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.

The Executive Committee of the University of South Carolina Board of Trustees met on Monday, December 15, 2003, at 9:05 a.m. in the Carolina Plaza Board Room.

Members present were: Mr. Mack I. Whittle, Jr., Chairman; Mr. Herbert C. Adams; Mr. James Bradley; Dr. C. Edward Floyd; Mr. William C. Hubbard; and Mr. Michael J. Mungo. Other Trustees present were: Mr. Arthur S. Bahnmuller; Mr. Mark W. Buyck, Jr.; Mrs. Helen C. Harvey; Mr. Toney J. Lister; Mr. Miles Loadholt; Mr. Robert N. McLellan; Mr. James A. Shuford, III; Mr. John C. von Lehe, Jr.; Mr. Eugene P. Warr, Jr.; and Mr. Othniel H. Wienges, Jr.

Others present were: President Andrew A. Sorensen; Secretary Thomas L. Stepp; Vice President for Academic Affairs and Provost Jerome D. Odom; Vice President and Chief Financial Officer Richard W. Kelly; Vice President for Research and Health Sciences Harris Pastides; Vice President for Information Technology and Chief Information Officer William F. Hogue; Vice President for University Advancement T.W. Hudson Akin; Vice President for Human Resources Jane M. Jameson; Vice President for Student Affairs 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; Assistant to the Vice President, Office of Business and Finance, Ken Corbett; Assistant Treasurer Susan D. Hanna; Director of Publications and Printing, Office of Public Affairs, Laurence W. Pearce; Director of Printing Services Don Pruitt; Bond Counsel Margaret C. Pope and B. Eric Shytle from Haynesworth Sinkler Boyd PA; Financial Advisor with A.G. Edwards & Sons, Inc. Dianne McNabb; Public Information Officer, Office of Media Relations, Karen Petit; Director of the Office of Public Affairs Russell McKinney, Jr.; and members of the media.

Chairman Whittle called the meeting to order and invited Board members to introduce themselves. Mr. McKinney introduced members of the media who were in attendance. 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 members of the Committee; and a quorum was present to conduct business.

There were personnel matters, a contractual matter, and receipt of legal advice which were appropriate for discussion in Executive Session. Chairman Whittle called for a motion to enter Executive Session. Mr. Bradley so moved, and Dr. Floyd seconded the motion. The vote was taken, and the motion carried.

The following persons were invited to remain: Dr. Sorensen, Mr. Stepp, Dr. Odom, Mr. Kelly, Mr. Akin, Dr. Hogue, Ms. Jameson, Dr. Pruitt, Dr. Plyler, Mr. Parham, Mr. McKinney, Ms. Tweedy, and Ms. Stone.

Return to Open Session

1. Contracts Valued in Excess of $250,000:
   1. South Carolina Electric and Gas Company (Old Bell South) Electric Service: Chairman Whittle recognized Mr. Parham who explained that this contract addressed the provision of electric services to the building located at 1600 Hampton Street. Under this agreement, SCE&G will provide power to the building at the "state rate," which was approximately 38 percent lower than the standard rate. Mr. Parham explained that this building qualified for the lesser charge because of the amount of power it used and because it was within 5 miles of the state capitol. It was estimated that the University would pay approximately $23,000 per month ($276,000 annually) to cover the cost of electricity at 1600 Hampton Street. The term of the contract spanned 5 years with automatic extensions for additional periods unless either party submitted an appropriate notice to terminate the agreement.
      
      Mr. Bradley moved approval of the South Carolina Electric and Gas Company (Old Bell South) Electric Service contract as described in the materials distributed for this meeting. Dr. Floyd seconded the motion. The vote was taken, and the motion carried.
      
      
   2. South Carolina Electric and Gas Company Service for Colonial Center: Mr. Parham stated that this contract addressed the provision of electric services to the Colonial Center. Under the agreement, SCE&G will provide power to the building at the "state rate" as mentioned above. In addition to these charges, the University will pay $2,873.50 per month to reimburse SCE&G for expenses incurred while installing two additional transformers with "excess transformer capacity" (in case the primary transformers failed) at the arena as the University had requested. It was estimated that the University would pay approximately $30,000 per month for electricity and the equipment costs as described above ($360,000 annually); Mr. Parham explained that the Athletics Department will pay these costs. The term of the contract covered a five-year period and will be extended automatically for additional terms unless either party submitted a notice of termination.
      
      Mr. Bradley moved approval of the South Carolina Electric and Gas Company Service for the Colonial Center as described in the materials distributed for this meeting. Mr. Hubbard seconded the motion. The vote was taken, and the motion carried.
      
      
   3. Xerox Corporation: Mr. Parham explained that Printing Services was seeking Executive Committee approval to lease a Xerox Docucolor 5252 Digital Printing System which included two digital copier printers, software, and training. This system will replace the existing Xerox printer located in the main Print Shop and an additional printer located in the Russell House. The term of the lease covered five years; the University will pay a monthly rental fee of $3,931.20 ($47,174.64 annually) and a maintenance fee of $2,235.80 for 54 months. It was estimated that approximately $20,000 of additional charges would be incurred during the term of the contract as a result of exceeding the minimum amount of copies per month. The total amount of the contract was estimated to cost the University $377,391.
      
      Printing Services believed that the advantages of this new system were several: (1) 50 percent increase in speed; (2) larger paper capacity; (3) enhanced print quality; (4) an estimated savings of $43,729 during the five year period as determined by the differential between the current vs. the new lease values.
      And, finally, Mr. Parham pointed out that because of the size of the contract, this request had required State Budget and Control Board approval which it had given.
      
      Mr. Hubbard moved approval of the Xerox Corporation contract as presented. Mr. Mungo seconded the motion. The vote was taken, and the motion carried.
      
      
2. Stadium Athletic BANs Resolution: Chairman Whittle called on Mr. Kelly who was presenting for Executive Committee approval a resolution to reissue the Stadium Athletic BANs.
   
   Mr. Kelly explained that currently the University had three debts associated with the Athletics Department: (1) a long-term bond for $21 million; (2) the Stadium Athletic BANs; and, (3) the Arena Athletic BANs. When the original BANs were issued, the University committed to an eight-year payment schedule (as delineated in the Board minutes) for defeasance of those BANs. Therefore, this resolution represented another step toward that goal as originally approved by the Board of Trustees in 2001. It was estimated that the current debt after the reissue of these bonds would total $32,270,000.
   
   Therefore, Mr. Kelly was requesting approval to issue bonds not to exceed $8,085,000 for the stadium; in actuality, it was projected that the bond would be issued for $6,330,000. However, because the debt totaled $8,085,000, it was necessary to have in place the language which would allow the University to issue enough debt to complete the defeasance of the BANs. It was anticipated that the University would pay $1,900,000 toward the reduction of this debt.
   Mr. Mungo expressed concern about reissuing bonds for the same amount as one year ago; he asked for assurance that no more than $6,385,000 of bonds be issued and that the amount of $1,700,000 be applied toward debt reduction. The language of the resolution did not clearly specify those intentions.
   
   Mr. Kelly noted that the defeasance schedule had been included as part of the Board of Trustees' minutes when the bonds were issued in 2001. He assured Mr. Mungo that the Athletics Department would pay the debt in accordance with the schedule which the Board had approved at that time. For that not to happen would require another Board action; Secretary Stepp concurred with Mr. Kelly's interpretation.
   
   In response to Mr. Bradley's inquiry about a projected interest rate, Mr. Kelly indicated that the rate had been 1.2 percent during the previous week.
   Mr. Mungo asked that bond counsel formulate a more readable and understandable document in the future.
   
   Mr. Bradley moved approval of the Stadium Athletic BANs as presented. Mr. Mungo seconded the motion with the assurance that $1,700,000 would be applied toward debt reduction and that the bond reissue would not exceed $6,385,000. The vote was taken, and the motion carried.
   
   
3. Arena Athletic BANs Resolution: Mr. Kelly presented for Executive Committee consideration a resolution for the issue of the BANs for the arena not to exceed $1,006,140.
   
   Mr. Bradley moved approval of the Arena Athletic BANs Resolution as described in the materials distributed for this meeting. Mr. Hubbard seconded the motion. The vote was taken, and the motion carried.
   
   
4. MUSC Resolution: Chairman Whittle read the following resolution for Executive Committee consideration:
   In light of the intention of the Medical University of South Carolina and this University to integrate pharmacy education in this State, this Board, in coordination with the Board of the Medical University of South Carolina, authorizes the President immediately to begin a search process to select a dean of pharmacy education for the State of South Carolina in a mutual effort with the President of the Medical University of South Carolina.
   
   Mr. Hubbard moved approval of the motion as read. Mr. Adams seconded the motion. The vote was taken, and the motion carried.
   
   
5. Sanctioning of Creation of New Foundation: Chairman Whittle called on Mr. Parham who was presenting for Executive Committee approval a proposed resolution to create a single purpose support foundation for the University. The foundation will be named "The University of South Carolina Research Campus Foundation" and will assist with the creation of the research campus at USC Columbia.
   
   Mr. Parham read the following two final paragraphs of the proposed resolution with the addition of a proposed amendment as discussed in Executive Session:
   

   RESOLVED, FURTHER, that the President of the University and/or his designee(s) shall be, and hereby are, authorized to file Articles of Incorporation of the Foundation; (ii) to obtain determination(s) in connection with the federal income tax status of the Foundation; and (iii) to obtain such other determinations, rulings and opinions as may be necessary and in the best interests of the University in connection with the establishment of the Foundation.

RESOLVED, FURTHER, that the President of the University shall be, and hereby is authorized to take such steps as may be necessary and in the best interests of the University in connection with the operations of the Foundation, provided, however, the Board of Directors of the Foundation shall consist of seven members, one of whom shall be appointed by and from, and shall serve at the pleasure of, the Board of Trustees of the University. The remaining six members shall be approved by the Board of Trustees of the University, upon the recommendation of the President of the University, to serve staggered three-year terms.

Chairman Whittle asked that Mr. Parham include a description of the process to appoint the six members of the Research Campus Foundation. Secretary Stepp assured the Board that the minutes of this meeting would adequately define the process.

Chairman Whittle reiterated the process for clarification: the Board of Trustees and the President will submit names; from that pool, the President will present six names for final Board approval. In addition, one member from the Board will be appointed to the Research Campus Foundation Board.
Mr. Hubbard moved the adoption of the resolution in principle with the modifications Chairman Whittle stated. Mr. Bradley seconded the motion. The vote was taken, and the motion carried.

Since there were no other matters to come before the Committee, Chairman Whittle declared the meeting adjourned at 9:50 a.m.

Respectfully submitted,
Thomas L. Stepp
Secretary