus purchases on behalf of the university.

The Iowa Board of Regents, which oversees Iowa’s three public universities, had a policy at the time of the purchase requiring the universities to seek board approval of any equipment costing $1 million or more. Regent and university officials have said that because the plane was purchased by the foundation, approval from the full board was not required.

State lawmakers have suggested that if the plane had been placed on the agenda for a regents meeting, it would have led to a broader discussion about whether a public university needs to own aircraft at all.

In response to questions about Leath’s use of university aircraft, regent internal audit staff are conducting a review to ensure the equipment and travel policies at all three universities are in compliance with state law. Discussion of the review is scheduled for the regents Oct. 19-20 meeting in Cedar Falls.

Regent officials said last week the board’s internal audit division has not looked at ISU Flight Service for more than a decade.

Iowa State obtained the smaller Cirrus plane during the same year as the King Air. Both planes replaced two older planes previously used by ISU Flight Service — a 1977 King Air and a 1978 Piper PA 28-161.

Unlike with the King Air, the university directly purchased the Cirrus for $470,000 for after trade-in — well below the $1 million threshold for requiring regent approval. The money came from foundation funds that were set aside for use at the discretion of the Iowa State president.

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