MINUTES OF THE FINANCE COMMITTEE
UNIVERSITY OF LOUISVILLE BOARD OF TRUSTEES

October 9, 2003

In Open Session

The Finance Committee of the University Board of Trustees met Thursday, October 9, 2003, in the Jefferson Room, Grawemeyer Hall with members present and absent as follows:

I. Call to Order

Having determined a quorum present, Chairman Green called the meeting to order at 1:15 p.m.

Approval of Minutes, July 10, 2003

Prof. Ensign made a motion, which Ms. Worland seconded, to approve the minutes of July 10, 2003. The motion passed unanimously.

II. Action Item: Approval of Grant Agreement for University Physician’s Group, Inc.

Executive Vice President Kaplan reported the University Physician’s Group, Inc. (Grantee) was incorporated as a Kentucky not-for-profit corporation on April 30, 1999. Article 3.1 of its Bylaws states that it “is established to further the education, research and patient care mission of the University at its Health Sciences Center campus.” The sole member of the Grantee is the University, acting through its Chancellor for the Health Sciences Center. Its directors include the Deans of the four Health Sciences Center schools, the President of University of Louisville Hospital, one member of the University’s Board of Trustees, and three faculty members from the School of Medicine.

The University will use the Grantee to develop clinical initiatives at the Health Sciences Center for the benefit of the teaching and clinical missions of its four schools. Illustrative types of initiatives contemplated was the proposed joint venture Cancer Hospital with Norton Healthcare. Although that development was not successful, the Grantee intends to develop these types of initiatives in the future, either alone or with other partners, which would further the educational and research missions of the University. The Grant funding will come from clinical operations of the schools at the Health Sciences Center, or from Intergovernmental Transfer Payments related to clinical activities at the Health Sciences Center. Mr. Sticklen made a motion, which Mr. Burns seconded, to approve the

President’s Recommendation that a Grant of up to $3,000,000 of restricted funds available to the School of Medicine be made to University Physicians’ Group, Inc. d/b/a UofL Health Care (the “Grantee”), a not-for-profit corporation of which the University is the sole member, in order to further the initiation and development of clinical and educational opportunities at the Health Sciences Center for the benefit of the University; and that the President, Provost, or Chancellor for the Health Sciences Center be authorized to execute one or more Grant Agreements containing such provisions as they deem necessary and appropriate, with the Grantee to appropriately implement this authorization

The motion passed unanimously.

III. Action Item: Approval of Shared Leave Program

Acting Provost Willihnganz reported the Voluntary Leave Sharing Program is a program whereby staff may donate sick leave to employees who have experienced a serious health condition and who have exhausted all paid leave. The Voluntary Leave Sharing Program was approved in September of 2000. However, it has not been widely used because it requires a person to have given leave to participate. The changes represented by the attached policy are as follows:

(1) A person no longer has to give leave in order to receive leave;
(2) Employees may give sick or annual leave to the shared leave pool (formerly only sick leave was authorized); and,
(3) Due to HIPAA requirements concerning private health information, Human Resources will disguise all requests before forwarding to the Shared Leave Committee for consideration.

Ms. Brown commented these changes reflect a long-time goal for staff to have this opportunity to share leave with other staff members who have catastrophic illnesses. Ms. Brown said the Staff Senate hoped by opening up the policy with these changes, people who are in very difficult times will be better able to utilize this program. Ms. Worland made a motion, which Prof. Ensign seconded, to approve the

President’s recommendation that the Board of Trustees approve the recommended changes to the Voluntary Leave Sharing Program as represented in the attached policy. Additionally, the President recommends that the policy be authorized for a period not to exceed two years after which Human Resources will be directed to report to the Board of Trustees regarding the fiscal impact and other aspects of the program before subsequent reauthorization.

The motion passed unanimously.

IV. Action Item: Approval of Capital Construction Project for Partial Renovation of: Student Counseling and Health Center

Acting Provost Willihnganz reported this project will renovate 2,300 square feet of existing space into additional clinic space that provides the venue for personnel from U of L’s Health Science Center to supply health care services to employees (faculty & staff) on the Belknap campus. Dr. Willihnganz said this renovation will better serve our students. Ms. Worland made a motion, which Prof. Ensign seconded, to approve the

President’s recommendation that the following project be approved:

The motion passed unanimously.

V. Action Item: Approval of Contractual Signature Authority

Dr. Willihnganz reported with the Board’s approval of the President’s reorganization, effective July 1, 2003, the existing authorization passed by the Board, September 24, 2001 required updating for the new titles. She said it updated the titles to represent this change. Ms. Worland made a motion, which Prof. Ensign seconded, to approve the

President’s recommendation that the Board of Trustees adopts the attached resolution regarding contractual authority of the University’s administrative offices.

The motion passed unanimously.

VI. Action Item: Approval of Issuance of Consolidated Educational Buildings Revenue Bonds, Series O

Dr. Ramsey reported that the attached resolution authorizes the issuance of Series O bonds to fund the construction of the natatorium. This resolution delegates to the President or his designee the authority to accept or reject proposals and to make the award on behalf of the Board of Trustees. The bond sale is tentatively scheduled for October 28, 2003. Dr. Ramsey introduced Stan Kramer, First Kentucky Securities, financial advisor to the University. Mr. Sticklen made a motion, which Prof. Ensign seconded, to approve the

President’s recommendation that the Board authorize: (1)“Series Resolution Relating to University of Louisville Consolidated Education Buildings Revenue Bonds, Series O” in substantially the form as attached and (2) the President or his designee to make any technical changes that might be required and to execute the proposed bond sale.

The motion passed unanimously.

VII. Action Item: Approval of Establishment of Endowment Fund for Oncology Research

Dr. Willihnganz reported the James Graham Brown Foundation made a grant of $15,000,000 to recruit new faculty, create three new endowed chairs, and establish research infrastructure and administrative support needed for the maintenance of a nationally recognized cancer research program. This matching request to endow $500,000 will expand the existing chair, the James Graham Brown "Our Highest Potential" Chair in Oncology. This fund will advance the university's research mission in oncology and conforms to the university's strategic plan, the Challenge for Excellence, as well as the advancement of the new economy. Mr. Sticklen made a motion, which Prof. Ensign seconded, to approve the

President’s recommendation that the Board of Trustees approves the expansion of an existing endowment fund for oncology research that will be funded from the Commonwealth’s Endowment Match Program; and authorizes the Chair of the Board of Trustees to execute any documents required to complete the expansion of this endowment fund.

The motion passed unanimously.

VIII. Action Item: Approval of the Endowment Match Program 2002-03 Annual Report

Dr. Willihnganz reported that Kentucky recognizes the importance of research to the economic well being of its citizens. The Endowment Match Program encourages private investment in public higher education research activities to stimulate business development, generate increases in externally sponsored research, create better jobs and a higher standard of living, and facilitate Kentucky’s transition to a knowledge-based economy. The program matches public funds with private gifts to fund endowed chairs, professorships, fellowships, scholarships, and mission support at the public universities.

Beginning in 2002-03, the Council on Postsecondary Education directed the state universities to provide detailed annual reports describing how the state and matching funds were used by October 15 of each year. The report includes the number of endowed chairs and professorships by name and incumbent, the specific support services attached to the chairs and professorships, and the benefits of the program to the Commonwealth of Kentucky in terms of jobs, revenue growth, creation of wealth, and improved quality of life. The University of Louisville has identified institutional outcomes, such as increases in sponsored research directly attributed to the program, changes in the quality of students and measurable outcomes such as retention, graduation, pursuit of advanced study, and employment as well as the creation and profitable use of intellectual property.
Ms. Worland made a motion, which Prof. Ensign seconded, to approve the

President’s recommendation that the Board of Trustees approves the Endowment Matching Program Annual Report due to the Council on Postsecondary Education on October 15, 2003.

The motion passed unanimously.

IX. Other Business

There was no other business.

X. Adjournment

Prof. Ensign made a motion, which Mr. Sticklen seconded, to adjourn the meeting at 1:35 p.m.