Repository: UIHistories Project: Board of Trustees Minutes - 1952 [PAGE 286]

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UNIVERSITY OF ILLINOIS

383

increase to the Board of Trustees. T h e deans and directors performed a valiant service in reducing their askings by $4,500,000. They eliminated many items earnestly in demand. Nevertheless, I feel that the temporary decline in enrollment, the general economic situation in 1950, and the uncertainties of the immediate future require a further reduction. In the interest of prudent operation, I am requesting a biennial increase from t a x funds for 1951-1953 of $8,829,835. This sum includes $1,514,464 for contractual obligations; to this we are committed. It also includes the sum of $3.7 I 5.37 I in order to put newly constructed facilities into operation. Salary and wage adjustments of only 5 per cent, on the average, will cost $2,400,000. T o permit a normal rate of growth in various important areas of teaching and research, the sum of $2,200,000 is needed. T h e estimated savings in departmental budgets due to smaller enrollments are $1,000,000. An earned income increase of $1,500,000 from auxiliary enterprises (student and staff housing, food services, bookstores, etc.), added to the appropriation, brings a total increase, from all sources, of $10,329,835. / . Statutory and Contractual Increases Additions to Retirement System Appropriations In 1041 the General Assembly passed an Act establishing the University Retirement System of Illinois. It provides disability, death, and retirement benefits for all permanent staff members and employees of the University and of other state-supported institutions of higher education and the state scientific surveys. The University of Illinois' share of the cost of the System is regularly included in the appropriations to the University. It is computed on an actuarial basis. T h e amount of this item for the current biennium is $1,579,618. Because of increased staff, increased scale of compensation, and the larger number of persons retiring, additional funds of $406,600 for two years are required. B. Central Steam Plant T h e enlarged hospital could not be serviced by the steam available in present facilities. It was necessary to erect a new plant. T w o years ago, an appropriation of $6,400,000 was requested for the plant and distribution lines. T o obviate the necessity of such a capital appropriation, the University, with the approval of the Governor and the Director of Finance, concluded a contract with the Medical Center Steam Company, a corporation organized by officers of Commonwealth Edison Company. This plant is being built and will be operated on a nonprofit basis by the Company. T h e University will eventually pay the entire cost of operation, including amortization and interest on funds borrowed (80 per cent of cost) to construct the building. T h e estimated cost of the steam plant is $5,900,000 and the amortization period is thirty years. At the end of this time (or sooner by prepayments which are allowable) the plant will become the property of the University of Illinois. T h e University is authorized to sell steam to other governmental and educational agencies. A contract has been made with the State Department of Public Health which has contributed a sum representing the increased capital investment required for services to the Tuberculosis Hospital. A contract has been made also with the Veterans Administration for services to its new hospital, on a basis that will recover all costs. T h e plant now being built is of sufficient capacity to provide services for needed new additions to the instructional facilities of the Professional Colleges. T h e steam plant will also serve the new housing units that the University is endeavoring to construct through private loans. T h e Steam Plant contract will require additional appropriations in the coming biennium, estimated at $1,107,864, as follows: Payments on principal of construction loan J 375 000 Interest on loan 317 000 Charges for balance of funds supplied by Commonwealth Edison Company n o 864 Administrative services 40 000 Taxes (local real estate) 265 000 Total (two years) J i 107 864 A.