Minutes of February 15, 1996 through March 14, 1996 Meetings

Minutes of February 15, 1996 Meeting

     The meeting convened at 10:07 a.m. in room 817 Cathedral of Learning.

     UPBC members present were: Jacob Birnberg, Toni Carbo, James Cassing,
H.K. Chang, Richard Colwell, Thomas Detre, Ronald Gardner, Randy Juhl, Peter
Koehler, James Maher, Franklin McCarthy, Glenn Nelson, and Philip Wion.  Also
present were: Jerome Cochran, Ann Dykstra, Kevin Evanto, Jeffrey Liebmann,
William Madden, Jeffrey Masnick, Robert Pack, and Arthur Ramicone.
     UPBC members not present were: Thomas Anderson, John Brice, Marjorie
Carlson, Brian Hart, Keith McDuffie, Jeffrey Romoff, Michael Stuckart, Ben
Tuchi, Bruce Williams, Julius Youngner, and Judith Zimmerman.

Approval of Minutes

     The minutes of the January 29, 1996 meeting were approved.

Report of the Chair

     Maher stated that he forwarded a recommendation on TA/TF/GSA salaries to
the Chancellor that included the recommendation of the UPBC.  Maher also
informed members of changes to employee fringe benefits recommended by the
Senate Benefits and Welfare Committee.  The changes include institution of
vision and dental insurance benefits, a Medicare HMO for retirees, and
policies that would allow employees to borrow against retirement
accumulations.  He stated that it was his understanding that these changes
could occur at no cost to the University.

Discussion of the Relationship Between the University and the UPMC System

     Masnick presented a description of the University of Pittsburgh Medical
Center System, explaining how it is actually a series of corporations
structured similarly to many other medical centers.  He described how the
Presbyterian University Hospital corporation and the UPMC System includes the
various hospitals, while the UPMC Division includes the School of Medicine,
the Pittsburgh Cancer Institute (PCI), UPMC Administration, and Western
Psychiatric Institute and Clinic (WPIC) research.  He distinguished the
organizational structure of the UPMC Division from its personnel structure by
adding that School of Medicine staff are University employees, while PCI and
WPIC staff are employees of Presbyterian University Hospital.
     Masnick stressed that the UPMC Division is responsible for its own
expenses, in that any costs incurred by the University in support of the UPMC
Division are paid for by the Division.  Masnick estimated that the UPMC
Division budget comprises $200 million of the University's $790 million
budget.  In comparison, the overall UPMC System budget totals approximately
$1.3 billion.  Masnick discussed governance structures, indicating that the
University appoints 48% of the Boards of both the UPMC System and of
Presbyterian University Hospital.
     Masnick and Detre described the two management contracts between the
University and the UPMC System and between the University and Presbyterian
University Hospital.  Masnick then briefly described the major corporate
entities within the UPMC System.
     Detre discussed the practice in recent years of UPMC System investment
in University programs, amounting to approximately $100 million annually.  He
emphasized that these funds are generally targeted efforts to improve the
quality of specific academic programs of mutual interest to the University and
the UPMC System.  Such seed funding, often supporting capital expenditures and
faculty start-up costs, have typically included sunset provisions calling for
the procuring of alternative funding sources after a specified period to
replace UPMC System funding.  He added that, in the past 12 years, UPMC System
investment has helped the University increase from the 36th to the 14th ranked
institution in terms of National Institutes of Health funding.  Other UPMC
System support of the University consists of ongoing support for units such as
the Falk Library and faculty in the School of Medicine.  In response to
Koehler's question, Detre indicated that future changes in the UPMC System
budget will not result in any additional obligation on the part of the
University as the hospitals are responsible for any deficits that they incur.

Discussion of the Governor's Proposed Commonwealth Budget

     Dykstra presented highlights of the Governor's proposed FY 1997 budget
for the Commonwealth, which included level funding for basic and public higher
education.  She added that, while the $3.2 million from the Tuition Challenge
Grant Program has been rolled into the base funding for higher education, the
Program itself is not included in the FY 1997 proposed budget.  The proposed
budget also included no increase in PHEAA funding and reduced funding to
state-aided institutions, such as Penn and Drexel.
     Dykstra indicated that the budgetary climate for the Commonwealth is not
positive, due to limited flexibility and the use of previous surpluses for
expenditures such as those related to the recent flooding and the emissions
program buy out.  The Governor's recommended FY 1997 budget did include $42
million for distance education initiatives, $7 million of which would be
available to colleges and universities.  She indicated that the University
included a new line item in its budget request for FY 1997 for distance
education and that representatives are already involved in these initiatives
at the state level.  Dykstra also discussed the reorganization of the
Department of Commerce, which may impact funding in programs that support
initiatives between universities and industry.

     The meeting adjourned at 12:03 p.m.

Minutes of February 26, 1996 Meeting

     The meeting convened at 2:02 p.m. in room 817 Cathedral of Learning.

     UPBC members present were: Thomas Anderson, Jacob Birnberg, James
Cassing, H.K. Chang, Richard Colwell, Ronald Gardner, Brian Hart, Randy Juhl,
Peter Koehler, James Maher, Glenn Nelson, Jeffrey Romoff, Bruce Williams,
Philip Wion, Julius Youngner, and Judith Zimmerman.  Also present were: Jerome
Cochran, Kevin Evanto, Jeffrey Liebmann, William Madden, Jeffrey Masnick,
Robert Pack, Arthur Ramicone, and Ellen Beam Rudy.
     UPBC members not present were: John Brice, Marjorie Carlson, Toni Carbo,
Thomas Detre, Franklin McCarthy, Keith McDuffie, and Michael Stuckart.

Report of the Chair

     Maher reported that Interim Chancellor Nordenberg had approved the
recommendation to increase salaries for teaching assistants and graduate
student assistants by 3.7% and for teaching fellows by 3.6% in FY 1997.

Discussion of the Relationship Between the University and the UPMC System

     Romoff discussed the nature of the relationship between the University
and the University of Pittsburgh Medical Center (UPMC) System, specifically
detailing the financial support it provides the University.  He explained the
long-term strategy to systematically establish the health science schools,
particularly the School of Medicine, among the top such schools in the world. 
Part of this strategy has been annual investments raise the academic quality
of the health sciences, which exceeded $100 million in FY 1995 plus an
additional $93 million of practice plan funding in support of faculty
salaries.  Romoff explained that these funds are derived from clinically-
derived revenues of the hospitals of the UPMC System and currently account for
approximately 35% of the faculty salaries of the School of Medicine.
     In detailing investments in the health sciences schools, Romoff
explained that the greatest portion is in the School of Medicine, mostly for
salary-related expenditures.  Approximately $9 million is invested in other
health sciences schools.  Juhl emphasized the importance of UPMC System
investments, stating that while University contribution to faculty salaries in
the School of Pharmacy has remained flat in the past 10 years, UPMC System
investment has risen six-fold.  He explained that this relationship is
symbiotic, in that the funds support faculty who improve the quality of the
School while performing valuable services for the UPMC System hospitals.
     Romoff emphasized that the hospitals could operate at a significantly
lower cost if their commitment to the University did not exist.  He cautioned
that the ability of the UPMC System to  continue its investment in University
programs is diminishing because of changes in health care.
     Romoff detailed areas of significant investment in recent years,
including Falk Library, the Pittsburgh Cancer Institute, the Medical Ethics
Program, the Neuroscience Program, the Student Health Center, and the Central
Animal Facility.  He pointed out that in cases such as Student Health and the
Central Animal Facility, these investments corrected long standing
deficiencies in University infrastructure areas.  In response to Birnberg's
question regarding whether any funds flow from the University to the UPMC
System, Romoff replied that quality faculty produce quality clinical services
which, in turn, attract revenues.
     Wion cited the need for further communication between the University and
UPMC System, such as that resulting in an improved attribution methodology
this year.  Romoff explained that the Health Sciences Committee of the Board
of Trustees is currently assembling a comprehensive document, including
financial information, that should answer many of these questions.

     The meeting adjourned at 3:55 p.m.

Minutes of March 14, 1996 Meeting

     The meeting convened at 10:12 a.m. in room 817 Cathedral of Learning.

     UPBC members present were: Thomas Anderson, Jacob Birnberg, John Brice,
Toni Carbo, James Cassing, H.K. Chang, Thomas Detre, Ronald Gardner, Brian
Hart, Peter Koehler, James Maher,  Franklin McCarthy, and Philip Wion.  Also
present were: Jeffrey Liebmann, William Madden, and Robert Pack.
     UPBC members not present were: Marjorie Carlson, Richard Colwell, Randy
Juhl, Keith McDuffie, Glenn Nelson, Jeffrey Romoff, Michael Stuckart, Bruce
Williams, Julius Youngner, and Judith Zimmerman.

Report of the Chair

     Maher reported that the University budget hearings with the House and
Senate Appropriations Committee had taken place and that, though the
legislators were cordial and supportive, there is a strong likelihood that the
Governor's recommended budget for higher education FY 1997 will be approved. 
He announced his decision to appoint Gerald Holder to the position of Dean of
the School of Engineering, which followed extensive discussions with faculty
and department chairs of the School as well as the Executive Committee of the

Discussion of Recent Board of Trustees Resolutions

     Maher summarized several resolutions passed at the recent Winter Board
of Trustees meeting as an attempt to capture the thinking of the Trustees on
the future of the University.  The resolutions addressed pursuing excellence
in undergraduate education, ensuring operational efficiency and effectiveness,
securing an adequate resource base, maintaining research excellence, and
partnering in community development.  Maher asked members what role they saw
for the UPBC in fulfilling these resolutions.  He provided details on how the
University is already responding to the resolution on undergraduate
excellence, including consulting the Provost's Advisory Committee on
Undergraduate Programs, scheduling a retreat of the Council of Deans, and
facilitating a review of general education requirements that will be discussed
at an upcoming meeting of the FAS Board of Visitors.
     Maher stated that the University has strong freshman retention relative
to peer institutions with similar entering freshman SAT scores.  He added that
raising the University's SAT criteria would probably result in raising
freshman retention rates even closer to those peers whose average SAT scores
are higher.  Maher cited recent initiatives to improve scholarships for highly
qualified freshmen, to develop working relationships with local school
districts, and to refocus the enrollment profile in the College of General
     Anderson expressed concern that the resolutions have substantial
resource implications.  Wion emphasized that the resolutions should be viewed
as an opportunity to set meaningful deadlines, create integrated plans, and
bring together existing activities in a public way.  He emphasized that the
resolutions, in fact, often articulate current University directions
concisely.  Wion cited the importance of reviewing Vice Chancellor level long
range plans to determine relations with the resolutions and to address larger
resource issues.  Maher agreed that the resolutions endorse many of the
current planning and management efforts.  He emphasized the importance of
synchronizing facilities and programmatic improvements and of expanding the
University's revenue base through institutional advancement activities.
     McCarthy suggested that the Long-Range Planning Parameters Subcommittee
be reactivated to examine future planning issues.  Maher stated that the
Agenda Subcommittee could organize reflections on these issues for further
review by the full Committee.  Koehler summarized his impressions from a
recent meeting of AAU arts and sciences deans by stating that the University
is addressing many of the same problems facing similar institutions across the
country.  He added that, especially relative to private AAU institutions, the
University has the opportunity to capitalize on its relatively low tuition
rates.  Maher detailed some current efforts to examine and improve student
services at the University and to increase the customer orientation of
administrative structures, noting that these efforts were consistent with the
recommendations of the Task Force on Duplicated Services.

     The meeting adjourned at 11:55 a.m.