Trustees Hear Budget Report, Etc.

GOVERNOR'S FUNDING HELPS, BUT REGENTS DISTRIBUTION
HURTS OHIO STATE UNIVERSITY

     COLUMBUS -- William J. Shkurti, vice president for finance
at The Ohio State University, told the Board of Trustees Friday
(2/3) that higher education would receive increases in
instructional subsidies of 4.9 percent in 1996 and 3.8 percent in
1997 under the budget submitted by Gov. George V. Voinovich.
However, under the Ohio Board of Regents distribution formula,
Ohio State's Columbus campus would see increases of just 2.6
percent in 1996 and 3.4 percent in 1997.

     "We're very pleased with what the governor has recommended,
but we're very displeased with the way the Board of Regents is
distributing it," Shkurti said.

     "The governor's recommendations put enough money into the
system to allow Ohio State to continue to improve our academic
programs and student services while maintaining financial
stability," he added.  "But, the Regents' distribution undermines
our ability to achieve these goals."

     Richard Sisson, senior vice president for academic affairs
and provost, said: "Earlier discussions with the regents and the
regents' staff gave me a sense that we were moving toward
defining and funding institutional missions.  I am genuinely
disappointed that the budget numbers reflect little progress in
that regard."

     The statewide funding levels recommended by the governor
provide for an increase in state support above inflation,
financial stability, and an opportunity to reward academic
excellence and improved services to students.

     "Unfortunately, the funding distribution recommended by the
board of regents in fiscal year 1996 rewards increased enrollment
only," Shkurti said.  "For Ohio State, which has a stable
enrollment, this means inadequate state support, more pressure
for tuition increases and special fees, and financial penalties
for moving towards academic excellence and away from warehousing
students.  For all Ohioans, this means a missed opportunity to
move from business as usual to performance oriented funding --
unless the current distribution mechanism is modified."

     The governor's budget also calls for increases in 1996 and
1997 of 3.4 percent and 3.5 percent, respectively, for research
challenge funds, and 3 percent each year for other line item
funds, including agriculture and medicine programs.

     Under the governor's proposal, state funding for labor
education and the Arthur G. James Cancer Hospital and Research
Institute would be reduced and funding for the Institute for
Japanese Studies would be eliminated.

     Shkurti also noted that the budget language calls for a
total tuition cap of 6 percent per year.  No instructional
subsidies would be provided for increased enrollments in the
state's doctoral and law degree programs.  The budget also
proposes shifting the funding of debt service for capital
construction projects from the state to individual campuses.

Ohio State saving $7 million for next year's budget

     Shkurti announced that the university's Columbus campus
budget for the fiscal year starting July 1 will include $7
million in subsidy distributions saved from the current year.

     The money represents subsidy distributions received in
December that were higher than projected last summer.  Of that
amount, $3 million was earned primarily from increases in the
number of graduate student credit hours taken and $4 million came
from a supplemental distribution created when enrollments dropped
below system-wide projections.

     The money, equivalent to about 1.3 percent of the General
Funds Budget, is being invested and held until a determination
has been made on how to spend it in next year's budget.

CAPITAL BUDGETING TO FOCUS ON RENOVATIONS

     Renovations and replacement projects will receive priority
in determining what goes into the university's capital budget
plan for 1997-2002.

     Sisson and Shkurti reviewed the procedures for submitting
projects for the six-year capital improvements plan.  The first
two years of the plan will form the 1997-98 capital budget
request that Ohio State will submit to the Board of Regents in
June.  The Regents recommend capital projects for higher
education to the governor for inclusion in the state's biennial
capital budget.

     As a general rule, central university funds will not be made
available to build or operate additional space, according to
Sisson and Shkurti.  They expect no additional state support to
build new space for universities with stable enrollments.  Thus,
Ohio State, which has a stable enrollment, plans to hold
increases in the cost of facilities to no more than the rate of
inflation unless sources other than central general funds can be
found to support them.

     The vice presidents noted that Ohio State must provide more
money to care for and improve existing space because deferred
maintenance has continued to grow.  In addition, Ohio State is
committed to moving toward an incentive budgeting program in
which units will be expected to share in the costs and revenues
attributed to them.

     Two projects -- the second phase of the Fisher College of
Business complex and the Food Science and Technology building --
have been previously approved and Ohio State intends to request
$15.4 million and $9.9 million, respectively, for them in its
1997-98 capital budget.  Ohio State also is committed to
requesting $20 million for funding smaller basic and supplemental
renovation projects.

     According to the report, other commitments may emerge from
projects which have received planning money from the Ohio General
Assembly.  They include the Austin E. Knowlton Architecture
Building, the Heart and Lung Institute, and Life Sciences Lab
Building on the Columbus campus and the Life and Physical
Sciences Building on the Lima campus.

BOARD APPROVES HOME HEALTH CARE AGREEMENT, AMENDS BYLAWS

     The board authorized the university and its medical center
to enter into an agreement with MedOhio Health Inc. to provide
patient access to home health care programs and services and to
loan MedOhio Health up to $900,000 as the initial capital for the
program.

     Trustees nominated for membership to the MedOhio board of
directors John Kessler, chair of the university board of
trustees; William Shkurti, R. Reed Fraley, associate vice
president for health services and executive director of
University Hospitals, and William Bennett, vice chair of the
University Hospitals Board and vice chairman of Bank One,
Columbus.

     The board amended the Bylaws of the Medical Staff to change
the procedures for appointment and reappointment, change the
responsibilities of the chief of the clinical department, and to
add grounds for removal of officers of the medical staff.
Trustees also amended the Rules and Regulations of the Medical
Staff to clarify who may give and receive telephone and verbal
patient orders.

CONTRACTS APPROVED FOR EQUINE CENTER CONSTRUCTION

     The board approved contracts for constructing the Equine
Center, a 44,200-square-foot addition to the west side of the
Veterinary Hospital.  The Equine Center will house horses used in
the College of Veterinary Medicine's academic programs, patient
horses, and intensive care facilities.  The $6.4 million project
is being funded by the state and from private gifts.  The
estimated completion date is June 1996.

     Receiving contracts were Settelin Construction of COLUMBUS,
general, $3,835,000; J.A. Croson Co. of COLUMBUS, plumbing,
$428,338; Kirk Williams Co. Inc. of GROVE CITY, heating,
ventilating and air conditioning, $704,300; and Buckeye Electric
Co. of DAYTON, $425,800.  A 5 percent contingency allowance was
established.

     Trustees also authorized university officials to request
construction bids to enlarge and remodel the Emergency Department
at University Hospitals.  The size of the department will double
with an addition to the west side of the building and renovation
of the existing department.  Total cost of the project is
estimated at $5 million.  University Hospitals will provide the
funding.

BOARD APPROVES CONDOMINIUM PURCHASE, EASEMENTS

     The board authorized the purchase of a first floor business
condominium in Riverwatch Tower, 364 W. Lane Ave., from The Ohio
State University Foundation, at a price not to exceed $463,000
plus the foundation's expenses in acquiring and holding the
property.  In December, trustees authorized the foundation to
accept the condominium, subject to an indebtedness of about
$527,000, from Ronald S. Ohsner of Upper Arlington.

     The 9,604 square-foot office space is occupied by the
offices of the Treasurer and of Equipment Inventory and has been
appraised at $552,500.  Funds for the purchase will be provided
by an internal loan, to be repaid from rental income.  An
analysis of expenses and income showed that owning versus leasing
the space will save Ohio State at least $40,000 a year, according
to Treasurer James L. Nichols.

     Trustees also approved three easements:

     -- A 25-year easement of land to the City of Columbus for
constructing a bikeway along the Olentangy River north of
Dodridge Street.  The path will be part of a regional bikeway
that will serve bicyclists and pedestrians traveling to and from
the campus.
     -- A 15-year easement to the Ohio Department of Natural
Resources for installing an underground propane gas line across
university property on Peach Point, South Bass Island.  The line
will provide service to the department's fish hatchery.
     -- A 15-year easement to Ohio Bell Telephone Co. to install
an underground fiber optic cable on university property along
West Ninth Avenue near Perry Street on the Columbus campus.

RESEARCH CONTRACTS ACCEPTED

     The board accepted 141 research contracts totaling
$15,482,651.  Singled out for special mention were:

     -- The Environmental Scholarship/Fellowship and Grants
Program, funded with $1,298,819 by the Uniformed Services
University of the Health Sciences, Bethesda, Md.  The funds will
benefit students studying environmental sciences to develop an
expertise in soil and water remediation, according to a research
report summary.  Franklin W. Schwartz, Ohio Eminent Scholar and
professor in the Department of Geological Sciences, is heading
the project, which is funded through June 1999.

     -- A project to discover and analyze anticancer drugs
through a mechanism group-based strategy, funded with $200,000
from the American Cancer Society Inc.  The study will use an
analytical system called simian virus 40 DNA replication which
can be used to understand mechanisms of new cancer drugs,
according to the report.  Sources of new drugs will be plant
groups with historic or folkloric antitumor activity from Ohio
State's collection of more than 1,700 species and from the
National Cancer Institute's Natural Product Repository.  R. M.
Snapka, associate professor in the Department of Radiology, is
the principal investigator.

     -- A sabbatical award to evaluate a psychosocial
intervention for women with breast cancer, funded with $86,896 by
the U.S. Army Medical Research and Development Command.  Barbara
L. Andersen, professor in the Department of Psychology, is
conducting the study on the hypothesis that women treated with
the psychological intervention regimen will show "lowered stress,
increased quality of life, more positive health behaviors and
fewer negative ones, greater compliance with prescribed medical
treatment, and an increase in immune functioning."  The study was
funded earlier by a grant from the American Cancer Society.

     -- A project to develop a dystrophin-containing adenoviral
vector system that could be used clinically for treating Duchenne
Muscular Dystrophy, funded by $77,971 from the Muscular Dystrophy
Association Inc. (MDA).  Arthur H. Burghes, associate professor
in the departments of Medical Biochemistry and Neurology, is
conducting the study along with another to clone and characterize
the spinal muscular atrophy gene, funded with $82,494 from the
MDA.

     -- A project to provide a method for documenting and
preserving dance through the use of multimedia software, funded
with $50,000 from the National Initiative to Preserve American
Dance.  Vera Maletic, professor, and Scott Sutherland, systems
analyst, both in the Department of Dance, planned the project.

MISCELLANEOUS ACTIONS

     In other matters, trustees:

     -- Received the annual report on capital improvements
projects from Jill Morelli, assistant vice president and
university architect.  In 1994, the Office of the University
Architect and Physical Planning worked on 273 projects costing an
estimated $669.1 million, completing 67 of them worth $129.5
million.
     -- Discussed amendments to the Medical Practice Plan with
Reed Fraley and Richard Sisson.
     -- Heard about the Arthur G. James Cancer Hospital and
Research Institute's membership in the National Cancer Care
Network, from Dennis Smith, the hospital's director of
administration.
     -- Heard a report on the Administrative Resource Management
System by John Ellinger, a report on the College of Law from
Gregory H. Williams, dean; and an update on university
restructuring from Sisson.
     -- Heard from Martha Garland, associate dean of the College
of Humanities, and Eric Busch, assistant vice president for
student affairs, regarding the work of the Committee on the
Undergraduate Experience.
     -- Received reports from officers of the InterProfessional
Council and Undergraduate Student Government.
     -- Held a discussion in the Investments Committee with
Richard Hill, dean of the College of Optometry, and James
Garland, dean of the College of Mathematical and Physical
Sciences, concerning whether to lower the amount of money
distributed from endowments from 5.5 to 5 percent and to increase
the amount reinvested in the endowment.
                                #
                                
Contact:  William J. Shkurti, (614) 292-9232.
Written by Tom Spring, (614) 292-8309.


[Submitted by: REIDV  (reidv@ccgate.ucomm.ohio-state.edu)
               
Fri, 03 Feb 1995 16:41:45 -0500 (EST)]
All documents are the responsibility of their originator.