Transcript
1.1/204-19
4/5/19
April 5, 2019
TO: Members of the Board of Regents
Designated Representatives to the Board of Regents
FROM: Tyler Lange, Secretary of the Board of Regents
RE: Schedule of Meetings
WEDNESDAY, APRIL 10, 2019 4:00 p.m. 142 Gerberding Hall SPECIAL MEETING OF THE FINANCE AND
ASSET MANAGEMENT COMMITTEE: Regents
Benoliel (Chair), Ayer, Harrell, Jaech, MacPhee, Rice,
Riojas, Tamaki, Zeeck, Zhou*
5:30 p.m. 142 Gerberding Hall MEETING OF THE FULL BOARD OF REGENTS: Regents Rice (Chair), Ayer, Benoliel,
Harrell, Jaech, MacPhee, Riojas, Tamaki, Zeeck, Zhou
THURSDAY, APRIL 11, 2019
THE BOARD MEETS AT
FRIDAY HARBOR LABORATORIES,
620 UNIVERSITY RD., FRIDAY HARBOR, WA 98250
REGULAR MEETING OF THE BOARD OF REGENTS: The Regular Meeting of the Board of
Regents will begin at 9:30 a.m.
8:40 a.m. Academic Presentation to Regents and Invited Guests*
9:30 a.m. Commons Room, Friday
Harbor Laboratories
MEETING OF THE FULL BOARD OF REGENTS: Regents Rice (Chair), Ayer, Benoliel,
Harrell, Jaech, MacPhee, Riojas, Tamaki, Zeeck, Zhou
11:30 a.m. Academic Presentation to Regents and Invited Guests*
12:30 p.m.** Dining Hall, Friday
Harbor Laboratories
MEETING OF THE FULL BOARD OF REGENTS (continued); Lunch for Regents and Invited Guests
1:30 p.m. Academic Presentation to Regents and Invited Guests*
2:20 p.m.** Commons Room, Friday
Harbor Laboratories MEETING OF THE FULL BOARD OF REGENTS (continued)
*see agenda for details.
**or later as announced at the conclusion of the preceding session.
To request disability accommodation, contact the Disability Services Office at: 206.543.6450 (voice), 206.543.6452 (TTY), 206.685.7264 (fax), or email at dso@uw.edu. The University of Washington makes every effort to honor disability accommodation requests. Requests can be responded to most effectively if
received as far in advance of the event as possible.
1.2.1/204-19 4/10/19
UNIVERSITY OF WASHINGTON
BOARD OF REGENTS
Special Meeting of the Finance and Asset Management Committee
Regents Benoliel (Chair), Ayer, Harrell, Jaech, MacPhee, Rice, Riojas, Tamaki, Zeeck, Zhou
Wednesday, April 10, 2019 4:00 p.m.
142 Gerberding Hall
Consent Agenda
Approval of Minutes of Committee Meeting on March 14, 2019
COMMITTEE ACTION
1. Finance, Budget, and Capital Report Brian McCartan, Vice President, Finance Sarah N. Hall, Vice Provost, Planning & Budgeting Lou Cariello, Vice President, Facilities
INFORMATION F–1
2. Approve Workday HR/Payroll Contract Renewal Brian McCartan, Vice President, Finance Ann Anderson, Associate Vice President, Enterprise Services
ACTION F–2
3. Kincaid Hall Renovation: Stage 2 Approval Lou Cariello, Vice President, Facilities Mike McCormick, Associate Vice President, Capital Planning and Development Annette Sommer, Associate Treasurer Steve Majeski, Associate Dean, Research Administration and Infrastructure, College of Arts and Sciences
ACTION F–4
4. Parrington Hall Renovation: Stage 2 Approval Lou Cariello, Vice President, Facilities Mike McCormick, Associate Vice President, Capital Planning and Development Annette Sommer, Associate Treasurer Sandra Archibald, Dean, Evans School of Public Policy
ACTION F–3
5. Approve Internal Lending Program Distribution for Down-Payment Assistance to Faculty Members
Mark Richards, Provost and Executive Vice President Chris Malins, Associate Vice President, Treasury Aaron Hoard, Deputy Director, Regional and Community Relations
ACTION F–5
1.1.1/204-19 4/10/19
AGENDA
UNIVERSITY OF WASHINGTON BOARD OF REGENTS
Wednesday, April 10, 2019
5:30 p.m. Gerberding Hall, Room 142
(Item No.) I. CALL TO ORDER II. ROLL CALL III. CONFIRM AGENDA IV. PUBLIC COMMENT PERIOD To provide public comment at this meeting, sign up at the meeting before the start of
the meeting. V. BOARD ITEMS Long-Term Planning Assumptions: Finance, Facilities, Budget, and Enrollment
(Information only) Brian McCartan, Vice President, Finance Sarah N. Hall, Vice Provost, Planning & Budgeting Lou Cariello, Vice President, Facilities Phil Reid, Vice Provost, Academic and Student Affairs
1. Finance (McCartan, Hall) What are the primary financial risks to and opportunities for the University? 2. Facilities (Cariello, McCartan) How should the UW think strategically about long-term capital planning? 3. Budget and Enrollment (Hall, Reid) Enrollment and Tuition Demand for and Supply of Courses of Study
B–1
Panel: Student Perspectives on Long-Term Planning (Information only) Ritika Jain, President, ASUW Giuliana Conti, President, GPSS Leah Shin, President, ASUW Bothell Armen Papyan, President, ASUW Tacoma
B–2
VI. ADJOURN
1.1.1/204-19 4/11/19
AGENDA
UNIVERSITY OF WASHINGTON
BOARD OF REGENTS
April 11, 2019 9:30 a.m.
Friday Harbor Laboratories,
620 University Road Friday Harbor, Washington 98250
Prior to the meeting, the Board will attend an academic presentation. (Item No.) I. CALL TO ORDER II. ROLL CALL III. CONFIRM AGENDA IV. PUBLIC COMMENT PERIOD V. BOARD RETREAT B–3 Session 1: Access to Excellence under Constraints (Information only)
Ana Mari Cauce, University President Mark Richards, Provost and Executive Vice President
Following this session, the Board will recess for an academic presentation. The following session will include lunch for Regents and invited guests, and will be held in the Dining Hall.
Session 2: Key Strategic Issues – Curriculum (Information only) Ana Mari Cauce, University President Mark Richards, Provost and Executive Vice President
Following this session, the Board will recess for an academic presentation.
Session 3: Facilitating Change, Removing Barriers (Information only) Ana Mari Cauce, University President Mark Richards, Provost and Executive Vice President
VI. CONSENT AGENDA Approval of Minutes of the Meetings on March 13 and 14, 2019 Report of the CEO, UW Medicine
UWM
Approve Workday HR/Payroll Contract Renewal F–2
AGENDA – Board of Regents Meeting on April 11, 2019 Page 2
1.1.1/204-19 4/11/19
Parrington Hall Renovation: Stage 2 Approval
F–3
Kincaid Hall Renovation: Stage 2 Approval
F–4
Approve Internal Lending Program Distribution for Down-Payment Assistance to Faculty Members
F–5
Academic and Administrative Appointments B–4 VII. STANDING COMMITTEE
Finance and Asset Management Committee: Regent Benoliel – Chair Finance, Budget, and Capital Report (Information only) F–1
VIII. DATE FOR NEXT REGULAR MEETINGS: Wednesday, May 8, and Thursday, May 9,
2019 IX. ADJOURN
OFFICIAL MINUTES approved at the meeting of the Board on May 9, 2019.
M I N U T E S
BOARD OF REGENTS University of Washington
April 11, 2019
The Board of Regents its held its regular meeting on Thursday, April 11, 2019, beginning
at 9:40 a.m. in the Commons Room at Friday Harbor Laboratories. Notice of the meeting
was appropriately provided to the public and the media. Delay of meeting notices from
the previously published time of 9:30 a.m. were duly posted.
CALL TO ORDER
Board Chair Regent Rice called the meeting to order at 9:40 a.m.
ROLL CALL
The Secretary called the roll. Present were the Chair, Regent Rice, Regents Ayer,
Benoliel, Jaech, MacPhee, Riojas, Tamaki, Zeeck, Zhou; President Cauce, Provost
Richards.
Regent Harrell was absent.
CONFIRM AGENDA
Regent Rice announced that the agenda was confirmed, as distributed.
PUBLIC COMMENT PERIOD
Regent Rice announced that the Board would receive comments from the public. This
segment of the meeting provides an opportunity for the Board to hear directly from the
public new concerns and new perspectives on current issues.
No one signed up for public comment.
BOARD RETREAT (Agenda No. B–3) (Information only)
Session 1: Access to Excellence under Constraints
Regent Rice again thanked the planning team of Regent Ayer, Regent Harrell, Tyler
Lange, and Margaret Shepherd. Yesterday’s presentations demonstrate the excellence of
President Cauce’s executive team.
President Cauce introduced a discussion of the UW’s financial model, focusing on how it
might continue to deliver access to excellence in the future. She noted how much the
UW’s excellence had increased since she arrived in 1986. Many departments and schools
BOARD OF REGENTS Page 2
April 11, 2019
are now of global stature. The challenge is now to adequate the UW’s aspirations to its
resources through strategic prioritization.
Provost Richards said that he will soon no longer be able to plead that he is new. He
remains impressed by the UW’s flexible, thin, and agile administration and by its
positive, efficient campus culture. That culture is likely more efficient than many
corporations, and more efficient than the public may acknowledge: the UW provides a
top-notch education at a cost of $30,000 to $35,000 per student; Harvard University
likely spends upwards of $100,000 per student.
Regents then discussed the state’s responsibility to fund the UW adequately in exchange
for low tuition, how to right-size the UW’s state funding to its student body, or vice
versa, and possibilities for reaching new markets.
Provost Richards explored possibilities for funding expanded financial aid to middle-
class families presented in the attached slides. Discussion ensued of how the current
burden of tuition amounts to a per-child tax on middle-class families. It was suggested
that the conversation is more accurately, given financial assistance, not “what should
tuition be?” but “who pays tuition?”
Hearing no objections, Regent Rice recessed the meeting at 11:30 a.m. for an academic
presentation. In the interim, Regent Zeeck departed.
Session 2: Key Strategic Issues -- Curriculum
Calling the meeting to order in the Dining Hall at 12:20 p.m., Regent Rice adjourned the
meeting to the Commons Room for discussion, after the Regents had lunched.
Regent Rice called the meeting to order in the Commons Room at 12:55 p.m. President
Cauce initiated discussion. Earlier sessions focused on external financial pressures with
respect state funding and tuition levels. Internal financial pressures derive from shifting
student demands. Because science and engineering courses are more expensive, and
because the UW has as high a percentage of students majoring in those fields as a
technology school, recent shifts away from the humanities and social sciences move
instruction away from relatively low-cost, high-capacity fields to relatively expensive,
capacity-constrained fields. In addition, as students enter or transfer with considerable
Running Start, International Baccalaureate, or Advanced Placement credit, instruction
shifts further away from relatively low-cost, high-capacity introductory courses to
relatively high-cost, capacity-constrained upper-division and laboratory courses. The
challenge is deciding how to meet this demand, whether to meet this demand, and in
which ways to meet this demand. Possible responses include expanding minors that can
serve as a technical platform for humanities and social science students such as the data
science minor, changing disciplinary hiring habits so as to encourage the hire of new
faculty members better equipped to teach courses that integrate with potential new
minors, and developing alternatives to the major such as a cluster of minors in a
concentrated area. The first response is underway. The second requires faculty buy-in.
The third requires more robust advising.
BOARD OF REGENTS Page 3
April 11, 2019
Discussion ensued. There was agreement that habits of mind gained from study of the
humanities and social sciences are crucial to long-term career success and to leadership,
but that the focus should be on equipping students for a successful transition from college
to a career. It was suggested that both data science and ethics might best be taught like
writing, in courses intimately tied to subject-area problems and approaches.
Regents then discussed the balance of autonomous evolution and central, intentional
strategy in the successes of the Bothell and Tacoma campuses. When the Bothell and
Tacoma campuses were founded thirty years ago, they were intended to be transfer
campuses at which community-college students could transfer to complete a four-year
degree. They have since begun to admit first- and second-year students at the same time
as community colleges have begun to offer four-year degrees. The state ecosystem of
higher education is changing. Enrollments on the Bothell and Tacoma campuses are
approaching those of Washington’s regional comprehensive universities. In addition, if
the UW as a whole is capacity-constrained, there is capacity at the regional
comprehensives. It was suggested that how students differentiate the Bothell and Tacoma
campuses guide strategic planning.
Hearing no objections, Regent Rice recessed the meeting for a final academic
presentation at 1:40 p.m.
Session 3: Facilitating Change, Removing Barriers
Calling the meeting to order at 2:30 p.m., Regent Rice opened the last session of the day.
Regents discussed how their meetings might provide a site for discussing the President’s
strategic initiatives and how they might better act as advocates for and facilitators of
change.
In conclusion, Regent Ayer stated that the day’s discussions should be the model for
future meanings. The Board has two roles: to act as the fiduciaries of the people of
Washington and to act as a sounding board for the management it hires. Many routine
items can go on consent agendas, and detailed reports and analyses can be pre-distributed
so as to leave greater time for the discussion of key strategic issues.
It was suggested that the Board make a habit of holding an annual retreat. It was also
suggested that the format of reports to the Board be reexamined, or that reports to as
currently constituted be dispensed with. It was further suggested that, while current
meeting items focus on inputs (e.g. enrollment reports), future items might also focus
more on outputs and outcomes (e.g. alumni success or the financial impact of the UW).
Regent Rice concluded by thanking every Regent for actively participating in each
segment of the Retreat. She asked that the Board consider holding a retreat each year and
requested that Regents Benoliel and Riojas, with the aid of Tyler Lange and Margaret
Shepherd, create sample agendas reflecting the Board’s wishes.
See Attachment B–3.
BOARD OF REGENTS Page 4
April 11, 2019
CONSENT AGENDA
Regent Rice noted there were seven items for approval on the consent agenda, and asked
if any items should be removed. She called for a motion.
MOTION: Upon the recommendation of Chair and the motion made by Regent
Benoliel, seconded by a Regent, the Board voted to approve the seven
items on the consent agenda below. Regent Zhou abstained from the vote.
Minutes of the meetings on March 13 and 14, 2019
Report of the CEO, UW Medicine (Agenda No. UWM)
See Attachment UWM. Approve Workday HR/Payroll Contract Renewal (Agenda No. F–2)
It was the recommendation of the administration and the Finance and Asset Management
Committee that the Board of Regents:
1. Delegate authority to the President or her designee to execute a five-year renewal
of the Workday Human Capital Management Software-as-a-Service Solution
(a.k.a. HR/Payroll Modernization Project) in accordance with the Workday
Master Subscription Agreement for $18,035,274 plus applicable Washington
State Sales Tax; and
2. Delegate authority to the President or her designee to execute future renewals of
the HR/Payroll Modernization Project subscription, provided that these renewals
are reported to the Board with other actions under delegated authority and in
accordance with any existing or future provisions in Board of Regents
Governance, Standing Orders, Chapter 1, as presented.
See Attachment F–2.
Parrington Hall Renovation: Stage 2 Approval (Agenda No. F–3)
It was the recommendation of the administration and the Finance and Asset Management
Committee that the Board of Regents, by granting Stage 2 approval to the Parrington Hall
Renovation project (the “Project”):
1) Approve the Project budget of $23.8 million;
2) Approve the financing plan including use of:
a) up to $2.42 million of funding from the Internal Lending Program (ILP)
for a portion of the construction costs; and
BOARD OF REGENTS Page 5
April 11, 2019
b) the Bridge Program to fund expenditures relating to unfulfilled gifts with a
maximum borrowing of $2.6 million and a term not to exceed five years
from the date of Board approval; and
3) Delegate authority to the President or her designee to execute contract
amendments for construction, as presented.
See Attachment F–3.
Kincaid Hall Renovation: Stage 2 Approval (Agenda No. F–4)
It was the recommendation of the administration and the Finance and Asset Management
Committee that the Board of Regents, by granting Stage 2 Approval to the Kincaid Hall
Renovation project (the “Project”):
1) Approve the Project budget of $43.217 million;
2) Approve use of up to $31.217 million (including financing costs) of Internal
Lending Program (ILP) funding; and
3) Delegate authority to the President or her designee to execute contract
amendments for construction, as presented.
See Attachment F–4.
Approve Internal Lending Program Distribution for Down-Payment Assistance to Faculty Members (Agenda No. F–5)
It was the recommendation of the administration and the Finance and Asset Management
Committee that the Board of Regents approve an annual distribution from the Internal
Lending Program (ILP) Program Fund of $1 million per year from Fiscal Year (FY) 2020
to FY 2022 to fund a pilot Down-Payment Assistance Program to support recruitment
and retention of members of the Faculty, as presented.
See Attachment F–5.
Academic and Administrative Appointments (Agenda No. B–4)
It was the recommendation of the administration that the Board of Regents approve the
academic and administrative appointments, as presented.
See Attachment B–4.
BOARD OF REGENTS Page 6
April 11, 2019
STANDING COMMITTEE FINANCE AND ASSET MANAGEMENT COMMITTEE: Regent Benoliel, Chair
The following items were presented for information during the special meeting of the
Finance and Asset Management Committee.
Finance, Budget, and Capital Report (Agenda No. F–1) (Information only)
See Attachment F–1
DATE FOR NEXT REGULAR MEETINGS
Regent Rice announced that the next regular meetings of the Board will be on
Wednesday, May 8, in 142 Gerberding Hall and on Thursday, May 9, 2019, in the
Petersen Room of the Allen Library.
ADJOURNMENT
The regular meeting was adjourned at 4:18 p.m.
___________________________
Tyler Lange
Secretary of the Board of Regents
Approved at the meeting of the Board on May 9, 2018.
F–1 STANDING COMMITTEES Finance and Asset Management Committee
F–1/204-19 4/10/19
Finance, Budget, and Capital Report INFORMATION This item is being presented for information only. BACKGROUND This item is a standing monthly agenda item. No reports will be discussed this month. The Active Capital Projects Summary shows four projects that are behind schedule. Lou Cariello, Vice President, Facilities, will be presenting two of these (the Parrington and Kinkaid Renovations) to the Board for Stage 2 approval this month. The two other projects (the Northwest Hospital Childbirth Center and the Foster School expansion) require additional time in project definition to align budget and scope. The delay will not adversely impact the projects. Attachments 1. Monthly Debt Report – April 2019 2. Monthly Budget Report: April 2019 3. Active Capital Projects Summary as of March 21, 2019
100$
154
Remaining Debt Capacity (FY 2020-2023) 246
Total Debt Funding 500$
(1) 80/20 weighting between tax-exempt (assumes 5% coupons and a 10-year par call) and taxable 30-year interest rates to illustrate the University's portfolio (2) Due to commercial paper timing differences, project costs incurred in FY18 were refinanced with long-term debt in FY19
FY 2019-2023 (in millions)
Authorized FY 2019 Issuance (A)
Board Approved Projects (B)
Long-Term Credit Rating: Aaa/AA+Internal Lending Rate: 4.50%
Weighted Average Cost of Debt: 3.53%
Recent Events As of March 28th, the University's estimated borrowing cost was 3.65%(1), down 23 basis points from the beginning of March. Market
expectations for any increase in the Federal Funds rate are very low
Currently, there is no outstanding commercial paper. Through June 2019, the University estimates it will issue $25 million incommercial paper to fund Destination One and Kincaid Hall (Kincaid subject to Board approval in April)
Through December 2019, the University plans to issue an additional $50 million in commercial paper to fund Board approved projects
In early 2020, the University anticipates issuing $100 million in General Revenue Bonds to pay off commercial paper and fund project cash flows
Estimated Future Funding
A revised estimate of debt capacity was presented to the Board in May 2018. This analysis indicated $500 million in debt capacity through 2023 (roughly equal to principal expected to be repaid FY19-23)
Debt capacity estimates will be revised and presented to the Board in June 2019
Additional capacity from the Capital Assets Pool is recalculated quarterly as the value of the Invested Funds (IF) changes and principal owed to the CAP is repaid. As of 12/31/2018, the available capacity was $109 million
Short-term equipment financing has minimal impact on capacity
External Debt Portfolio (as of 2/28/2019)
ILP Debt, 76%
Non-ILP Debt, 24%
Variable, 4%
Fixed, 96%
Debt Activity (in millions)
The University has $2,375 million of external debt outstanding
The weighted average cost of debt is 3.53%
Between 2008 and 2014 outstanding debt grew by 13% annually. From 2015 through 2018, the annual growth rate slowed to 5%. Debt has not materially grown since 2017 and outstanding debt is projected to remain stable through 2023
$135 million of internal funding from the CAP is excluded from the external debt portfolio
Monthly Debt ReportApril 2019
(A) Authorized projects include HFS Phase 4a and Life Sciences(B) Estimated. Authorized projects include Destination One and NWH Childbirth Center
68 47
378
188 262
122 78
142 117
63
(67)(2)
17 11 9 8
950
2,348 2,393
($500)
$0
$500
$1,000
$1,500
$2,000
$2,500
($100)($50)
$0$50
$100$150$200$250$300$350$400$450
FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23
Out
stan
ding
Deb
t
Net
Cha
nge
Fiscal Years
Net Change Outstanding Debt
ATTACHMENT 1F-1.1/204-19 4/10/19
Page 1 of 2
Project Purpose Balance (1) Final Maturity
Life Sciences Building Instruction and Research $109.8 2049
Animal Research and Care Facilities Instruction and Research 88.5 2047
Molecular Engineering Building Instruction and Research 69.3 2043
Dempsey Hall Instruction and Research 36.1 2041
Foege Building Instruction and Research 25.7 2031
UW Bothell Phase 3 Instruction and Research 24.0 2043
William H. Gates Law School Instruction and Research 18.6 2028
AAALAC Instruction and Research 20.1 2035
Ben Hall Instruction and Research 14.7 2037
Denny Hall Instruction and Research 14.3 2046
Ocean Sciences Instruction and Research 8.8 2024
Other Instruction and Research Instruction and Research 14.9 various
Subtotal Instruction and Research $444.0
South Lake Union (Ph I, II, 3.1, & 3.2) UW Medicine 343.0 2048
UWMC Expansion UW Medicine 198.8 2046
NW Hospital UW Medicine 63.7 2033
UWMC Surgery Pavilion UW Medicine 32.5 2028
Other UW Medicine UW Medicine 18.4 various
Subtotal UW Medicine $663.0
HFS Expansion Student Life 557.0 2045
Husky Union Building Student Life 96.8 2043
IMA Building Student Life 27.2 2030
Radford Court Apartments Student Life 27.7 2032
Nordheim Court Student Life 18.2 2033
Bothell Student Center Student Life 16.3 2046
Ethnic Cultural Center Student Life 12.1 2043
UW Tacoma YMCA Student Life 11.1 2046
Other Student Life Student Life 25.4 various
Subtotal Student Life $797.2
UW Tower Academic Support 94.5 2037
HR Payroll Modernization Academic Support 31.2 2027
Cobb Building Academic Support 30.6 2045
West Campus Utility Plant Academic Support 25.6 2047
4225 Roosevelt Academic Support 13.8 2029
4545 Building Academic Support 12.7 2024
Other Academic Support Academic Support 32.1 various
Subtotal Academic Support $245.6
Husky Stadium Athletics 214.1 2045
Husky Ballpark Athletics 11.2 2045
Other Athletics Athletics 4.1 various
Subtotal Athletics $231.4
Available Proceeds Unallocated 15.9
Total University Outstanding Debt $2,397.1
(1) Will not exactly match ILP balances reflected in the Semi-Annual ILP report due to bond premiums and use of the CAP
Projects still drawing on ILP loans
% by Purpose
100%
Outstanding External Debt (in millions)
Long-Term Credit Rating: Aaa/AA+Internal Lending Rate: 4.50%
Weighted Average Cost of Capital: 3.53%
Unallocated, 0.7%
Athletics, 9.5%
Academic Support,
10%
Student Life, 33%
UW Medicine, 27.4%
Instruction and
Research, 18.6%
Monthly Debt ReportApril 2019
F-1.1/204-19 4/10/19
Page 2 of 2
OFFICE OF PLANNING & BUDGETING
MONTHLY BUDGET REPORT: April 2019
The Annual Review process is a nine-month budget development and holistic assessment effort that involves deans, faculty,
staff, and students. Through this process, the Provost and President work to identify and fund institutional and unit-specific
strategic goals and address resource constraints. This process also serves as an early warning system to identify and address
potential deficits within units (i.e. schools, colleges, campuses, and major Seattle administrative offices).
During March and April, the Provost and OPB leadership meet with each unit to discuss Annual Review submissions.
Conversations focus on strategic use of scarce resources, plans to address obstacles and improve financial health,
expectations for growth, and requests for tuition increases and central funding.
Meanwhile, OPB is working to incorporate variety of information into interactive models that will form the basis of
the University’s FY20 Operating Budget.
One of the major sources of information that will feed those models and, ultimately inform the FY20 Operating
Budget, is the state’s 2019-21 biennial operating budget. The state’s 2019-21 budget will not be finalized until April
28, 2019, or later. A brief concerning budget proposals will soon be posted at http://www.washington.edu/opb/opb-
briefs/.
Sept/Oct:Templates Developed
Nov 16: Templates
Sent
Feb 1:Responses Due
Feb/Mar: OPB Analysis
Mar/Apr: Unit Meetings w/
Provost
May/Jun:Presentation of UW Operating Budget
WE ARE HERE
ATTACHMENT 2F-1.2/204-19 4/10/19
Page 1 of 1
Monthly Active Capital Projects Summary
Project Name Financial Details Schedule Project Health Trending
Budget Forecast Funding Committed Target Forecast Budget Funding Schedule Safety
Seismic Improvements - Phase 1 Schacht/Aslani Architects/CLARKCONS $17.60 $17.60 $17.60 9/19 9/19
*
*
*
*
New Burke Museum Olson Kundig/Skanska $82.80 $82.80 $82.80 10/19 10/19
*
*
*
*
NCH Phase IV(b): Denny Field, Haggett & Oak Halls Kieran Timberlake/Absher $65.50 $65.50 $65.50 7/21 7/20
*
*
*
*
Population Health Facility Miller Hull Partnership/LCL $230.84 $229.71 $230.84 8/20 8/20
*
*
*
(1)
Parrington Hall Renovation INTEGRUS Architecture, PS/Absher $20.00 $23.80 $10.10 5/20 8/20
(2)
*
(3)
*
HFS Stevens Court Exterior Enclosure Rehabilitation Phase 2 RDH Building Sciences Inc./ $9.30 $9.31 $9.30 9/20 9/20
*
*
*
*
Kincaid Hall Psychology Renovation 2017-2023 Perkins+Will/Skanska $30.00 $43.22 $30.00 6/20 3/21
(4)
*
(3)*
*
Northwest Hospital Childbirth Center Zimmer Gunsul Frasca Architects/ABBOTT $25.00 $25.00 $25.00 3/21 5/21
*
*
(5)
*
Foster School Expansion LMN Architects/Hoffman $70.00 $70.00 $55.00 3/21 5/21
*
*
(5)*
*
Health Sciences Education Building Miller Hull Partnership/LCL $80.62 $80.62 $10.62 3/22 3/22
*
(6)
*
*
Totals $652.36 $647.35 $536.76
$ All Dollars in Millions
Targets Legend Budget: Budget is equal to or greater than Forecast (1% Tolerance) Meeting Target
Funding: Funding and cashflow as planned Not Meeting Target, Plan in Place
Schedule: Forecast is equal to or sooner than Target Not Meeting Target, No recovery Plan in Place Safety: Total Recordable Incident Rate of 2 or lower Notes:
(1) The project has experienced minor safety incidents and is above the safety metric goal. A recovery plan is in place to achieve the safety goal.
(2) Project budget and funding reconciled at $23.8M. Stage 2 approval is planned for April, 2019.
(3) Project definition duration and permitting schedule have been extended. Stage 2 approval with new completion date planned for April, 2019.
(4) Project budget forecast is revised based on strategies that renovate the entire Kincaid building. Stage 2 approval planned for April, 2019.
(5) Project definition phase has been extended to reconcile scope and budget. There are no expected programmatic impact.
(6) Funding request for $70M being considered by State Legislature.
ATTACHMENT 3F-1.3/204-19 4/10/19
Page 1 of 1
F–2 STANDING COMMITTEES Special Meeting of the Finance and Asset Management Committee
F–2/204-19 4/10/19
Approve Workday HR/Payroll Contract Renewal RECOMMENDED ACTION It is the recommendation of the administration and the Finance and Asset Management Committee that the Board of Regents:
1. delegate authority to the President or her designee to execute a five-year renewal of the Workday Human Capital Management Software-as-a-Service Solution (a.k.a. HR/Payroll Modernization Project) in accordance with the Workday Master Subscription Agreement for $18,035,274 plus applicable Washington State Sales Tax; and
2. delegate authority to the President or her designee to execute future
renewals of the HR/Payroll Modernization Project subscription, provided that these renewals are reported to the Board with other actions under delegated authority and in accordance with any existing or future provisions in Board of Regents Governance, Standing Orders, Chapter 1.
BACKGROUND The Workday Human Capital Management solution was selected as the result of a request for proposals conducted by UW Procurement Services in 2012, which resulted in the Master Subscription Agreement and initial purchase. This was executed on February 20, 2014 under the delegated authority approved by the Board of Regents on February 13, 2014 (https://www.washington.edu/regents/files/2014/02/2014-02-f-4.pdf). The Board approved a revised timeline for the HR/Payroll Modernization in May 2016 (https://s3-us-west-2.amazonaws.com/uw-s3-cdn/wp-content/uploads/sites/12/2018/07/23173036/2016-05-F-9.pdf) and received a status update just prior to “go-live” in June 2017 (https://s3-us-west-2.amazonaws.com/uw-s3-cdn/wp-content/uploads/sites/12/2018/07/23172252/2017-06-F-4.pdf). The HR/Payroll Modernization Project went live on July 26, 2017 and is now a major component of the UW’s Enterprise Resource and Planning system infrastructure and the system of record for all of the UW’s human resource and payroll information. The original term and value of the approved contract was five years at $16 million. The current agreement expired on February 17, 2019. Workday extended the terms of the agreement for a two-month period through April 17, 2019, to permit the Board to approve the new agreement, at a cost of $517,000.
STANDING COMMITTEES Special Meeting of the Finance and Asset Management Committee Approve Workday HR/Payroll Contract Renewal (continued p. 2)
F–2/204-19 4/10/19
The total renewal value of $18,035,274 plus applicable Washington State Sales Tax represents a 14-percent increase over the total value of the pre-negotiated annual renewal rate included in the original instrument executed on Feb 20, 2014. The increase is due to an increase in the total number of Full-Service Equivalent Workers (“FSE”) over the previous five-year term, including employees added as a result of the planned integration of Northwest Hospital into the University of Washington Medical Center on January 1, 2020. Execution of this renewal will allow the UW to utilize the Workday Human Capital Management solution through February 17, 2024. The Board must approve this renewal per Board of Regents Governance, Standing Orders, Chapter 1:
“The President of the University or the President's designee is authorized to act for the Board of Regents regarding the execution and administration of instruments and the general business and financial affairs of the University which occur in the usual course of business except the following: … G. The execution of any other instruments, including but not limited
to instruments related to acquisitions of goods and services, where the anticipated cost or value to the University exceeds $5 million. However, when the cost or value to the University exceeds $5 million and is less than $15 million, the President or the President's designee may approve and execute the instruments and report all such actions to the Board of Regents no less often than quarterly.”
The Board will revisit its delegations of authority at the July meeting of the Governance Committee to account for the launch and planned launch of cloud-based, software-as-a-service human resources and payroll, and financial reporting systems. In the interim, the Board delegates authority to the President or her designee to execute future renewals of the Workday HR/Payroll Contract, subject to reporting to the Board as it shall determine. FUNDING Consistent with the original funding plan for the HR/Payroll Modernization Project approved by the Board in February 2014, ongoing Workday subscription fees are funded by distributing the costs to campus organizational units across the campuses and Medical Centers on an full-time equivalent (FTE) basis.
F–3 STANDING COMMITTEES Finance and Asset Management Committee
F–3/204-19 4/10/19
Parrington Hall Renovation: Stage 2 Approval RECOMMENDED ACTION It is the recommendation of the administration and the Finance and Asset Management Committee that the Board of Regents, by granting Stage 2 approval to the Parrington Hall Renovation project (the “Project”):
1) Approve the Project budget of $23.8 million;
2) Approve the financing plan including use of:
a) up to $2.42 million of funding from the Internal Lending Program (ILP) for a portion of the construction costs; and
b) the Bridge Program to fund expenditures relating to unfulfilled gifts with a maximum borrowing of $2.6 million and a term not to exceed five years from the date of Board approval; and
3) Delegate authority to the President or her designee to execute contract amendments for construction.
BACKGROUND In January 2018, the Board approved a Five-Year Capital Budget that includes the the Project. In April 2018, the Board granted Stage 1 approval to the Project, authorizing a pre-construction budget of $1.4 million and delegating authority to award the design-build contract. Stage 2 approval authorizes the full financial plan for the Project. Since 1998, enrollment in the Evans School of Public Policy and Governance (“Evans School”) has grown from 223 students to over 500 in 2018 with a core faculty growing from 13 to 40 during the same period. US News & World Report ranks the school fourth in the nation, second among public institutions, out of 266 schools of public affairs and policy. The Evans School has managed growth within the limitations of its existing space in Parrington Hall for the past ten years. The Project will renovate the Parrington Hall interior to meet program needs. This includes the demolition and replacement of existing general assignment classrooms with flexible classrooms that support active learning. Additionally, the Project will create more open staff and graduate student offices and provide increased collaboration areas across the building.
STANDING COMMITTEES Finance and Asset Management Committee Parrington Hall Renovation: Stage 2 Approval (continued p. 2)
F–3/204-19 4/10/19
Attachments 1. Parrington Hall Project Summary 2. Parrington Hall Project Background 3. Parrington Hall Financing Plan and Credit Analysis
Approve Project Budget and Funding Plan
Proposed Budget Proposed FundingConstruction Cost $ 18,231,211 77% State Funds $ 10,000,000 42%Consultant Services $ 2,865,725 12% Donor Funds $ 9,488,849 40%Equipment and Furniture $ 1,012,920 4% ILP Loan * $ 2,411,151 10%Project Management $ 883,632 4% UW Capital Funds $ 1,900,000 8%Other Costs $ 806,512 3%Total Project Cost $ 23,800,000 100% Total Funds $ 23,800,000 100%
UW Denny Hall Renovation: $367/GSF* Rice University Rayzor Hall $340/SF* Denny benchmark data adjusted to align with Parrington scope.
Current Targets Current TargetsNet Assignable SF 27,162 25,776 Construction Cost/GSF $311 $277 Gross SF 58,755 58,755 Project Cost / GSF $405 $340 Efficiency (NASF/GSF) 46% 44% Operating Costs/GSF* $6.99 $6.99
Objectives• Create learning environments that support collaboration, active learning, and faculty innovation• Create space that fosters student engagement, and builds academic community• Reflect the school’s commitment to sustainability and stewardship for one of the oldest, most iconic buildings on the Seattle campus• Create a building that will be useful well into the future, accommodating emerging campus standards for flexibility and density
Approve Pre-construction Budget ($1.4M)Delegated Authority to Award Design Build Contract
* excludes $2,500 issuance fee to be paid from School reserves at closing.
Project Cost Benchmarks
Metrics & Indicators
Schedule
Description
Regent Actions
The Project will renovate the Parrington Hall interior aligning the building to meet the Evans School's program needs for flexible learning and office space. This includes demolition of existing general assignment classrooms and replacing them with flexible classrooms that support active learning, creating more open staff and graduate student offices, and providing more collaboration areas across the building. This project includes upgrades to modernize systems and improve accessibility to better provide for consistent user comfort and flexibility.
Financials
*utility costs within operation budget will be less
Benchmarks are total project costs escalated to 2019
*estimated debt service on ILP is $288.5K/yr
Parrington Hall Project Summary
Stage 1 Actions: April 2018
Stage 2 Actions: April 2019
2018
Jan March June Sept
2019
Jan March June Sept
2020
Jan March June Sept
Planning
Stage 1 Approval Move In
2017
June Sept
Design/Permitting
ConstructionStage 2 Approval
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Parrington Hall Project Background
Project Background
For the past decade the Evans School of Public Policy and Governance (“Evans School”) has
managed student and faculty growth within the limitations of Parrington Hall. The Parrington Hall
renovation will modernize outdated building programs and infrastructure creating flexible
classrooms to support creative learning classrooms and open offices to increase collaboration.
The April 2018 Stage 1 approval by the Board of Regents set a target budget of $20 million. The
Design Build contract was subsequently executed according to this budget. However, due to new
permit requirements which defined the Project as substantial alteration, the original budget was
altered in order to meet both program and building Code requirements.
An increased budget recommendation of $23.8 million aligns project scope with both City
permitting and Evans School program requirements. The revised budget follows the original 50-
percent funding participation by the Evans School which will be strategically allocated to achieve
balanced program and building renewal project goals. The project team continues to work with
the City of Seattle to determine the most appropriate ways to address a variety of Code
interpretation issues while maximizing funds available for academic program enhancements.
Project Schedule
This is a Design-Build (D-B) project, with Absher Construction-Integrus Architecture as the selected
D-B team. The design started in summer 2018 and construction will begin in May 2019 with
substantial completion in August 2020. City permitting negotiations have extended the project
completion date by three months.
ATTACHMENT 2F-3.2/204-19 4/10/19
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Parrington Hall Financing Plan and Credit Analysis
SCOPE OF FINANCIAL DUE DILIGENCE
Prior to the Administration’s recommending a debt-funded project for Board approval,
the Treasury Office conducts a financial due diligence. The process for due diligence is
well-defined but not exhaustive. It involves a financial risk assessment based on
conversations with the borrower, an in-depth review of provided data, and an
evaluation of the impact of a series of stress tests on the proforma. It is not intended
to replace the work of the management team, and offers no assurance of financial
performance.
Specific due diligence tasks, in partnership with the Evans School and the Office of Planning
and Budgeting, included the following:
Developed a FY2019 - FY2029 project proforma
Identified key risks
Conducted critical stress tests
Identified mitigation plans
Provided guidance on loan structuring
Financing Plan and Credit Analysis
The Parrington Hall is a $23.8 million renovation to the infrastructure and interior of
Parrington Hall (the “Project”), which will help meet the Evans School of Public Policy and
Governance’s (the “Evans School”) needs for flexible learning and office space.
In partnership with the Office of Planning and Budgeting (OPB), the Treasury Office worked
closely with the Evans School to perform a credit analysis to assess the ability of the
department to fully fund the Project through a combination of (a) State funds, (b) a
University capital contribution, (c) donor funds, and (d) an Internal Lending Program (ILP)
loan. The ILP loan will be repaid from net income of the Evans School, followed by available
reserves. Ultimately, the Provost backstops all ILP loans.
Due to the donor funding component of the Project, the University’s Bridge program will
also be used to address the timing gap between project expenditures and the receipt of gift
funds in order to accelerate project construction.
Treasury believes the Evans School has demonstrated the ability to fully fund the Project
and adequately service related debt. While the loan is relatively small in size, it is important
to note that the Evans School’s ability to service the debt is largely due to growth in fee-
based revenue and limited increases in salaries and benefits. Further, the Evans School has
thin reserves to mitigate declines in financial performance. In the event of declining
ATTACHMENT 3F-3.3/204-19 4/10/19
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Parrington Hall Financing Plan and Credit Analysis
financing performance, the Evans School will work with OPB to evaluate various
mitigations.
Project Scope and Funding
The Project includes the demolition and replacement of existing general assignment
classrooms with flexible spaces that support active learning, create open staff and
graduate student offices, and provide collaboration areas across the building. This Project
also includes significant structural work as well as infrastructure upgrades to modernize
systems and improve accessibility to provide for consistent user comfort and flexibility.
As shown in the following table, the total cost of the Project is $23.8 million:
Proposed Budget
Proposed Funding
Construction Cost $ 18,231,211 State Funds $ 10,000,000
Consultant Services 2,865,725 Donor Funds 9,488,849
Equipment and Furniture 1,012,920 ILP Loan* 2,411,151
Project Management 883,632 UW Capital Funds 1,900,000
Other Costs 806,512
Total Project Cost $ 23,800,000 Total Funds $ 23,800,000
* Excludes $2,500 issuance fee to be paid from School reserves at closing. Estimated debt service on the
ILP loan after completion is expected to be approximately $288,500/year
Key Assumptions
Two key assumptions behind the financial proforma are the Evans School’s forecast that (1)
fee-based programs will grow at a higher rate than in recent years and (2) salaries and
benefits will grow modestly going forward. Proforma assumptions were vetted with OPB
and align with the Evans School’s budget.
Revenues (FY19-FY29):
Tuition: An average growth rate of 2.2%/year, reflecting expected tuition increases
Self-Sustaining Units: An average growth rate of 8%/year, reflecting growth in actual
and planned programs
Fee-Based Programs: The growth rate for FY20 and FY21 is assumed to be 32% and
21% respectively due to the launch of the Global MPA fee-based program in FY20.
Thereafter the Evans School projects a growth rate of 5%/year, reflecting sustained
enrollment and tuition growth
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Parrington Hall Financing Plan and Credit Analysis
Expenses (FY19-FY29):
Salary Expenses: A growth rate of 2%/year
Benefit Expense: A growth rate of 2%/year
FTE Growth: 1 faculty added in FY22, 2 faculty and 2 professional staff added in FY23
Loan Provisions:
10-year loan (useful life of tenant improvements is > 10 years)
Interest is accrued and paid through construction
Estimated debt service on the 10-year loan (after construction) is expected to be
approximately $288,500/year
The Bridge loan will accrue interest at a fixed short-term market rate, and will be
paid monthly (see Bridge Financing Strategy below)
Base Case Proforma (see Appendix A)
The Base Case proforma shows that the Evans School can service the debt related to their
ILP and Bridge loans:
The relative size of the ILP loan is small compared to net income resulting in Debt
Service Coverage (DSC) well above the standard 1.25x. The minimum Debt Service
Coverage (DSC) is 6.2x in FY23 and the maximum is 155.5x in FY20
Unrestricted reserves are well above 1-year of debt service (approximately
$288,500) and are projected to grow from a minimum of $1.9 million in FY20 to a
maximum of $20.7 million in FY29
Stress Tests & Sensitivity Analysis (see Appendix B)
Three stress tests were performed. For illustrative purposes, the stress tests assume no
mitigation is taken by the Evans School or OPB.
1. Revenue Stressor: Fee-based revenues remain equal to FY19 levels (0% growth)
If fee-based revenues remain at FY19 levels, the Evans School is still
projected to generate positive cash flow in all years
Reserves would remain positive in all years
2. Expense Stressor: Salary and benefit expenses grow 5%/year and 4%/year
respectively
If salary and benefits grow at higher rates than in the Base Case proforma,
the Evans School is projected to generate negative cash flow beginning in
FY27
Reserves would remain positive in all years
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Parrington Hall Financing Plan and Credit Analysis
3. Combined stress case (both conditions described above)
If both conditions described above occur simultaneously, cash flow will
become negative beginning in FY23 and thereafter and reserves will be
exhausted in FY24
Risk Mitigation Plan
Potential mitigations of evaluated stressors include:
Expense reductions;
Increased philanthropy;
Curtail other capital expenditures and School initiatives; and
Increased support by Central
Bridge Financing Strategy
As of March 15, 2019, the Evans School has received $9.5 million in pledges relating to the
Project, with $6.9 million on hand. The Evans School expects to collect an additional $2.6
million through the construction of the Project. When combined with the other funding
sources, these funds are expected to cover Project expenditures through June 2020.
At that point, Project expenditures are expected to exceed available funds and the Bridge
program will be used to fund expenditures relating to unfulfilled gifts. Based on currently
uncollected pledges, the maximum Bridge loan will be set at $2.6 million. However, under
current collection projections, the needed Bridge loan is estimated to be $1.4 million.
The Bridge loan will accrue interest at a short-term market rate determined at the time of
the initial draw. The interest rate will be fixed for the life of the loan. The interest will be
paid monthly from Evans School net income. The Bridge program is not an additional
funding source for Project costs, and any outstanding Bridge loan balance will be repaid as
donor funds are received, but no later than five years after Regent approval (April 2024).
Ongoing Communication Plan
On-going requirements and communication include:
Enter into a financing agreement with Treasury
Provide periodic financial information as requested by Treasury, OPB, and/or the
Board of Regents
Contact Compliance and Risk Services to determine the appropriate types and
amounts of coverage, if any
F-3.3/204-19 4/10/19
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Parrington Hall Financing Plan and Credit Analysis
Parrington Hall
Appendix A: Base Case Proforma
(1) CAGR = Compound Annual Growth Rate
(2) Majority of negative cash flow was from spend down of reserves unavailable to Evans School. These were ultimately covered by Central, and therefore do not contribute to reserve balances in FY16
and FY17
Annualized
FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 FY 2025 FY 2026 FY 2027 FY 2028 FY 2029
CAGR (1)
(FY16-FY18)
CAGR
(FY19-FY20)
CAGR
(FY20-FY29)
Beginning Balances -$ -$ -$ 61,316$ 222,039$ 1,890,647$ 3,824,818$ 5,972,441$ 7,582,570$ 9,354,570$ 11,281,829$ 13,374,814$ 15,642,286$ 18,093,240$
REVENUE
Tuition (ABB) 6,750,941$ 6,739,673$ 7,135,073$ 6,985,000$ 7,195,090$ 7,418,500$ 7,559,000$ 7,710,000$ 7,864,200$ 8,021,484$ 8,181,914$ 8,345,552$ 8,512,463$ 8,682,712$ 2.8% 3.0% 2.1%
Research Cost Recovery (RCR) 202,745$ 256,360$ 254,979$ 281,787$ 475,250$ 538,427$ 598,428$ 615,044$ 627,345$ 639,892$ 652,690$ 665,743$ 679,058$ 692,639$ 12.1% 68.7% 4.3%
Self-Sustaining Units 842,835$ 863,620$ 502,768$ 460,156$ 523,164$ 547,322$ 722,688$ 689,222$ 723,843$ 760,203$ 798,390$ 838,494$ 880,613$ 924,848$ -22.8% 13.7% 6.5%
Nonrestricted Annual Gifts 243,691$ 140,600$ 119,930$ 150,000$ 150,000$ 150,000$ 150,000$ 150,000$ 150,000$ 150,000$ 150,000$ 150,000$ 150,000$ 150,000$ -29.8% 0.0% 0.0%
Nonrestricted Endowment Distributions 508,487$ 471,189$ 518,248$ 681,600$ 681,600$ 681,600$ 681,600$ 681,600$ 695,232$ 709,137$ 723,320$ 737,786$ 752,542$ 767,593$ 1.0% 0.0% 1.3%
Fee-Based Revenue 1,246,335$ 1,176,621$ 1,480,310$ 1,806,000$ 2,377,000$ 2,875,031$ 3,018,783$ 3,169,722$ 3,328,208$ 3,494,619$ 3,669,349$ 3,852,817$ 4,045,458$ 4,247,731$ 9.0% 31.6% 6.7%
Total Operating Revenue 9,795,034$ 9,648,063$ 10,011,308$ 10,364,543$ 11,402,104$ 12,210,880$ 12,730,499$ 13,015,588$ 13,388,828$ 13,775,334$ 14,175,662$ 14,590,393$ 15,020,135$ 15,465,524$ 1.1% 10.0% 3.4%
EXPENSES
FTE 57 57 57 53 53 53 54 58 58 58 58 58 58 58
Salaries 6,975,318$ 7,321,583$ 6,996,345$ 6,383,089$ 6,510,751$ 6,640,966$ 6,923,785$ 7,512,261$ 7,662,506$ 7,815,756$ 7,972,071$ 8,131,513$ 8,294,143$ 8,460,026$ 0.2% 2.0% 3.0%
Benefits 1,792,731$ 1,962,143$ 1,826,065$ 1,770,628$ 1,806,041$ 1,842,162$ 1,911,931$ 2,063,582$ 2,104,854$ 2,146,951$ 2,189,890$ 2,233,688$ 2,278,362$ 2,323,929$ 0.9% 2.0% 2.8%Other Operations (e.g. supplies, computers, 1,046,367$ 1,140,945$ 1,127,582$ 2,050,103$ 1,405,902$ 1,528,431$ 1,433,180$ 1,522,126$ 1,552,959$ 1,596,889$ 1,632,237$ 1,669,240$ 1,708,196$ 1,749,377$ 3.8% -31.4% 2.5%
Total Operating Expenses 9,814,416$ 10,424,671$ 9,949,992$ 10,203,820$ 9,722,694$ 10,011,559$ 10,268,897$ 11,097,969$ 11,320,320$ 11,559,596$ 11,794,199$ 12,034,441$ 12,280,701$ 12,533,332$ 0.7% -4.7% 2.9%#DIV/0! #DIV/0!
NET OPERATING INCOME (19,382)$ (776,608)$ 61,316$ 160,723$ 1,679,410$ 2,199,321$ 2,461,602$ 1,917,619$ 2,068,508$ 2,215,738$ 2,381,463$ 2,555,952$ 2,739,434$ 2,932,192$ 944.9% 6.4%
Bridge Loan (Estimated) -$ -$ -$ -$ -$ 31,310$ 25,500$ 19,011$ 8,028$ -$ -$ -$ -$ -$ FAST Loan (Estimated) -$ -$ -$ -$ 10,803$ 233,840$ 288,479$ 288,479$ 288,479$ 288,479$ 288,479$ 288,479$ 288,479$ 288,479$
TOTAL DEBT SERVICE -$ -$ -$ -$ 10,803$ 265,150$ 313,980$ 307,490$ 296,508$ 288,479$ 288,479$ 288,479$ 288,479$ 288,479$
Subtotal: Net Operating Cash Flow (19,382)$ (776,608)$ 61,316$ 160,723$ 1,668,608$ 1,934,171$ 2,147,623$ 1,610,129$ 1,772,001$ 1,927,259$ 2,092,984$ 2,267,472$ 2,450,954$ 2,643,713$
Non-Operating Revenue/Income -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$
Capital Expenditures -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$
Cash Flow (2) (19,382)$ (776,608)$ 61,316$ 160,723$ 1,668,608$ 1,934,171$ 2,147,623$ 1,610,129$ 1,772,001$ 1,927,259$ 2,092,984$ 2,267,472$ 2,450,954$ 2,643,713$
Ending Balance (Reserves) 61,316$ 222,039$ 1,890,647$ 3,824,818$ 5,972,441$ 7,582,570$ 9,354,570$ 11,281,829$ 13,374,814$ 15,642,286$ 18,093,240$ 20,736,953$
155.5 8.3 7.8 6.2 7.0 7.7 8.3 8.9 9.5 10.2
Actual
Coverage (Net Operating Income / Debt Service)
Projected
F-3.3/204-19 4/10/19
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Parrington Hall Financing Plan and Credit Analysis
Parrington Hall
Appendix B: Stress Tests and Sensitivity Analysis
FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 FY 2025 FY 2026 FY 2027 FY 2028 FY 2029
Net Operating Income 160,723$ 1,679,410$ 2,199,321$ 2,461,602$ 1,917,619$ 2,068,508$ 2,215,738$ 2,381,463$ 2,555,952$ 2,739,434$ 2,932,192$
Cash Flow 160,723$ 1,668,608$ 1,934,171$ 2,147,623$ 1,610,129$ 1,772,001$ 1,927,259$ 2,092,984$ 2,267,472$ 2,450,954$ 2,643,713$
Reserves 222,039$ 1,890,647$ 3,824,818$ 5,972,441$ 7,582,570$ 9,354,570$ 11,281,829$ 13,374,814$ 15,642,286$ 18,093,240$ 20,736,953$
FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 FY 2025 FY 2026 FY 2027 FY 2028 FY 2029
Net Operating Income 160,723$ 1,108,410$ 1,130,290$ 1,248,819$ 553,897$ 546,300$ 527,120$ 518,114$ 509,135$ 499,976$ 490,462$
Cash Flow 160,723$ 1,097,608$ 865,140$ 934,840$ 246,407$ 249,793$ 238,641$ 229,635$ 220,655$ 211,497$ 201,982$
Reserves 222,039$ 1,319,647$ 2,184,787$ 3,119,627$ 3,366,034$ 3,615,826$ 3,854,467$ 4,084,101$ 4,304,757$ 4,516,254$ 4,718,236$
FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 FY 2025 FY 2026 FY 2027 FY 2028 FY 2029
Net Operating Income 160,723$ 1,452,505$ 1,729,982$ 1,733,980$ 910,597$ 746,027$ 557,166$ 365,057$ 158,800$ (62,599)$ (300,148)$
Cash Flow 160,723$ 1,441,703$ 1,464,832$ 1,420,000$ 603,107$ 449,520$ 268,687$ 76,577$ (129,679)$ (351,078)$ (588,627)$
Reserves 222,039$ 1,663,742$ 3,128,574$ 4,548,574$ 5,151,681$ 5,601,201$ 5,869,888$ 5,946,465$ 5,816,786$ 5,465,708$ 4,877,080$
FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 FY 2025 FY 2026 FY 2027 FY 2028 FY 2029
Net Operating Income 160,723$ 881,505$ 660,951$ 521,197$ (453,125)$ (776,181)$ (1,131,453)$ (1,498,293)$ (1,888,017)$ (2,302,057)$ (2,741,879)$
Cash Flow 160,723$ 870,703$ 395,801$ 207,217$ (760,615)$ (1,072,688)$ (1,419,932)$ (1,786,772)$ (2,176,496)$ (2,590,536)$ (3,030,358)$
Reserves 222,039$ 1,092,742$ 1,488,543$ 1,695,760$ 935,145$ (137,543)$ (1,557,475)$ (3,344,247)$ (5,520,743)$ (8,111,279)$ (11,141,637)$
Base Case Proforma
Stress Test 1 - Fee Based Revenue
Stress Test 3 - Combined Scenario
Stress Test 2 - Salaries & Benefits
F-3.3/204-19 4/10/19
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F–4 STANDING COMMITTEES Finance and Asset Management Committee
F–4/204-19 4/10/19
Kincaid Hall Renovation: Stage 2 Approval RECOMMENDED ACTION It is the recommendation of the administration and the Finance and Asset Management Committee that the Board of Regents, by granting Stage 2 Approval to the Kincaid Hall Renovation project (the “Project”):
1) Approve the Project budget of $43.217 million;
2) Approve use of up to $31.217 million (including financing costs) of
Internal Lending Program (ILP) funding; and
3) Delegate authority to the President or her designee to execute contract amendments for construction.
BACKGROUND In January 2018, the Board approved a Five-Year Capital Budget that includes the Project. In April 2018, the Board granted Stage 1 approval to the Project, authorizing a preconstruction budget of $3 million and delegating authority to award the design-build contract. Stage 2 approval authorizes the full financial plan for the Project. Construction of the new Life Sciences Building enabled Kincaid Hall to be vacated and renovated for the Departments of Psychology and of Biology. The current proposal includes an expanded scope that will save significant money in both capital and operating over the next decade. The recommended debt funding for the Project has been included in the estimates of institutional debt capacity. The new debt service will be repaid centrally from available funds as existing debt service for other centrally funded projects expires. Attachments 1. Kincaid Hall Project Summary 2. Kincaid Hall Project Background 3. Kincaid Hall Financing Plan and Credit Analysis
Approve Full Project Budget and Funding Plan
Proposed Budget Proposed FundingConstruction Cost $ 35,400,000 82% Internal Lending (ILP), original $ 27,189,000 63%Consultant Services $ 3,500,000 8% UW Central Funds $ 5,000,000 12%Equipment and Furniture $ 1,300,000 3% Equity College Arts Sciences $ 4,000,000 9%Other Costs $ 1,300,000 3% Internal Lending (ILP), additional $ 4,028,000 9%Project Management $ 1,500,000 3% UW Central Funds FY 2018/2019 $ 3,000,000 7%Financing Costs $ 217,000 1% Other $ 0 0%Total Project Cost $ 43,217,000 100% Total Funds $ 43,217,000 100%
UW Denny Hall Renovation: $367/GSF Skanska USA 2017 Feasibility Study Cost Estimate $360/GSFUW HSC J-Wing Renovation $349/GSF*Denny/J Wing benchmark aligned with Kincaid project Scope
Current Targets Current TargetsNet Assignable SF 70,000 62,500 Construction Cost/GSF $454 $284 Gross SF 78,000 84,400 Project Cost / GSF $554 $355 Efficiency (NASF/GSF) 90% 74% Operating Costs/GSF** $6.99 $6.99
**there will be no incremental O&M increase with full building renovation
Attachment 1
Schedule
Regent Actions
Delegated Authority to Award Design Build Contract
Objectives· Kincaid Hall renovation project will extend the useful life of a central campus building.· Consolidate and provide a permanent location for Psychology Clinics dislocated by the new Population Health Facility and other capital projects, and create office and dry lab for Biology. · Reduce campus deferred maintenance backlog and improve building energy efficiency creating long term operational cost savings.· Utilize Kincaid Hall as a resource for future growth and programmatic needs for the departments of Psychology and Biology.
Approve Pre-construction Budget of $3,000,000 Funded by UW Central Funds
DescriptionThe original scope is revised to accommodate an investment strategy that better aligns with the institutional goals of the University and the College of Arts and Sciences. Building infrastructure and tenant program improvements were expanded to cover the entire Kincaid Hall. Building improvements include new mechanical systems, energy Code compliant building envelope, life safety Code compliance, and interior program improvements to floors 1-5, plus the basement. Interior program improvements will allow consolidation of satellite Psychology units within Kincaid Hall.
Financials
Metrics & Indicators
Benchmarks
Kincaid Hall Project Summary
Stage 1 Actions: April 2018
Stage 2 Actions: April 2019
2018
Qtr 1 Qtr 2 Qtr 3 Qtr 4
2019
Qtr 1 Qtr 2 Qtr 3 Qtr 4
2020
Qtr 1 Qtr 2 Qtr 3 Qtr 4
Planning
Stage 1 Approval
Move In
2017
Qtr 3 Qtr 4
Design/Permitting
Construction
Qtr 1 Qtr 2
2021
Stage 2 Budget and Funding Approval
ATTACHMENT 1F-4.1/204-19 4/10/19
Page 1 of 1
Kincaid Hall Project Background
Project Background
Construction of the new Life Sciences Building enabled Kincaid Hall to be vacated and renovated.
The Kincaid Hall project will modernize the space and replace aging infrastructure reducing the
deferred maintenance backlog of this central campus asset and increasing energy efficiency. A key
project goal was consolidation of the Department of Psychology that was scattered throughout
West Campus.
The April 2018 Stage 1 approval by the Board of Regents set a target budget of $30 million. The
Design Build contract was executed and the definition of the project based on the goals and
objectives began. The original $30 million partial building renovation was evaluated and compared
to investment strategies that further aligned the project objectives by increasing scope/funding to
accommodate. Financial comparisons of investment strategies led to the recommendation of a
revised project budget of $43.217 million.
The $43.217 million budget and corresponding scope accommodates a full building renovation,
which includes floors 4 and 5, and provides the best investment value. Including renovations of
floors 4 and 5 consolidates Psychology, reduces future capital and operating costs and decreases
deferred maintenance obligations in Kincaid and satellite occupied Psychology spaces.
Project Schedule
This is a Design-Build (D-B) project, with Skanska Construction-Perkins + Will Architecture as the
selected D-B team. The design started summer 2018. Construction will begin in May 2019 with
substantial completion in March 2021. Increasing the project scope has shifted the project
completion date by three months.
ATTACHMENT 2F-4.2/204-19 4/10/19
Page 1 of 1
Kincaid Hall Financial Plan and Credit Analysis
Scope of Financial Due Diligence
Prior to the Administration’s recommending a debt-funded project for Board approval,
the Treasury Office conducts a financial due diligence. The process for due diligence is
well-defined but not exhaustive. It is not intended to replace the work of the
management team, and offers no assurance of financial performance.
Since debt service of the loan will be paid centrally, specific due diligence tasks, in
partnership with Central Administration, included the following:
Confirmed and identified available funds to pay loan debt service
Confirmed the College of Arts and Sciences available balances
Provided guidance on loan structuring
Financing Plan and Credit Analysis
The $43.217 million renovation of Kincaid Hall (the “Project”) is a critical project for Central
Administration that replaces aged and outdated building infrastructure, reduces deferred
maintenance backlog, and increases space utilization. Debt service will be paid centrally
from available funds as existing debt service for other centrally funded projects expire.
The Office of Planning and Budgeting worked closely with the Treasury Office to perform a
financial and credit analysis to assess the financial viability of the Project:
Project scope included verifying debt service schedules for Physics Astronomy and
the K-Wing with Financial Accounting, and confirming that Central Administration
currently pays debt service on those facilities
Central Administration confirmed that they currently make debt service payments
on those facilities, with the caveat that $600,000/year in DOF budget authority will
be returned to the School of Medicine (beginning in FY19) and is not available to pay
Project debt service
$8 million of Project expenditures will be funded through an equity contribution from
Central Administration. $4 million of Project expenditures will be funded through an equity
contribution from the College of Arts and Sciences. The equity will be spent first. Remaining
funding will come from a $31.217 million loan through the University’s Internal Lending
Program (ILP).
The Treasury office believes financial risk with this Project is low as measured by the
reduction in aggregate debt service paid by Central Administration, the level of reserves
available to pay future costs, and the relatively small project cost in the scope of Central
Administration. It is noteworthy that the $4 million equity contribution from the College of
Arts and Sciences reduces reserves available to mitigate financial stress for the Life
Sciences Building loan, which is paid from Arts and Sciences revenue (primarily tuition
ATTACHMENT 3F-4.3/204-19 4/10/19
Page 1 of 3
Kincaid Hall Financial Plan and Credit Analysis
operating fee). The College of Arts and Sciences is currently forecast to experience annual
deficits beginning in FY21, given conservative revenue and modest expense growth
assumptions. After accounting for the equity payment, FY19 College of Arts and Sciences
ending reserve balance (GOF) is projected to be $29.3 million (or roughly 14% of FY19 GOF
Permanent Budget Authority). Available reserve balances for the College of Arts and
Sciences are projected by the Department to be sufficient to fund these annual deficits.
Loan Details
Key loan provisions include:
Interest is accrued and paid during construction (substantial completion expected in
March 2021)
The loan will be amortized over 25 years after construction is complete (useful life of
the asset is greater than 30 years, includes rebuild of mechanical, electric and
plumbing systems, seismic and structural work, new roof)
Estimated debt service on the 25 year loan is expected to be $2.1 million/year
beginning in FY22
Base Case Proforma
If the Project is approved, the FY19 debt service payment will be $4.1 million lower than the
current FY18 debt service payment (on an aggregated basis). This is due to the reduction in
current debt service payments related to the Physics Astronomy and K-Wing loans.
Current Payments
FY18 FY19 FY20 FY21 FY22 FY23
Physics Astro Debt
Service $2,859,590 $237,354 $63,929 $65,813 $63,250 $5,250
K-Wing Debt Service 2,300,979 192,500 - - - -
Current Debt Service $5,160,569 $429,854 $63,929 $65,813 $63,250 $5,250
Future Payments
FY18 FY19 FY20 FY21 FY22 FY23
Physics Astronomy Debt
Service $2,859,590 $237,354 $63,929 $65,813 $63,250 $5,250
K-Wing Debt Service 2,300,979 192,500 - - - -
DOF Budget Authority
to Department (1) 600,000 600,000 600,000 600,000 600,000
New Debt Service
(25-year) (2) 0 936,510 1,574,116 2,082,171 2,082,171
Future Debt Service $5,160,569 $1,029,854 $1,600,439 $2,239,929 $2,745,421 $2,687,421
Amount Future
Payment is Below FY18
Payment - ($4,130,715) ($3,560,130) ($2,920,640) ($2,415,148) ($2,473,148)
F-4.3/204-19 4/10/19
Page 2 of 3
Kincaid Hall Financial Plan and Credit Analysis
(1) Reflects permanent transfer of DOF budget authority to School of Medicine (2) Reflects estimated construction draw schedule and assumes equity is spent first
ILP Loan Requirements
N/A – Centrally funded project
Key Risks
N/A – Centrally funded project
Stress Tests & Sensitivity Analysis
N/A – Centrally funded project
Risk Mitigation Plan
N/A – Centrally funded project
Ongoing Communication Plan
N/A – Centrally funded project
F-4.3/204-19 4/10/19
Page 3 of 3
F–5 STANDING COMMITTEES Finance and Asset Management Committee
F–5/204-19 4/10/19
Approve Internal Lending Program Distribution for Down-Payment Assistance to Faculty Members RECOMMENDED ACTION It is the recommendation of the Finance and Asset Management Committee that the Board of Regents approve an annual distribution from the Internal Lending Program (ILP) Program Fund of $1 million per year from Fiscal Year (FY) 2020 to FY 2022 to fund a pilot Down-Payment Assistance Program (Program) to support recruitment and retention of members of the Faculty.
BACKGROUND
Rising housing prices in Seattle make the recruitment and retention of faculty members more difficult. Many peer institutions the University competes with for these faculty offer housing assistance programs or are located in more affordable housing markets. The proposed Program will make the University more competitive with offers to priority faculty hires. Aside from the economic benefits of housing assistance, down payment assistance programs tend to “ground” faculty to the institution and the area and can reduce faculty turnover. This Program is part of a broader effort to improve housing affordability for all employees at the University. Since 1998, the University has participated in the Hometown Home Loan Program that offers employees a series of discounts on mortgages and access to special programs. More than 3,340 employees have taken part in this program. More recently, the University built a workforce housing project in partnership with Children’s Hospital that included 37 affordable units for those making 65 percent to 85 percent of area median income. The University is currently in a partnership with Seattle Housing Authority to build 150 units for those making 60 percent of area median income. The University also committed to building more affordable housing as part of the Campus Master Plan. THE PROGRAM The Program will be available to all faculty upon recommendation from the Provost and the Vice Provost for Academic Personnel. It will provide a cost-effective alternative to a traditional thirty-year mortgage structure with a 90-percent first mortgage and a 10-percent down payment. The Program will allow for up to 10 percent of the price of a home to be borrowed at a below-market interest rate with deferred monthly payments. Based on the current median price
STANDING COMMITTEES Finance and Asset Management Committee Approve Internal Lending Program Distribution for Down-Payment Assistance to Faculty Members (continued p. 2)
F–5/204-19 4/10/19
of a house in Seattle, the Program can save a faculty member nearly $600 per month on his or her mortgage payment. The initial interest rate on the Program will be 3.5 percent, as compared to current market rates for second mortgages of 6 percent. Additionally, the payment of interest on the Program can be deferred for up to seven years. By utilizing the Program, the borrower can also avoid costly Private Mortgage Insurance (PMI). Below is an example of potential savings from using the Program assuming a 10 percent down payment and a $675,000 purchase price:
Years 1-7
Conventional Mortgage (90%/10%)
With UW Down Payment Assistance (80%/10%/10%)
Monthly Savings
1st Mortgage Payment 3,261 2,899 362 Second Mortgage Payment n/a deferred n/a Private Mortgage Insurance 253 0 253 Total Years 1-7 (per month) 3,514 2,899 615 Years 8-30 1st Mortgage Payment 3,261 2,899 362 2nd Mortgage Payment 0 444 (444) Total Years 8-30 (per month) 3,261 3,343 (81) Total Payments (30 years) 1,195,291 1,166,050 29,242
The loan will be payable in full at separation from the University or sale or refinance of the purchased property. If the loan remains outstanding after seven years, the borrowed amount and the accrued interest will amortize for 23 years. The University is partnering with the Washington State Housing Finance Commission (Commission) to service the loans and report on the Program. The Commission is an agency of the State of Washington that is dedicated to increasing housing access and affordability and to expanding the availability of quality community services for the people of Washington. The Commission has extensive experience with managing down payment assistance programs.
STANDING COMMITTEES Finance and Asset Management Committee Approve Internal Lending Program Distribution for Down-Payment Assistance to Faculty Members (continued p. 3)
F–5/204-19 4/10/19
Withdrawals from the ILP Program Fund for this purpose requires the approval of the Board of Regents pursuant to Section 4(f) of the University’s Debt Management Policy. A list of Program Fund withdrawals will be included in the annual Program report to the Board. FUNDING PLAN The Program will initially be funded with ILP reserves in the amount of $1 million per year for FY 2020-2022. These funds will be available each June, and will be used to originate Program loans. As loans are repaid, available funds will be used to make future loans. To create a program that funds ten loans a year in perpetuity, approximately $7 million will need to be contributed, or $1 million per year for seven years. In the seventh year, enough loans will be repaid to allow the program to become self-sustaining. Funding has not yet been identified beyond the first three years. The Treasury Office has evaluated the impact of the initial contribution of $1 million per year for three years and believe that making this investment will not have a material effect on ILP rate stabilization. However, any distributions from the ILP increase the likelihood that the ILP rate will need to be increased for internal borrowers. APPROVALS This item has been reviewed and approved by the Provost, the Vice President for Finance, and the University Treasurer. Attachment Faculty Down Payment Assistance Program
FACULTY DOWN PAYMENT ASSISTANCE PROGRAM
BOARD OF REGENTS
FINANCE AND ASSET MANAGEMENT COMMITTEE
April 10, 2019
ATTACHMENTF-5.1/204-19 4/10/19
Page 1 of 9
Why a Down Payment Assistance (DPA) Program?
Cost of housing is making recruitment of faculty more difficult• Seattle remains in the top-10 most expensive metro areas for housing• Seattle area vs. peer institution areas (average):
Despite existing housing assistance programs, UW’s portfolio of support is lagging other institutions in higher priced areas
DPA Program adds to the portfolio of available options to support housing needs for UW faculty and can “ground” faculty to the UW and the Seattle area
Down payment assistance can provide a meaningful benefit with a relatively small investment
Ho
usi
ng
–Z
illo
w (
20
18
)
$0
$200,000
$400,000
$600,000
$800,000
Median Home Value
$0
$1,000
$2,000
$3,000
Median Rent Price
F-5.1/204-19 4/10/19
Page 2 of 9
What are UW’s Existing Housing Assistance Programs?
Hometown Home Loan Program offers reduced mortgage costs, assistance programs and education for all UW employees
Partnership with Seattle Children’s to build affordable workforce housing in the U District
Visiting Faculty Office connects people with housing available for temporary use
Whole U promotes affordable housing resources to employees
Partnership with Seattle Housing Authority to build 150 affordable units at 4201 Roosevelt Way
UW commitment to build 300 additional affordable units as part of Seattle Campus Master Plan
F-5.1/204-19 4/10/19
Page 3 of 9
What Housing Programs do Other Schools Have?
Institution Name
Faculty Housing Inventory?
First MortgageOrigination?
DownPayment Assistance?
Grant or Ongoing Subsidy?
UC Berkeley
UCLA
Stanford
U British Columbia
Columbia
USC
Harvard
Ohio State
F-5.1/204-19 4/10/19
Page 4 of 9
How will UW’s DPA Program work?
UW’S DPA PROGRAM WILL OFFER LOANS TO FACULTY WITH FAVORABLE TERMS
AT BELOW MARKET INTEREST RATES
The interest rate is initially set at 3.5%
DPA loans are up to 10% of the home price with a maximum loan amount of $90,000
Payments are deferred for 7 years
Loans are payable upon sale/refinance of the house or separation from the UW
If the loan remains outstanding by year 7, the balance plus interest is payable over the next 23 years (maximum term = 30 years)
LOAN AVAILABILITY AND ALLOCATION
10 faculty loans per year
Participants are determined by the Provost’s Office in consultation with Deans and Chairs
Initially, the Program will focus on new assistant and associate faculty hires
F-5.1/204-19 4/10/19
Page 5 of 9
How Much Could the Program Benefit Faculty?
Over the first seven years, a participant could save about $600 per month on their mortgage payment or about $29,000 over the life of the loan when compared to a traditional 90% first mortgage with a 10% down payment and mortgage insurance
Assumptions:• $675,000 home purchase price (current Seattle median)• 30 year overall term• 5% interest rate on 1st mortgage• 3.5% interest rate on UW Down Payment Assistance Program (interest deferred for 7
years, then amortizing for the remaining term of 23 years)
Years 1-7
Conventional Mortgage (90%/10%)
With UW Down Payment
Assistance (80%/10%/10%)
Monthly Savings
1st Mortgage Payment 3,261 2,899 362
Second Mortgage Payment n/a Deferred n/a
Private Mortgage Insurance 253 0 253
Total Years 1-7 (per month) 3,514 2,899 615
Years 8-30
1st Mortgage Payment 3,261 2,899 362
2nd Mortgage Payment 0 444 (444)
Total Years 8-30 (per month) 3,261 3,343 (81)
Total Payments (30 years) 1,195,291 1,166,050 29,242
F-5.1/204-19 4/10/19
Page 6 of 9
Partnership with Washington State Housing Finance Commission
The Washington State Housing Finance Commission (Commission)• Acts as a bridge between lenders and the University
• Externally administers the program on behalf of the UW
• UW still responsible for managing relationship with the Commission, including operations, Program accounting and Board and UW-wide reporting
The Commission is a State agency with deep experience and expertise in affordable housing lending programs
UW will leverage the Commission’s existing down payment assistance program structure – Community Second Mortgages• Avoids need to get regulatory approval and manage new lending program
Access for UW employees to other Commission programs:• Homebuyer education
• House Key First Loans (Below-market rates)
• Home Advantage Down Payment Assistance (up to 4%)
F-5.1/204-19 4/10/19
Page 7 of 9
How is the Program Funded?
The DPA Program will be initially funded with Internal Lending Program (ILP) reserves
• ILP will contribute $1 million per year for three years
• No fund source has been identified beyond the third year
• The funds identified meet constitutional limitations on lending and the use of funds
Providing 10 loans per year requires an annual contribution of $1 million for about 7 years before the Program becomes self-sustaining
• Actual lending and repayment patterns will determine when the Program is self-sufficient
If less than 10 loans are made in any year, unused Program capacity will be available in the subsequent year
All repaid interest and principal will be used to fund new loans
F-5.1/204-19 4/10/19
Page 8 of 9
Ongoing Program Management
Continued strong partnership between the Provost’s Office, Treasury and Financial Accounting will assure a successful launch
If action is approved by the Board, expect to make first loans by summer 2019
Hiring season reporting will be made to the Regents by the Provost Office• Number of new faculty assisted
• Benefiting departments
• Recruiting impact
Financial status of DPA Program will be shared with Board as part of annual Debt Management Report each spring and will include:• Program Balance
• New loans made
• Loans repaid
• Changes in interest rates for new loans
F-5.1/204-19 4/10/19
Page 9 of 9
B–1 BOARD OF REGENTS MEETING
B–1/204-19 4/10/19
Long-Term Planning Assumptions: Finance, Facilities, Budget and Enrollment INFORMATION This item is for information only BACKGROUND To prepare the Board for tomorrow’s retreat discussions, the Board will hear presentations from Brian McCartan, Vice President, Finance; Lou Cariello, Vice President, Facilites; Sarah Norris Hall, Vice Provost, Planning & Budgeting; and Phil Reid, Vice Provost, Academic and Student Affairs, on long-term planning assumptions in the areas of finance, facilities, budget, and enrollment. Attachments
1. April 2019 Financial Forecast and Fiscal Year 2020 Budget 2. Deferred Maintenance: Effectively Planning for Life-Cycle Costs 3. Access and Excellence: Enrollment and Budget
APRIL 2019 FINANCIAL FORECAST & FY20 BUDGET
BOARD OF REGENTS
APRIL 10, 2019
ATTACHMENT 1B-1.1/204-19 4/10/19
Page 1 of 10
FORECAST METHODOLOGY
> Covers entire UW, including UW Medicine (UWM)
> FY 2018 Actuals (audited), FY 2019 Estimates
> FY20-24 Forecast
– Based on inputs from across UW, Washington State Economic & Revenue Forecast Council, Congressional Budget Office (CBO) and UW Finance estimates
– UWM financial forecast from Dec 2017 (FIT Plan)
KEY ELEMENTS OF FORECAST
> Slowing economic growth through 2021; slow but steady growth thereafter. No recession included in forecast.
> Continued rising Washington population strong enrollment demand
> Slow student growth limited headcount growth
> Tuition growth consistent with current approach
> Slowing endowment (CEF) return
> UWM
– Assumes UWM stays on track with FIT plan goals through FY24
– Rising share of UW overall enterprise
> Slow growth of research funding declining share of UW enterprise
WHAT FORECAST IS NOT……
APRIL 2019 FINANCIAL FORECAST B-1.1/204-19 4/10/19
Page 2 of 10
APRIL 2019 FINANCIAL FORECAST> Operating deficits widened FY13-17 due to rising salary growth, slowing federal research and deteriorating UWM
financial position
> Deficit narrowed FY18 with heightened expenditure control & progress on UWM FIT Plan
> Deficit is forecast to widen after FY21 as rising compensation costs and deferred maintenance costs outpace growth in key revenue sources (tuition, research) and UWM FIT plan gains plateau.
> Changes in Net Assets remains positive due to gifts and endowment (CEF) returns.
Actual Forecast
B-1.1/204-19 4/10/19
Page 3 of 10
RECESSION SCENARIO
(600)
(400)
(200)
-
200
400
600
FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24
April 2019 Recession Scenario Forecast$
M
Adjusted Net Income= Operating Revenue + State Approp. - Operating ExpensesChange in Net Assets = Change in All Revenues - All Expenses
Change in Net Assets
Adjusted Net Operating Income
B-1.1/204-19 4/10/19
Page 4 of 10
KEY FINANCIAL DRIVERS
Does not include gifts, endowment return
UW Salaries47%
Benefits16%
Purchased services14%
Supplies and materials
10%
Depreciation7%
Other6%
2018 OPERATING EXPENDITURES: $5.9 BILLION
UW
B-1.1/204-19 4/10/19
Page 5 of 10
KEY RISKS & OPPORTUNITIES
OPPORTUNITIES
> Long-term growth in endowment $$
> Increased capital capacity through public private partnerships/innovative finance $
> Improved funding state partnership
> Higher research growth $
> Lower long-term capital spend through life cycle maintenance approach $
> Alternative tuition models $
RISKSInstitutional
> Talent management– Need to attract/retain top talent– Risks of salary & benefit growth
outpacing revenue growth $$$$
> Deferred maintenance backlog $$
Academy/Teaching> Limits on tuition growth $$> Declining state share since 2008 $
UWM> Market risks $$> Sufficient access to capital $$
Research> Limited federal research revenue
growth $> Ability to maintain market share $
$ (low), $$ (medium), $$$(high) financial impact
B-1.1/204-19 4/10/19
Page 6 of 10
> As a diverse, public, state research institution with academic medical center, UW will always face budgetary challenges and tough choices, which will require vigilant, tight fiscal management
> Core institutional strength provides the foundation for financial sustainability
– Academy: Top tier institution in high growth region
– Medicine: Highly rated comprehensive medical system with aging population and rising share of income dedicated to health care
– Research: Long standing strong market share of federal grants; strengths in key areas (engineering, computer science, life sciences, health care)
– Culture: diverse, entrepreneurial, dynamic institution
> Attention to, and development of, underlying institutional strengths can allow UW to continue to evolve to meet its dynamic mission and maintain financial sustainability
KEY FORECAST TAKEAWAYS
The University’s “…main challenge in the future is identical to its main challenge during at least my entire time here, namely, securing the necessary financial support so it can retain and whenever possible enhance its high quality as a research university…” President Gerberding 1994
B-1.1/204-19 4/10/19
Page 7 of 10
> Improved performance in core operating, and self-sustaining operations
– As of February 2019 month end, self-sustaining operations reflect a FYTD margin of 2.81%, which is slightly positive to February 2018’s FYTD margin of 2.03%
– Core expenditures as a percent of budget are tracking to historical trends, despite revenues trending slightly higher than budgeted+
> Unit budget meetings will conclude April 16, and operating budget targets, based on proposed rates and fees, enrollment targets, and major areas of investment will be presented in May
FY20 BUDGET B-1.1/204-19 4/10/19
Page 8 of 10
FY20 Budget
> Consistent themes of budget meetings include concerns with regard to salary and benefit growth without sufficient new revenues
> These risks are evident in enterprise forecast, and require careful alignment of budget planning
> Primary levers to accomplish this include: – Containing net new FTE growth, tying recruitments to key strategies
within each of the operating units
– Mitigating growth of salaries, contingent upon revenues and budget authority from the state of Washington
– Intentional enrollment, tuition and financial aid strategies
B-1.1/204-19 4/10/19
Page 9 of 10
B-1.1/204-19 4/10/19
Page 10 of 10
Board of RegentsApril 10, 2019
Deferred MaintenanceEffectively planning for life cycle costs
ATTACHMENT 2B-1.2/204-19 4/10/19
Page 1 of 11
2
I. Reviewing the Challenge
II. Proactive Plan to Address It
III. Utilities Infrastructure
AGENDA
8-inch diametermain water supply pipeMagnuson Health Sciences (2019)
B-1.2/204-19 4/10/19
Page 2 of 11
Deferred Maintenance Across UWSeattle Campus Education & General (E&G) - $1.7 Billion
3
Education & General Auxiliaries Bothell & Tacoma
Seattle Campus $1.7B
Housing - $200M UW Bothell - $80M
Utilities* - TBD ICA - $45 MUW Tacoma* - TBD
Medicine* - TBD
* Estimates not yet available
B-1.2/204-19 4/10/19
Page 3 of 11
$5
$-
$1
$2
$3
$4
$5
$6
2011 2015 2019 2023 2027 2031 2035 2039 2043 2047
Bill
ion
s
Deferred Maintenance BacklogSeattle Campus Education and General
4
$5.4 billionProjected backlog in 2047
Manageable risk = $80 per SF
$2.5 billion
$1.7 billionCurrent deferred
maintenance backlog
B-1.2/204-19 4/10/19
Page 4 of 11
Total Spending on FacilitiesUW Facilities reorganization optimizes life-cycle decision making
5
• Excludes auxiliaries (e.g. UW Medical Center, HFS, Transportation, and ICA), affiliated units (e.g. Northwest Hospital and Valley Medical Center), and Tacoma and Bothell campuses
• Minimum Target = Capital and PM spend that will keep backlog at “manageable risk” level
Asset ReinvestmentMajor Capital
Annual StewardshipLife Cycle Renewal
Daily ServiceReactive
Utilities + RentEnergy, Water, OPEX
Capital Funds~$300M / yr
Operating Funds~$100M / yr
Fixed Costs~$150M / yr
• Utilities Infrastructure• Modernization• Deferred Maintenance
2018 E&G Actual = $22MMinimum Target = $90MPeer Average = $66M
• Corrective Maintenance• Customer Directed
• Custodial• Grounds
2018 Actual = $53MPeer Average = $56M
• Electricity• Fuel• Water/Sewer• Lease space
2018 Utilities = $39MPeer Average = $46MNo peer data on leases
Minor CapitalPreservationProg. Renewal
2018 E&G Actual = $7M• Target Renewal = $30M• Target PM = $6.5MTotal Min. Target = $36.5MPeer Average = $22M
Preventive Maintenance
B-1.2/204-19 4/10/19
Page 5 of 11
Total Capital InvestmentMost of capital allocation has been for new space
6
$-
$50,000,000
$100,000,000
$150,000,000
$200,000,000
$250,000,000
$300,000,000
$350,000,000
$400,000,000
$450,000,000
$500,000,000
$550,000,000
2013 2014 2015 2016 2017 2018 2019
Annual Stewardship Operating Budget - PM Asset Reinvestment Capital for New Space/IT Target Reinvestment
Increasing DM Backlog
Annual Reinvestment Target
Increasing DM Backlog
B-1.2/204-19 4/10/19
Page 6 of 11
UW Compared to Research Peers (2018)
Peer Research Institutions surveyed: Carnegie Mellon, Georgia Tech, Johns Hopkins, MIT, Northwestern, Penn State, University of Florida, University of Georgia, University of Illinois, University of Minnesota
B-1.2/204-19 4/10/19
Page 7 of 11
8
$0
$50,000,000
$100,000,000
$150,000,000
$200,000,000
$250,000,000
$300,000,000
$350,000,000
$400,000,000
$450,000,000
$500,000,000
$550,000,000
2013 2014 2015 2016 2017 2018 2019
State UW Equity Debt Donor
Capital FundingFund sources are varied across the portfolio
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Deferred Maintenance StrategyMajor initiatives for reducing backlog
9
1. Conduct campus-wide Facility Condition Assessment
2. Increase capital reinvestment
– allocate 50% of major capital available to replace/renovate existing space
3. Fully fund annual stewardship for all new buildings
4. Fully fund preventive maintenance
5. Consolidate and optimize utilization of office & support space
6. Reinvest energy savings
7. Other strategies
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$5
$2
$-
$1
$2
$3
$4
$5
$6
2011 2015 2019 2023 2027 2031 2035 2039 2043 2047
Bill
ion
s
Flattening the CurveStrategic approach could reduce backlog to manageable risk in 20 years
10
$5.4 billionprojected backlog in 2047
manageable risk
50% to Replace/Renovate
Space Utilization
Fully Fund O&M for New
Fully Fund PM
$2.1 billion“under manageable risk line”
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Utilities InfrastructurePreparing for the next 100 years
11
Central steam heating plant• Fossil-fueled system in operation since 1921
• ~$400M required to convert to clean energy (hot water), but state no longer funds major utility infrastructure projects.
• ~$50M in interim capital funding required to maintain reliability of current plant
Electrical infrastructure • Near capacity for U District and UW
• UW & Seattle City Light exploring joint solutions
• SCL may be able to assume significant portion of capital costs within rate design
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ACCESS AND EXCELLENCE: ENROLLMENT & BUDGET
Sarah Norris Hall and Phil Reid April 2019
ATTACHMENT 3B-1.3/204-19 4/10/19
Page 1 of 20
SNAPSHOT: ENROLLMENT AND TUITION
Fall 2018 Total Enrollment (Headcount)
SEATTLE BOTHELL TACOMA TOTAL
UNDERGRAD 32,594 5,411 4,573 42,578
GRAD/PROF 15,305 578 802 16,685
TOTAL 47,899 5,989 5,375 59,263
• Tuition comprises 64 percent of the UW’s general operating fund
• As projected, undergraduates generate 68 percent of total gross operating fee revenue ($587M out of$859M) and 75 percent of total net operating fee revenue ($495M out of $658M)
• Of undergraduate net operating fee revenue, more than half is derived from nonresident undergraduates
As published in the FY19 operating budget:
0m
250m
500m
750m
FY12 FY13 FY14 FY15 FY16 FY17 FY18 ProjectedFY19
Grad/Prof Nonresident
Grad/Prof Resident
Undergraduate Nonresident
Undergraduate Resident
Projected Tuition by Student Category, All Campuses, Net of Aid – FY19
Note: Tuition figures presented are representative of the operating fee; thus exclusive of building fee
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PRESENTATION ROADMAP
I. Application
II. EnrollmentIII. Outcomes
IV. Looking Ahead: Risks and Opportunities
II. Enrollment
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• Continued increase in number of applications across all applicant categories
• Watching slight decline of grad/prof applications
FRESHMAN APPLICATIONS: 2014 to PRESENTB-1.3/204-19
4/10/19 Page 4 of 20
APPLICANT PROGRAM OF INTERESTSchool Program 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Built Environments 2.44% 2.00% 1.77% 1.43% 1.36% 1.16% 1.17% 1.17% 1.20% 1.09%
College of Arts and Sciences
Arts (A&S) 4.52% 4.10% 3.68% 3.00% 2.97% 3.03% 2.91% 2.70% 2.72% 2.45%
Health Sciences (A&S) 6.08% 5.30% 5.37% 4.87% 3.83% 3.31% 3.32% 3.23% 3.29% 4.48%
Humanities (A&S) 5.03% 4.60% 4.05% 3.21% 2.98% 2.86% 2.51% 2.43% 2.73% 2.13%
Natural Sciences (A&S) 22.18% 21.48% 22.31% 23.23% 24.52% 24.42% 23.82% 24.59% 25.19% 22.20%
Social Sciences (A&S) 18.19% 15.60% 14.79% 14.87% 14.35% 13.51% 13.32% 13.47% 13.62% 11.18%
College of Education 0.77% 0.82% 0.77% 0.78% 0.80% 0.76% 0.78% 0.78% 0.81% 1.05%
College of EngineeringComputer Science 2.41% 2.68% 2.72% 3.68% 4.82% 6.63% 7.97% 9.36% 9.85% 9.34%
Engineering 13.27% 14.42% 14.46% 15.40% 15.92% 16.52% 16.12% 15.42% 14.81% 15.24%
College of the Environment 2.73% 2.30% 2.66% 2.47% 2.37% 2.34% 2.49% 2.51% 2.70% 1.88%
Foster Business School 14.05% 13.84% 13.86% 14.03% 13.33% 13.05% 13.05% 11.88% 11.52% 10.73%
School of Medicine 1.22% 1.18% 1.74% 1.23% 1.32% 1.10% 0.93% 1.06% 1.19% 0.43%
School of Nursing 2.60% 2.87% 2.97% 3.07% 3.06% 2.74% 2.87% 2.70% 2.99% 2.69%
School of Public Health 0.18% 0.18% 0.13% 0.13% 0.57% 0.75% 0.87% 0.98% 0.96% 0.75%
School of Social Work 0.19% 0.23% 0.22% 0.20% 0.20% 0.20% 0.22% 0.22% 0.19% 0.16%
The Information School 0.05% 0.09% 0.09% 0.08% 0.08% 0.10% 0.16% 0.18% 0.27% 0.28%
Undecided 4.07% 8.29% 8.40% 8.32% 7.51% 7.52% 7.47% 7.31% 5.95% 13.91%
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• WA resident enrollments are relatively stable.
• Significant “bump” in domestic non-resident enrollment.
FIRST YEAR ENROLLMENT: 2014 to PRESENTB-1.3/204-19
4/10/19 Page 6 of 20
ENROLLMENT TRENDS FOR SELECT UNDERGRADUATE MAJORS
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
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ANNUAL % CHANGE OF UNDERGRAD. MAJOR ENROLLMENTS (SELECT MAJORS)
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
2010 2011 2012 2013 2014 2015 2016 2017 2018
Arts Humanities Natural Sciences Social Sciences Computer Science Engineering
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DEMAND FOR HIGHER EDUCATION
• Changes in college-going populations will vary by region and institution type
• Northeast and Midwest will feel decreases most acutely
• Will be spared from ‘birth dearth’ to some extent, the PNW may face increased competition from institutions in these regions
• As such, grow cautiously:
• Focus on WA residents
• Closely attend to interplay between tuition, enrollment and aid policies
• Ensure that our students have access to excellence
United States College-Going Forecast (Grawe, D.)
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RESIDENT UNDERGRADUATE TUITION AMONG TOP PUBLICS
$18,454
$17,641
$16,004
$15,730
$15,262
$14,974
$14,970
$14,402
$14,391
$14,184
$13,961
$13,678
$13,201
$12,424
$11,830
$11,207
$10,968
$10,726
$10,606
$10,595
$10,556
$9,992
$8,987
$6,381
Penn State
U Virgina
U Illinois-Urbana-Champaign
UConn
U Michigan-Ann Arbor
Rutgers U-New Brunswick
Clemson
UC-Davis
UC-Santa Barbara
UC-Berkeley
UCSD
UC-Irvine
UCLA
Georgia Tech
U Georgia
UW-Seattle
Texas A&M
Ohio State
U Texas-Austin
U Maryland-College Park
U Wisconsin-Madison
Purdue
UNC-Chapel Hill
U Florida
Source: 2018-19 AAUDE, U. of Virginia system survey, and institution websitesPeer Set: U.S. News 2019 Top 25 Publics
Median: $13,678
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NON-RESIDENT UNDERGRADUATE TUITION AMONG TOP PUBLICS
Source: 2018-19 AAUDE, U. of Virginia system survey, and institution websitesPeer Set: U.S. News 2019 Top 25 Publics
$49,350
$49,020
$43,394
$43,383
$43,176
$42,953
$42,670
$42,193
$38,098
$37,480
$36,805
$36,724
$36,636
$36,588
$35,216
$35,170
$34,858
$33,020
$30,404
$32,574
$31,282
$30,742
$28,794
$28,658
U Michigan-Ann Arbor
U Virginia
UC-Davis
UC-Santa Barbara
UC-Berkeley
UC-San Diego
UC-Irvine
UCLA
U Conn
U Texas-Austin
U Wisconsin-Madison
Clemson
Texas A&M
UW
U Maryland
UNC-Chapel Hill
Penn State-University Park
Georgia Institute of Technology
U Georgia
U Illinois-Urbana-Champaign
Rutgers-State U of New Jersey
The Ohio State U
Purdue U
U Florida
Median: $36,724
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RESIDENT UNDERGRADUATE TUITION OVER TIME
$7,125
$8,122
$9,746
$11,305 $11,305 $11,305$10,768
$9,694 $9,909 $10,127
+14.0%
+20.0%
+16.0% 0% 0%
-5%
-10%
+2.2%+2.2%
$k
$2k
$4k
$6k
$8k
$10k
$12k
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
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Page 12 of 20
NON-RESIDENT UNDERGRADUATE TUITION OVER TIME
$23,800 $24,750$27,230
$28,860$30,879
$32,424 $33,072 $33,732 $34,473$35,508
+4.0%
+10.0%
+6.0%
+7.0%+5.0%
+2.0%+2.0%
+2.2%+3.0%
$k
$5k
$10k
$15k
$20k
$25k
$30k
$35k
$40k
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
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RISKS/OPPORTUNITIES OPPORTUNITIES
Tri-campus enrollment shifts and changes
Intentional work admitting exceptional students into pathways for success
Alignment of recruitment strategies and financial aid decisions will improve our planning (less reactive)
Facilitate student understanding of academic opportunities
Continue focus on exceptional WA resident students
RISKS
Strain on housing, classroom demand and student support services
Maintain current course with regard to enrollment and intended major
Some tuition rate increases may have an impact on yield
Resident undergraduate tuition rate policy
International student enrollment
National ‘birth dearth’
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ENROLLMENT MANAGEMENT: CURRENT WORK
Admission and Enrollment
Communications and Outreach
Journey to Major
Curricular/Co-Curricular
• Improving how we describe opportunities to prospective students.
• Revisiting holistic review.
• Developing services to support student journey from admission to major (e.g., tracking preferred major, common internal application portal).
• Curricular innovation (e.g., data science initiative).
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APPENDIX
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Source: Migration Policy Institute
U.S. INTERNATIONAL STUDENT ENROLLMENTS: 2007–2017*
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Federal Support State Support UW Support Total
2010-2011 $32,217,000 49% $25,988,000 39% $7,618,000 12% $ 65,823,000
2011-2012 $35,583,000 41% $32,378,000 37% $18,654,000 22% $ 86,615,000
2012-2013 $25,304,000 36% $29,900,000 40% $31.420.000 24% $106,454,000
2013-2014 $42,300,000 37% $40,500,000 36% $29,900,000 27% $112,100,000
2014-2015 $37,259,000 33% $41,276,000 37% $32,876,000 30% $111,411,000
2015-2016 $38,425,000 36% $42,479,000 39% $26,855,000 25% $107,758,000
2016-2017 $36,801,000 38% $38,650,000 40% $21,082,000 22% $ 96,533,000
2017-2018 $41,533,000 41% $37,577,000 37% $21,936,000 22% $101,046,000
2018-2019 $43,847,000 42% $47,301,000 45% 14,227,000 14% $105,375,000*
*estimated
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LOAN DEBT: UW UNDERGRADUATES-TRI-CAMPUS
# of Graduates
# of Graduates w/ Debt
Total LoanVolume
Average
2017-18 10,803 4,319 $95,727,524 $22,164
2016-17 10,351 4,280 $95,944,268 $22,417
2015-16 10,315 4,489 $98,994,539 $22,053
2014-15 9,881 4,581 $104,400,716 $22,790
2013-14 9,629 4,707 $101,459,945 $21,555
2012-13 9,461 4,713 $101,193,043 $21,471
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UNDERGRADUATE DEBT LEVEL BY INCOME LEVEL- TRI-CAMPUS
2017-2018 Resident Undergraduates
Family Income # of Students Average Income Average Debt
$0 – 24,999 1,220 $10,360 $24,399
$25,000 – 49,999 731 $36,239 $20,882
$50,000 – 74,999 456 $62,440 $19,938
$75,000 and above 1,492 $150,193 $19,803
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B–2 BOARD OF REGENTS MEETING
B–2/204-19 4/10/19
Panel: Student Perspectives on Long-Term Planning INFORMATION This item is for information only BACKGROUND To prepare the Board for tomorrow’s retreat discussions, the Chair of the Board asked student leaders to prepare responses to the following questions:
1. Given funding constraints, what value must be delivered to convince students that tuition expenses are justified? (e.g. curricular offerings, career transition help including internships and alumni networking integrated into courses of study, student services…)
2. What is most successful about the University’s current operations from the student perspective?
3. Which are the most important areas of improvement, from the student perspective?
4. What would students like the Board, the administration, and the faculty to take into consideration as they plan for the next thirty years?
The Board will hear from ASUW President Ritika Jain, GPSS President Giuliana Conti, ASUW Bothell President Leah Shin, and ASUW Tacoma President Armen Papyan.
Student Leader Long-Term Planning Recommendations
The following information presented to the Board of Regents during April, 2019, represents a joint set of recommendations and feedback on behalf of the of the tri-campus student government Presidents toward the university’s long-term financial and academic planning. This information is intended to inform and encourage the UW administration’s progress toward these topics and serve as a benchmark in the coming years for both UW administration as well as incoming student leaders.
Common Recommendations Between the Boards
Given funding constraints, what value must be delivered to convince students that tuition expenses are justified? ● Career preparation and professional development opportunities ● Resources for maintaining personal well-being (food, mental health)
What is most successful about the University’s current operations from the student perspective? ● Extracurricular activities ● Individualized resources for diverse populations and interests
Which are the most important areas of improvement from the student perspective? ● Funding, funding, funding! With regard to even allocation across campuses and notoriously underfunded programs ● Increased mental health and wellness resources ● Career and professional development resources and training
What would students like the Board, administration, and faculty take into consideration as they plan for the next thirty years? ● Diversifying the student, staff, and faculty populations ● Transparency and inclusion of students within decision-making processes ● Affordability of educational and living expenses ● Accommodation of and support for the tri-campus growth beyond the minimum, especially with regard to space ● The availability of personal and professional student resources increase the likelihood of success ● Student safety, health, and well-being are pivotal for academic and post-graduation success ● We will carry this University’s name and legacy, we need to be cared for now so that we may adequately care for the next
generations
ASUWS Priorities GPSS Priorities
● Humanities emphasis for non-humanities majors ● Providing the capacity for all students to explore their
academic interests ● Ability to build a network of professional connections ● Greater support for long-term career planning ● Critically assessing the balance that the University must
maintain between its world-class ranking and its commitment to the community as a public university
● Mental health resources and training across campus ● Funding availability for Master’s programs ● Work and communication boundaries for grad students ● Faculty advising standards and training ● Involvement of grad students in decision making processes ● Match cost of living with job/funding/TA/RA opportunities ● Caregiver/child care practical and financial needs ● Arts and Humanities funding availability
ASUWT Priorities ASUWB Priorities
● Career workshops, Internship opportunities, integrate training/internships into courses
● Alumni networking in students prefered field ● Need for increase number of career fairs and more
employers ● Transportation services, getting in and around UW
Tacoma ● Increasing student life on campus
○ Building a HUB/student recreation center ● Maintain 24/7 access to the library ● Affordable and accessible childcare for student parents ● Defining the student experience at UW Tacoma
● Long term Health & Wellness Resources and Food Services. ● Increase support in funding for clubs on-campus. ● Student Services with a focus on mentorship and career
readiness ● Diversity, Disability, and Mental Health resources for students. ● Locating information and opportunities on-campus; on our
website and main communication channels. ● Financial Aid & Scholarship Communication; cost of living and
not paying for resources we already have. ● The funding distribution across the three campuses. ● Providing more student space for students on-campus. ● Defining the student experience at UW Bothell.
B-2.1/204-19 | 4/10/19 Page 1 of 1
ATTACHMENT
B–3 BOARD OF REGENTS MEETING
B–3/204-19 4/11/19
Board Retreat INFORMATION This item is for information only BACKGROUND The Board of Regents last met in retreat in April 2015. That retreat focused on Board functioning and best governance practices. The last time the Board broadly discussed ongoing trends was in December 1992, closing out implementation reports on the UW 2000 strategic planning exercise begun in September 1985. At this meeting, the Board plans to surface discussion of long-term issues at the Board level. It expects to make no conclusions, but to open lines of questioning and discussion to shape the agendas of future meetings. President Cauce and Provost Richards will lead discussion on the basis of attached reading assignments and yesterday evening’s presentations. The meeting will recess for visits to laboratories and discussions of research and teaching at Friday Harbor Laboratories. SCHEDULE 8:40 a.m. Welcome and First Academic Presentation: Scan All Fishes** 9:30 a.m. Session 1: Access to Excellence under Constraints 11:30 a.m.* Second Academic Presentation:
The College of the Environment and Friday Harbor Labs** 12:30 p.m.* Session 2: Key Strategic Issues – Curriculum 1:30 p.m.* Third Academic Presentation:
ZooBots (Marine Invertebrates and Marine Algae)** 2:20 p.m.* Session 3: Facilitating Change, Removing Barriers *or later as announced at the conclusion of the preceding session. **not part of the open public meeting; a quorum of Regents may be present, but no action as defined by RCW 42.30.020 will be taken. Attachments April Retreat: List of Assigned and Recommended Readings Letter from W. P. Gerberding
April Retreat: List of Assigned and Recommended Readings
UW DOCUMENTS
• RCW 28B.20.020, Purpose of the University of Washington: https://apps.leg.wa.gov/RCW/default.aspx?cite=28B.20.020• Regent Policy No. 5, Role and Mission of the University: http://www.washington.edu/admin/rules/policies/BRG/RP5.html
• ‘About the UW’ and ‘Funding the UW’ slide decks: https://s3-us-west-2.amazonaws.com/uw-s3-cdn/wp-content/uploads/sites/98/2019/01/07121711/About_the_UW_12-24-18.pptx and https://s3-us-west-2.amazonaws.com/uw-s3-cdn/wp-content/uploads/sites/98/2018/10/26173601/Funding_the_UW_presentation-10-26-18.pptx
• 2019 Operating and Capital Budgets: https://s3-us-west-2.amazonaws.com/uw-s3-cdn/wp-content/uploads/sites/12/2018/07/23171317/2018-06-B-2.pdf and https://s3-us-west-2.amazonaws.com/uw-s3-cdn/wp-content/uploads/sites/12/2018/07/13092627/2018-07-B-3.pdf
• Deferred Maintenance Presentation, July 2018: https://s3-us-west-2.amazonaws.com/uw-s3-cdn/wp-content/uploads/sites/12/2018/07/05141438/2018-07-F-10.pdf
• Debt Capacity Presentation, May 2018: https://s3-us-west-2.amazonaws.com/uw-s3-cdn/wp-content/uploads/sites/12/2018/07/23171446/2018-05-F-4.pdf
• Recent OPB Briefs (ABB, Demographics): https://s3-us-west-2.amazonaws.com/uw-s3-cdn/wp-content/uploads/sites/162/2018/12/07005440/ABB_Trends_Brief_and_Spreadsheet_FY19.pdf and https://s3-us-west-2.amazonaws.com/uw-s3-cdn/wp-content/uploads/sites/162/2018/12/07005701/Demographics_and_Demand_for_Higher-Ed_-_Book_Summary.pdf
• Diversity Blueprint: https://www.washington.edu/diversity/files/2017/01/17_DiversityBlueprint-010917.pdf• 2018 Research Report: https://www.washington.edu/research/wp/wp-content/uploads/2018/10/Annual-Report-FY-2018.pdf
LOOKING BACK 1. Rita Koganzon, “Who will defend the University? Hanna Holborn Gray and the lost art of academic governance,” Chronicle of
Higher Education (CHE), November 9, 2018: https://www.chronicle.com/article/Who-Will-Defend-the/245052Optional: Hanna Holborn Gray, An Academic Life (Princeton UP, 2018), Chapter 1, pages 1-22:
http://assets.press.princeton.edu/chapters/s11244.pdf 2. William P. Gerberding, Memo to the Board of Regents (1994)
LOOKING LATERALLY 3. Deloitte Insights, The Future(s) of Public Higher Education: Five New Models for State University Success (2018):
https://www2.deloitte.com/content/dam/insights/us/articles/4726_future-of-higher-education/DI_Future-of-public-higher-ed.pdf4. John Aubrey Douglass and Patrick Lapid, “Tuition as a Path for Affordability? The Pursuit of a Progressive Tuition Model at the
University of California”: https://cshe.berkeley.edu/sites/default/files/publications/tuition_as_a_path_for_affordability.pdfOptional: Elisabeth Corey, “The University has no purpose. And that’s a good thing,” CHE (2018):
https://www.chronicle.com/article/The-University-Has-No-Purpose/243185 Michael Crow and William Dabars, Designing the New American University (JHU Press, 2015),
115-150 and 240-303
LOOKING FORWARD 5. Nathan D. Grawe, Demographics and the Demand for Higher Education (Johns Hopkins, 2018), 68-112 and 135-138, optional
(on education policy): 113-1346. Ben Schmidt, “The Humanities Are in Crisis,” The Atlantic, August 23, 2018:
https://www.theatlantic.com/ideas/archive/2018/08/the-humanities-face-a-crisisof-confidence/567565/7. Tables and Figures from Hemelt et al., “Why is Math Cheaper than English? Understanding Cost Differences in Higher
Education,” NBER Working Paper 25314 (2018): https://www.nber.org/papers/w253148. Clayton Rose, Five minutes on the liberal arts: https://www.youtube.com/watch?v=1zm11mYPcfw9. Burning Glass Technologies, “Majors that Matter: Ensuring College Graduates Avoid Underemployment” (2018):
https://www.burning-glass.com/wp-content/uploads/underemployment_majors_that_matter_final.pdf10. Cathy O’Neil, TED talk on Big Data: https://www.ted.com/talks/cathy_o_neil_the_era_of_blind_faith_in_big_data_must_end
Optional: Microsoft, The Future Computed: Artificial Intelligence and its role in society (2018), esp. 110-122:https://3er1viui9wo30pkxh1v2nh4w-wpengine.netdna-ssl.com/wp-content/uploads/2018/02/The-Future-Computed_2.8.18.pdf
American Academic of Arts and Sciences, “The Future of Undergraduate Education: The Future of America”(2017): https://www.amacad.org/sites/default/files/academy/multimedia/pdfs/publications/researchpapersmonographs/CFUE_Final-Report/Future-of-Undergraduate-Education.pdf
ATTACHMENT 1B-3.1/204-19 4/11/19
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B-3.2/204-19 4/11/19
Page 1 of 3ATTACHMENT 2
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Who pays resident undergraduate tuition at the UW?
ATTACHMENT 3 B-3.3/204-19 4/10/19
Page 1 of 7
State Revenue Per Student Among Top Publics
Source: IPEDS data for FY15 (most recent final year available)Peer Set: U.S. News 2017 Top 25 Publics
$4,240
$4,346
$5,220
$5,663
$6,495
$6,621
$6,921
$7,247
$8,000
$8,224
$8,556
$9,181
$9,629
$10,128
$11,134
$11,283
$11,621
$11,634
$13,673
$14,249
$14,439
$18,684
$24,390
Penn State
U Pittsburgh
UW-Seattle
U Virginia
U Illinois-Urbana-Champaign
U Michigan-Ann Arbor
UT-Austin
Ohio State
Purdue
UC-Santa Barbara
UC-Irvine
UC-Berkeley
Georgia Tech
UCSD
U Wisconsin-Madison
U Georgia
UCLA
UC-Davis
U Florida
Rutgers U-New Brunswick
U Maryland-College Park
UNC-Chapel Hill
UConn
Except the UW, institutions with the lowest state funding have the highest resident undergraduate tuition rates
B-3.3/204-19 4/10/19 Page 2 of 7
State Revenue Per Student Among Top Publics
Source: IPEDS data for FY15 (most recent final year available)Peer Set: U.S. News 2017 Top 25 Publics
$4,240
$4,346
$5,220
$5,663
$6,495
$6,621
$6,921
$7,247
$8,000
$8,224
$8,556
$9,181
$9,629
$10,128
$11,134
$11,283
$11,621
$11,634
$13,673
$14,249
$14,439
$18,684
$24,390
Penn State
U Pittsburgh
UW-Seattle
U Virginia
U Illinois-Urbana-Champaign
U Michigan-Ann Arbor
UT-Austin
Ohio State
Purdue
UC-Santa Barbara
UC-Irvine
UC-Berkeley
Georgia Tech
UCSD
U Wisconsin-Madison
U Georgia
UCLA
UC-Davis
U Florida
Rutgers U-New Brunswick
U Maryland-College Park
UNC-Chapel Hill
UConn
Except the UW, institutions with the lowest state funding have the highest resident undergraduate tuition rates
B-3.3/204-19 4/10/19 Page 3 of 7
Resident Undergraduate Tuition Among Top Publics
$19,080
$18,436
$16,781
$15,868
$14,880
$14,826
$14,638
$14,451
$14,419
$14,170
$14,018
$13,738
$13,261
$12,418
$11,818
$10,974
$10,591
$10,533
$10,452
$10,399
$9,992
$9,005
$6,381
U Pittsburgh
Penn State
U Virginia
U Illinois-Urbana-Champaign
UConn
U Michigan-Ann Arbor
Rutgers U-New Brunswick
UC-Santa Barbara
UC-Davis
UC-Berkeley
UCSD
UC-Irvine
UCLA
Georgia Tech
U Georgia
UW-Seattle
Ohio State
U Wisconsin-Madison
UT-Austin
U Maryland-College Park
Purdue
UNC-Chapel Hill
U Florida
Source: 2017-18 AAUDE, U. of Virginia system survey, and institution websitesPeer Set: U.S. News 2017 Top 25 Publics
B-3.3/204-19 4/10/19 Page 4 of 7
Resident Undergraduate Tuition Among Top Publics
$19,080
$18,436
$16,781
$15,868
$14,880
$14,826
$14,638
$14,451
$14,419
$14,170
$14,018
$13,738
$13,261
$12,418
$11,818
$10,974
$10,591
$10,533
$10,452
$10,399
$9,992
$9,005
$6,381
U Pittsburgh
Penn State
U Virginia
U Illinois-Urbana-Champaign
UConn
U Michigan-Ann Arbor
Rutgers U-New Brunswick
UC-Santa Barbara
UC-Davis
UC-Berkeley
UCSD
UC-Irvine
UCLA
Georgia Tech
U Georgia
UW-Seattle
Ohio State
U Wisconsin-Madison
UT-Austin
U Maryland-College Park
Purdue
UNC-Chapel Hill
U Florida
Source: 2017-18 AAUDE, U. of Virginia system survey, and institution websitesPeer Set: U.S. News 2017 Top 25 Publics
B-3.3/204-19 4/10/19 Page 5 of 7
Avg. Tuition & Fees Paid (i.e. Not Covered by
Grants/Scholarships) by Income Level
$-
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
0 $50K $100K $150K $200K $250K
Tu
itio
n &
Fe
es
Pa
id
Family Income
UW Seattle UNC U Michigan UC Berkeley
WA Middle Income
B-3.3/204-19 4/10/19 Page 6 of 7
0%
2%
4%
6%
8%
10%
12%
14%
0 $50K $100K $150K $200K $250K
Family Income
UW Seattle UNC U Michigan UC Berkeley
Percent of Family Income Spent on Tuition & Fees by Family Income
Pe
rce
nt
of
Fa
mil
y I
nco
me
Sp
en
t o
n T
uit
ion
& F
ee
s
WA Middle Income
B-3.3/204-19 4/10/19 Page 7 of 7
B–4 BOARD OF REGENTS MEETING
B–4/204-19 4/11/19
Academic and Administrative Appointments RECOMMENDED ACTION It is the recommendation of the administration that the Board of Regents approve the appointments to the University faculty and administration as presented on the attached list. BACKGROUND This is a standing monthly item that comes before the full Board this month in the absence of a meeting of the Academic and Student Affairs Committee. Per Board of Regents Governance, Bylaws, Article IV:
“Any matter that would typically fall within the responsibility of one standing committee may be directed by the chair of that committee or the Chair of the Board to any other standing or special committee or the Board itself for consideration.”
Attachment Academic and Administrative Appointments
School/College/Campus Department Worker Last Name Worker First Name
Title Start Date
College of the Environment Atmospheric Sciences Bitz Cecelia Chair 7/1/2019
School of Medicine School of Medicine Sahani Dushyant Chair 3/7/2019
School of Medicine School of Medicine Sherman David Chair 3/1/2019
College of Engineering Mechanical Engineering Aliseda Alberto Paccar Professorship In Engineering 9/16/2018
College of the Environment School of Environmental and Forest Sciences Bakker Jonathan Rachel A. Woods Professorship In Reforestation 1/1/2019
College of Arts and Sciences Germanics Wagner‐Egelhaaf Martina Visiting Professor 3/16/2019
Daniel J. Evans School of Public Policy and
Governance
Daniel J. Evans School of Public Policy and Governance Xu Dafeng Assistant Professor 9/16/2019
School of Medicine Emergency Medicine St. John Alexander Assistant Professor WOT 3/1/2019
School of Medicine Microbiology Sherman David Professor 3/1/2019
School of Medicine Pediatrics ‐ General Pediatrics Chung Esther Professor WOT 4/1/2019
School of Medicine Pediatrics ‐ General Pediatrics Liljenquist Kendra Assistant Professor WOT 1/7/2019
School of Medicine Pediatrics ‐ Infectious Diseases Parsons Marilyn Professor WOT 3/31/2019
School of Medicine Pediatrics ‐ Infectious Diseases Urdahl Kevin Professor WOT 3/31/2019
School of Medicine Psychiatry and Behavioral Sciences Buchholz Jonathan Assistant Professor WOT 3/1/2019
School of Medicine Psychiatry and Behavioral Sciences Sibley Margaret Associate Professor WOT 4/1/2019
School of Medicine Radiology Sahani Dushyant Professor 3/7/2019
School of Nursing Family and Child Nursing Bleil Maria Research Assistant Professor 9/1/2017
School of Public Health Health Services Katon Jodie Research Assistant Professor 12/1/2018
UW Bothell School of Business, Bothell Khanna Sushil Visiting Professor 3/10/2019
Administrative Appointments
Endowments
Academic and Administrative Appointments
Academic Appointments
ATTACHMENTB-4.1/204-19 4/11/19
Page 1 of 1
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