MINUTES OF A MEETING OF THE
BOARD OF VISITORS OF
VIRGINIA COMMONWEALTH UNIVERSITY
February 14, 2002
A regular meeting of the Board of Visitors of Virginia Commonwealth Uni-
versity as held on Thursday, February 14, 2002, at 9 a.m. in the University
Meeting Center located at 101 North Harrison Street.
Present were Messrs. Flippen, Axselle, Gresham, Markel, Plymale and
Rigsby; Drs. Long, Perkinson, and Wootton; and Mesdames McMichael, Petera
and Riddick. Messrs. Baldacci, Pyon and Slater; and Dr. Smith were absent.
Mr. Flippen called the meeting to order and the Report of the President
followed:
The Medical College of Virginia Hospitals Auxiliary of VCU will hold the
grand opening of the Gateway Building and Community Health Education
Center on Saturday, February 16, 2002 from 7 to 9 p.m.
Susan Ferguson, Associate General Counsel, since November, 2001, was
introduced. Ms. Ferguson is a graduate of Providence College and Mar-
shall-Wythe School of Law at the College of William and Mary. Ms.
Ferguson practiced law in Suffolk, Virginia, before joining the State Attor-
ney General's Office in the mid-1980's. In 1998, Ms. Ferguson was appointed by Governor Gilmore as the Director of the Department of Rights
of Virginians with Disabilities and served in that capacity until joining VCU.
The Dean of the School of Nursing presented a report on the nursing
shortage. The six dimensions that must be addressed in order to affect the root
causes of the shortage and avert a crisis are: the work environment, education,
legislation and regulation, technology research and data collection, financing,
and the role of governing boards.
A budget update was presented based on Governor Gilmore's introduced
budget with Governor Warner's proposed amendments. Budget reductions in
higher education include:
• $343 million, a 13% decrease from the current level of funding for pub-
lic colleges and universities.
• $25 million reduction in equipment funding (HEETF) and $35 million in
maintenance reserve.
• On top of the existing base inadequacy of $240 million ($10 million for
VCU without Medicine or Dentistry needs identified) - reductions take
base inadequacy to 15% statewide.
For VCU, the cuts take the form of across-the-board reductions in-state
support dollars (general funds). Additional general fund reductions predicated on
an ability, but not a requirement, to raise tuition as well as reductions in central
allocations. The targets will change as additional institutional needs are identi-
fied. VCU reductions are particularly challenging because VCU has the largest
percentage of Virginia resident students of all the doctoral institutions; therefore,
the largest percentage of the E&G budget from State taxpayer dollars. The
budget cuts for VCU mean:
• A $14-million reduction is roughly equivalent to:
- the combined budgets of the Schools of Education and Engi-
neering or the Schools of Nursing and Pharmacy
-
• 78% of the E&G budget is in salaries, wages and fringe benefits; re-
ductions and layoffs will be necessary to meet the reduction targets.
• 71% of the E&G budget is in instruction and academic support, and
11 % is in facilities operation and maintenance.
The planning process at the present time is:
• VCU distributed preliminary reduction targets on January 14, 2002; an-
ticipated that targets would exceed actual cuts to allow choices.
• Revised targets plus internal needs indicate the full amount may be re-
quired; further adjustments may be needed for institutional needs and
final actions of the General Assembly.
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• Reduction plans submitted to the State on February 7, 2002, based on
reduction plans developed as part of January 15, 2002, process.
• The President and Vice Presidents will review plans presented by the
Deans and make adjustments according to University mission and pri-
orities.
• A special Board meeting will be held in April to review budget and tui-
tion/fee recommendations.
• The Board will act on budget and tuition/fees in May.
VCU continues the movement toward the Tier 2 Goal. Budget reductions
will curtail the implementation of some of the strategies planned for reaching the
Tier 2 goal. New and innovative strategies will be developed and employed in all
areas measured by U.S. News & World Report. VCU goals are to:
• Increase academic reputation rating from 2.8 to 3.2
• Increase the proportion of full-time faculty members with a doctorate or
the highest degree in the field or specialty from 83% to 88%
• Increase the proportion of total faculty employed on a full-time basis
during the academic year from 82% to 90%
• Increase the percentage of first-year freshmen who return the following
fall from 74% to 84%
• Increase the percentage of first-time freshmen who graduate within six
years from 42% to 57%
• Increase average SAT scores of first-time freshmen from 1028 to
1100, and increase the 25th - 75th percentile ranges from 920-1130 to
1000-1200
• Increase the percentage of first-time freshmen who graduate in the top
10 percent of their high school class from 13% to 20%
• Increase the average spending per full-time equivalent student from
$18,039 to $23,000
• Increase the percentage of undergraduate alumni who donate money
from 12% to 17%
• Increase the graduation rate performance measure to students
from -6 to +5 (predicted versus actual rate comparison)
A final budget is not completed but VCU's first obligation is to VCU's resident
students. The Council of Presidents is highly focused on pursuing shared priori-
ties such as:
• Maximum flexibility in tuition increases
• Bond bill for capital projects
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• Maintenance reserve funding and financial aid
• Raising awareness among legislators of the impact of no salary in-
creases on recruitment and retention of faculty
• Raising awareness of the impact of declining financial resources on
reputation
VCU also needs to broaden the revenue base. Nonresident student tui-
tion - - VCU's out-of-state recruitment goals have been authorized by the General
Assembly. The nonresident initiative will generate significant resources for the
schools. Alternative revenue sources are research; increased endowments and
private giving; entrepreneurial activities; and clinical and university enterprise.
VCU will be seriously challenged but, the President remains committed to en-
suring that VCU is providing the best possible education for the students, pursing
the best possible funding alternatives to preserve VCU's excellence, and main-
taining the Tier 2 objectives.
Dr. Wootton reported for the Academic and Health Affairs Committee.
The Proposal to Rename the Department of Anatomy, School of Medicine was
presented. The name change has been initiated to more appropriately reflect the
teaching and research missions of the department which extend far beyond tra-
ditional anatomical studies. The Academic and Health Affairs Committee recommended to the full Board the approval to Rename the Department of Anat-
omy, School of Medicine, to the Department of Anatomy and Neurobiology,
School of Medicine.
The Proposal for the B.S. Degree in Financial Technology was presented.
The proposed program should provide national exposure for VCU, and is con-
sistent with VCU's goal to become ranked as a Tier 2 university. The program
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will attract students from the Commonwealth of Virginia as well as students from
around the country. Graduates will be in high demand in the technologically fo-
cused economy. The Academic and Health Affairs Policy Committee recom-
mended to the full Board the approval of the B.S. Degree in Financial Technol-
ogy.
The Proposal for the B.A. Degree in International Studies was presented.
The College of Humanities and Sciences at Virginia Commonwealth University
proposes that the Bachelor of Arts degree be offered in the International Studies
Program. The proposed expansion of the current interdisciplinary minor in Inter-
national Studies reflects continued and increasing collaboration among more
than a dozen academic units in the College of Humanities and Sciences, the
School of Business and the School of the Arts. The Academic and Health Affairs
Policy Committee recommended to the full Board the approval of the B.A. De-
gree in International Studies.
The School of Medicine Clinical Faculty Salary Plan (Revision to the
July 1, 1998, Plan) was presented. The revised Clinical Faculty Salary Plan,
while retaining the basic structure and components of the 1998 Salary Plan,
clarifies, defines and expands certain aspects of the Salary Plan including the
key factors that determine a faculty member's annual salary. The refinements
are summarized below. The revised Clinical Faculty Salary Plan:
• Expands and clarifies the definition of the Variable Salary Component
of Base Salary
• Defines a new component called the Annual Contract Salary
• Requires each department to use a nationally recognized Salary
Benchmark approved by the Dean
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• Clarifies and defines the linkage of the new salary determination crite-
ria in setting the Annual Base Salary
• Provides a mechanism to adjust faculty salaries to achieve budget
goals.
The revised Clinical Faculty Salary Plan will be effective July 1, 2002. The Academic and Health Affairs Policy Committee recommended to the full Board the
approval of the revisions to the School of Medicine Clinical Faculty Salary Plan.
Dr. Perkinson reported for the Advancement and External Relations
Committee. The Marketing and Media Relations Report was presented. Two
video news releases (VNR) were viewed. The first video highlighted the work of
Dr. Ron Merrell, Chief of Surgery; Dr. William Broaddus, Associate Professor in
VCU's School of Medicine; and Dr. Tony Guiseppe Eley, Professor in VCU's
School of Engineering. The VNR on Dr. Merrell was watched on Fox News in
Washington D.C. with a viewership of 1.5 million people. The next video was a
recruitment video to be used as a direct mail campaign that highlights VCU and
VCU's location. VCU has received marketing awards for the Life Sciences
Website and the printed admissions recruitment materials. The Federal, State,
Local and Community Relations report was presented for information.
Mr. Gresham reported for the Student Affairs Committee. An update on
the Housing Plan for the Fall 2002 was presented. On motion made and sec-
onded, the Student Affairs Committee recommended to the full Board that a five
year plan to address VCU's housing needs be prepared. An update on the
Center for Multicultural Activities was presented for information.
Mr. Markel reported for the Finance, Investment and Property Committee.
The Lease for 700 West Grace Street and 701 West Broad Street was pre-
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sented. The lease at 700 West Grace Street and 701 West Broad Street is for
approximately 27,862 square feet of office space and a 24-space surface parking
lot at 700 West Grace Street and 701 West Broad Street, respectively, for VCU.
The VCU Real Estate Foundation will acquire the property from the Metropolitan
Medical Office Partnership and lease the property to VCU. The Facilities Man-
agement Division will be the major University department to occupy the building.
The Division is currently located in six different buildings and the consolidation
into one location will enhance efficiency and services to the University commu-
nity. Additionally, the consolidation will allow for the demolition of one building
(824 Park Avenue), the elimination of three private leases (totaling approximately
$93,751 annually), and the availability of two University-owned buildings for other
uses (14,735 SF). VCU will lease the space for a five-year initial term, with two
five-year renewals after the initial term of the lease. The tenants will pay the cost
of fit-up as well as all operating and maintenance expenses. The Finance, In-
vestment and Property Committee recommended to the full Board the approval
of the Lease for 700 West Grace Street and 701 West Broad Street.
The Amendment to Master Deed of Lease and Sublease between Virginia
Commonwealth University and the Virginia Commonwealth University Health
System was presented. The Finance, Investment and Property Committee recommended the following resolution to the full Board for approval:
:
WHEREAS, the 1996 Session of the General Assembly of Virginia, with
the support of the Board of Visitors of Virginia Commonwealth University,
created the Medical College of Virginia Hospitals Authority (the "Authority")
as a political subdivision of the Commonwealth of Virginia; and
WHEREAS, in furtherance of the establishment of the Authority, the
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General Assembly empowered and authorized the Board of Visitors of
Virginia Commonwealth University to take certain actions, including the
transfer to the Authority of the assets and liabilities on the balance sheet
of the Medical College of Virginia Hospitals, formerly a division of the
Health Sciences Division of Virginia Commonwealth University; and of
hospital facilities, then or thereafter owned, leased, operated or used, in
whole or in part, by Virginia Commonwealth University as part of, or in
conjunction with, the Medical College of Virginia Hospitals in the normal
course of its operations as a teaching, research and medical treatment
facility, subject to the proviso that real property assets could be leased to
the Authority for a term not to exceed ninety-nine years upon such terms
as may be approved by the Board of Visitors of Virginia Commonwealth
University; and
WHEREAS, the Board of Visitors of Virginia Commonwealth University
subsequently authorized the execution of a Master Deed of Lease and
Sublease as between Virginia Commonwealth University and the
Authority, pursuant to which certain real property assets and hospital
facilities were classified as Long-Term Leased Premises that were leased
to the Authority for a period of ninety-nine years and other such facilities
were classified as Short-Term Leased Premises, that were leased for
renewable terms of five-years; and
WHEREAS, it subsequently has been determined that there exists a need
for the addition to the Master Deed of Lease and Sublease of a new
category of leased premises identified as Intermediate-Term Leased
Premises, pursuant to which certain real property assets could be leased
by Virginia Commonwealth University to the Authority for periods of times
spanning more than fifteen (15) years but less than ninety-nine (99) years;
and
WHEREAS, it also has been determined that other amendments to the
Master Deed of Lease and Sublease are now necessary and appropriate
to recognize certain changes in circumstances that have occurred since
the execution of the original Master Deed of Lease and Sublease,
including, but not limted to, the change of the Authority's name from the
Medical College of Virginia Hospitals Authority to the Virginia
Commonwealth University Health System Authority, as enacted by the
Virginia General Assembly during its 2000 Session, changes to recognize
the demolition and construction of certain facilities and other similar
changes; and
WHEREAS, the Board of Visitors of Virginia Commonwealth University
wishes to support and authorize the amendment of the aforementioned
Master Deed of Lease and Sublease as between the Virginia
Commonwealth University and the Authority in the aforementioned
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respects;
NOW, THEREFORE, BE IT RESOLVED by the Board of Visitors of
Virginia Commonwealth University that the Rector of the Board of
Visitors is authorized and empowered to execute, on behalf of Virginia
Commonwealth University, an appropriate amendment to the
aforementioned Master Deed of Lease and Sublease in substantially the
same form as the Attachment to this Resolution.
The Project Plans for the University Student Commons, Phase III were
presented. The third phase of construction of the University Student Commons
will consist of an approximately 35,000 GSF addition and 24,850 GSF of renova-
tions within the existing building. Increased student enrollment has necessitated
an expanded University Student Commons. Included in the new addition is a
multi-purpose ballroom with catering capabilities on the second level. The first
level of the addition primarily consists of departmental office suites for student
services. Renovations are planned for the existing food court and café, com-
muter lounge, multicultural center suite, and information center. The construction
budget is $6,750,000 with a total budget of $9,000,000. The Finance, Investment
and Property Committee recommended to the full Board the approval of the Proj-
ect Plans for the University Student Commons, Phase III.
The Project Plans for the Gladding Residence Center Addition were pre-
sented. The purpose of the project is to increase the amount of on-campus stu-
dent housing on the Academic Campus. The project adds approximately 53,700
gross square feet of dormitory space housing 172 beds in a mix of four-bedroom
and two-bedroom units. The construction budget is $6,000,000 with a total
budget of $7,768,000. The Finance, Investment and Property Committee rec-
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ommended to the full Board the approval of the Project Plans for the Gladding
Residence Center Addition.
On motion made and seconded, the following items on the Consent
Agenda were approved:
Board of Visitors
Minutes of a Meeting held November 8, 2001
Minutes of a Retreat held November 16, 2001
Minutes of a Retreat held November 17, 2001
Academic and Health Affairs Policy Committee
Minutes of a Meeting held November 7, 2001
Proposal to Rename the Department of Anatomy,
School of Medicine
Proposal for B.S. Degree in Financial Technology
Proposal for B.A. Degree in International Studies
School of Medicine Clinical Faculty Salary Plan (Revision to
the July 1, 1998, Plan)
Advancement and External Relations Committee
Minutes of a Meeting held November 7, 2001
Audit Committee
Minutes of a Meeting held November 7, 2001
Finance, Investment and Property Committee
Minutes of a Meeting held November 7, 2001
Lease for 700 West Grace Street and 701 West Broad Street
Amendment to Master Deed of Lease and Sublease between
VCU/VCUHS
Project Plans for the University Student Commons, Phase III
Project Plans for the Gladding Residence Center Addition
Student Affairs Committee
Minutes of a Meeting held November 7, 2001
On motion made and seconded, the Board accepted the Consent Agenda
Information items.
Mr. Flippen appointed the following members to serve on the Board Nomi-
nating Committee for Rector: Dr. Wootton, Mr. Flippen and Dr. Smith.
On motion made and seconded, the Board convened into closed session
to discuss certain personnel matters and matters relating to the performance o
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identifiable employees and faculty of VCU, including the Faculty Appointments
and Changes in Status and other Personnel Actions; and to discuss the perform-
ance of departments or schools of VCU where such matters regarding such indi-
viduals might be affected by such evaluations, including Audit Reports of indi-
vidually identified departments and/or schools; and to discuss legal matters and
probable litigation relating to the aforementioned Audit Reports, to discuss the
acquisition or use of real property for public purpose, or of the disposition of pub-
licly held property, or of plans for the future of a state institution of higher educa-
tion which could affect the value of property owned or desirable for ownership by
such institution, including the acquisition of property on or adjacent to the Academic Campus; and to consult with legal counsel pertaining to actual and prob-
able litigation, and other specific legal matters requiring the provision of legal ad-
vice by counsel, including the Report of the General Counsel; to discuss matters
relating to gifts, bequests, and fundraising activities, including the approval of the
Named Funds Report and Facility Naming Recommendations, and an update on
the development activities; and to discuss matters relating to honorary degrees
and special awards including the Report of the Student Affairs Committee as au-
thorized by Section 2.2-3711 A(1), A(3), A(7), A(8) and A(10) of the Virginia Free-
dom of Information Act.
Following closed 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 closed session
meeting to which this certification resolution applies, and (ii) only such public
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business matters as were identified in the motion convening the closed session
meeting were heard, discussed or considered by the Board of Visitors of Virginia
Commonwealth University.
Roll Call Vote Ayes Nays
Mr. Edward L. Flippen, Rector X
Mr. Ralph L. "Bill" Axselle, Jr. X
Mr. David G. Baldacci Absent
Mr. Timothy L. Gresham X
Dr. Stephen P. Long X
Mr. Steven A. Markel X
Ms. Laura R. McMichael X
Dr. W. Baxter Perkinson, Jr. X
Mrs. Anne P. Petera X
Mr. Monty W. Plymale X
Mr. Harold Y. Pyon Absent
Ms. E. Janet Riddick X
Mr. Robert E. Rigsby X
Mr. G. Bryan Slater Absent
Dr. Lindley T. Smith Absent
Dr. Percy Wootton X
Vote:
Ayes: 12
Nays: 0
ABSENT DURING MEETING: 4
ABSENT DURING VOTING: 4
On motion made and seconded, the Board accepted the Report of the
President; approved the Recommendations of the Student Affairs Committee for
the Board of Visitors Scholarship Award Selection; approved the Faculty Ap-
pointments and Changes in Status and other personnel actions; approved the
Named Funds Report and Facility Naming Recommendations; concurred with the
acquisition of property by the VCU Real Estate Foundation on or adjacent to the
Academic Campus; accepted the closed session Committee Reports; and ac-
cepted the Report of the General Counsel.
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The meeting was adjourned at 1 p.m.
.
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