MINUTES OF A REGULAR MEETING OF THE
BOARD OF VISITORS OF
VIRGINIA COMMONWEALTH UNIVERSITY
March 17, 1994
A regular meeting of the Board of Visitors of Virginia Common-
wealth University was held on Thursday, March 17, 1994, at 9 a.m. in the
University Meeting Center.
Present were Messrs. Whitworth (Rector), Arenstein, Framme,
Meador, Siegel, Townes, and Weinberg; Drs. Berenguer, Dombalis, Gilmer,
Johnson, and Peay; and Mesdames Epps and Vaughan. Ms. Teig and Mr.
Weinberg were absent. Also present were Dr. Trani, Costanzo, Dewey,
Harris, Jones, Rhone and Schexnider; Messrs. Bruegman, Bunce, Ross and
Wyeth; and Mesdames Messmer and Price.
Mr. Whitworth called the meeting to order. The President's Report
followed:
The School of Nursing has received eight years accreditation from
the National League for Nursing, the maximum number of years
allowed. Also, the League is not requiring any follow-up interim
reports.
The budget includes increases of 3.4 percent on December
1, 1994, and 2.25 percent on December 1, 1995, for full-time faculty
and 2.25 percent on December 1, 1994, and 1995 for part-time facul-
ty and graduate teaching assistants.
The budget includes a performance pay plan for classified staff
effective December 1, 1994.
The budget as introduced by Governor Wilder, included general
fund reductions of $458,000 in 1994-95 and $3.9 million in 1995-96
which were offset with tuition revenues. The General Assembly
adopted the recommendations.
Statewide, the Governor targeted general fund reductions for Re-
search and Public Service Centers and Commonwealth Centers. For
VCU, the elimination of the Center on Aging ($290,000 in each
year) and the elimination of the Commonwealth Center for Drug
2
Abuse ($318,534 in each year) was included. The General Assem-
bly restored funding of $285,000 per year for the Center on Aging.
Governor Wilder's budget included the following general fund adden-
da which were adopted by the General Assembly: Massey Cancer
Center, Police Support, Family Practice Centers, U21 Technology,
Brain Injury Center and Library.
The University received additional nongeneral fund
authority to raise tuition within prescribed policy and to generate
revenues from various fees.
The budget calls for institutions of higher education to
submit restructuring plans to be implemented in 1994-96 and beyond
to the Secretary of Education and the State Council of Higher Educa-
tion by September 1, 1994. The objective of the plans is "to effect
long-range changes in the deployment of faculty, to ensure the
effectiveness of academic offerings, to minimize administrative and
instructional costs, to prepare for the demands of enrollment in-
creases, and to address funding priorities as approved by the Gener-
al Assembly."
The University received $4.3 million from the general fund
and $1.3 million in nongeneral funds to make major repairs to Uni-
versity facilities during the upcoming biennium. Forty percent of
the funding will be made available in the first year of the biennium
and sixty percent in the second year. The budget requires institu-
tions of higher education to spend or contractually obligate at
least 85 percent of maintenance reserves funds by June 30, 1996.
The Hospitals are appropriated $355,663 from the general fund and
$1.2 million in nongeneral funds to make major repairs to Hospital
facilities during the upcoming biennium. Forty percent of the
funding will be made in the first year of the biennium and sixty
percent in the second year.
The General Assembly acted favorably on Senate Bill 545 which will
allow MCVH the flexibility to enter into joint ventures. The legis-
lation helps to ensure the economic future of the medical centers.
House Bill 725 creates the Virginia Biotechnology Research Act. The
legislation establishes the regulatory framework for the industry in
such a way as to inform the public of biotechnology activity while
at the same time promoting economic development.
Dr. Henry McGee, the new Associate Provost for Engineering, was
introduced. Dr. McGee is working on establishing the School of
Engineering. There will be four departments in the School: Elec-
trical, Chemical, Biomedical and Mechanical. A curriculum proposal
will be presented to the Board at the September meeting.
Dr. Trani discussed an article that appeared in the March
9, 1994, Chronicle of Higher Education, entitled "The New American
College", by Ernest L. Boyer. Mr. Boyer's major message is that
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the efforts of higher education must be central to "the nation's
work . . . that we must return to seeing a college education as a
public good, not a private benefit." Mr. Boyer is worried that, in
recent years, the latter has been more often the case.
Mr. Meador reported for the Academic Policy Committee. The Execu-
tive Committee of the Faculty Senate discussed the changing role of the
faculty, funding and resource issues, improved public perception of the
University, implementation of the Strategic Plan, and the successful activi-
ties in the General Assembly.
The Request for a Name Change for the Afro-American Studies
Program and Minor to the African-American Studies Program and Minor was
presented. The request had been approved by the University Undergradu-
ate Curriculum Committee and presented to the Provost for submission to
the Academic Policy Committee of the Board of Visitors by the Dean of the
College of Humanities and Sciences. The basis of the name change request
is to replace outdated terminology and more accurately reflect the cultural,
social, and historic reality of the population examined in the discipline.
Since the 1970s, VCU has submitted to the State Council of Higher
Education of Virginia (SCHEV) plans for recruiting and retaining faculty on
a biennial basis. Under Governor Wilder's administration, VCU was re-
quired to submit a document entitled the "Virginia Plan" on faculty recruit-
ment and retention. In November, 1993, SCHEV required a new version of
the previous report which called for additional information. In response to
SCHEV's new requirements, a call went out from the VCU Office of EEO/AA
Services to the applicable University units requesting information on female
and other-race faculty recruitment and retention activities.
The University Honors Program plays an important role in VCU's
attainment of academic excellence. Dr. Berglund, Director of the Honors
Program, summarized the report on the program. The discussion highlight-
4
ed the value of the Honors Program in student recruitment and marketing
the University as an institution of academic excellence. Fundraising for
scholarships is a continuing need for the program.
Dr. Barbara Fuhrmann gave an update on the process and plans
for the SACS site visit in April. A summary of the recommendations and
responses to the Southern Association of Colleges and Schools was present-
ed.
Mr. Siegel reported for the Advancement Committee. The Exclusive
Beverage/Food Services Agreement was presented. The Request for Propos-
als (RFP) for the Exclusive Beverage/Food Services Agreement will encom-
pass all University and Medical College of Virginia Hospitals soft drink
vending, fountain and retail beverage services. As an element of the RFP,
the successful respondent will provide an independent food services consul-
tant who will assess University and MCVH food services programs and offer
recommendations for enhancements. The RFP is anticipated to be to Purchas-
ing no later than March 31, 1994. The findings of the independent food
services consultant will then be used to determine an approach and scope for
any changes in University and MCVH food services.
A Legislative Update was presented. VCU received an exceptional
reception from the General Assembly and succeeded in achieving all of the
goals outlined on the Priority Card.
VCU provided the Franklin Street Gym for the legislative basketball
game between Democrats and Republicans and for a game between the Gover-
nor's Office and the lobbyists in which the Governor participated. The
game was held to raise funds for a worthwhile cause and to provide an
outlet for the legislators. Subsequent to the game, Dr. Trani was invited
5
to the floor of the House of Delegates in order to receive a $1,000 check
for the Massey Cancer Center.
Dr. Peay reported for the Finance and Investment Committee. The
Revision of the Solicitation, Acceptance and Administration of Contributions
Statement of Policy was presented. The Board Policy, adopted in 1987, is
for the management of private funds and is being amended to comply with
the recommendations of the auditor of public accounts relating to interest
earnings on the Hospitals' trust funds. Two changes are being recommend-
ed in the policy to avoid similar problems in the future:
1. Since not all private fund balances are true gifts, the
policy is being changed to use the term "fund balances" rather
than "gifts" when money is being transferred to the foundations
for management.
2. So that interest earnings can be credited to certain funds, the
policy is being amended to allow the President and designate
interest income for the use of specific funds.
Revisions were made to Section D 2(a), 3(a) and (b), 4 and 5.
The Committee discussed eight major issues relative to the 1994-96
budget. The budget will be presented for approval at a special board
meeting on April 22. The issues include:
1. The 3% cap on tuition increases.
2. A need to enroll 367 additional full-time students next fall to
realize the tuition revenue appropriated by the General Assembly.
3. Restructuring to reduce administrative costs and increase
efficiency.
4. Funding the Strategic Plan Initiatives.
5. Budget reductions in Federal Indirect Cost Recovery (or
overhead) funds.
6. Fee increases above the $50 approved for the Convoca-
tion/Recreation Center.
7. Financial aid allocations.
8. Indigent Care Funding.
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The Quarterly Budget Report - December 31, 1993, was presented.
A tuition revenue shortfall is anticipated due to lower than expected full-
time equivalent enrollments. The amount of annual revenue expected to be
received from tuition is currently projected to be down $1.875 million, or
3.0% of the amount budgeted. In anticipation that a shortfall might occur,
contingency funds have been set aside to cover the loss of revenue.
The Quarterly Investment Report - December 31, 1993, was present-
ed. The total of all funds under investment management by VCU and affili-
ated foundations at December 31, 1993, is $157 million. The VCU Operating
Pool has 100% of the pool invested in fixed income and cash equivalents.
The VCU Foundation has 76% in equities and 24% in fixed income and cash
equivalents. The MCV Foundation has 43% in equities, 46% in fixed income
and cash equivalents, and 11% in real estate and other assets.
Dr. Johnson reported for the Health Affairs Committee. The Hospi-
tal Finances were presented. Financial statistics for the seven months
ending January 31, 1994, were reviewed. Adult and Pediatric admissions
exceed the budget, however the hospital's average length of stay continues
to be reduced resulting in inpatient days for the seven month period being
below the budget. A favorable retroactive contract with a major payer
resulted in total operating revenue being in excess of budget. Operating
expenses for the period exceeded budget by $1.6 million related to medi-
cal/surgical supplies and implant costs. The excess from operations for the
seven month period is $12.2 million compared to a budget of $11.7 million.
Non-operating income increases the total excess revenue over expense to
$13.1 million, compared to a budget of $12.6 million.
The Hospitals State support for the biennium shows that all indigent
care funding (including that for the Virginia Treatment Center for Children)
7
will be completely supported by special Medicaid Disproportionate Share
Hospitals.
Bond Refunding was presented. VCU/MCV Hospitals issued $48.8
million of bonds on February 1, 1994, to refund $55.3 million of outstanding
debt. The Hospitals interest rate was reduced from above 6.0% to 4.3% for a
gross savings of $13.2 million and a net present value savings of $4.9
million. Debt maturity was also reduced from the year 2007 to the year
2003, and $9.7 million of previously bond restricted funds were released for
future capital/construction uses.
Funds in Trust Commitments and Plan were presented. Fund bal-
ances will be utilized for emergency room renovations and for three year
funding for the Bainbridge project and clinic support. New additions to the
trust funds will be used for the care of medically indigent patients who are
not eligible for Medicaid or the State Indigent Care Program.
The Engineering Management Services Notification contract was
presented. The Hospitals entered into a contract with Marriott Health Care
Services for the provision of Hospital Engineering Management Services.
The contract was awarded for two years with the option to renew for three
additional one year periods. The value of the contract for the two year
period is $657,726.
The Value Improvement Study was presented. The Hospitals re-
ceived proposals from six firms and invited three for additional presenta-
tions. Hospitals management has elected to pursue with one vendor the pur-
chase of an initial phase to assist management and medical staff in identi-
fying potential savings reduction target areas and opportunities for im-
provement. Negotiations with a vendor are proceeding and the proposal is
expected to be under contract in March 1994.
8
The Hospital Finances for Release of Capital Funds for the Third
Quarter of FY 1993-94 was presented. The Hospitals have fully funded
$3,554,602 in depreciation for the third quarter of 1994 and are recommend-
ing release for the purchase of equipment and renovation needs. Total
remaining needs related to the 1994 capital budget are $8,111,796. The
requested capital release will not be allocated until an improved cash
position is assured.
A Contract for Clinical Engineering Services Request for Proposals
was presented. The contract has been established for clinical equipment
repair, preventative maintenance services, and program management. The
estimated annual cost of the service will exceed $500,000, and will be for
multiple years; the initial period of the contract may exceed $1,000,000.
Mr. Townes reported for the Property Committee. The Capital
Project Status Report was presented for information.
The Fine Arts Center design has been approved by the State Art
and Architectural Review Board. Partial demolition on the site is
scheduled to begin in the summer of 1994, and construction is
scheduled to begin May, 1995.
Phased construction is being considered for the Academic Campus
Parking Deck II. Temporary relocation of the Sculpture Department
in the Meridian Building on the eastern portion of the site is too
costly.
The Ambulatory Care Facility is 46% complete. Change orders to
the architect and construction contracts are being required as the
redesign of floors 2, 5, 6, and 7 are initiated and approved. The
estimated date of completion is January, 1995.
$900,000 in planning funds are recommended in the Governor's
budget for renovation of the old State Library Building for VCU's
use.
The Master Lease for Biotech One is under review by the State and
it appears that some changes to the lease terms will be required
before State approval can be secured.
Mr. Arenstein reported for the Student Affairs Committee. In
November of 1990, the Student Right-to-Know and Campus Safety Act was
9
signed into law (Public Law 101-542) in the Commonwealth of Virginia requir-
ing colleges and universities to begin reporting incidences of campus crime
and arrests for certain categories of offenses. Subsequently, the Higher
Education Amendments of 1992, enacted on July 23, 1992, imposed new
requirements for preventing, reporting, and investigating sex offenses that
occur on campus.
As a result, a Sexual Assault Task Force was appointed at VCU to
draft a policy on student sexual assault. The initial document drafted by
the Task Force received university-wide review and input, including review
by Ms. Jean Reed, Associate General Counsel of VCU. The final version of
the document was approved by the University Council on February 9,
1994. There was considerable discussion of the definition section including
the language on inabilities induced by alcohol or other drugs. The matter
was tabled until the next meeting for further review of the SCHEV guide-
lines and further consideration of the section on definitions. Annual
review of the effective use of the policy was requested if approved.
Since the 1970s, VCU has submitted to the State Council of Higher
Education of Virginia (SCHEV) plans for recruiting and retaining students
on a biennial basis. Under Governor Wilder's administration, VCU was
required to submit a document entitled the "Virginia Plan" on student re-
cruitment and retention. In November, 1993, SCHEV required a new ver-
sion of the previous report which called for additional information. In
response to SCHEV's new requirements, a call went out from the VCU Of-
fice of EEO/AA Services to the applicable University units asking for infor-
mation on female and other-race student recruitment and retention activi-
ties.
10
On motion made and seconded, the following items from the Consent
Agenda were approved:
Board of Visitors
Minutes of a Meeting held January 20, 1994
Academic Policy Committee
Minutes of a Meeting held January 19, 1994
Request for Name Change: Afro-American Studies
Program and Minor to African-American Studies Program
and Minor
Request for Proposal for University Library
Services - Periodical Services
Instructional and Administrative Faculty Plans
Submitted to SCHEV for 1994-98
Advancement Committee
Minutes of a Meeting held January 19, 1994
Request for Proposal for Exclusive Beverage
Contract
Audit Committee
Minutes of a Meeting held January 20, 1994
Executive Committee
Minutes of a Meeting held February 3, 1994
Finance and Investment Committee
Minutes of a Meeting held January 19, 1994
Revision: Solicitation, Acceptance and
Administration of Contributions Statement of
Policy
Health Affairs Committee
Minutes of a Meeting held January 19, 1994
Hospital Finances: Release of Capital Funds for
the Third Quarter of FY 1993-94
Contract for Clinical Engineering Award
Academic Policy and Student Affairs Committees
Minutes of a Joint Meeting held January 19, 1994
Property Committee
Minutes of a Meeting held January 19, 1994
Retreat Planning Committee
Minutes of a Meeting held January 19, 1994
Student Affairs Committee
Minutes of a Meeting held January 19, 1994
Institutional Student Recruitment and Retention
Plans Submitted to SCHEV for
1994-98
On motion made and seconded, the items from the Consent Agenda -
Information were approved.
The Virginia Commonwealth University's Policy Guidelines on Recog-
nition of Donors and Friends was presented. It was requested that the
Executive Committee named in the policy be replaced by the Advancement
11
Committee; therefore, the authority to name permanently any physical facili-
ty or programmatic element of the University rests with the Board of Visi-
tors of Virginia Commonwealth University through the Advancement Commit-
tee subject to ratification by the Board. On motion made and seconded,
the revised Policy Guidelines and Recognition of Donors and Friends was
approved.
The Presidential Evaluation Committee was appointed. A report will
be presented to the Board in May. On motion made and seconded, Messrs.
Siegel and Meador (subsequently Dr. Holland replaced Mr. Meador); Ms.
Teig; and Dr. Peay will serve on the Presidential Evaluation Committee with
Mr. Whitworth serving as Chair.
On motion made and seconded, the Board convened into executive
session to discuss certain personnel matters involving the performance of
identifiable employees or faculty of VCU, and to discuss the evaluation of
performance of departments or schools of VCU where such matters regard-
ing such individuals might be affected by such evaluation including the
Faculty Appointments and Changes in Status and other Personnel Actions,
Full and Consultative Hospital Privileges, Non-Board Certified Members of
the Medical Staff, the Semi-Annual Quality Assessment and Improvement
Report and the Safety and Risk Management Quarterly Report, and Audit
Reports of individually identified departments and/or schools; to discuss
legal matters and probable litigation with its attorney relating to the
aforementioned Audit Reports as may be necessary; to discuss the condi-
tion, acquisition or use of real property for public purpose, or of the
disposition of publicly held property, or of plans for the future of a state
institution of higher education which could affect the value of property
owned or desirable for ownership by such institution including the Acquisi-
12
tion of Property; to discuss matters relating to gifts, bequests, and
fundraising activities including the Development Report and the approval of
the Named Funds Report; and to discuss matters relating to honorary de-
grees and special awards as authorized by Section 2.1-344 a(1), a(3), a(7),
a(8), and a(10) of the Virginia Freedom of Information Act.
Following executive session, on motion made and seconded, the
following Resolution was approved by Roll Call vote:
Virginia Commonwealth University hereby certifies that, to the best of each
member's knowledge, (i) only public business matters lawfully exempted
from open meeting requirements by Virginia law were discussed in the execu-
tive session meeting to which this certification resolution applies, and
(ii) only such public business matters as were identified in the motion
convening the executive session meeting were heard, discussed or consid-
ered by the Board of Visitors of Virginia Commonwealth University.
Roll Call Vote Ayes Nays
Mr. F. Dixon Whitworth, Jr. Rector X
Mr. Richard A. Arenstein X
Dr. Thomas J. Berenguer X
Rev. Constantine N. Dombalis X
Mrs. Rozanne G. Epps X
Mr. Lawrence W. Framme, III X
Dr. Robert D. Gilmer Left before voting
Dr. William E. Holland Left before voting
Dr. Harry I. Johnson, Jr. X
Mr. Richard L. Meador X
Dr. Clifton L. Peay Left before voting
Mr. Stuart C. Siegel X
Ms. Eva S. Teig Absent
Mr. Clarence L. Townes, Jr. Left before voting
Ms. Sandra Adair Vaughan X
Mr. Jay M. Weinberg Absent
VOTE:
AYES: 10
Nays: 0
ABSENT DURING MEETING: 2
ABSENT DURING VOTING: 6
On motion made and seconded, the Board accepted the Report of
the President; approved authorizing the President, in his discretion, to
proceed to secure a Commencement speaker by exhausting the expanded list
13
and possibly making use of an appropriate talent agency; approved the
Faculty Appointments and Changes in Status, and other Personnel Actions,
the Full and Consultative Hospital Privileges, the Named Funds Report;
accepted the Semi-Annual Quality Assessment and Improvement Report;
accepted the Safety and Risk Management Quarterly Report; approved the
recommendations contained in the Non-Board Certified Members of the Medi-
cal Staff Report and the request to the administration to develop guidelines
relating to non-Board Certified Members with Mr. Arenstein abstaining;
approved requesting the Administration to develop and bring back to the
Board a plan for the use of properties along West Broad Street within the
next six months; accepted the Report of the General Counsel; accepted the
report of the Audit Committee regarding the meeting held March 17, 1994;
approved the recommendation contained in the Board of Visitors' Award
Selection Report; approved the Acquisition of Property at 700-32 West
Broad Street and 701-27 West Marshall Street; 1200-22 West Broad Street
and 1201-1307 West Marshall Street; and 1224-1306, 1308 and 1310 West
Broad Street. Due to a conflict of interest in the property being dis-
cussed, Dr. Peay excused himself from the meeting.
The meeting was adjourned at 12:30 p.m.
