Board of Regents

08-21-92minutes

Board of Regents

OFFICIAL MINUTES

Board of Regents' Meeting
August 21, 1992
Fairbanks, Alaska

Regents Present :

Robert F. Williams, President

Morris Thompson, Vice President

Susan A. Stitham, Secretary

Mark H. Helmericks, Treasurer

Virginia W. Breeze

Eric Forrer - via audio (excused at 4:07 p.m.)

Sharon D. Gagnon

Joseph R. Henri

Michael P. Kelly

Tim Lamkin

Lew Williams, Jr.

Jerome B. Komisar, Executive Officer & President of the

University of Alaska

In Attendance :

Donald F. Behrend, Chancellor, University of Alaska Anchorage

Marshall Lind, Chancellor, University of Alaska Southeast - via audio

Joan Wadlow, Chancellor, University of Alaska Fairbanks

Luis Proenza, Acting Vice President for Academic Affairs & Research

Wendy Redman, Vice President for University Relations

Brian Rogers, Vice President for Finance

J. Mark Neumayr, Associate General Counsel

Jeannie D. Phillips, Regents' Affairs Officer

Jim Lynch, Associate Vice President for Finance

'Nanne Myers, Assistant Vice President for Academic Affairs

Gerald Neubert, Executive Director, Facilities Planning

& Construction

Marty Epstein, Director, Land Management

Marsha Hubbard, Director, Budget Development

Robert Miller, Director, Public Affairs

Beverly Beeton, Provost and Vice Chancellor for Academic Affairs, UAA

Stan Vaughn, Vice Chancellor for Administration, UAA

Larry Kingry, Vice Chancellor for Student Services, UAA

Michael Rice, Vice Chancellor for Administration, UAF

Janice Reynolds, Vice Chancellor for Academic Affairs, UAF

Ray Highsmith, President, General Assembly

Jim Sampson, Mayor, Fairbanks North Star Borough

Gary Wilken, Fairbanks Chamber of Commerce

Phil Yonker, Fairbanks Chamber of Commerce

1. Call to Order

Board President Williams called the meeting to order at 9:05 a.m. on August 21, 1992.

2. Adoption of the Agenda

Regent Breeze moved, seconded by Regent Stitham, and passed unanimously that:

PASSED AS AMENDED

"The Board of Regents adopts the agenda as amended (*).

1. Call to Order

2. Adoption of the Agenda

3. FY93 Operating and Capital Budget Status Report

4. FY94 Operating and Capital Budget Presentations

5. Executive Session

6. Revision to Regents' Policy 04.05.08 - Retirement System Eligibility

7. University of Alaska Fairbanks Research Support Center

8. Authorization of Bond Sales

* 9. University of Alaska Fairbanks Residence Hall Security Improvements - Approval of Schematic Design and Authority to Bid and Award a Contract - withdrawn

10. Cordova Subdivision Development

11. Wrangell-St. Elias National Park Headquarters Site

12. Land Transfer to City and Borough of Sitka for Park Site

13. Requested Modifications to Board of Regents' Meeting Schedule

14. Regents' and Presidents' Comments

15. Other Items of Concern to the Board of Regents

16. Adjourn

This motion is effective August 21, 1992."

3. FY93 Operating and Capital Budget Status Report

In June 1992, the Board of Regents approved the FY93 Working Budget pending Governor's Action. Marsha Hubbard, director of Statewide Budget, and Jerry Neubert, executive director of Facilities Planning and Construction, reviewed actions taken by the governor. Ms. Hubbard reported that Governor Hickel did not veto any items in the operating budget, and Mr. Neubert reviewed the vetoes that occurred in the capital budget.

4. FY94 Operating and Capital Budget Presentations

A. FY94 Operating & Capital Budget Overview

President Komisar provided an overview of the FY94 budget process and the proposed categories of funding. The following areas were highlighted: general and non-general fund expenditures for FY91-93; enrollment projections through the year 2001 and trends from the past five years in the areas of new, returning, and transfer undergraduates, graduates, and part-time students; physical plant value and corresponding deferred maintenance costs; and information on how the university's budget compares to the NCHEMS categories in the budget modeling process.

B. FY94 Operating & Capital Budget Presentation - UAF

Chancellor Wadlow reviewed the visions for the future of UAF as stated during last year's budget presentation: (1) to become the world's leading university by the year 2000 in research and studies about the Arctic; (2) to be known for offering one of the nation's leading undergraduate educations; (3) to be known as a leader in meeting the practical needs of the state (e.g., fisheries, forestry, minerals and wildlife); (4) to also meet selected national needs (i.e., global change); (5) to become a model showing how the full involvement of women and minorities, with special emphasis on Alaska Natives, will enrich and strengthen the institution and society; (6) to become a leader in developing international dimensions pertaining to countries around the Arctic; and (7) to integrate planning and budgeting together at UAF. Dr. Wadlow reviewed the FY94 budget, linking it with the above visions and mission of UAF, and with the visions stated by the Board during the last year, including strengthening Alaska Native education, and implementing the recommendations from the Kaludis report.

C. FY94 Operating & Capital Budget Presentation - UAA

Chancellor Behrend reported on how the following premises shaped the FY94 budget request for UAA: the need to economize and make administration more efficient; to increase productivity; to complete the base of the institution; and to take into consideration that UAA is still a very new institution with rising enrollments while experiencing the challenges of changing the ratio between permanent and adjunct faculty, and needing a greatly expanded base of library services.

D. FY94 Operating & Capital Budget Presentation - UAS

Chancellor Lind reviewed statistical data on increasing enrollments; full- and part-time headcounts; geographic information on students; enrollments and degrees awarded to Alaska Natives and American Indians; percent of growth in various degrees awarded; and concern, in the face of increased enrollments and a very small faculty base, over how basic courses can be offered and maintained. Dr. Lind then related how this information shaped the FY94 request.

E. FY94 Operating & Capital Budget Presentation - SPS

Vice President Rogers reviewed the operating and capital budget requests for statewide administration as presented in the green book, emphasizing that these requests support the mission of the University of Alaska in the areas of central services, specialized consulting, Board of Regents' support in policy setting and monitoring as well as protecting the corporation.

5. Executive Session

Regent Thompson moved, seconded by Regent Henri, and passed unanimously that:

PASSED

"The Board of Regents goes into executive session in accordance with the provisions of AS 44.62.310 to discuss matters relating to litigation and land acquisition/use, these topics being subjects the immediate knowledge of which would have an adverse effect on the finances of the university. The session shall include members of the Board of Regents, President Komisar, Associate General Counsel Neumayr, and such other university staff members as the President may designate and shall last approximately 45 minutes. Thus, the open session of the Board shall resume in this room at approximately 1:30 p.m. A.D.T. This motion is effective August 21, 1992."

The Board of Regents went into executive session at 12:30 p.m.

The Board of Regents returned to public session at 2:45 p.m.

Board President R. Williams announced that the Board of Regents just concluded an executive session in accordance with provisions of AS 44.62.310 lasting approximately two hours in order to discuss matters relating to litigation and real property acquisition/use, these topics being subjects the immediate knowledge of which would have an adverse effect on the finances of the university.

6. Revision to Regents' Policy 04.05.08 - Retirement System Eligibility

Regents' Policy 04.05.08 currently provides for enrollment of certain eligible employees in approved retirement plans and for the exclusion of foreign nationals from participation in such plans. Recent interpretations of and changes to the U.S. immigration laws and regulations indicate that compensation levels for foreign nationals may not deviate significantly from compensation levels for other employees. Inclusion of such individuals in the university's regular retirement programs will minimize the principal deviations in compensation levels for affected university employees. The proposed amendment makes the policy more consistent with immigration requirements by deleting the provisions excluding foreign nationals from participating in the retirement plans. It also updates the list of authorized plans to include the university's Optional Retirement Plan.

The proposed amendments are as follows (additions underlined, deletions in []):

Retirement Systems 04.05.08

The University shall enroll its eligible employees in the Teachers' Retirement System, [or] the Public Employees' Retirement System, or the University of Alaska Optional Retirement Plan, as appropriate.

[Foreign nationals employed by the University who have been admitted to the United States on temporary, non-immigrant visas, are not eligible for placement in permanent positions and are therefore ineligible to participate in the Teachers' Retirement System or the Public Employees' Retirement System until such time as they have achieved permanent residency status. (See Regulation 04.05.08)]

Patty Kastelic, acting executive director for Statewide Human Resources, and William R. Kauffman, vice president and general counsel, have reviewed the proposed amendment and recommend approval.

Regent Kelly asked for clarification on how the proposed policy change would compare with federal law. Associate General Counsel Neumayr responded that the contemplated action would ensure that current policy corresponded to federal law and bring the policy in line with current practices at the University of Alaska.

Regent Thompson moved, seconded by Regent Helmericks, and passed unanimously that:

PASSED

"The Board of Regents approves the proposed revision of Regents' Policy 04.05.08 to include reference to the university's Optional Retirement Plan and to eliminate the exclusion of foreign nationals from participation in the university's retirement programs. This motion is effective the pay period ending August 22, 1992."

7. University of Alaska Fairbanks Research Support Center

In December 1990, the Board of Regents authorized the administration to negotiate for the acquisition of two buildings as a cost effective solution to the University of Alaska Fairbanks' space needs. The Board further authorized the issuance of tax exempt debt to facilitate the acquisitions.

UAF is in the process of moving into the Administrative Services Center, formerly known as Cook's Corner.

Earlier this year, agreement was reached with the owners of the Plywood Supply Building, which was to be used for support of various UAF research activities. However, when the environ-mental audit of the property indicated significant contamination of the soil and water table, the agreement was terminated.

As the 1992 bonds were being sold, the results of the environmental evaluation of the Plywood Supply property were uncertain. In anticipation of potential withdrawal, the "Plywood Supply" project was re-defined for bond sale purposes as a research support center. In June, the Board directed the administration not to spend any of the $1,000,000 identified for planning of the research support center until approved by the Board.

After planning work is complete, an RFP will be issued requesting design/build proposals for a completed project which involves either all new construction or modification/renovation of an existing facility. Appearance, life safety, space relation-ships of the working environment, energy conservation, efficiency of operation and maintenance, quality of materials and equipment, location of the facility as it relates to developing traffic patterns in the immediate campus area, and the overall cost of the building will be considered in the evaluation process.

In the past few years UAF has been successful in obtaining funding for numerous research projects and sponsored programs such as Polar Ice Coring Office, the Arctic Research Consortium of the United States, and the National Undersea Research Center. This type of growth has maintained UAF's preeminence and prestige in northern latitude research. However, UAF is not able to provide the required space for these and other programs.

Agreements have been negotiated with outside agencies in good faith and contracts made with the expectations that other buildings would be completed as originally scheduled. The university is currently at risk because of the inability to fulfill present research obligations.

The planning process will include an evaluation of other cost-effective alternatives for meeting these research obligations; e.g., relocating community programs like the Cooperative Extension Service out of the Arctic Health Building and upgrading some of those labs, rather than building new space in a research support center.

A supplemental appropriation was received for the wet chiller project to limit benzene contamination of the slough adjacent to the UAF power plant. Because the project was so critical to the university, it was also included as an authorized project in the 1992 bond package in case a supplemental appropriation was not secured. These bond funds will be available to the Board for the research support center or, if necessary, the power plant condenser, additional wet chiller capacity, or the administrative services center. Recommendations on the most critical use of the funds will be brought to the Board as the research support facility planning progresses and the other authorized projects near completion.

Gerald Neubert, executive director of Facilities Planning and Construction, discussed the anticipated schedule, reporting that the RFP should be ready for publication by mid-October with the deadline for submission around the first of December. Final results and recommendations should be ready by the first of January with approval by the Board scheduled for the February 1993 Board of Regents' meeting.

Regent Kelly moved, seconded by Regent Helmericks, and passed unanimously that:

PASSED

"The Board of Regents authorizes the administration to proceed with the planning and design of the research support center, issue an RFP, and expend proceeds from the University of Alaska General Revenue Bonds 1992, Series A, in an amount not to exceed $200,000 for the planning and RFP phase of the project. This motion is effective August 21, 1992."

8. Authorization of Bond Sales

In June 1992, the university sold its first issue of general revenue bonds. Many aspects of the sale were very successful. The university secured an A+ rating from Standard & Poors and established a flexible debt instrument for funding the university's revenue supported and critical capital improvement needs.

At the time the Board approved the sale of bonds, the administration indicated that it would bring a proposal for a second revenue bond issue to the Board in the fall. It was anticipated that the current outstanding UAF housing system revenue bonds would be refinanced to consolidate the university's debt structure, release reserve funds for repayment of advances on the Yak Estate sale, and provide for critical capital improvements to the UAF housing system. The feasibility of the refinancing is being evaluated by the university's bond counsel, financial advisor, and underwriter. Since current interest rates are very low and expected to remain stable until the election, and since the incremental cost of issuance for additional projects is relatively low, the president and the chancellors are considering proposals for inclusion of several other projects in a bond financing package.

Vice President Rogers and Associate Vice President Jim Lynch presented a schedule of proposed projects for funding through a general revenue bond issue. They also requested authorization to proceed with the sale of a second general revenue bond issue for those projects approved for funding by the Board of Regents.

A substitute motion was presented at the meeting.

Regent Helmericks moved, seconded by Regent Thompson, and passed with Regents Breeze, Forrer, Gagnon, Helmericks, Kelly, Lamkin, Stitham, Thompson, and L. Williams voting in favor, and Regent Henri voting in opposition that:

PASSED

"The Board of Regents authorizes President Komisar, Vice President Rogers, and Associate Vice President Lynch to perform all acts necessary to issue general revenue bonds to refinance currently outstanding debt which can be refinanced or defeased at a net present value savings to the university and to issue general revenue bonds in an amount not to exceed $6.8 million for the following projects:

UAF Housing System Bond Refinancing $5.0

UAF Telephone System Upgrade .6

UAA Housing System Facilities and Land

Acquisitions 1.2

$6.8

This motion is effective August 21, 1992."

9. University of Alaska Fairbanks Residence Hall Security Improvements - Approval of Schematic Design and Authority to Bid and Award a Contract - withdrawn

10. Cordova Subdivision Development

This spring, as part of the most recent land settlement with the state, the university received title to several hundred acres south of Cordova along Whitshed Road. Most of this land is accessible from the existing road network. The highest and best use of a majority of the property is for subdivision development. Staff has conducted numerous discussions with residents of Cordova, real estate salespeople, and Cordova city officials. It has been determined that a market exists for prime, southern exposure residential lots near town. Lots could generate gross revenues in the range of $20,000-30,000/acre for average quality lots and $40,000-50,000/acre for prime waterfront lots.

Three separate phases of subdivision development have been identified. In the first phase, small odd-shaped parcels would be sold to adjoining landowners, thereby curing some existing encroachments. The costs of this phase would be born by the purchasers.

The second phase of the development would consist of subdividing approximately six lots fronting Whitshed Road. Each would be designed for on-site sewer and water. It would be the purchaser's responsibility to construct driveway access from Whitshed Road. All these lots are expected to sell during a 24-month period, for $20,000-30,000 each. The costs associated with these six lots will be soils testing, surveying, platting, permitting and marketing, estimated at $3,000-$6,000 per lot.

The third phase of the proposed development would be the subdivision of the southern half of Whiskey Ridge, tentatively called Whiskey Ridge Estates. The northern half of Whiskey Ridge was subdivided by the state prior to the university's acquisition. Whiskey Ridge Estates will be a 15-20 lot subdivision containing oceanfront, riverfront, or prime view lots. These lots are expected to sell during a five (5) year period for $40,000-50,000 each. It is proposed that: 1) a road be con-structed to access these lots, and 2) city water and sewer be extended to them due to their proximity to existing city utilities in the Whiskey Ridge Subdivision and to the city's sewage treatment plant. These lots should cost approximately $18,000 each to develop.

The university will realize an estimated net revenue of $275,000-400,000 from this five-year project, based upon gross sales of $800,000-900,000.

Regent Gagnon requested that the administration rename the proposed subdivision.

Regent Kelly moved, seconded by Regent L. Williams, and passed unanimously that:

PASSED

"The Board of Regents approves the subdivision and sale of the University's Whitshed Road property in Cordova and authorizes the administration to negotiate and execute all necessary documents for the development and sale of this property. This motion is effective August 21, 1992."

11. Wrangell-St. Elias National Park Headquarters Site

The National Park Service (NPS) has selected university property east of the Richardson Highway immediately north of the Copper Center Bypass, as its new headquarters site for the Wrangell-St. Elias National Park. The 250 acres selected is located primarily on a bluff overlooking the Copper River, although a small portion is on the river flats. This bluff site offers generally well-drained soils with white spruce and aspen tree cover and a spectacular vista of the Wrangell Mountains.

The Park Service has offered to purchase the property from the university for $250,000, which is the appraised value established by a NPS staff appraiser. The Statewide Office of Land Management (SOLM) contracted with an appraiser, who determined the property's value to be $275,000. SOLM is cooperating with the NPS to have certain easements and deed restrictions removed before the property is transferred. Also being discussed is the possibility of offering the property to the NPS with a deed restriction prohibiting commercial development.

SOLM believes that the location of this proposed facility will benefit the university by increasing the value of its remaining land in this area. Moreover, since it is the Park Service's stated intention not to locate any large commercial operations on the headquarters site, the natural location for these will be on surrounding university property. The university will retain all of the land across the Richardson Highway from this site. It is felt that within a 20-30 year time frame this area might develop in a manner similar to McKinley Village near the entrance to Denali National Park.

Regent Kelly moved, seconded by Regent Stitham, and passed unanimously that:

PASSED

"The Board of Regents authorizes the administration to conclude negotiations and execute all necessary documents for the sale of property to the National Park Service. This motion is effective August 21, 1992."

12. Land Transfer to City and Borough of Sitka for Park Site

The University owns approximately 5.3 acres of undeveloped land overlooking Silver Bay in Sitka. The Statewide Office of Land Management is in the process of platting approximately 1.9 acres of this land into four residential lots. The remaining 3.4 acres will be designated Tract C and left undeveloped.

The four developed lots in this Silver Bay Subdivision were offered in the university's 1992 land sale at appraised value. Offers to purchase were received on Lots 1 and 2. No offers were received on Lots 3 and 4.

The city and borough of Sitka wishes to acquire Lots 3 and 4 of the subdivision, as well as Tract C, for development of a park. The university will receive fair market value for the property.

Regent Thompson moved, seconded by Regent Kelly, and passed unanimously that:

PASSED

"The Board of Regents authorizes the administration to transfer, at fair market value, Lot 3, Lot 4, and Tract C of the Silver Bay Subdivision to the city and borough of Sitka and to execute all necessary documents to complete this transaction. This motion is effective August 21, 1992."

13. Requested Modifications to Board of Regents' Meeting Schedule

Board members considered a request from the administration the location of the December 3-4, 1992 meeting to change from Kotzebue to Girdwood (Alyeska) for the purpose of holding a Board retreat. Since there will be items that will need action during the retreat, it was suggested that the meeting be expanded to include Wednesday, December 2.

Board members also considered a request from Vice President Brian Rogers that the date of the June 1993 Board of Regents meeting be changed from June 3-4 to June 10-11. This change would allow the administration sufficient time to prepare budgets after the close of the legislative session in order to meet bylaw stipulations on submission of agenda materials.

Regent Stitham moved to divide the motion. There was no opposition and the motion was divided.

Regent Stitham moved to amend the main motion by changing the date from December 2-4 to December 3-5, 1992. Regent Breeze seconded the amendment to the main motion, and it passed unanimously.

Regent Stitham moved, seconded by Regent Breeze, and passed unanimously that:

PASSED AS AMENDED

"The Board of Regents approves changing the location of the December 1992 meeting from Kotzebue to Girdwood, Alaska and modifying the December 1992 meeting date from December 3-4 to December 3-5, 1992. This motion is effective August 21, 1992."

The Board discussed changing the June 1993 meeting from June 3-4 to June 10-11. The Board expressed reluctance in changing the meeting date. Vice President Rogers cautioned the Board that with the legislative session ending late in May 1993, the administration would be unable to send out an FY94 budget document seven days in advance as is prescribed in Regents' Policy 01.01.02F(4)B. The Board concurred that it would prefer waiving policy for this specific topic rather than changing the date of the meeting.

Regent Stitham moved, seconded by Regent Breeze, and failed unanimously that:

FAILED

"The Board of Regents approves changing the date of its June 1993 meeting from June 3-4 to June 10-11, 1993. This motion is effective August 21, 1992."

Regent Stitham moved, seconded by Regent Breeze, and passed unanimously that:

PASSED

"The Board of Regents waives Regents' Policy 01.01.02F(4)B. regarding the seven-day requirement for distribution of agenda materials for the June 1993 Board of Regents' meeting. This motion is effective August 21, 1992."

14. Regents' and Presidents' Comments

Regent Helmericks reported on continuing computer conversion problems experienced at the Alaska Commission on Postsecondary Education.

Regent L. Williams requested that Vice President Rogers consult with Alaska Airlines administrators on the feasibility of utilizing frequent flyer miles.

Regent Breeze thanked the chancellors for their budget presentations.

Regent Henri requested that the administration explore different possibilities regarding life insurance for Board members; reported that an ad hoc committee will begin a review on the UA Mining and Engineering Schools; commented on the budget process; and again requested information on productivity of faculty.

Regent Gagnon distributed information from the Alaska Commission on Postsecondary Education regarding the breakdown of student loan information.

Regent Stitham requested that the Board formalize directions to the administration through specific motions; and asked that a thorough review of the faculty tenure policy take place.

Regent Thompson commented on the ACPE student loan program and its impact on Alaska Native students; reported on the progress of the Doyon House; and urged the Board to read the latest ISER report from Lee Gorsuch and commended Dr. Gorsuch and his staff for their excellent work.

President Komisar thanked the Board for rearranging their schedules to accommodate the change in location and agenda due to the Mt. Spurr eruption.

Board President Williams reported on the formation of three ad hoc committees: Committee on Presidential Assessment (Breeze-chair, Gagnon, Stitham, R. Williams); Committee on Board Assessment and Bylaws (Gagnon-chair, Breeze, Stitham, R. Williams); and Committee on Mining Education (Henri-chair, Thompson, R. Williams, members of the public to be selected at a later date).

15. Other Items of Concern to the Board of Regents

None

16. Adjourn

Board President Williams adjourned the meeting at 6:25 p.m. on Friday, August 21, 1992.

Back to Top