CHICAGO – Suggestions that former Gov. Rod Blagojevich traded the chairmanship of the University of Illinois Board of Trustees for political favors surfaced Tuesday in testimony before a state panel investigating UI admissions practices.

Associates of Blagojevich told Trustee Larry Eppley in early 2003 that he was the governor's pick for chairman over Trustee Kenneth Schmidt, a Ryan appointee who was then acting chairman and a senior member of the board, Eppley testified Tuesday at a hearing in Chicago.

The Chicago law firm where Eppley works, then called Bell Boyd, later donated $100,000 to Blagojevich's campaign. But Eppley testified that he did not know about the contribution beforehand and had nothing to do with it. He said he had not personally donated to the former governor's campaign.

Schmidt, meanwhile, told the Illinois Admissions Review Commission about a conversation with Eppley in which the new board chairman referred to what Schmidt understood to be a request from Blagojevich.

"He looked at me and said, 'They want us to do something for Wyma,'" Schmidt said, referring to John Wyma, a lobbyist, fundraiser and close adviser to Blagojevich. Schmidt said he took "they" to mean the governor and his staff but Eppley didn't explain what "things" he was referring to. The topic never came up again.

Schmidt said he knows of no university connections to Wyma involving hiring, contracts or anything else.

"I didn't know who Wyma was," Schmidt said. "I didn't know specifically his line of business or what he offered."

In earlier testimony, Eppley said he did not recall having any specific conversation about Wyma with any other trustee.

Eppley testified he did not "pal around" or act as a go-between for Blagojevich with the university. He said he never discussed so-called "Category I" applicants with the governor's representatives who were pushing him to be board chairman.

But he admitted he passed along anywhere from four to 10 admissions inquiries each year from Blagojevich and people close to him, including the governor's chief of staff, Lon Monk, and Champaign native and Blagojevich fund-raiser Chris Kelly, who was later convicted of tax fraud.

However, Eppley told the commission he didn't recall an email or conversation with administrators about a candidate pushed by convicted Blagojevich associate Antoin "Tony" Rezko. In a 2005 email to Herman, cited by the commission in relation to Rezko, UI President B. Joseph White says, "The governor through Larry Eppley has expressed his support and would like to see admitted" two candidates for the Urbana campus.

"To my knowledge I did not get any inquiries from Tony Rezko," Eppley testified Tuesday.

In his opening statement, Eppley said he did not use jobs "or anything else" to bargain or negotiate for admissions to the UI. He also offered an apology.

"This institution and its reputation are of paramount importance to me," said Eppley, who received his master's and bachelor's degrees in business and law degree from the UI.

"Unfair inferences are drawn that we act as part of someone else's team. That's totally false," he said. "We advocate on behalf of the university.

"At times this meant battling with members of the prior administration," he said, noting that he helped whittle down Blagojevich's proposed $350 million budget cut for the UI to $70 million.

Pressed by commissioners about the appropriateness of his actions, Eppley said he didn't want to act as a "filter" for admissions requests but wanted to leave those decisions up to administrators. He said he didn't try to sway decisions, just passed along the inquiries.

He said he followed a "decades-old protocol for special admissions considerations." He said the first time he received an admissions inquiry as a trustee, he was told by a fellow board member to forward it to Herman, who was then provost.

"As sensational as it seems now," Eppley said, his admissions inquiries seemed "benign" at the time.

However, he admitted that what he later called an "underground admissions" process had "snowballed" beyond any best practices used by universities of the UI's caliber. Eppley said he had been unaware of how large-scale the so-called Category I system had become, and recent media reports are an opportunity for reforms.

Under questioning, both Eppley and Schmidt conceded that their "inquiries" received more prompt attention because of their position and said trustees should not be involved in admissions decisions.

"Do we need to change the system? Absolutely. Do we need to level the playing field? Absolutely. We desperately need to restore public confidence in this system," Eppley said.

Eppley was initially appointed to the board as an independent in 2001 by former Gov. George Ryan after turning down a spot on the Illinois Gaming Board. After Blagojevich was elected in 2002, he said he began talking with members of the Blagojevich administration on behalf of the UI, worried about possible budget cuts to come because state was facing a $5 billion deficit.

He said he was told that Monk and Blagojevich wanted him to become the board chair. He said he'd been introduced to Monk through Kelly, whom he'd met through a mutual friend.

"I told them it was a little awkward doing that," Eppley said, as he expected the position to go to a more senior member of the board. As a relatively new member, Eppley testified, he wasn't sure what the protocol was for the board chairmanship. Board practice had been to rotate the position every couple of years.

"I wasn't extraordinarily happy that this person who was next in line was not going to be chair. The bigger issue was making sure the university was able to move forward," he said.

The governor was in the process of appointing four new trustees to the board at the time, and also had a potential vote himself as an ex-officio member of the board, Eppley said.

Eppley agreed to take the job, although "I didn't think it was my time."

Former Board Chairman Gerald Shea had recently stepped down as board chairman, and Schmidt had been named acting chair by default as head of the academic affairs committee. Schmidt said there seemed to be a consensus on the board that, even as a Republican serving a Democratic governor, "I could do the job."

Schmidt said he received a call from Kelly, who told him the governor wanted Eppley to be chair.

"'I'm sorry to tell you this but this is the way the governor wants it,'" Kelly reportedly told Schmidt.

Schmidt said he "simply backed off" – "It didn't make sense for the university to have a chair the governor didn't want" – and Eppley was elected by the other trustees. Eppley served a total of six years as chairman until Trustee Niranjan Shah took his place last January.

"What upset me the most," said Schmidt, who choked up during his testimony, was that "I know of no (other) time when the governor reached inside the board to do this."

He said he sensed that some university decisions made by Eppley and UI President B. Joseph White should have been made collectively by the board. He pointed to decisions about Global Campus, the university's startup online initiative, as well as tuition discussions where Eppley would say the governor didn't like a proposed increase.

Schmidt estimated he contributed about $1,000 to Ryan and about $1,500 to Blagojevich.

Blagojevich reappointed Schmidt in 2005. Schmidt, the lone physician on the board, said he was in the middle of a number of university projects, including the expansion and renovation of the UIC's medical campus.

The panel concluded testimony before getting to the third scheduled witness, Trustee David Dorris, who was moved to next Tuesday's agenda. Others expected to testify at upcoming hearings are current board Chairman Ninranjan Shah, former Trustee Robert Sperling, UI President B. Joseph White, high school admissions counselors, and state legislators who also made admissions inquiries.