The Chronicle of Higher Education reports that the U.S. Department of Education forced the chairman of the board of Metropolitan Community College in Omaha to resign (not just step down as chairman, which he had already done). The Department threatened to cut off student aid to the college if he didn’t.
Why? Another agency of the government, the Department of Housing and Development had prohibited him from “participating in federal contracts for three years.” HUD had found “that he had failed to disclose a potential conflict of interest when he was a member of the Omaha Housing Authority’s board.” Conley claims that HUD’s action was in retaliation for his effort to obtain an audit of the Omaha Housing Authority. (The housing authority was audited, and the audit found that $2.5 million in federal funds had been misappropriated.)
I have no idea whether the trustee, Fred Conley, is an honorable person or not. But does the Department of Education have the authority to stop a school’s federal aid on the basis of one board member having been cut off from another agency’s contracts for failing to disclose a potential conflict of interest?
Do we have a rule of law or a rule of regulators?