The official minutes of the University of South Carolina Board of Trustees are maintained by the Secretary of the Board. Certified copies of minutes may be requested by contacting the Board of Trustees’ Office. Electronic or other copies of original minutes are not official Board of Trustees' documents.
Board of Trustees
February 13, 2003
The University of South Carolina Board of Trustees met on Thursday, February 13, 2003 at 1:40 p.m. in the Carolina Plaza Board Room.
Members present were: Mr. Mack I. Whittle, Jr., Board Chairman; Mr. Herbert C. Adams, Board Vice Chairman; Mr. Arthur S. Bahnmuller; Mr. James Bradley; Dr. C. Edward Floyd; Mr. Samuel R. Foster, II; Mrs. Helen C. Harvey; Mr. William C. Hubbard; Mr. John S. Long; Mr. Miles Loadholt; Mr. Robert N. McLellan; Ms. Darla D. Moore; Mr. James A. Shuford, III; Mr. M. Wayne Staton; Mr. John C. von Lehe, Jr.; and Mr. Othniel H. Wienges, Jr. Trustees absent were: Mr. Toney J. Lister and Mrs. Inez M. Tenenbaum. The faculty representative, Professor Robert Wilcox was present; the student representative, Mr. Ankit Patel, was absent.
Others present were: President Andrew A. Sorensen; Secretary Thomas L. Stepp; Executive Vice President for Academic Affairs and Provost Jerome D. Odom; Vice President and Chief Financial Officer Richard W. Kelly; Vice President for Information Technology and Chief Information Officer William F. Hogue; Vice President for Human Resources Jane M. Jameson; Vice President for Student and Alumni Services and Interim Vice President for Development Dennis A. Pruitt; General Counsel Walter (Terry) H. Parham; Vice Provost and Executive Dean for Regional Campuses and Continuing Education Chris P. Plyler; Chancellor of USC Aiken Thomas L. Hallman; Chancellor of USC Beaufort Jane T. Upshaw; Chancellor of USC Spartanburg John C. Stockwell; Dean of USC Lancaster John Catalano; Dean of USC Sumter C. Leslie Carpenter; Dean of USC Salkehatchie Ann Carmichael; Dean of USC Union James W. Edwards; Associate Chancellor for Business and Finance, USC Aiken, Virginia S. Steel; Associate Chancellor for Student Services, USC Aiken, Deborah Kladivko; Associate Chancellor of Planning and Construction, USC Beaufort, James E. Bass; Vice Chancellor for Business Affairs, USC Spartanburg, Robert Connelly; Dean of the College of Engineering and Information Technology Ralph E. White; Director of the Department of Athletics Michael B. McGee; Associate Athletics Director for Development, Department of Athletics, Brad Edwards; Director of Campus Planning and Construction and University Architect Charles G. Jeffcoat; Director of Planning Services, Campus Planning and Construction, Donna Collins; Director of Student Development and University Housing, Division of Student and Alumni Services, Gene Luna; Director of the Department of Internal Audit Alton McCoy; Director of the Budget Office William P. Bragdon; Director of Operations, USC Aiken, Anthony Ateca; President of University Housing Services, Inc. William H. Mills, Jr.; Executive Vice President of University Housing Services, Inc. Robert M. Mills; Brent Jeffcoat of Parker Poe Adams & Berstein, LLP; Executive Vice President of The Frazier Lanier Company Ashton Stuckey; Craig Davis, Mack Little, and John Lyn of Craig Davis Properties; CEO of TRELYS Larry Wilson; President of Edens & Avant John Lumpkin; University Legislative Liaison John Gregory; Chairman of the Lancaster Commission for Higher Education W.L. McDow; Lutheran Campus Pastor, Palm Campus Ministry, Robert H. Thompson; Director of the Office of Public Affairs Russell McKinney; and members of the media.
Chairman Whittle stated that notice of the meeting had been posted and the press notified as required by the Freedom of Information Act; the agenda and supporting materials had been circulated to the members; and a quorum was present to conduct business.
Chairman Whittle welcomed everyone and invited Board members to introduce themselves. Mr. McKinney introduced members of the media who were in attendance. At Chairman Whittle's invitation, Dr. Robert Thompson delivered the invocation.
Open Session
There were no additions, deletions, or corrections to the minutes; therefore, they stood approved as distributed.
At this time, Chairman Whittle reordered the agenda to facilitate the discussion of a proposed Research Campus; several individuals who were attending the meeting today were involved in the development of this University venture.
Chairman Whittle initially explained that during Mr. Hubbard's Board of Trustees chairmanship approximately 2½ years ago, Craig Davis from Raleigh, N.C., had been introduced to the Board of Trustees. Mr. Davis had been instrumental in the development of the Research Triangle or Centennial Campus at North Carolina State University. "We (the University of South Carolina) were intrigued. We listened, we visited, and we then formed a collaboration with the City of Columbia and with the business community in Columbia." Subsequently, these three entities had funded a $150,000 study to determine the feasibility of developing a Research Campus at the University. Today's report, therefore, represented the culmination of this joint effort and the results of that study. Chairman Whittle recognized President Sorensen to discuss the proposal for a Research Campus.
President Sorensen wholeheartedly acknowledged the many individuals who had contributed to this vision prior to his presidency. He sincerely hoped that his stewardship had adequately promoted the enthusiasm and the resources which had been dedicated to this project.
Craig Davis & Associates had been engaged to assess the University's research-related growth plans and initiatives, to recommend organizational focus and direction, and to assist with financial structure for growth.
President Sorensen addressed the critical situation which all higher education institutions in the state were facing:
Our state appropriations continue to decline. The announcements since I have become president is a total decrease of $41 million in the University of South Carolina System budget, the most recent of which was another $7.8 million cut. We went from a little bit more than $33 million two weeks ago to an announcement on Tuesday of another $7.8 million. We now have our budget down by $41 million.
This is occurring as the cost of operating the University increases. We have fixed costs over which we have absolutely no control -- costs for utilities, costs for use of telephone, xeroxing, postage. In addition, there is the expectation of our students and our faculty that we will provide more adequate resources for them; that our software will be upgraded regularly; that the computer hardware will be upgraded regularly; that the time it takes from the time one enters something into a computer to the turnaround will be less than it was previously; that the quality of the service will improve; that our residence halls will have accommodations that are more luxurious than the so called ‘gang showers' of sharing one bathroom for 10 or 12 students that many of us grew up with when we were undergraduate students.
This rising set of expectations and rising fixed costs means that the slope representing the cost of operation is going up. Revenues are going down. We can't continue on that path without facing extinction or enormous reduction in the scope of our activities. The recourse is to seek and secure funds externally. And, so, I am very excited about the possibility of developing the research campus.
We are going to form collaborative agreements with the City of Columbia, other local governments, and the private sector to outline and implement what was agreed to before I came here as a 20-year roadmap and plan. I would like that to be a 10-year roadmap and plan.
There are four groups that are absolutely essential to this plan. We cannot accomplish it without each of the four entities. First of all, the University of South Carolina - we need to persuade all of our faculty and staff that this is a desirable goal and secure their support for it. Secondly, there are three governmental entities, especially, that are critical - the City of Columbia, Richland County and Lexington County, as well as other local entities. Third, the private sector - we need a huge infusion of capital from the private sector. And, fourth, the General Assembly. I emphasize the General Assembly because it is important that we work closely with the South Carolina State Legislature and the Office of the Governor on all of these issues.
We are outlining a program to create facility densification on property owned by the University of South Carolina and the five foundations, and also review operational entities which will support controlled growth and use of existing assets. I believe that in order to do that, we are going to need to support the creation of a 501C3 corporation, a not-for-profit entity to coordinate the City of Columbia, Richland County, Lexington County, the State of South Carolina, and the private sector to achieve the desired results. This entity will lead a continuous effort to communicate effectively the roles, goals, objectives, and status reports with all the participating parties.
I have been cast in the role of the catalyst to help bring these groups together, to give a series of speeches talking about this proposal. It is clear that, although I can continue to do that, we need an entity which will be focused exclusively on this project pending your approval. We need to have very strong communications with and in support of the State of South Carolina Legislature and the Office of the Governor as it evolves.
As we think about the future of the University of South Carolina, it is very important that we keep our eye on the larger picture. It is important that we deal with the larger picture of our research plan, our objectives as an institution, and thus I am excited to present to you for your approval this research campus proposal. It is with great pleasure that I introduce Craig Davis to you.
Mr. Davis initially thanked those individuals involved in the venture who were attending the meeting today. He stressed the fact that this plan would require daily attention because the strategies of the various initiatives were critical to the creation of the facilities.
Mr. Davis stated that this project "does not deal with geography, does not deal with real estate, does not deal with the types of things that you are normally dealing with when you talk about facilities management or site plans. What you are really trying to do is to change your paradigm to an operation." During the development of the North Carolina research campus, it had been determined that partners wishing to collaborate with the university needed facilities which were located within close proximity of the "major magnets," or the students, professors, and scholars.
Mr. Davis commented that the University had available a unique opportunity because of the geography of the city and the location of the institution to put into place a "densification practice" which would utilize existing assets and "take this into another realm." His initial feasibility study had determined that the University had "much more capacity here in land that you already own than you think you have." Mr. Davis further commented that the transportation systems and infrastructure were well-developed; the close proximity of the campus to downtown Columbia was also a critical factor. "Your foundation is very strong for you to take it to the next level."
Mr. Davis briefly reviewed the benchmark statistics of the University's space needs as compared to North Carolina State University's Centennial Campus. He commented that the University's urban setting facilitated the development of a research campus. "You are already right in the middle of everything."
An architectural rendering of the proposed renovation plans for The Norman J. Arnold School of Public Health was displayed. Mr. Davis explained that this project represented an example of facility densification; he suggested that other University-owned facilities could be efficiently renovated.
During the upcoming Joint Boards Retreat scheduled for February 27-March 1, Mr. Davis will discuss University research operational facility needs and financial structure; will outline elevations and site plans for potential projects; will discuss required legislative support; and will present a timetable for implementation.
Mr. Davis also shared a capital issue which will require attention.
One of the things that legislative initiatives have done is to provide an incentive to start. But the private capital will get you there. Interestingly enough, when you look at the benchmark of what we have done at the NC State's Centennial Campus, the campus sat dormant for about 7 years. It did not have any outside capital/private partnerships to come into the game. In 3½ years that ratio went from 100 percent NC State and 0 percent private sector to $185 million NC State and $180 million private sector.
You have to have funding through legislative initiatives; you have to back it; you have to work it daily and there will be nuances that you will have to deal with on a daily basis which will require modification. You need a plan in place with a leader or ‘point guard' and then you have to get behind each other and work it.
I have been very impressed with the collaborative agreements here. That will be your limiting factor if it falls apart. With the President's leadership and a ‘can do' attitude, you have the infrastructure to really make this place very special.
Mr. Bradley asked whether members of the 501C3 tax exempt organization would include the political and business leaders of the state. President Sorensen responded that the four groups he referenced earlier -- University, local governmental entities, business/private sector, and the General Assembly -- must be represented to ensure the successful realization of this vision.
Chairman Whittle called for a motion to authorize and direct President Sorensen to continue to pursue the concepts for the University's research campus as described in his presentation. Mr. Bradley so moved, and Mr. Adams seconded the motion. The vote was taken, and the motion carried.
The Ad Hoc Committee on Advancement had met earlier today and discussed the following items:
The Intercollegiate Activities Committee had met earlier today and had heard a report from the Athletics Director. In addition to providing the Committee with an update on the status of football recruiting, he had reported on the standings of academics for various sports from the Fall semester.
Dr. McGee had also presented a report on the fund-raising activities for the fitness facility under the South End Zone of Williams-Brice Stadium. The progress to date was significant.
With respect to the new Carolina Center, Dr. McGee had reported on activities in the building to date as well as on the status of the budget of the Center compared to its pro forma and continuing progress in selling suites and other revenue activities.
Dr. McGee had reported on the status of the Athletics Department's budget for 2002-2003.
The Buildings and Grounds Committee had met earlier today and had approved the following items which required consideration by the Board today:
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved approval to increase the project budget by $429,741 and adjust the funding as presented. This increase will result in a total project budget of $49,253,741. Mr. Hubbard seconded the motion. The vote was taken, and the motion carried.
Mr. Loadholt explained that the Committee had approved this requested increase because of an existing obligation between the University and the architect; however, in the future the Board will strictly scrutinize any cost overruns.
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved approval to increase the budget for this project by $1.9 million to fully fund the project as designed and bid. This increase will be funded with Housing Revenue bonds and will result in a total project budget of $30.9 million as described in the materials distributed for this meeting. Mr. Bahnmuller seconded the motion. The vote was taken, and the motion carried.
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved approval to establish a project to replace all fire alarm systems on the V. A. Campus of the School of Medicine with a budget of $385,000 funded with School of Medicine Institutional Capital Project Funds (ICPF) as presented. Dr. Floyd seconded the motion. The vote was taken, and the motion carried.
The site selected for development was adjacent to the University's existing apartments and northwest of the current Soccer/Softball Complex. The project would include a 108,000 square foot, three-story residence hall with approximately 75 units accommodating four students each. A large common area would be available on each floor to support community activities. Also included in the project were Housing offices, a laundry facility, recreation areas, landscaping, pedestrian walkways and 300 parking spaces. The exterior building design and structural features would be consistent with existing buildings on campus. The total estimated cost of the project was $12.3 million.
The project would be financed and owned by an independent tax-exempt Housing Foundation (501c3). Members would include the USCA Chancellor, Associate Chancellor for Business and Finance, and the executive committee of the Aiken County Commission for Higher Education. To develop the project, the Foundation would enter into a long-term ground lease with the ACCHE and would secure tax-exempt bonds through a non-recourse financing vehicle. The property would be managed by USC Aiken and ownership of the residence hall would revert to the ACCHE upon satisfaction of the debt.
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved approval to establish a project for the development of USC Aiken campus housing by an independent Housing Foundation (501c3) on behalf of USC Aiken, authorized through an agreement between the aforementioned Foundation and the Aiken County Commission for Higher Education as described in the materials distributed for this meeting. Mrs. Harvey seconded the motion. The vote was taken, and the motion carried.
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved approval to accept the transfer of 49.078 acres in Beaufort/Jasper Counties from the USC Development Foundation to the University of South Carolina as presented. Mrs. Harvey seconded the motion. The vote was taken, and the motion carried.
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved approval to establish a project to renovate the USC Spartanburg Building #976 for use by the Arts Education Department of the College of Arts and Sciences' Fine Arts Division with a budget of $350,000 to be funded with USC Spartanburg Renovation Reserve Funds as described in the materials distributed for this meeting. Ms. Moore seconded the motion. The vote was taken, and the motion carried.
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved approval to establish a project for a 25,000 to 30,000 square foot addition to the USC Spartanburg Campus Life Center and renovation of approximately 15,000 square feet of existing space with a budget of $5.5 million funded with $5 million in Revenue Bonds and $500,000 in USC Spartanburg Institutional Capital Project Funds (ICPF) as described in the materials distributed for this meeting. Mr. Shuford seconded the motion. The vote was taken, and the motion carried.
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved approval to increase the budget for this project by $29,000 funded from USC Spartanburg ICPF. This increase will result in a total project budget of $419,000 funded with $390,000 in USC Spartanburg Institution Bonds and $29,000 in USC Spartanburg Institutional Capital Project Funds (ICPF) as described in the materials distributed for this meeting. Mr. Staton seconded the motion. The vote was taken, and the motion carried.
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved approval to increase the budget for this project by $132,000 to complete additional deferred maintenance funded with $130,000 in USC Spartanburg ICPF and $2,000 in USC Spartanburg Institution Bonds. This increase will result in a total project budget of $481,000 funded with $130,000 in USC Spartanburg ICPF and $351,000 in USC Spartanburg Institution Bond as described in the materials distributed for this meeting. Mr. von Lehe seconded the motion. The vote was taken, and the motion carried.
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved approval of the 2003 Comprehensive Permanent Improvement Plan as described in the materials distributed for the meeting. Mr. Wienges seconded the motion. The vote was taken, and the motion carried.
President Sorensen addressed University budget concerns as impacted by the State Legislature. He will seek the assistance of Board members in moving various University initiatives forward within this arena "as we attempt to deal with some assaults on proposals that we have endorsed." He referenced the Centers for Excellence proposal commenting that many of the Board members had worked very hard to secure the support of the Legislature to dedicate $30 million of lottery funds toward this effort. President Sorensen emphasized that this money was essential to the success of the research campus proposal.
At this time President Sorensen recognized Trustee Moore who had been involved in the process of exploring the possibility of the University joining forces with Clemson University and the Medical University of South Carolina to withdraw from the Commission on Higher Education and to develop a mechanism with fewer bureaucratic impediments.
Trustee Moore explained that the removal of the three research universities from the CHE was "a work in progress." Legislation had been drafted and meetings with the leadership of the House of Representatives, Senate, and Governor's representatives had been conducted. "We are now in the process of getting this issue to mature." An executive committee comprised of the respective Board chairmen from the three schools had been formed; a meeting of this committee was planned for the following day. The committee will communicate its decisions to the various lobbying groups regarding details of the legislation.
Within the past 48 hours, President Sorensen had tendered an offer for the University position of Vice President for Advancement as well as an offer for the position of Dean of the Law School. He hoped to announce in the near future that these vacancies had been filled.
And, finally, President Sorensen assured the Board that, although recent newspaper articles had referenced his discussions with Mayor Coble regarding a baseball stadium, no proposal had been submitted and no budget had been presented. "I absolutely guarantee you that, if I get a proposal, you will be the first group that will hear about it."
The annual Alumni Association meeting was scheduled for March 8 with President Sorensen as the keynote speaker; Mr. Shuford encouraged everyone to attend.
The Alumni Association had initiated a program with Traveler's Insurance to extend home and auto insurance benefits to members, a service which was also available to University faculty and staff.
And, finally, the Alumni Association had established a campaign committee for the Alumni Center project. Mr. Shuford explained that this proposed project involved the construction of a new Alumni Center adjacent to the Greek Village.
Mr. Hubbard reminded those individuals who were engaged in the land use planning effort in this area that the original concept of the Thurmond Wellness and Fitness Center (across from the Greek Village) had included several other playing fields; however, the configuration of the railroad tracks had prohibited their construction. Therefore, additional outdoor recreation space should be considered as the development of the surrounding property moved forward.
The following persons were invited to remain: Dr. Sorensen, Mr. Stepp, Dr. Odom, Mr. Kelly, Ms. Jameson, Dr. Pruitt, Dr. Plyler, Mr. Parham, Mr. Gregory, Mr. McKinney, Ms. Tweedy, and Ms. Stone.
Executive Session
Return to Open Session
Mr. Parham stated that the term of the agreement would begin February 13, 2003 (pending Board approval) and would extend until June 30, 2006. The permitted uses of the Coliseum were consistent with those uses described in the existing agreement between the University and the Columbia Inferno Hockey Team. In essence, the only agreement changes were utility costs which the University would pay excluding a $200 per hockey game charge and those utility costs associated with the ice rink compressor. In addition, the agreement stipulated that the City of Columbia will receive up to $50,000 of net parking revenue and net concessions revenue generated from hockey or public skating events at the Carolina Coliseum.
Chairman Whittle called for a motion to approve the lease agreement with the City of Columbia for the Carolina Coliseum to facilitate the use of the arena portion of the building for hockey and public skating as described in the materials distributed for this meeting. Mr. Bradley so moved, and Mr. Staton seconded the motion. The vote was taken, and the motion carried. Mr. Adams cast his vote as "no."
Respectfully submitted,
Thomas L. Stepp
Secretary