Minutes of the University Senate Meeting January 9, 2008
Present: C. Bengston, G. Berk, P. Boye, H. Briston, C. Cherry, M. Chong*, R. Davies, D. Falk, P. Gilkey, A. Gladhart, N. Gulley, E. Herman, D. Hernandez, J, Hunter*, K. Kennedy, P. Lambert, D. Levin, P. Lu, B. Malle, A. Mathas, L. Middlebrook, T. Minner, J. Newton, M. Pangburn, A. Papailiou, C. Parsons, S. Paul, E. Peterson, F. Pyle, M. Redford, J. Rowell, G. Sayre, A. Schulz ,L. Stephen, A. Taylor, T. Toadvine, N. Tublitz, P. van Donkelaar, L. Vandenburgh. *denotes non-voting participant
Excused: R. Illig, D. Olson, N. Rajabzadeh
Absent: C.A. Bassett, R. Bramhall, L-S. Chou, A. Coles-Bjerre, C. Martinez*, C. Moore, P. Rounds
CALL TO ORDER
The regular meeting of the University Senate was called to order at 3:05 p.m. in room 150 Columbia. Before starting into the agenda, Senate President Gordon Sayre commented that he had received a denial of his request to PEBB to make available to faculty a professional liability insurance policy as was discussed during a senate meeting fall term. Expressing his disappointment in PEBB’s response, he encouraged faculty members to consider looking into their own personal professional liability insurance as they deemed appropriate. Additionally, Senator Peter Gilkey, mathematics, commented that he would not be bringing motionUS07/08-9 to the floor until the February senate meeting as he received a memo from General Counsel Grier that a ruling regarding the motion was anticipated from the Department of Justice in the next several weeks (see http://www.uoregon.edu/~uosenate/dirsen078/MelindaGrier9Jan08.pdf). President Sayre reminded the senators of the special senate meeting on the arena project scheduled for January 23, 2008 in room 150 Columbia from 3:00 to 5:00 p.m. He indicated that any motions or other agenda items for the special senate meeting must be received by January 11, 2008.
APPROVAL OF THE MINUTES
Minutes from the November 14th and 28th 2007 regular senate meetings were approved as distributed.
STATE OF THE UNIVERSITY
Remarks from University President Dave Frohnmayer. The president began his remarks acknowledging two losses to the academic community – one person killed in a recent automobile accident, and another still missing. He then commented that he had shared highlights of his concerns in his January letter to the campus community (see http://www.uoregon.edu/~assembly/dirFrohnmayer/FrohnmayerW08.html).
President Frohnmayer remarked that he was gratified to acknowledge an upcoming television special on NOVA concerning Absolute Zero for which Professor Emeritus Russell Donnelly was a key contributor. Similarly, he noted Professor Garrett Epps received an Oregon book award for his recent book concerning the passage of 14th Amendment and its impact on USA society, and that creative writing professor Ehud Havazelet authored a book named by the New York Times as one of the most notable 100 books of 2007. Further, the president noted that Campaign Oregon will officially close in December having raised more than $740 million, the largest campaign in private philanthropy in history of the state of Oregon.
Concerning issues before the state board, the president mentioned several items, in particular, governance in the university system, higher education in Portland, and consolidating tuition and fees to a single fee. The governance issued was prompted by the UO’s recent report to the board commenting on how far state support has fallen for the state’s only AAU institution – we have lower support than any other AAU institution or OUS institution. The president noted that there is a task force looking at higher education in Portland, which may generate legislative proposals down the line, as the UO proceeds with its own development of a presence in the White Stag building in Portland
Another concern is the creation of sticker shock that may act to the detriment of our students if we consolidate all tuition and fees into a single fee. The board has extended the time frame, for us to move to variable tuition or higher tuition, until 2011. The UO will have issues to face in the future, for example, should we charge a variable tuition, how would it impact the UO, and what would be the academic consequences.
The president next turned his attention to plans for building on campus. He noted that he has received the first round of suggestions from the faculty and staff concerning building proposals. He remarked that an enormous number of very pointed and valuable suggestions were made, and thanked everyone who participated in the process. Moving to the basketball arena project, the president thanked the hard working members of the Senate Budget Committee’s sub committee on the financing of the proposed arena. He referred to the sub-committee’s recently released report, saying that although he has only had 24 hours to examine the report’s recommendations since its release, two concepts of the recommendations already have his full support. The first is that there should be adequate transparency in the athletics department’s financial situation delivered at regular intervals. Saying that information should be easily accessible to the IAC, FAC, Senate Budget Committee and others who wish to review it, the president pledged to take whatever steps necessary to make sure that would be the case.
Second, in accordance with another recommendation, the president said that the athletics department will be responsible for debt service to the bonds. The president pledged that academic funds will not be used for the debt service, and that the athletics department would not be released from being fully self-supporting. In addition to his own assurances, the president said that the State Board of Higher Education limits the payment of debt service to the sources that are approved in the project description, and in this project, athletics department revenues are the source for the repayments. The way the law operates, other auxiliary funds would have to be used before any academic funds could be used; in essence, there are two firewalls in the financing process. The president noted that he will fully review the other recommendations in the report, which he takes very seriously, before making further statements at this time. However, the president did make one last point regarding parking issues, saying that they need to be taken into consideration with the university as a whole, and noted that the administration has been in touch with city officials on a regular basis about parking and an internal group has been working diligently on parking issues that will be the subject of other reports.
Annual Report from Athletics Director Pat Kilkenny. Athletics Director Kilkenny echoed sentiments regarding the diligent work that resulted in the report released by the sub committee on financing the arena. He noted that he will spend more time discussing the report during the special senate meeting scheduled for January 23rd. He then turned his attention to highlighting some broader comments regarding the athletics department during the past year (see http://www.uoregon.edu/~uosenate/dirsen078/Kilkenny9Jan08.html for full text). Director Kilkenny commented that the athletics department sees itself as a window to the institution and has initiated a number of efforts to utilize athletic events and media coverage to recognize faculty excellence and programs of regional and national significance. He remarked that the department is dedicated to the principles of equality, opportunity, and freedom from discrimination; athletics is one of the most diverse departments within the university and play a significant role in attracting minority students to the campus. He assured everyone that athletes are students first, and like all other parts of the university the goal is to ensure the students receive the best possible experience academically as well as athletically. The department’s goal is to graduate as many student-athletes as possible. He noted that many student athletes serve as positive role models on campus and in the community. The director added that the athletics department must be fiscally responsible, passing from a self-supporting department to a self-sustaining one, which can only be achieved with the cooperation and support of the entire university community.
Regarding issues of student athlete welfare, Mr. Kilkenny commented that the department is making a concerted effort to coordinate such areas, which includes the construction of a new academic learning center. He noted that there were no major NCAA violations to report, although the department was still on probation for signing violations that occurred in 2003. Concerning program and facility expansion, Mr. Kilkenny reported the intent is to terminate the wrestling program and replace it with baseball (for men) and competitive cheer (for women). The new baseball staff is in place with students arriving in fall 2008, and staff for the competitive cheer team will be in place this spring. He noted, too, that money to support the operation and facilities for baseball and competitive cheer comes from donations to the department for these activities. The baseball facility is moving closer to resolution and, again, it will be paid for with new donations.
On other topics, the director said that university athletic events continue to have significant impact on the local economy. He cited the upcoming Olympic track and field trials, football games, basketball games, and the recent men’s cross country championship as examples. Of significance, too, is that all five men’s basketball seniors have complete degree requirements; of 17 senior football players, seven have graduated, six more will graduate by winter and the rest by end of academic year. A number of student athletes were named to All- PAC-10 teams and others were selected as academic all Americans. Some of the UO athletes have received or been nominated for the most prestigious awards in college athletics.
Mr. Kilkenny then spoke about the financial situation of the department. Total revenue for the budget year 2007-08 is approximately $47 million. The breakdown is approximately 70% from football, 15% from men’s basketball, 6% from other sports, and the rest from non-sport specific sources. From an expense perspective, football expenses are $13.5 million, $3.1 million for basketball, other sports are $12.6 million dollars and non-sport specific is $17 million, which is primarily the administrative body along with all of the facilities. Mr. Kilkenny said that the expected Legacy Fund gift of $100 million and the expected revenues from the new basketball arena are needed to provide long-term stability for the program. Currently, revenues less expenditures yield a net of about $200,000 after all the bills are paid, so the financial situation is fragile. There are no reserves at this time, and no substantial reserves are anticipated until the Legacy Fund is in place, fully funded, and functioning as intended, as well as the additional revenue the new arena can provide.
The director concluded his part of the report and turned to Mr. Dave Sparks, a UO Foundation Trustee and a retired CPA, who provided further financial information. Mr. Sparks provided a simple chart that demonstrated where the athletics department is now financially, and where it is going. Stated in millions of dollars, Mr. Sparks said the gross revenue for FY 2007 was $48, and the department is asking to borrow $200 for the new arena, paid back in revenues from the arena. The Legacy Fund gift is $100; by Mr. Sparks’ estimates and those of the consulting company (CLS), and by investing the Legacy Fund wisely, the department would have between $6 and $18 million in reserves after five years.
Report from the Senate Budget Committee (SBC). Senate Budget Committee Chairwoman Marie Vitulli, mathematics, spoke briefly about three main issues before the budget committee: the new budget model, faculty salaries, and the arena project. The committee expressed some concerns about the new budget model and will be receiving revised versions in meetings to come, so the committee was not prepared at this time to give a report or opinion on the new model.
Moving to faculty salary issues, Ms. Vitulli reported that the budget committee was waiting for data from central administration to do an analysis, and hopes to work with the provost on a renewed look at the White Paper on salaries written in 2000 in order to refocus and update goals of the paper. She noted that many faculty members were disappointed with the recent raises especially related to cost of living adjustments, which were 2%, while November estimates were approximately 3.3% or 3.4%. Other OUS institutions such as OIT and SOU are about to announce faculty raises for the biennium of nearly 14%. She noted that the UO raises were for the first year of the biennium and thus she anticipates another round of raises for the second year. Ms. Vitulli commented that both the OIT and SOU campuses have unionized faculties, and she referred to one of the handouts available that announced a meeting on January 25th (3:30 in the Ben Linder room) to discuss collective bargaining on this campus.
Lastly, Ms Vitulli lauded the arena project sub committee members – John Chalmers, Dennis Howard, Gordon Sayre, and Paul van Donkelaar, aided by UO administrators Frances Dyke and Melinda Grier, and athletics administrators Laura Hazlett and Dave Sparks. She opined that the sub-committee has written an excellent report that the full budget committee unanimously endorses (see http://darkwing.uoregon.edu/~uosenate/dirsen078/SBC-ArenaReport-09Jan08.pdf for full report).
Report from the SBC Arena Project sub-committee. Sub-committee Chairman John Chalmers, finance, explained that the charge to the sub-committee was to provide a comprehensive review of the arena financing plan and issue a report to the Senate Budget Committee, the University Senate, and President Frohnmayer that provides an assessment of the arena plan and its impact on the UO budget. The committee was to collect and distill information, evaluate risks to the UO budget, and offer recommendations. The group consulted with legal experts, and committee members were involved with focus groups. The report was vetted with the IAC, the FAC, and members of the administration with opportunity to offer comments, and, as Ms. Vitulli reported, the SBC reviewed and unanimously endorsed the report.
Mr. Chalmers identified the key aspects of the report as the history and background on the arena project, estimated cost of the project, details of the financing plan, revenue projections, and the committee’s recommendations. From a historical perspective, replacing Mac Court has been on the agenda since at least 2003, and in its current condition, it is outdated with safety concerns; remodeling would cost as much as a new arena. The announcement in August 2007 of a $100 million gift “legacy fund” to the athletics department brought the arena issue to the forefront of planning activities. The goals in building the arena are to increase seating capacity, enhance experience of athletes and fans, and increase revenues to the athletics department in order to stabilize its self-sufficiency well into the future. The estimated cost of the project is approximately $196 million with an additional $27.4 million to purchase the land for the arena. The project financing would be through State of Oregon General Obligation Bonds, that is, self-supporting and self-liquidating F-bonds. Mr. Chalmers noted that the sub-committee did not have the financing of any parking facilities as part of its charge.
The essence of the financing plan is to borrow $200 million for the arena -- the university has already borrowed $27.4 for the land purchasing – incurring an estimated $13 million in debt service for 40 years. Projected repayment sources include arena revenues ($12 million/year), Duck Athletic Funds, and the Legacy Fund as needed to balance the budget. Mr. Chalmers noted some debt service constraints the committee considered as well. There are firm guidelines that limit the proportion of debt service on F bonds to 7% of annual budget, consequently borrowing the $200 million in bonds will consume approximately 26% of our bonding capacity, and thus might limit future borrowing for other buildings, such as new dormitories, for example.
Mr. Chalmers highlighted some of the more detailed aspects of revenue estimates found in the report, saying that if revenues are large, the funding plan works well; but if revenues are smaller than expected, the committee looked at a number of scenarios of how to repay the debt. The sub-committee estimated that Mac Court currently brings in $3.76 million with operating costs of $1.3 million, so the operating income is about $2.5 million. The new arena revenues would be about $11.5 million and the increased operating costs would leave about $8 million in income. By comparison, the recent report from the consulting firm, CSL, estimated that conservatively $13.9 million in revenues would be generated and minus operating costs, income would be approximately $10 million a year. Part of the difference in projected revenues was based on the interpretation of focus group data when asked about willingness to buy men’s basketball season tickets if projected ticket prices rose from $352 (average per seat currently) to $844 (average per seat projected)..
The committee looked at several scenarios if revenue projections were 100%, 75%, or only 50% of the outside consultant’s estimates. If 100% of estimated revenues are realized, there is no problem repaying the loan; if 75%, the Legacy Fund would be reduced to $69.3 million, which is not desirable, but still a substantial cushion. If revenues were only 50% of estimates, the Legacy Fund would be exhausted by 2024, which is a lot of time to solve the problem, but less than an ideal picture. Another financing issue considered by the sub-committee was that the Legacy Fund is not fully funded at this point, and earning interest; full funding of this source of back-up funding will occur in $20 million allotments over five years. The arena will not generate revenues until it is built (2010), but expenses go on, so preserving the cushion provided by the Legacy Fund is crucial, especially in the early stages of the project.
Mr. Chalmers concluded his report by listing the recommendations of the sub-committee:
1. Transparency of financial outcomes, that is, a means to make sure the financial information on the project can be monitored in an easy, collegial way.
2. Containing risk until such time as cost and revenue uncertainties are resolved, that is, limiting exposure of the Legacy Fund to market volatility.
3. Budget allocations in adverse situations, that is, the athletics department bears the burden of making the arena project work, and if it does not work, budget cuts will be in athletics.
4. Remediation and/or demolition costs for Mac Court, such as returning Mac Court to academic purposes, without paying for it from the academic budget.
5. Use of construction fees to reduce outstanding debt and reduce risk.
6. Revenue sharing with the university general fund if the project goes well.
7. Study the costs of providing parking faculties.
During a discussion period, a question was raised about the parking issue, saying that a permit from the city is required to build the arena and that parking facilities will be part of the permit, thus leaving parking out of the arena financing seems a major omission. Mr. Chalmers replied that parking was a concern of the sub-committee but was not part of its charge. Ms. Vitulli added that the issue was not overlooked, but that neither the SBC nor the sub-committee was given any information on parking. She opined that a new parking facility could be very expensive, as much as $40-55 million, but the SBC has not done any detailed analysis. Athletics Director Pat Kilkenny commented that athletics has retained a consultant to do a traffic impact study but the analysis has not yet been completed. He anticipates that parking will be a challenge, but he has a high level of confidence the issue can be resolved.
A senator asked what percentage of men’s basketball season ticket holders are also football season ticket holder, and might not the higher basketball season tickets force them to choose. Sub-committee member Dennis Howard, business, did not have a direct answer, but noted there will be an additional fee associated with basketball season tickets that ticket holders have not paid before. Mr. Kilkenny speculated there will be a significant number of ticket holders that overlap.
Senator Nathan Tublitz, biology, asked why there was such a difference in revenue estimates in the consultant’s 2003 report and the current report. Mr. Chalmers did not have a direct answer for the differences, saying only that the numbers were slightly greater line by line. Mr. Kilkenny then added that the 2003 report was never finalized. Revenue generating items have changed since then, with more premium seats and the overall quality and types of seats improving with the new design, and of course, inflation is a factor. Senator Tubiltz also asked if the budget committee was making an endorsement. Ms. Vitulli replied that at this point the budget committee was endorsing the sub-committee’s report – the budget committee’s task was not to endorse (or not endorse) the arena project, per se, but to try and understand the fiscal impact of the project on the university.
Intercollegiate Athletics Committee chairwoman Anita Weiss, international studies, asked if the arena would be used for campus academic events as well as for athletic events, and if there would be a charge for such use. President Frohnmayer replied that whenever the university needs to use the arena for academic purposes, it will do so. He could not think of a university in the country that does not use its arena structures for convocations, graduations, speakers, and so forth. The president said the university would not pay athletics for such events. He noted that there may be some set up fees, but those disappear in white noise.
Senator Bertram Malle, psychology, asked for more information on the focus groups used to collect data regarding willingness to pay higher ticket prices. Mr. Chalmers replied that two groups were in Portland and four were in Eugene-Springfield. The people in Portland were less adverse to the increased prices than those in Eugene-Springfield. Mr. Howard added that a web-based survey and the focus groups accounted for several thousand responses to price sensitivity questions. Three target prices were tested with response choices of definitely pay the price, likely pay the price and, possibly pay the price. There was considerable price sensitivity and push back for the “club seats” ($1600 for the season ticket). Mr. Howard indicated that more details were available in the report’s appendix.
With the discussion winding down, President Sayre reminded everyone of the special senate session on the arena project scheduled in two weeks, January 23rd. He instructed that notice for any motions for that meeting, whether on parking issues, environmental building issues, or other issues, must be received by Friday January 11th.
Interinstitutional Faculty Senate (IFS) report. IFS representative Peter Gilkey, mathematics, brought two items to the senators’ attention, and provided an informational handout. The first item concerns preparations for town hall discussions commemorating the bicentennial of Abraham Lincoln’s birthday, spearheaded by Portland State University. The second item concerns a request for faculty input regarding plans for new high school graduation requirements. Senator Gilkey stressed the importance of faculty responding to the state board’s direct request for faculty views and comments on the matter. He noted that the IFS, OUS, and Vice Provost for Undergraduate Studies Karen Sprague seek faculty comments on the proposed new graduation requirements, and asked that comments be sent to vice provost Sprague or to him in preparation for upcoming discussions (See http://www.uoregon.edu/~uosenate/dirsen078/EssentialSkills.pdf; http://www.uoregon.edu/~uosenate/dirsen078/EssentialSkills-2.pdf; http://www.uoregon.edu/~uosenate/dirsen078/HS-Requirements.pdf; and http://www.uoregon.edu/~uosenate/dirsen078/Sadofsky-Berger-10Dec07.pdf for relevant documents.
Interim report of the ad hoc committee for on-line course evaluations implementation. President Sayre noted that Mr. Brad Shelton, mathematics, was ill and not available for an update on the results of the pilot trial run for the new on-line evaluation system at this meeting, but that a full report will be provided shortly. Further, President Sayre announced the creation of a joint senate/academic affairs committee on course evaluation implementation, charging the committee to:
President Sayre said the goal is to have the new required evaluation question, use policy, and relevant legislation in place by Fall 2008, thus senate motions/resolutions related to these changes would have to be passed by the end of the Spring term 2008.
ANNOUNCEMENTS AND COMMUNICATION FROM THE FLOOR
The president commented that he is looking into creating an ad hoc committee to examine the creation of a system for evaluation of the university’s top administrators; it would require defining the scope, procedures, kinds of questions, use of the results, and so forth. He has begun talking with the administration on the matter.
Revised Motion US 07/08-2 that would permit the senate to call a University Assembly meeting with full legislative authority. Mr. Frank Stahl, emeritus biology, spoke to the motion, which had been previously tabled until the current (January 2008) meeting. He noted the text has been revised (simplified) in the interim and now reads:
Amend Section 6.6 of the Enabling Legislation of May 3-17, 1995 as follows (new words in bold):
6.6 The University Assembly, with full legislative power, shall be convened by an affirmative vote of the University Senate or after a petition to so convene has been signed by 33 % of those eligible to vote for non student senators, as provided by other sections in this legislation. Assembly meetings called by the Senate shall be held in accordance with section 6.6, as amended.
Mr. Stahl said that a meeting of the University Assembly with full legislative authority was attempted in January 2003 on the topic of the war in Iraq (that meeting failed to achieve a quorum). There was a substantial petitioning effort to call that meeting. Since then the senate has passed legislation relating to procedures to help achieve a quorum. This current motion simply confers on the senate the ability call such a meeting, with full legislative authority, if it deems necessary.
Mr. Stahl further clarified that when the assembly turned over principal governing authoring to senate (in May 1995), it retained some functions, among them to meet once each term (without legislative authority), and, if called by petition of one-third of the voting faculty, to meet with full legislative authority. The quarterly assembly meetings have not occurred, and the fall assembly meeting was blended into the fall convocation. The only (seemingly) worthwhile function of the assembly is to meet with full legislative power so that it can act on motions before it. Due to the size of the assembly and the numbers needed to have a quorum (approximately 1100 people); it is still a formable task and not likely to happen for anything other than an extremely important matter. This motion enables such a meeting to be called by the senate, in addition to the petitioning means for calling an assembly meeting. He added that students have a voice in the assembly through the ASOU executive members (25), the constitutional court (5), and student senate members (18), although they have indicated they would like greater representation in the assembly and would likely vote against this motion. An ASUO senator confirmed that the student members of the senate feel that student representation in the university assembly is inadequate, and thus they are against the motion.
President Sayre called for a hand vote on the motion with results of 23 in favor of the motion and 5 opposed. Motion US07/08-2 to enable the senate to call a meeting of the University Assembly with full legislative authority carried.
Notice of motion US07/08-10 regarding the state’s opening meetings law and quorum requirement for passing legislation. Mr. Frank Stahl gave notice that he intends to present a motion asking the state attorney general for a clarifying opinion regarding the number of people necessary to pass legislation at an assembly meeting once a quorum for the meeting is met. He disagreed with President Frohnmayer’s January 2003 interpretation of how many are needed to pass legislation. President Frohnmayer replied that the opinion he used in 2003 came from the Office of the Attorney General in preparation for matters of parliamentary procedure, thus the state’s attorney has ruled on this issue. Mr. Stahl then commented that the November 2003 document is somewhat obtuse, and he is asking for greater clarity. Parliamentarian Paul Simmons stated that the senate’s practice is that when there is a quorum (half of the membership plus one), a majority of those present at the meeting can pass legislation.
With no other business at hand, the meeting was adjourned at 4:54 p.m.
Secretary of the Faculty
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