For regent facing impeachment inquiry, digging through UT records comes naturally


When Wallace Hall Jr. misbehaved in elementary school, his music teacher, Mrs. Ortega, would send him to a closet.

He didn’t mind. There was a stack of National Geographic magazines in the closet, and he loved to read.

“It was great,” Hall recalled.

Now, as a member of the University of Texas System Board of Regents, the 51-year-old Hall is facing another form of discipline: an investigation by a state House committee that could lead to his impeachment and removal from office. His insatiable appetite for reading helped put him in this spot.

In an interview with the American-Statesman, Hall didn’t seem cowed about the possibility of becoming the first unelected official in the state’s history to be impeached. Asked if he was losing sleep over it, he replied: “No, because I believe I’m doing the right thing.”

Hall has come under legislative scrutiny mainly for burying UT-Austin in records requests. For the past several months, he has often spent 30 to 40 hours a week combing through hundreds of thousands of pages of emails, letters and other documents, some of them confidential.

Citing records, Hall has all but accused UT-Austin President Bill Powers of lying about when he learned of a $500,000 forgivable loan to then-Dean of Law Larry Sager, a charge Powers strongly denies. What’s more, Hall once traveled to Washington to dispute UT-Austin’s method of counting charitable donations, an argument he won.

Hall, a businessman from Dallas, says he is simply carrying out his duty as a regent to get to the bottom of questions involving fundraising, salary supplements and Powers’ oversight of these and other matters. He has proceeded with the blessing of Gene Powell, who was until last month the chairman of the nine-member governing board, and the encouragement of Gov. Rick Perry. In one email, Perry told Hall and some other regents to persevere against “charlatans and peacocks” in a fight the governor likened to World War II’s Battle of the Bulge.

Hall is by no means the only regent in the storied history of the state’s most prominent public university to stir controversy. In 1970, Frank Erwin Jr., chairman of the regents, bypassed the board, system administrators and campus officials in taking it upon himself to fire the dean of arts and sciences, John Silber, who went on to serve as president of Boston University for many years.

But a records review by a governing board member on the scale of what Hall has undertaken seems to be unheard-of, not only at UT-Austin but also at the state’s 37 other public universities.

Some state lawmakers and even two of his fellow regents contend that Hall is on a witch hunt to oust Powers and that he has gone beyond his policymaking role and into micromanagement. House Speaker Joe Straus has charged the House Select Committee on Transparency in State Agency Operations with investigating whether Hall should be impeached. Among other things, the panel is expected to look into Hall’s failure to list a number of business-related lawsuits on his application to be a regent, an omission he later corrected.

The dust-up involving Hall is playing out against the backdrop of a broader debate, in Texas and nationally, about the future of higher education. Among the issues: rising tuition, low graduation rates, inadequate financial aid, faculty productivity, the role of online learning and the growing need for remedial training in math and other basics.

Hall told the Statesman that he began examining UT-Austin’s records because questions he had posed about various matters weren’t yielding complete and cooperative responses. By contrast, Hall said, most of the UT System’s other 14 academic and health institutions were “very interested in our interest, if you will. UT-Austin has been an outlier in that regard.”

Most of the material he has reviewed is public information that other people have requested, but some is confidential, such as certain student records. It’s unclear whether Hall’s status as a regent entitled him to view all of the confidential material he has received.

“I can’t say I’ve read every single page” of the materials, “but I’ve done my best to look at it,” Hall said. “I’ve read most of it.”

Reading, asking questions

Hall’s passion for digging deep and his confidence in his position are longstanding traits, said Bill Sachs, a Dallas investment manager who has been friends with him for decades.

At St. Mark’s School of Texas, a private boys’ school in Dallas where they were classmates and football players, Hall was a bit undersized for a defensive end but overcame that with skill and fearless tenacity, Sachs recalled. Years later, as their families were planning a trip to the Galapagos Islands, Sachs figured that Hall could recommend a couple of books on the islands; sure enough, Hall had already boned up on the subject.

So Sachs isn’t surprised that Hall is mining university records. “I think he has a strong sense of duty as a regent to find out all the information that he needs to do his job,” Sachs said. “A threat of impeachment is not going to stop him.”

Wallace Legette Hall Jr. grew up in Dallas, attended St. Mark’s for 12 years and earned a bachelor’s degree in economics at UT-Austin, where he was a member of the Sigma Alpha Epsilon fraternity.

His father, a stock broker, helped him make connections on Wall Street that led to a job as a securities analyst for an investment-research firm. The experience left a lasting impression.

“Some companies were extremely open, and they welcomed the analyst in, and they invited questions, and they liked to be challenged on what they were trying to do,” Hall said. “And some leaders were not interested in doing that.”

He left that position after a year for the hurly-burly of the trading pits at the New York Futures Exchange.

After several years of shouting buy and sell orders, he started his own money-management firm in Dallas. By the late 1990s, he had done well enough to close that chapter of his career and become an entrepreneur.

He lives comfortably, with a house in Dallas’ University Park neighborhood valued at $3.7 million and a ranch in the Colorado Rockies.

“My kids always ask me what I do,” said Hall, who has four children — two at St. Mark’s and two at UT-Austin. “What I really do is I read and I ask questions. That’s what I do for a living.

“I characterize myself as an opportunivore. I try to find an area, or a niche, that is underappreciated or misplaced, and I’ve enjoyed that.”

A prime example is Wetland Partners LP, a company he founded in 1998. Hall parlayed flood-plain holdings along the Trinity River into a sand and gravel mine whose operation was designed to create some wetlands.

That allowed him to sell “mitigation credits” to the Texas Department of Transportation and other entities so that they could comply with federal requirements to compensate for environmental damage resulting from road building and other construction. Hall credits his father, also a voracious reader, for passing along an article in Forbes magazine about a man in Maryland who had established a mitigation bank.

Hall is an oil and gas investor as well, and his financial statement filed with the Texas Ethics Commission also discloses holdings in gold exploration and production companies. He’s been bullish on gold for years because of what he considers risk-promoting policies of the Federal Reserve and other central banks around the world.

Hall manages to fit in some pleasure reading on top of his massive UT-Austin records review. He is working his way through a stack of more than 30 books on the history of war, recently reading about the 1571 Battle of Lepanto between the Ottoman Empire and a coalition of Catholic states, in which hundreds of ships fought it out.

Hall had been serving as a member of the Texas Higher Education Coordinating Board, which, like UT board service, is unpaid, when Perry named him a regent in February 2011. By December of last year, Perry was poised to elevate Hall to chairman of the regents but he backed off when warned that Hall would have been too controversial of a choice, according to two well-placed sources.

To outward appearances, the regents elect their own leader, but in practice they follow the governor’s lead. Last month they chose Paul Foster, an El Paso businessman and philanthropist, to succeed Powell as chairman. Foster says he wants to ease tensions with the Austin campus.

Hall isn’t the only current regent whose relationship with the system’s flagship school has been strained. Powell clashed with Powers on tuition and faculty productivity. Alex Cranberg has peppered the campus with data requests. And Brenda Pejovich, whose audit committee has been looking into the Law School and a charitable foundation that supports it, had Powers and other top administrators barred from deleting emails.

But Hall has taken regent activism to another level.

Pushing harder

In November, Hall traveled to Washington for a meeting with officials of a national standards-setting group and representatives of UT-Austin. He successfully argued against the university’s practice of including temporary donations of software in fundraising totals, and the university had to subtract more than $200 million from its tally.

Hall’s dealings with UT-Austin have prompted him to question whether open-records requests are handled properly and consistently throughout the UT System, and that, in turn, has led the Board of Regents and Chancellor Francisco Cigarroa to begin a systemwide review.

The final chapter has yet to be written on one of Hall’s chief interests: a once-secret program under which law professors and the law dean received forgivable loans from the UT Law School Foundation. Hall wasn’t satisfied with a review by the UT System’s general counsel — who has since left for private-sector work — and pushed for an outside investigation.

The regents voted narrowly to commission such a review, only to back off when lawmakers demanded that they turn to Attorney General Greg Abbott instead. An investigation by Abbott’s office is ongoing, and Hall said he has supplied the office with copies of some campus records.

Now, with the impeachment investigation looming, Hall has hired lawyers to go on the offensive. In a letter to the House panel, one of his lawyers said campus documents led Hall to believe that Powers knew of the $500,000 forgivable loan to Sager as early as 2009. Powers says he didn’t learn of it until two years later.

Hall’s lawyer also told the panel that the regent found correspondence showing that some state legislators exerted “undue influence” over admissions. In one case, a House member got his or her child admitted to a UT-Austin graduate school after the child was rejected, according to the lawyer.

State Rep. Jim Pitts, who has called for Hall’s impeachment, has acknowledged writing a letter in behalf of his son’s application to the School of Law. But Pitts, R-Waxahachie, said he didn’t exert undue influence.

Hall’s lawyer didn’t identify any legislators or students, but Hall said he has seen the names in campus records. Asked whether it was appropriate for him to view such confidential student information, he referred the question to the UT System’s lawyers.

“In a perfect world, no, he probably should not have seen the names of those students,” said Jenny LaCoste-Caputo, a spokeswoman for the system. “They should have been redacted, but they were in with a lot of other information.”

In June, two UT regents, R. Steven Hicks and Robert Stillwell, said in emails that Hall’s continuing demands for records are an “abuse of power” that amounts to a “witch hunt.” Higher education specialists say the massive records requests fall outside norms for a member of a university governing board.

“Nobody in a responsible position would say a board member’s role is as an investigator,” said Aims McGuinness Jr., a senior associate with the National Center for Higher Education Management Systems, a nonprofit policy center in Boulder, Colo. “Unfortunately, some board members with the best of intentions simply don’t want to hear that.”

Hall says he’s not backing off.

“To the extent that I feel I need to ask for information and read it to educate myself and educate others on the board or the chancellor, that’s my job,” he said. “So when I come across something that warrants, that begs, a question, then I’m going to ask the question, and then I’m going to pursue it until I get a good answer.”



Reader Comments ...


Next Up in Texas News & Politics

Minnesota man has collected nearly 3 million soda can tabs
Minnesota man has collected nearly 3 million soda can tabs

A Minnesota man has been collecting the tabs from aluminum cans for nearly 30 years, and he is closing in on a major milestone. In a Plexiglas box that is the size of a Dumpster, Jim Spinler has collected nearly 3 million tabs. >> Read more trending news “There’s 2,650,000 in there right now,” the 75-year-old Spinler told the...
Kentucky must pay attorney fees for couples who sued Kim Davis
Kentucky must pay attorney fees for couples who sued Kim Davis

A federal judge ruled Friday that Kentucky taxpayers must foot the bill for more than $220,000 in attorney fees for the couples who were denied marriage licenses by the Rowan County clerk, WKYT reported. >> Read more trending news In July 2015, four couples -- two same-sex and two opposite-sex filed suit against Kim Davis, who had refused...
Scientists will battle mosquito population by releasing 20 million of them
Scientists will battle mosquito population by releasing 20 million of them

Mosquitoes are an annoying pest, particularly during the summer. Now, scientists in California are working to shrink the population of the pesky insects that carry disease. >> Read more trending news How? The scientists will be releasing 20 million of them in California. If that sounds counterproductive, there is a method behind it. The plan...
First woman enlists to become a Navy SEAL
First woman enlists to become a Navy SEAL

A woman will be training with other potential candidates as she tries to become te first female Navy SEAL, CNN reported. >> Read more trending news The midshipman and another woman have enlisted and hope to join the Navy’s special operations teams. The Navy declined to identify the candidates, citing security considerations, NPR reported...
Hutto City Council replaces entire development board amid criticism
Hutto City Council replaces entire development board amid criticism

The Hutto City Council has replaced the entire board of directors for the town’s economic development corporation after the city manager criticized it for lavish spending on hotel rooms. The council on Thursday also approved changing the development group’s structure from a type A to a type B corporation so it can attract a wider variety...
More Stories