February 15, 2002

Contact: Bob Bruce, 503-725-5700

Higher Ed Okays Concept for $500 Million Capital Bond Measure

EUGENE - After years of incremental attempts to remedy the deferred maintenance backlog at Oregon's public universities, the State Board of Higher Education has decided to advance a legislative concept that could lead to a $500 million capital bond measure strictly for building repair and modernization.

The concept, approved Friday by the State Board, seeks to place a general obligation bond measure before Oregon voters. The earliest such a measure might be considered is the November 2003 general election. If approved for the ballot, the measure would allow the sale of state-backed bonds over a 10-year period dedicated directly to reducing the deferred maintenance backlog at all of Oregon's seven public universities.
The Board also approved a second legislative concept that would help to clarify the bidding processes used by OUS campuses under authority granted to the State Board in the Higher Education Administrative Efficiency Act of 1995. The act exempts OUS from certain state regulations on contracting, procurement and purchasing. The Board is seeking to clarify legislative intent of the original measure.

The proposed concepts will now be submitted to the Oregon Department of Administrative Services for review and recommendation to the Governor, who will then decide if either will be advanced for consideration during the 2003 session of the Oregon Legislature.

In other action Friday, the Board:

  • Authorized officials at Oregon Institute of Technology to complete purchase of a 17.4-acre parcel of land adjacent to the campus for future growth and development. The purchase, subject to final transaction arrangements and closure, is being purchased from the O'Connor family for $215,000 plus closing costs.
  • Approved Portland State University's plan to purchase the 5th Avenue Business Center for additional classroom and office space. The two-story, 36,000-square-foot building with underground and surface parking is being purchased from the Walter R. and Velma A. Peterson Trust. PSU will pay $3.1 million for the building and will bond an additional $400,000 for maintenance and renovation. Existing tenants will continue to use the space until their leases expire, then the building will be converted to university use.
  • Okayed the filing with the Internal Revenue Service of a restated optional retirement program for employees. The restatement incorporates changes to comply with new federal tax laws, providing employees with options to defer additional retirement savings and increase the portability of retirement benefits.
  • Continued, with minor timeline changes, the universities' undergraduate admissions policy for 2003-2004. The timeline changes reflect continued work between the campuses, Oregon schools and the Oregon Department of Education to transition to a proficiency-based admission standards system. Under the current undergraduate policy, admission at all seven Oregon public universities require high school graduation, select subject requirements and national test scores. Grade point average requirements range from OIT, to 2.75 at Southern Oregon University and Western Oregon University, and 3.0 at OSU and UO. Grade point requirements for PSU will be considered by the Board at its April meeting.
  • Learned that of the state's three major universities, OSU remains the only school with a continuing athletic deficit. According to a new OUS report, both UO and PSU show positive fund balances in their athletic budgets as of June 30, 2001. And while OSU has reduced its athletic deficit by about $3 million over the past three fiscal years, its deficit still totaled $5.3 million on June 30.
  • According to the report, OSU fell short of its own deficit reduction targets by $457,000 in 2000 and $600,000 in 2001.
  • The report says while OSU athletic revenues has increased from $13.3 million to $25.4 million over the past three years, its expenditures have gone from $19.7 million to $29.2 million. A current year loss of $800,000 is projected because of a campus reduction in state general funds given to athletics, lower than expected lottery revenues and a $2 million expenditure for an electronic sign and replay screen at Reser Stadium. It says unless current year budget operations improve additional general fund money may be needed to help the university June 2002 deficit reduction target. OSU currently budgets about $4.3 million in general funds to support intercollegiate athletics.
  • Board members asked officials from OSU and the Chancellor's Office to develop an updated budget reduction plan for the deficit by the Board's April meeting.
  • Authorized OSU to merge and combine its existing colleges of home economics and health and human performance into a new College of Health and Human Services. The change is effective immediately.
  • Granted a 3 percent salary increase to OUS Chancellor Joe Cox. The increase is comparable to that previously given campus presidents and faculty. Cox currently receives $149,004, more than $80,000 below the median shared by other public university system heads across the nation.
  • Approve new graduate level degree programs at OSU and Oregon Health & Sciences University. OHSU will now be able to offer a new Master of Medical Informatics degree, while OSU will offer a new doctoral degree in materials science, a Masters of Fine Arts in creative writing, and a Master of Public Policy degree, and
  • Endorsed honorary degree proposals at OSU and PSU. Oregon State will award an honorary doctorate to John S. Niederhauser, a prominent agricultural scientist and World Food Prize winner, at its June commencement. PSU will award honorary doctorates later this spring in Tokyo to President Takayasu Okushima and Professor Takehiko Kawase of Waseda University, and at its June commencement to State Senator Lenn Hannon of Ashland, a strong higher educational advocate; Joan Johnson of Portland, a long-time leader in community and public service; and George Passadore, president of the Oregon Wells Fargo banking operations.

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