Outlook for union optimistic, Regent president says
Wildcat File Photo
Arizona Daily Wildcat
Regents President Judy Gignac
She said yesterday that the union project "has a good chance of approval."
The Arizona Board of Regents president yesterday said "barring catastrophe," the UA's Memorial Student Union project Friday will garner the board's approval.
With building plans laid and finances plotted - without a student fee -the only obstacle before University of Arizona officials for the $59 million renovation is the board's blessing.
Regents President Judy Gignac said yesterday that the union project "has a good chance of approval."
"Barring catastrophe, which one never knows, it seems to me that the university has accomplished what we asked them to," Gignac said, adding that Regents wanted to minimize the students' burden stemming from fees or tuition hikes.
UA Chief Budget Officer Dick Roberts, who played a role in drafting the university's plan to repay its construction loan, said he was "cautiously optimistic" about the proposal's chances.
"I'm really excited about it, and it has been a real struggle to solve the financial puzzle," Roberts said. "I think we found a way that satisfies the concerns of all major constituents."
However, Roberts did add "that's an answer from a guy who has got a lot of time and effort and ego" invested in this project.
Gignac said a contingency plan that will cover costs if the UA fails to collect any donations is a pleasing aspect of the renovation project.
"It's not a pie in the sky," she said. "They have considered the worst-case scenario."
UA officials plan to finance 24.7 percent with a 25-year loan for the new building year by creating an endowment. The investment will be started with $6.35 million of the university's funds and $600,000 from the UA's Pepsi contract.
Administrators also expect $10 million in donations during the first six years of the loan.
The cash endowment will carry the financing until 2012 without donations. After that point, officials will have paid off other outstanding debts and be able to reallocate money for the union.
In a 1985 referendum for the Student Recreation Center, the UA promised to pay $5 million of the $15 million project with gifts, offsetting the $25 per semester student fee.
However, the UA was able only to raise $200,000, and had to pay the difference out of pocket.
Roberts said his experience with the Recreation Center's finances, which did not have a contingency plan, "substantially" influenced his approach to the new union's loan repayment.
"The model tests itself," Roberts said, adding he is "most proud" of that aspect of the plan. "We're not out of the game if there's no gifts."
In other business, on Thursday the Regents will examine 23 key bills in the Arizona Legislature with potential to directly impact state universities.
"None have to do with the budget," Gignac said. "We'll go through each one and make a determination as to how we feel about it."
The board will take issue with a House bill that would tie tuition increases to the average of the prior three years' inflation.
"What we say is, 'you can't tie our hands like that,'" Gignac said, adding that the Regents' constitution places an emphasis on setting tuition rates. "The Board of Regents has fiduciary responsibility for the universities - we can't agree to this in my opinion."
Gignac said Arizona universities have three major revenue sources -tuition and fees, state appropriations and gifts, grants and contracts. The bill would put the Legislature in control of two monetary streams, she added.
"It's important that students understand what that could do to their access to universities in the future," Gignac said. "It's like having three streams of water running into a lake and damming up two of them."
The Regents will also discuss a bill prohibiting schools from using Social Security numbers for identification purposes.