MINUTES OF A REGULAR MEETING OF THE
BOARD OF VISITORS OF
VIRGINIA COMMONWEALTH UNIVERSITY
March 20, 1997
A regular meeting of the Board of Visitors of Virginia Commonwealth Uni-
versity was held on Thursday, March 20, 1997, at 9 a.m. in the University Meet-
ing Center.
Present were Messrs. Siegel (Rector), DeRusha, Flippen, Marcus, Markel,
Rigsby, Townes and Weinberg; Drs. Perkinson, Smith, Vaughan and White; and
Mrs. Vaughan. Mrs. Powell, Mr. Smith and Dr. Wootton were absent. Also pre-
sent were Drs. Trani, Dewey, Harris, Hiley, Jones and Rhone; Messrs. Bunce,
Gehring, Ross, Timmreck and Wyeth; and Mesdames Burnside, Messmer and
Price.
Mr. Siegel called the meeting to order and welcomed members of the
press.
The President's report followed:
At the January Board meeting, the Board expressed interest in expanding schol-
arship support for students at Virginia Commonwealth University. In the fiscal
year 1996, $1.4 million was budgeted for undergraduate merit scholarships. To
help with the pressing need, VCU will increase the Partners for Progress goal for
endowed scholarships from $6.5 million to $7.8 million taking scholarships, both
current and endowed, to a total of $15.9 million or 13 percent of the Campaign
goal.
The General Assembly approved 1997-98 increases for VCU of 6% for instruc-
tional faculty, 4% for administrative and professional faculty, part-time faculty and
graduate teaching assistants, and 4% for classified staff. Additional funding and
other recommendations were made for a number of items. The Governor rec-
ommended $100,000 in general fund support for the PharmD program. The
General Assembly provided an additional $350,000 for a total general fund in-
crease of $450,000 for the PharmD program in 1997-98.
The Governor's recommendations included an FTE increase of 197.23 and non-
general fund authorization of $17,442,710 to support the transition to the Hospi-
tals Authority structure. The General Assembly increased the Governor's rec-
ommendations by 142.26 FTE and $13,271,966 in nongeneral funds authoriza-
tion. As amended, the total for hospital services includes 339.49 FTE and non-
general funds authorization of $30,714,676 and reflects the total amounts re-
quested by VCU.
The General Assembly provided $42,400 in general funds to provide funding
equivalent to the 1997-98 compensation recommendations for State employees
for faculty and staff in the Family Practice Residency Program.
The General Assembly included language which permits VCU to use unrestricted
nongeneral funds in appropriation for the Auxiliary Enterprises program to make
short-term cash flow loans to the Virginia Biotechnology Research Park Author-
ity.
The General Assembly included language which requires all State agencies and
higher education institutions to report to the State Comptroller by August 1,
1997, the balance of all local funds under control as of June 30, 1997 as well as
the activity of the funds for the year. The Department of Accounts, in consulta-
tion with the Auditor of Public Accounts and the Director of the State Council of
Higher Education, will report the information, with recommendations, to the
Chairmen of the House Appropriations and Senate Finance Committees on or
before November 15, 1997.
The General Assembly recommended $2.3 million in nongeneral funds authori-
zation to renovate the former Jack Thompson properties for the University's
Sports Medicine and Athletics Department.
The Finance and Investment Committee held the first of two training sessions in
January. The second session will begin immediately following the Board of
Visitors' luncheon on March 20. Topics will include information on understanding
the operating budget and financial statements.
Freshman applications are 15% ahead of last year's freshman applications with
acceptances up by 18%.
Mr. Flippen reported for the Academic Policy Committee. The Committee
met with members of the Faculty Senate. Subjects discussed were:
Increased involvement in decision-making in the University in the
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following areas:
• Summer school budget
• Graduate school by-laws
• Information technology
• Budget planning -- the relationship of retention to budget, a
better understanding of the budget and how the budget sup-
ports the values of the institution
Emerging issues
• The need to support undergraduate education
• The need to support medical education and the decline in
clinical income in the School of Medicine
A Faculty Profile was presented. The profile showed the tenure status of
the 1,498 full-time, active instructional faculty at VCU. Highlights of the report
included:
• The decline in faculty on tenure track and an increase in collateral
positions, especially for females and minorities
• Downsizing in the faculty related to early retirements
A Report on Faculty Development was presented. An Office of Faculty
and Instructional Development has been established in the Office of the Provost,
emphasizing excellence in teaching and professional development for depart-
ment chairs and directors. A report on the initiative covered plans for the en-
hancement of teaching, including the Teaching Excellence Grant Program and a
series of workshops and seminars underway and planned.
An Update on the Strategic Plan for the Future of VCU, Phase II was pre-
sented. The goal of Phase II of the Strategic Plan for the Future of VCU is to
refocus the planning process on strategic themes in light of the third-year imple-
mentation report. Steering committees have been established for each strategic
theme, and presentation of the refocused strategic plan is expected at the May,
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1997, meeting of the Board of Visitors. The discussion pointed to the need to
move expeditiously to an implementation plan on the theme addressing the
identity and marketing of the University.
Mr. DeRusha reported for the Advancement Committee. The External
Relations Report was presented. The 1997 Session of the Virginia General As-
sembly adjourned on February 22, 1997. VCU and higher education fared well
in the budget bill. Members of the General Assembly were invited to attend or
participate in a number of events hosted by VCU. The legislators' participation
was significant. On January 14, Councilman Tim Kaine hosted a meeting re-
garding the revitalization of Monroe Park. City Manager Robert Bobb proposed
$150,000 in the City's budget for upgrades. VCU has been asked to participate
in developing a "Monroe Park Master Plan." On January 14, the Academic
Community Advisory Board meeting was hosted by the Midtown West Associa-
tion, and the MCV Community Advisory Board meeting was held on January 21,
at the Valentine Museum. Members of the Academic and MCV Community Ad-
visory Boards were invited to, and attended in great numbers, the final men's
home basketball game against the University of Richmond.
Dr. Perkinson reported for the Finance and Investment Committee. The
Management Principles and Guidelines for Relationships with University-related
Foundations and other Affiliated Organizations were presented. The Principles
and Guidelines were originally adopted by the Board of Visitors in 1990 and sub-
sequently amended in January 1993. The Management Principles and Guide-
lines for Relationships with University-Related Foundations and other Affiliated
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Organizations document was amended with the following revisions: (1) desig-
nate the Audit and Management Services Department of the University with re-
sponsibility to perform the annual review of activities to ensure compliance with
the guidelines and (2) add the term affiliate to the conditions in section B2e. The
Insurance Coverage Summary was presented for information.
Dr. White reported for the Health Affairs Committee. The Hospital Fi-
nances were presented. For the operating revenue: Budgeted reductions in
Medicare have not yet occurred, and the increased inpatient volume and im-
proved rate adjustments in contracts over what was budgeted contributed to ad-
ditional revenue of $2.4M or 1.1% for the period. The Hospitals continues efforts
to work with the Medicare intermediary to determine the appropriate Medicare
liability. For operating expenses: The Hospitals continues departmental ex-
pense controls and expenses within .6% of the budget even with the increase in
the inpatient census for the seven month period. The above operating revenue
and operating expenses resulted in an excess of $8.1M compared to a budget of
$6.9M.
The Statistics for eight months ending February, 1997, were presented.
The volume of inpatient days continue to exceed the budget by 7,747, while ad-
missions are only above the budget by 2. Emergency Room visits are (9,706)
below budget while system outpatient visits are above budget 13,130. Operating
revenue is $258.0M compared to a budget of $255.2M, for a positive variance of
$2.8M. Continued expense monitoring for the eight-month period resulted in to-
tal expenses for the period of $251.9M which compares to a budget of $248.7M
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for a negative variance of only $(3.2M). The expense variance results from an
adjustment to accrued leave, increased cost of group life insurance, reagents
and minor equipment purchases, and equipment repairs. The above revenue
and expenses result in an excess for the eight months ending February 28,
1997, of $6.4M, compared to a budget of $6.8M.
The Capital Equipment and Renovations Release was presented. The
Hospitals request a release of the fourth quarter FY96 and first and second
quarters of FY97 funded depreciation in the amount of $15,222,000 for the pur-
chase of capital equipment and renovations. The funding priorities were re-
viewed and approved by a committee comprised of medical staff department
chairs and hospital administration.
Mr. Weinberg reported for the Property Committee. The Invitation for Bids
for the Housekeeping Services Contract was presented. Through continued pri-
vatization, the quality of housekeeping services will be improved and be more
cost effective. An Invitation for Bids will be issued in compliance with all State
procurement regulations. The awarded contract will start on August 1, 1997.
The Revised Occupancy Agreement for Biotech One with the Institute for
Structural Biology and Drug Discovery was presented. Under the terms of the
Master Lease Agreement between VCU and the Virginia Biotechnology Re-
search Park Authority, VCU wishes to lease approximately 14,373 square feet of
space in Biotech One for use by the Institute for Structural Biology and Drug Dis-
covery. Cost of improvements is not expected to exceed $2,554,000 (VCU is
providing $550,000, an Economic Development Agency grant is providing
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$620,000, and the remaining $1,384,000 will be borrowed from the banking syn-
dicate as a tenant improvement loan).
The Revised Lease for Biotech One with lnsmed Pharmaceuticals, Inc.
was presented. Under the terms of the Master Lease Agreement between VCU
and the Virginia Biotechnology Research Park Authority, VCU wishes to sub-
lease approximately 5,380 square feet of space in Biotech One for use by
lnsmed Pharmaceuticals, Inc. Cost of improvements is not expected to exceed
$911,000 (an Economic Development Agency grant is providing $170,000 of the
amount and the remaining $741,000 will be borrowed from the banking syndicate
as a tenant improvement loan).
The Revised Space Lease for Biotech One with Immunotox, Inc. was pre-
sented. Under the terms of the Master Lease Agreement between VCU and the
Virginia Biotechnology Research Park Authority, VCU wishes to sublease ap-
proximately 1,400 square feet of space in Biotech One for use by Immunotox,
Inc. The cost of improvements is not expected to exceed $360,000 (an Eco-
nomic Development Agency grant is providing $210,000 of the amount and the
remaining $150,000 will be borrowed from the banking syndicate as a tenant im-
provement loan). The Committee received notification of Contract Awards for
the following items: Institutional Waste Management Services, Signage Pro-
curement Contract, Urology Department Renovations and West Hospital HVAC.
Mr. Townes reported for the Student Affairs Committee. The Committee
met with a group of students from both campuses and several different program
areas. Subjects discussed were: safety, transportation, parking, cost of medical
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education, and costs for out-of-state graduate students. Other items included
the need for better integration of students (especially commuting students) into
the life of the University.
A Report on the Student Co-Op Programs was presented. Cooperative
education is an educational program allowing undergraduate and graduate stu-
dents to integrate periods of academic studies with periods of relevant work ex-
perience in academic disciplines. The report covered the VCU Cooperative
Education Program, in operation for more than fifteen years. Over 350 organiza-
tions and businesses have participated, and about 300 students are placed each
year.
On motion made and seconded, the following items from the consent
were approved:
Board of Visitors
Minutes of a Meeting held January 16, 1997
Academic Policy Committee
Minutes of a Meeting held January 15, 1997
Advancement Committee
Minutes of a Meeting held January 15, 1997
Audit Committee
Minutes of a Meeting held January 16, 1997
Finance and Investment Committee
Minutes of a Special Meeting held January 15, 1997
Minutes of a Meeting held January 15, 1997
Amendments to the Management Principles and
Guidelines for Relationships with University-
Related Foundations and Other Affiliated
Organizations
Health Affairs Committee
Minutes of a Meeting held January 15, 1997
Capital Release
Property Committee
Minutes of a Meeting held January 15, 1997
Invitation for Bids: Housekeeping Services Contract
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Revised Occupancy Agreement: Biotech One with the
Institute for Structural Biology and Drug Discovery
Revised Lease for Biotech One with lnsmed
Pharmaceuticals, Inc.
Revised Lease for Biotech One with Immunotox, Inc.
Student Affairs Committee
Minutes of a Meeting held January 15, 1997
On motion made and seconded, the Items on the Consent Agenda for
Information were accepted.
Mr. Siegel appointed the Board Nominating Committee for the Rector.
Mr. Markel was asked to serve as Chair with Messrs. Townes and Flippen serv-
ing as members.
On motion made and seconded, the Board convened into executive
session to discuss certain personnel matters involving the performance of identi-
fiable employees or faculty of VCU, and to discuss the evaluation of performance
of departments or schools of VCU where such matters regarding such individuals
might be affected by such evaluation including the Draft Affiliation Agreement
between Virginia Commonwealth University and the Medical College of Virginia
Hospitals Authority, the Draft Bylaws for the Medical College of Virginia Hospitals
Authority, the Draft Master Lease, the Draft Clinical, Educational and Research
Services Agreement, the Draft Operations and Services Agreement, the Draft
Transfer Agreement, the Faculty Appointments and Changes in Status and other
Personnel Actions, the Full and Consultative Hospital Privileges, the Semi-
Annual Performance Improvement Report and the Report of the Vice President
for Health Sciences, and to discuss legal matters and probable litigation with its
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attorney including the Report of the General Counsel and the aforementioned
Audit Reports as may be necessary, and to discuss the investing of public funds
including an Investment Performance Report and Annual Investment Manager
Review and the University Health Services, Inc. Transfer of Funds, and to dis-
cuss matters relating to gifts, bequests, and fundraising activities including the
Campaign Update, the Development Report, the Alumni and Friends Challenge
Report, the Acceptance of Gift of Real Estate and the approval of the Named
Funds Report, and to discuss matters relating to honorary degrees and special
awards including the Board of Visitors' Award Selection as authorized by Section
2.1-344 a(1), a(6), 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 executive ses-
sion meeting to which this certification resolution applies, and (ii) only such public
business matters as were identified in the motion convening the executive ses-
sion meeting were heard, discussed or considered by the Board of Visitors of
Virginia Commonwealth University.
Roll Call Vote Ayes Nays
Mr. Stuart C. Siegel, Rector X
Mr. William C. DeRusha X
Mr. Edward L. Flippen X
Mr. M. Boyd Marcus, Jr. X
Mr. Steven A. Markel X
Dr. W. Baxter Perkinson, Jr. X
Ms. Diane Linen Powell Absent
Mr. Robert E. Rigsby X
Dr. Lindley T. Smith X
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Mr. Ted L. Smith Absent
Mr. Clarence L. Townes, Jr. X
Roll Call Vote Ayes Nays
Dr. David A. Vaughan X
Ms. Sandra M. Adair Vaughan X
Mr. Jay M. Weinberg X
Dr. H. George White, Jr. X
Dr. Percy Wootton Absent
Vote:
Ayes: 13
Nays: 0
ABSENT DURING MEETING: 3
ABSENT DURING VOTING: 3
On motion made and seconded, the Board accepted the Report of the
President; approved Faculty Appointments and Changes in Status and other
Personnel Actions including the appointment of Dr. Cecil Drain as Dean of the
School of Allied Health Professions and the Full and Consultative Hospital Privi-
leges; accepted the Named Funds Report, the Semi-aAnual Performance Im-
provement Report; approved the University Health Services, Inc. Transfer, the
Acquisition of Property, the Acceptance of a Gift of Real Estate; accepted the
Report of the Special Awards Committee; approved the Board of Visitors' Award
Selection and accepted the executive session Committee Reports and the Re-
port of the General Counsel.
The meeting was adjourned at 12:10 p.m.
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Edward L. Flippen, Secretary Stuart C. Siegel, Rector
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