Repository: UIHistories Project: Board of Trustees Minutes - 1930 [PAGE 455]

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452

board OF trustees

[December 4

The Legal Counsel and myself are of the opinion that this change will remove the ambiguity in the present rule. O n motion of M r . Trees, this a m e n d m e n t to the statutes w a s m a d e as r e c o m m e n d e d .

MANUFACTURE AND SALE OF PHOSPHORUS TEST SOLUTION

(27) As was reported at the last meeting, the Urbana Laboratories requested permission to continue the manufacture and sale of the phosphorus test solution developed by the University. This concern was authorized by the Board to manufacture and sell this solution under certain conditions and without the payment of royalties until November 1, 1929. In accordance with the instructions of the Board at its last meeting, I requested the Superintendent of Business Operations and the Acting Comptroller to inquire into the matter of suitable conditions of a contract and they report as follows: December 3, 1929 President David Kinley, jjj Administration Building Dear President Kinley: W e have analyzed the report submitted by the Urbana Laboratories as of the date of November 13, of their sales of the solution known as the "Field Test for Available Phosphorus in Soils," andfindthat to that date they had sold 378 , £ quarts V and distributed it to 17 different states in the union. The production cost has run somewhat higher than the original estimate of $.74 a quart and is nowfiguredat $.94 a quart. The selling price varies with the size of the package and the quantity purchased, but the average on the amount sold to date has been $1.37 per quart. The cost price of $.94 includes nothing for overhead or profit so that there is a balance there of $.43 to cover these items and any royalties which the University decides to charge. The cost of the solution is only about $.20 a quart, the other charges being for bottling, packing, shipping, etc. W e recommend that a contract be made with the Urbana Laboratories for the manufacture and distribution of this product at a royalty of $.10 a quart for the balance of this year and for the year 1930, the contract to become effective as of the date of its authorization by the Board of Trustees with the royalties retroactive to November 21, 1929. The contract will provide that the Urbana Laboratories shall keep their records in a manner satisfactory to the Comptroller, and for the payment of royalties quarterly. At the end of the year 1930, operations for the year will be reviewed to determine whether the contract will be continued in force and if so, whether on the same or on a different basis. A review of the material submitted by the Urbana Laboratories indicates that the price at which this material is being sold cannot be considered commercially profitable, but because of the fact that the company has salesmen on the road selling other products to the farmer, no sales costs are included. W e therefore feel that the Laboratories are handling this as a side issue more for the service they are rendering the farmer than because of the profit there is in it to them, and that under these circumstances there is no justification for charging a higher royalty unless we authorize an increase in the price, which does not seem wise at the present time, and the terms recommended as given above are entirely satisfactory to the Urbana Laboratories. Very truly yours,

James M. White

Supervising Architect

H. M. Edwards

Acting Comptroller

On motion of Mrs. Grigsby, the recommendation concerning contract and royalties was adopted. ELEVATOR FOR AGRONOMY SEED HOUSE

(28) A recommendation from the Supervising Architect that the contract for one direct-liftCompany elevator for the Agronomy Seed f 2,000.be awarded to the Otis Elevator plunger on the basis of their quotation of House I concur.