Minutes of March 16, 1995 Meeting

       The meeting convened at 10:03 a.m. in room 817 Cathedral of Learning.

       UPBC members present were: Thomas Anderson, Toni Carbo Bearman, Jacob
Birnberg, James Cassing, Thomas Detre, Ronald Gardner, Darlene Harris, James
Holland, James Isaacs, Peter Koehler, James Maher, Glenn Nelson, Joan Slezak,
Michael Stuckart, Ben Tuchi, Bruce Williams, Philip Wion, and Julius Youngner. 
Also present were: Ann Dykstra, Joseph Gil, Leon Haley, William Laird, Jeffrey
Liebmann, William Madden, Jeffrey Masnick, Robert Pack, Kathy Tosh, Thurman
Wingrove, and Douglas Wylie.
       UPBC members not present were: Nitin Badjatia, George Chambers, Randy
Juhl, Franklin McCarthy, Jeffrey Romoff, and Judith Zimmerman.

Approval of Minutes

       The minutes of the February 27 and March 2 meetings were approved.

Planning Activities in Student and Public Affairs

       Haley discussed the recent history and merger of Student Affairs and
Public Affairs, which has necessitated an integration of missions both between
the two units and with the University's long-range plan.  He stated that
Student and Public Affairs now has a joint Planning and Budgeting Committee
that has developed "customer-driven" vision statements for each area.  At a
recent retreat, the PBC drafted a new mission statement focussing on several
key themes, including:

--  providing an intentionally structured learning environment outside the
--  promoting personal development (enhanced self-esteem, sense of worth) of
--  emphasizing values, such as good citizenship, leadership, service,
acceptance of diversity, interdependence, ethical behavior, and altruism;
--  providing programs and services that respond to student needs; and
--  developing and maintaining internal and external communications networks
that enhance the reputation of the University.

       Haley discussed current projects including an off-campus, private rental
housing certification effort and a peer conflict resolution program.  He cited
a task force on alcohol abuse education and prevention as one effort aimed at
emphasizing values on campus.  Haley explained that the Student and Public
Affairs PBC is discussing budget reduction scenarios.  Koehler asked about the
synergies that exist between Student Affairs and Public Affairs.  Haley
responded that improving and promoting the quality of student life is an
important strategy for the University, and that students performing community
service promote the University.
       Anderson cited the importance of student input and assessing their
attitudes about University priorities.  Isaacs stated that the ability to
attract students is affected by publicity arising from campus safety, problems
with housing, and the performance of athletics teams.  Birnberg cited the need
to improve integration among the University's communications services.  Haley
responded that the University Communications Committee is currently dealing
with the presentation of the University's image.

FY 1996 Budget Parameters

       Koehler discussed the latest draft FY 1996 budget parameters, which now
include revised assumptions for appropriations based on the Governor's budget
proposal.  Draft 14A includes a tuition increase of 3.5% for all students,
while Draft 14B includes a 3.5% tuition increase for all but undergraduate
students.  Koehler stated that the Subcommittee is committed to identifying
the most accurate parameter information.
       Koehler listed several areas in the Educational and General budget where
adjustments in current assumptions would help balance projected expenditures
and revenues, including the following.

--  Raise the FY 1996 tuition increase to 4.5% -- In the Governor's budget, a
4.5% tuition increase is the largest allowed within the Tuition Challenge
Grant Program.
--  Reduce the planned $2 million technology enhancement expenditure by
$500,000 -- This action would slow the investment in information architecture
projects, but would still represent a strong beginning.
--  Reduce planned 1.5% increases in operating expenditure categories on a
selective basis.
--  Reduce projected $2.1 million debt service transfers -- Transfer the
Campus of the Future Phase I debt service from the E&G budget.
--  Ask the Chancellor to make a contribution from the Chancellor's
Discretionary funds, particularly for non-permanent or start-up costs.

       Wion reminded the Committee that the current drafts do not build a
salary increase into the budget.  He expressed concern that the UPBC must
convince faculty and staff that everything has been done to reduce University
expenditures in order to achieve a balanced budget.  Birnberg added that the
budget parameters also raise issues related to budgetary decisions on fund
transfers.  Bearman stressed the need to address policy issues, such as the
optimal level of support for operating expenditures.  Koehler emphasized to
build for the future by retaining in the budget program enhancement funds and
funds to act upon truly excellent ideas.  Anderson discussed the need to
examine all budgets, not just the Educational and General funds.

Plant Funds Presentation

       Laird began a presentation on University Plant Funds, which include:

--  funds used to acquire physical properties for institutional purposes, but
unexpended at the date of reporting;
--  funds set aside for renewal and replacement of properties;
--  funds set aside for debt service charges and the retirement of
indebtedness on properties; and
--  funds expended for (and thus invested in) institutional properties.

The Plant Fund is used to account for long-lived assets (buildings and
equipment) and the retirement of indebtedness (bonds and notes payable)
associated with those assets.
       Laird provided financial statistics on the Plant Fund at the end of FY
1994, which totalled $468.3 million.  During FY 1994, revenue changes in the
Plant Fund included $15.9 million in Commonwealth contributions to the Medical
Research Facility and $12.3 million in Investment income.  Expenditure changes
included $54.0 million in Depreciation expense and $16.5 million in Interest
expense (paid to banks and other bond holders).  Transfers into the Plant Fund
during FY 1994 included $14.0 million in Mandatory Transfers from University
units, $42.4 million in Nonmandatory Capital expenditures and transfers, and
$6.9 million in other Nonmandatory transfers, which includes restricted
revenues from fees (such as computing and parking fees).  Laird stated that
the Plant Fund is currently close to breaking even in spite of accounting for
depreciation expense.
       Laird expressed concern over a decline in General Plant Funds from $18
million to $11 million in FY 1994.  Members questioned whether the newly
created capital budgeting process was intended to prevent such a loss.  Pack
stated that the UPBC recommended a capital budget based on information that
such a decline would not occur.  The remainder of the presentation was
postponed until the next meeting.

       The meeting adjourned at 12:15 p.m.
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