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Higher Ed Board committee supports PSU land transfer to TriMet for light-rail, and other actions

Contact:  Endi Hartigan; Office: 503-725-5702

PORTLAND, May 6, 2011 – The State Board of Higher Education’s Finance and Administration Committee met today to consider the transfer of land to TriMet for light rail construction, to authorize a UO capital request, and to monitor financial activity, investments, and audits, among other items.

TriMet Land Transfer     Jay Kenton, Oregon University System vice chancellor for finance and administration, and Lindsay Desrochers, Portland State University (PSU) vice president for finance and administration, described the transaction to the Committee, which includes a request from PSU to voluntarily and permanently transfer two parcels of land on the campus to TriMet at no cost and to grant other easements to accommodate the Portland-Milwaukie Light Rail expansion. The land includes two strips of approximately 9,000 square feet currently used for parking and sidewalk space, and the transfer is necessary for TriMet’s construction of the light rail. TriMet has also requested two temporary construction easements. The Committee discussed the strong value of expanded light rail transportation for commuting students of the urban university. After discussion, the Committee authorized PSU to continue working on the agreements with TriMet to perfect the transfer of interest in the Board owned real property and granting of construction easements with the understanding that the Committee will recommend that the full Board of Higher Education formally approve the permanent transfer at its June 2011 meeting.

University of Oregon (UO) Capital Request  Frances Dyke, UO vice president for finance and administration, and Robin Holmes, UO vice president for student affairs, described the UO’s request to seek legislative approval for planning and construction of the Erb Memorial Union (EMU) Master Plan and completion of Phase III of the Student Recreation Center (SRC). Total project costs are $112.4 million for the EMU, and $48.1 million for the SRC. Upgrading these facilities will allow the UO to increase the residential population of the campus and increase opportunities for social and educational activities outside of the classroom, better integrating academic opportunities with co-curricular learning opportunities. Proposed funding for the project is described as a partnership between the students and the university, and requires a legislative request for a new project limitation during the current legislative session. The proposed funding strategy is fully described on page 36 of the Board Docket  and includes bond debt, $35 million in private gifts, and an increase in student fees. The Committee discussed implications of UO’s increased bond debt burden in relation to Board policy on debt capacity,  recognizing that the Board will expect the university debt capacity to remain below 7%, and will discuss the debt capacity again when UO seeks Board approval for the bond financing. Since part of the current funding strategy is a prepaid student fee on students who will not have the benefit of these facilities once complete because of the timing of the project, the Committee also discussed the financial and equity implications of the prepaid fee. The prepaid fee proposal component of the project will be further discussed by the Board at the June 2011 meeting. After discussion, the Committee authorized the Chancellor or designee to seek legislative authorization to add this project to the OUS capital budget during the 2011-13 legislative session.   

In other action and discussion at this meeting, the Committee:

  • Accepted the Investment Report as of March 31, 2011.
  • Accepted the Quarterly Management Report for March 31, 2011.
  • Approved the May 2011 Internal Audit Division Progress Report.
  • Approved the allocation to campuses of additional Federal Stimulus Funding of $1,868,489; and authorized the Chancellor or designee to seek additional or reallocate Other Funds Limitation if needed in consultation with the Legislative Fiscal Office prior to the close of legislative session. These actions are an effect of House Bill 5050 which rebalances the state’s 2009-2011 budget to partially address federal compliance to maintenance of effort issues; see details on Board Docket on Page 27.
  • Discussed development of an RFP to engage a risk consultant to begin the process of developing an independent, comprehensive risk management program. If Senate Bill 242 becomes law, OUS will have more autonomy from centralized state operations including risk management, which raises the necessity for this independent consultation.

The Oregon University System comprises seven distinguished public universities and one branch campus, reaching more than one million people each year through on-campus classes, statewide public services and lifelong learning. The Oregon State Board of Higher Education, the statutory governing board of OUS, is composed of twelve members appointed by the Governor and confirmed by the Oregon State Senate. For additional information, go to www.ous.edu; and for today’s Board Docket materials go to: http://www.ous.edu/state_board/meeting/dockets.