Repository: UIHistories Project: Board of Trustees Minutes - 1912 [PAGE 513]

EXTRACTED TEXT FROM PAGE:

1911]

PROCEEDINGS OF T H E BOARD OE TRUSTEES. E E N T A L TO COLLEGE OF P H Y S I C I A N S AND SURGEONS.

469 S

I n the course of the discussion of the Medical school situation the question was raised as to the reasonableness of the rental which has thus far been paid to the College of Physicians and Surgeons for t h e use of their plant. The president of the University made the following statement in regard to this m a t t e r : The rental has been $19,500.00 per annum, of which the sum of $1,000.00per annum has been used in the purchase of a corresponding amount of insurance upon the buildings and equipment included in the lease. This makes a net rental of $18,500.00 to the College of Physicians and Surgeons. The sum agreed upon between the College of Physicians and Surgeons and the trustees of the University of Illinois for the purchase of the property in the spring of 1907 was $386,000.00. This valuation was approved\by the Legislature of Illinois, which passed a bill in the Forty-fifth General Assembly, by a unanimous vote in the Senate, and by a two-thirds majority in the House, authorizing the purchase of the said property at this price of $386,000.00. The Governor vetoed the bill at that time on the ground that it was necessary to cut down the appropriations made by the General Assembly, as they had appropriated larger sums than would be available under the existing tax rate. No one has ever successfully impugned the statement that this was a very reasonable valuation of the property at that time. The buildings have, of course, deteriorated to some extent in certain respects, but they have been kept in very good condition as a whole, and many improvements have been made upon them since that time. Possibly the land has increased somewhat in value. If, then, we should take the valuation agreed upon at that time as the present valuation, the sum paid the College of Physicians and Surgeons the last year as net rental would be less than 5 per cent of the same,, which is surely an extremely reasonable rate. If, however, we should reduce the estimate agreed upon at that time by $77,000.00, cutting the valuation of the plant to $309,000.00, the "University would still be paying a net rental of only 6 per cent of the valuation, and this is surely a reasonable rate. Under this estimate of $309,000.00, the High School building would be put in at $150,000.00, which is a little lower than the estimate which the State Architect made of its value at the time referred "to; the old building at $60,000.Q0, which is also somewhat lower; the lot of ground on which theold High School building was situated, at $32,000.00, which is a lower estimate than made by any one of four independent arbitrators, and more than $10,000.00 lower than the value set upon it by the Chicago Real Estate Board; and the lot on which the old medical building was situated at $17,006.00,. which is $3,000.00 lower than the estimate made by three independent arbitrators. This would make a total of $259,000.00 as the value of the buildings and grounds. Adding to this sum $50,000.00 for the equipment, the value of1 which was estimated to be over $100,000.00 in 1907, and which is in better condition today than it was then, we shall have the sum of $309,000.00,. 6 per cent of which is $18,540.00. The low rate at which this valuation is made may be tested in another way. The present insurance* on the buildings and contents amounts to $252,000.00. If we take this as the real value of the buildings and contents— and surely it is far below the real value—and add $60,000.00 as the value of