Repository: UIHistories Project: Board of Trustees Minutes - 1974 [PAGE 484]

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474

BOARD OF TRUSTEES

[March 20

realistically during this year and I am certain that the issue is not going to disappear. There is no way that we can envision meeting our financial requirements in the years ahead without planned and modest tuition increases, but our view has not prevailed for fiscal year 1975. Another alternative is simply to reduce our expenditures by one million dollars. I will not repeat today why this alternative is unacceptable except to say that an unacceptable alternative of the last few months is now even more so under the pressures of energy costs and of inflation. Since January, 1974, we have been concerned about the possibility of achievingour proposed increases in the income fund and have been searching for alternatives. We have now developed a package of items which can provide a one time increase in our income fund for fiscal year 1975 and which will permit us to meet our minimal needs for 1975 while we continue to press for long-term solutions— including an acceptable tuition policy—for fiscal year 1976 and beyond. There are a number of small items which are contributing to the health or our income fund — all the way from reduced institutional fee waivers to improved earnings on funds invested temporarily. However, the most significant item is that we can deposit approximately $1.5 million of the working capital of our stores and service accounts in our income fund on July 1, 1974, These funds have previously been needed to finance the inventory of the stores and service depart* ments, but due to more sophisticated practices and procedures and by cooperation with various state agencies we can reduce our need for working capital by this amount and temporarily use these funds to pay for fuel oil increases and to offset the ioss of funds which would have accrued through tuition increases. To accomplish this transfer, we must, of course, have the concurrence of the General Assembly and oi the Governor to appropriate the funds to us; but such an action does not require general revenue funds and will permit us to meet our minimum needs without a tuition increase over the FY 1974 levels. Accordingly, with the full realization that we are deferring rather than solving a problem and based upon the assumption that at least the level of funding proposed by the Governor will be appropriated by the General Assembly, I recommend that the Board of Trustees approve the following action : 1. Upon the recommendation of the President of the University, the Board of Trustees of the University of Illinois authorize the President to seek appropriation increases from the income fund of _ the University of Illinois for fiscal year 1975 over fiscal year 1974 in an additional amount of approximately $1.5 million. Such increases shall be supported by transfers of working capital into the income fund, through increased investment income, and through such other methods as are appropriate without increasing student tuition levels. 2. The Board of Trustees suspend until further order of the Board its action in approving increases in tuition levels for 1974-75 and direct that financial planning for fiscal year 1975 be based upon the resources recommended in the Governor's budget message plus the increases in the income fund authorized in the paragraph above. 3. The Board of Trustees direct the President of the University and other University officers to continue analyses of the impact upon the University of rising energy costs and of general inflation and, if deemed necessary, to work in concert with the Illinois Board of Higher Education, the Governor, and the General Assembly to seek special appropriations to deal with previously unanticipated major problems related either to energy costs or to inflationary impacts upon personnel salaries. Mr. Livingston raised an objection to the lateness of the recommendations and expressed his feeling that he had not had sufficient time to consider or study the recommendations and that, accordingly, he was unwilling to vote in support of them. O n motion of Mr. Swain, the report and recommendations as presented were approved, with Mr. Livingston dissenting. Hospital-Medical-Surgical Fee, Urbana Chancellor Peltason indicated that presently under consideration was a