The quote you are thinking of was issued in a report by the Board of Regents on Sept. 18, 1894, in response to accusations by a board member that Richard Ely, head of the UW's School of Economics, was a socialist and teaching “utopian, impractical, or pernicious doctrines.” After an investigation, Ely was declared innocent.
In the statement, the Board of Regents introduced the concept of academic freedom by stating that the university should never censor or limit its members' quest for knowledge. The following quote is now on a plaque in Bascom Hall. The class of 1910 dedicated the plaque to the UW.
“WHATEVER MAY BE THE LIMITATIONS WHICH TRAMMEL INQUIRY ELSEWHERE, WE BELIEVE THAT THE GREAT STATE UNIVERSITY OF WISCONSIN SHOULD EVER ENCOURAGE THAT CONTINUAL AND FEARLESS SIFTING AND WINNOWING BY WHICH ALONE THE TRUTH CAN BE FOUND.”