Legislative Update No. 10

UCONN 2000

Legislative Update No. 10

April 2000

REBUILDING, RENEWING AND ENHANCING

THE UNIVERSITY OF CONNECTICUT

The TENTH in a series of reports to Governor John G. Rowland and the Connecticut General Assembly

Table of Contents
I. UCONN 2000: THE UPDATE
II. ACTIVITIES COMPLETED OR UNDERWAY:

IV. CURRENT PROJECT STATUS (as of April 2000)
V. CURRENT PROJECT STATUS – PHASE II (as of April 2000)
VI. CURRENT PROJECTS FUND SOURCES: PHASE I (as of April 2000)
VII. CURRENT PROJECTS FUND SOURCES: PHASE II (as of April 2000)
CHARTS

 

UCONN 2000: THE UPDATE

This is the tenth in a series of semi-annual reports to the Governor and the General Assembly pursuant to the provisions of Sections 10a-109 through 10a-109y of the Connecticut General Statutes, originally An Act to Enhance the Infrastructure of the University of Connecticut, and now known as UCONN 2000. These reports have been issued each October and April since the passage of UCONN 2000 on June 7, 1995. The law also required a four-year progress report, which was filed on January 15, 1999. The standard reporting structure of the previous reports is again utilized in this report.

As documented in past reports, UCONN 2000 has revitalized the University’s main and regional campuses. New buildings have been constructed and old buildings have been refurbished. Freshman enrollment is up, minority enrollment is up, and the average SAT score of incoming freshmen has climbed. Private fundraising has benefitted, dramatically. But, most important, the student experience has been enhanced significantly, both in and out of the classroom, via state-of-the-art facilities, cutting-edge equipment, and pedestrian-friendly surroundings.

So much has been accomplished in five years. Prior to 1995, students and parents visiting the Storrs Campus for the first time came up over the hill on Route 195 and were greeted on the right by dormitories in need of repair and a rural setting on the left, with cows grazing next to deteriorating facilities. When they turned onto North Eagleville Road into the main section of campus, little caught the eye but the ducks swimming on the pond. The family probably parked in old Lot 9, if they could find a space. On foot, they made their way up the hill past the old ROTC Quonset hut, and a Field House looking every bit its age. They then turned onto Fairfield Road a risky proposition on foot, because the core of the campus was in fact a congested thoroughfare and parking lot, dominated by a library wrapped in plastic to protect pedestrians from falling bricks.

Fast forward to the year 2000. A new century and a new UConn. The same family, now arriving with a younger sibling, is in for a pleasant surprise. Those dorms on the right have pitched roofs, clean facades and neat trim, all a sharp contrast from the last visit. The cows are still there on the left (although one happens to be cloned), but now a beautiful Agricultural Biotechnology facility sits at the foot of the hill. As they turn into campus, the ducks are still there, but on this sunny day, the pond’s surface reflects an impressive structure, the new Chemistry building. The family heads toward old Lot 9 but it’s gone, replaced by a new parking garage. They walk up the hill. No ROTC hangar. An attractive brick building, the new home of the UConn Foundation stands there in its place. And that Field House looks a lot nicer, too. A peek inside shows ultra-modern recreational facilities filled with students. Heading toward the core of campus, our family witnesses the most impressive transformation of all. Where once there was a perennial traffic jam, now is a beautiful pedestrian landscape, a campus core with brick paths, plazas and seating walls that welcome residents and visitors alike. A glance past the rebuilt library reveals a glimpse of the magnificent South Campus residential complex. A lot has changed in five years.

UCONN 2000: ACTIVITIES COMPLETED OR UNDERWAY

PLANNING, DESIGN AND MANAGEMENT

  • Bids are being received for the Wilbur Cross project, a complete renovation of the former library building. This project will provide an opportunity to locate all of the business functions relating to student services in one central customer-friendly location. These functions include dining services, residential life, financial aid, bursar, registrar, and services to students with disabilities. The architects for the project are Arbonies King & Vlock, of Stony Creek, Connecticut.
  • Program development activities are underway for renovations at the School of Law that will provide for phased renovations of facilities including the old Library Building. The architects for this project are Allan Dehar Associates of New Haven, Connecticut.
  • Programming activities have begun for renovations to the current School of Business building. The purpose of this project is to turn the old facility into a new Learning Center. The Learning Center will provide academic support for students as well as instructional support for faculty members and graduate students. Functions included in the facility will be the First Year Experience program (special seminars and activities for incoming freshmen), Career Services, the Institute for Teaching & Learning, Study Abroad, Urban Semester, the Center for Community Outreach, Instructional Research Center, Honors Program, and the Learning Research Center. Also included with this project is an addition to the building that will be the new home for the Counseling Program for Intercollegiate Athletes. Architects for the project are Svigals Associates of New Haven, Connecticut.
  • Design development has begun for the Student Union project. This project, which will include major renovations and additions to the current facility, has a primary goal of expanding the range and quality of activities available to students in the campus core. Included in the project will be a food court, 500-seat theatre, meeting space, ballroom and a central post office for all student mail. This facility will also provide new space for each of the campus’ cultural centers. Implementation of the project will be phased over several years. The architects for the project are Cannon Associates of Boston, Massachusetts.
  • As part of the overall building and renovation program, the University of Connecticut continues the process of standardizing building systems and system components (such as electrical circuitry, panel boxes, etc.). This standardization process will reduce the number of replacement parts the University needs to inventory, speed repairs, improve the level of maintenance and lower overall costs.
  • Program design activities have begun for renovations to the Arjona and Monteith buildings. This project will include renovations to the exterior and the interior of these heavily used classroom buildings, including the addition of central air conditioning. The exterior renovations will add pitched roofs as dictated by the architectural standards of the University’s Master Plan. Architects for the project are Herbert Beckhardt and Frank Richlan and Associates of New York City.
  • Design development drawings are being prepared for the new School of Pharmacy building. The project involves the construction of a 120,000 square foot building for teaching and research for pharmacy and the creation of a 55,000 square foot building of research space for biology. The architects for the project are Davis, Brody Bond of New York City.
  • Bids were received for the Gant Plaza Deck repair project. The bids were over the planned budget and redesign has begun. It is anticipated that construction will begin in the spring of 2000.
  • The installation of sprinklers at the North Campus Dormitory is underway. It is anticipated that construction will be complete in August 2000. This project is part of the program that will include the installation of sprinklers in all residence halls by the completion of UCONN 2000. By fall of 2000, all residence halls will have alarm and smoke detection systems, the first line of defense in a fire emergency.
  • A private developer has been selected for the construction and management of a hotel on the Storrs campus. This hotel will be constructed under a land-lease agreement with the University. The facility will be built next to the Lewis B. Rome Commons building at South Campus to take advantage of its conferencing and catering capacity in conjunction with the hotel. The partnership for the project is Robert Freidman (hotel developer and owner of the Norwich Navigators) along with the Maristar Group, which manages hotels worldwide, including many university hotel facilities such as the Princeton Forestal. It is anticipated that the construction will be complete in December 2001.
  • Programming activities have begun for the Technology Quad Phase II project. This project involves the construction of a new building for the School of Engineering’s Information Technology program. This facility, which is projected to be approximately 94,000 gross square feet, will include offices, classrooms, research labs, and a 350-seat lecture hall. Architects for the project are Preiss Breismeister of Stamford, Connecticut in conjunction with Burt Hill Kosar Rittlemann of Washington, DC.
  • Programming activities have begun for renovations to the Neag School of Education’s Gentry building. This project will include a complete renovation of the building’s interior along with exterior improvements of the facade and roof. Architects for the project are Svigals and Associates of New Haven, Connecticut.
  • Construction documents are being completed for renovations to the Horticultural Storage building, which will be the new location of the Natural History Museum. The museum is undertaking fund raising activities to supplement UCONN 2000 funds. Architects for the project are Arbonies King & Vlock of Stony Creek, Connecticut.
  • Prequalification has begun for design-build firms for the second parking garage, to be located next to the Gampel Pavilion. Funding for the project will come from parking fee revenue. The facility will contain approximately 1,500 parking spaces and 60,000 gross square feet of retail space for the UConn Co-op. The environmental assessment is now being prepared and permitting activities are underway.
  • Prequalification is underway for an additional residential tower at the Hilltop complex. This project will contain 400 to 500 beds for students in suite style rooms. Financing for the project will be secured by special revenue bonds to be repaid through room and board fees. With enrollments increasing, additional residential space is crucial to avoid serious over crowding. It is anticipated that this project will be complete in August 2001.
  • A design-build firm has been selected to construct and manage apartment style housing on the Storrs campus to accommodate 996 students. Part of the Hilltop residential neighborhood, the project is on Alumni Drive, immediately south of the Hilltop Dorms. The apartments will be rented to University students only; tenants will be subject to the University’s code of conduct. The design-build firm for the project is Capstone Development of Mobile, Alabama, an organization which has successfully built similar projects in a number of other states. The complex is scheduled for completion by August 2001.
  • Master planning activities have been completed for the north campus (former Tech Park), Agricultural campus, and the Depot campus (former Mansfield Training School) areas. Previous master planning activities had focused on the core campus areas. Potential for further campus development will be realized with the settlement of the lien that had been placed against the north campus property by the former Tech Park developer.
  • Architectural plans are being finalized for the development of a Community Center facility at the School of Social Work on the West Hartford campus. This project is funded through the generosity of Henry and Judith Zachs, a UConn alumna. The relocated computer center will go into a new free-standing building on the West Hartford campus. The architect for the project is Barkin Andrade of New Haven, Connecticut.
  • Programming activities are underway for the Waterbury downtown campus project. This project, funded by State General Obligation bonds, will involve the relocation of the Waterbury Regional Campus from the present Hillside location to East Main Street. The existing academic programs, along with additional MBA and Bachelor of Business programs, will be offered in the new facilities. The architect for the project is Jeter Cook & Jepson of Hartford, Connecticut. Although not part of UCONN 2000 funding, the project will be managed by the University with the authority granted by UCONN 2000.
  • The Facilities Management Home Page on the World Wide Web continues to be very successful in providing information to interested parties. The site has been visited over 16,700 times since its introduction in October 1996.

CONSTRUCTION

  • A construction contract is being awarded for the Waring Building renovation. Plans for the building include offices for the College of Liberal Arts and Sciences, the English Department, and the Geography Department. Also included in the project is the creation of additional classrooms. The contractor for the project is Haynes Construction of Seymour, Connecticut.
  • Construction has begun for the University’s new Visitors Center. This project, funded through a generous gift from alumni Philip and Christine Lodewick, includes a center for visitor tours and information about the University and events. The Construction Manager for the project is BB&E of Bloomfield, Connecticut. Project completion is scheduled for September 2000.
  • An exterior signage program has been developed for all campus locations, including the Health Center. The purpose of the program is to incorporate signage that will provide a unified look and better directional information to visitors to the campuses. Installation of the new signage will begin in May 2000.
  • Construction has begun on the Central Warehouse project. The project team includes Konover Construction of West Hartford and Kagan Architects of New Haven, Connecticut. This 85,000 square foot facility will include purchasing, central warehouse and accounts payable functions, mail services, parking and transportation services, and program space for campus police. The facility is located in the R-Lot as part of the University’s plan to move support services to the perimeter of campus. It is anticipated construction will be complete in October 2000.
  • Construction activity is continuing on the Avery Point Marine Science project. This project includes a new 116,000 square foot research building, a 30,000 square foot Project Oceanology building, and a new central chilled water plant. This project will be completed in February 2001. The contractor on the project is C.R. Klewin of Norwich, Connecticut.
  • Researchers moved into the Agricultural Biotechnology facility in January 2000. The 46,000 square foot facility will include research labs for transgenic animal, plant biotechnology, and transgenic plant activities. Funding for the project included UCONN 2000 and federal funds. The contractor for the project was HRH/Atlas of Stamford, Connecticut.
  • Construction has begun again on the Litchfield Agricultural Center project after a winter shutdown due to a shortage of masonry workers. The contractor for the project is Hayes Construction of Shelton, Connecticut. Funding for the project includes UCONN 2000 funds and a grant from the Litchfield Agricultural Center. It is anticipated that construction will be completed in September 2000.
  • The renovation of the Northwest Quad residence halls is moving on schedule for completion in August 2001. The construction manager of the project is Whiting-Turner of Baltimore, Maryland. The project includes a new central dining facility for the complex, which will eliminate the small kitchens that currently exist in each of the seven buildings. This change will significantly reduce operating costs for dining services while freeing up additional program support space in each building. The dorm rooms will be renovated and brought up to building code, including the installation of sprinklers.
  • Classroom renovations completed in summer 1999 included Avery Point, West Hartford, and Waterbury campuses.
  • Construction is underway on the new School of Business project. The contractor for the project is FIP Construction of Cheshire, Connecticut. The project’s funding will be augmented with $4.5 million to be raised from private donations. It is anticipated the project will be completed in April 2001. .
  • After repeated discussions, notifications and warnings, the contractor for the Biological Sciences project was terminated by the University on February 4, 2000. The grounds for this termination included:
  • Unqualified general contractor staffing
  • Removal of key personnel
  • Unauthorized substitutions
  • Subcontractor mismanagement
  • Schedule-failure to comply with contact requirements
  • Failure to prosecute the work
  • Subcontractor payment irregularities
  • Inadequate staffing/manning
  • Change order processing failures
  • Disregard for University property
  • Refusal/delay in allowing document review
  • Failure to timely provide general conditions documents
  • Inadequate quality control
  • Inadequate safety supervision

The University is working with Liberty Mutual, the Surety that holds the payment and performance bond to complete the project. On April 10, 2000 Liberty Mutual informed the University that it is committed to discharging its performance bond obligations in connection with the project.

FINANCE

Section 10a-109 of the Connecticut General Statutes empowers the University to issue General Obligation Bonds secured by the State’s Debt Service Commitment (sometimes referred to as “Debt Service Commitment Bonds”). The Debt Service Commitment Bonds are issued pursuant to the General Obligation Master Indenture of Trust, dated as of November 1, 1995, between the University of Connecticut, as Issuer, and, Fleet National Bank of Connecticut, as Trustee (now State Street Bank & Trust). The Master Indenture of Trust was approved by the University’s Board of Trustees on November 10, 1995 and the State Bond Commission on December 21, 1995. The University’s Board of Trustees and the Governor approve the subsequent Supplemental Indentures for each bond issue. The State Treasurer and the University manage the Debt Service Commitment Bond sale process.

  • February 21, 1996: the University, in conjunction with the Office of the State Treasurer, issued $83,929,714.85 of “The University of Connecticut General Obligation Bonds 1996 Series A,” the first series of bonds secured by the State’s Debt Service Commitment.
  • April 24, 1997: “The University of Connecticut General Obligation Bonds 1997 Series A,” the second series of bonds secured by the State’s Debt Service Commitment, was issued in the amount of $124,392,431.65.
  • June 24, 1998: the third series of bonds, “The University of Connecticut General Obligation Bonds 1998 Series A,” was issued in the amount of $99,520,000.00.
  • April 8, 1999: the Phase I Debt Service Commitment Bond financings were completed with the issuance of $79,735,000.00 of “The University of Connecticut General Obligation Bonds 1999 Series A.”
  • The four series of Phase I bonds totaled $387,577,146.50 in face value of which $382,000,000.00 was for UCONN 2000 projects. The balance, together with accrued interest, funded the cost of issuance through the Office of the Treasurer.
  • March 9, 2000: Moody’s upgraded the UCONN 2000 Debt Service Commitment Bonds to “Aa-3,” the same as the State’s General Obligation Bond rating. As of March 2000, the UCONN 2000 Debt Service Commitment Bonds were rated “AA” by Standard & Poor’s; “Aa-3” by Moody’s Investors Service; and “AA-” by Fitch Investors Service. Additionally, certain maturities of the bonds were insured with “AAA” rated municipal bond insurance at issuance.
  • March 29, 2000: the first series of Phase II Debt Service Commitment Bond financings was completed with the issuance of $130,850,000.00 of “The University of Connecticut General Obligation Bonds 2000 Series A.” Together, the five series of DSC bonds issued totaled $518,427,146.50 in face value, of which $512,000,000.00 was for UCONN 2000 projects. The balance, together with accrued interest, funded the cost of issuance through the Office of the Treasurer.

Trustee-Held Construction Fund
Prior to June 1998, all of the Debt Service Commitment Bond proceeds were deposited with the Office of the State Treasurer, and treated similar to State bond proceeds. Subsequently, the Office of the Attorney General determined that the UCONN 2000 bonds are issued by the University and not by the State. Accordingly, upon the advice of bond counsel and in order to conform to the Master Indenture of Trust, the Debt Service Commitment Bond construction fund proceeds were deposited to the Trustee Bank. The bond proceeds for cost of issuance are still deposited with, and disbursed by, the Office of the State Treasurer.

The University has directed the Trustee Bank to invest the Debt Service Commitment construction fund proceeds in the State Treasurer’s Short Term Investment Fund, which is “AAA” rated and offers daily liquidity and historically attractive risk-adjusted yields.

The Indenture of Trust provides that the University is authorized and directed to order each disbursement from the Construction Account held by the Trustee upon a certification filed with the Treasurer and the Trustee. The Indenture provides that such certification shall be signed by an Authorized Officer of the University, and that it provide certain disbursement information. Once the Authorized Officer certification filings are made, the University can directly disburse the payments.

University Special Obligation Revenue Bonds Secured by Pledged Revenues
UCONN 2000, as codified in Connecticut General Statutes Section 10a-109 through 10a-109y, also authorizes the University to issue Special Obligation Revenue bonds. Unlike the Debt Service Commitment Bonds, which are paid for out of the State’s General Fund, the Special Obligation Bonds are paid for out of certain, pledged revenues of the University as defined in the particular bond series indenture.

Additionally, a Special Capital Reserve Fund may be established for University Special Obligation bond issues only if the Board of Trustees of the University determines that the Special Obligation bond issue is self-sufficient as defined in the act. The self-sufficiency finding by the University must be submitted to and confirmed as not unreasonable or arbitrary by the Treasurer of the State, prior to issuance of the bonds. Once approved, the Special Capital Reserve Fund is funded at issuance by the University to meet the minimum capital reserve requirement. However, subject to notification by the University on or before December first annually, if this amount falls below the required minimum capital reserve, there is deemed to be appropriated from the state General Fund the sums necessary to restore each such Special Capital Reserve Fund to the required minimum capital reserve.

The Student Fee Revenue Bonds were issued pursuant to the Special Obligation Indenture of Trust, dated as of January 1, 1997, between the University of Connecticut, as Issuer, and, State Street Bank & Trust, as Trustee. The Special Obligation Indenture of Trust and the Student Fee Revenue Bonds Supplemental Indenture was approved by the University’s Board of Trustees on November 8, 1996. The Supplemental Indenture authorized the issuance of bonds up to a principal amount not exceeding $30,000,000.00 for construction of the South Campus Residence and Dining Hall, plus the amounts necessary to fund a Special Capital Reserve Fund (“SCRF”), and to provide for costs of issuance.

On February 4, 1998, the University issued $33,560,000.00 of the University of Connecticut Student Fee Revenue Bonds 1998 Series A. The bonds have a final maturity of November 15, 2027. The University managed the issuance and sale of the UCONN 2000 Student Fee Revenue Bonds 1998 Series A, and realized a favorable true interest cost over the twenty-nine year term. Debt service for the Student Fee Revenue Bond 1998 Series A’s debt service is paid from Infrastructure Maintenance Fee revenues. This fee is paid by students, and was instituted in 1997 to provide for such debt service, and to help support future operation and maintenance costs for facilities built or expanded by virtue of UCONN 2000.

The University has invested the bond proceeds in the State Treasurer’s Short Term Investment Fund, and, in regard to the Special Capital Reserve Fund, in “AAA” rated fixed income Investment Obligations as defined in the Special Obligation Indenture of Trust.

The State SCRF enhancement allowed the bonds to obtain a “AA” rating from Standard & Poor’s, a “AA-” rating from Fitch Investors Service, and an “A-1” rating from Moody’s Investors Service. The bonds were subsequently covered by municipal bond insurance and upgraded to a “AAA” rating category at Fitch and Standard & Poor’s and “Aaa” at Moody’s Investors Service. During October 1998, Standard & Poor’s upgraded the SCRF bond ratings to “AA” with a stable outlook.

Future Bond Issues
Phase II projects totaling $450,000,000.00 remain to be financed with future series of Debt Service Commitment Bonds. Generally, the University plans on issuing a series of Debt Service Commitment Bonds at least every 12 months. Additionally, the University is currently considering issuing Special Obligation Revenue Bonds for a parking garage near Gampel Pavilion, and for student housing facilities in the Hilltop campus area.

PRIVATE FINANCIAL SUPPORT

The UCONN 2000 endowment matching gift program has been a resounding success. The program is providing a powerful incentive for donors, who are investing in the University’s people, programs, and facilities at record levels. Since 1995, the year prior to the commencement of the UCONN 2000 program, private giving has increased 300 percent. In addition, the UConn Foundation’s investment performance was in the top 10 percent of all colleges and universities for the past three years. A combination of new contributions, maximized by the state matching program, and strong investment performance made UConn’s endowment one of the fastest growing nationally.

  • The $20 million in 1:1 state match funds for private gifts, as provided by the original UCONN 2000 legislation, is in-hand. During the first year of the program, $9.1 million in match-eligible gifts was received; an additional $6.5 million was received in calendar year 1997; and $4.4 million was received in calendar year 1998.
  • The $6.8 million in state funds to match the private gifts received in 1997 was transferred by the State to the University in December 1998 and January 1999, and was invested promptly.
  • In February 1999, the Board of Trustees submitted to the State a request for $7.5 million in matching funds to match endowment gifts received in 1998, 1997, and 1996, which had not been previously submitted. The match was received in October 1999.
  • In recognition of the program’s success, the General Assembly enacted a continuation and restructuring of the match on a 1:2 basis (one state dollar to every two private dollars). From fiscal year 2000 to fiscal year 2007, the state grant will total up to $52.5 million, depending on the level of match-eligible donations actually received. As of December 31, 1999, $29.0 million in pledges had been received as part of the 1:2 matching gift program.
  • Total endowment assets for the University as of December 31, 1999 were $207 million, including the UConn Foundation’s total endowment assets of $202 million. Foundation endowment assets grew 17 percent from $172 million on June 30, 1999. The Foundation’s outstanding investment performance in fiscal year 1999 placed it among the top five percent of endowments in American higher education.

Significant Gifts

  • Robert G. Burton, a successful Greenwich businessman and former professional football player, contributed $1 million to establish a scholarship for UConn football players enrolled in the School of Business. The Michael G. Burton Endowed Scholarship Fund is named for the donor’s son, a UConn senior and a captain of the football team. Burton’s investment, which demonstrates his dual commitment to athletics and academics, comes at a critical time as the UConn football program makes the transition to Division 1-A.
  • International philanthropists Raymond and Beverly Sackler donated $250,000 to support genetic research at the Health Center. The Raymond and Beverly Sackler Research Fund for Genetics and Molecular Medicine will support research in an innovative technology believed to be important in brain development and the immune system, with strong potential implications for drug development and the treatment of disease. The gift will advance UConn’s emerging prominence as a leader in genetic research.
  • A $1.5 million gift from Gary Gladstein through the SGM Foundation in January 2000 will support two exciting new initiatives in the School of Business: the Gladstein Professorship in Information Technology and Innovation, and the Gladstein Endowment for the MIS Research Laboratory. These endowed funds are vital to moving UConn to the forefront of technology research and development. The comprehensive gift will also support the Marsha Lilien Gladstein Visiting Professor in Human Rights and the new School of Business Building.
  • Judith ’77 and Henry Zachs gave $1 million to endow a faculty chair and to support a proposed doctoral program in the School of Social Work. The program will offer a strong core of advanced courses in theory and methods, research, history and philosophy, and policy and planning. The Henry M. and Judith M. Zachs Chair in Social Work will be filled by a prominent scholar in the field. As the first doctoral program in Connecticut, the gift will help fulfill a critical need in the state and the profession.

 

CURRENT PROJECT STATUS – PHASE I (as of April 2000)

CURRENT PROJECT STATUS- UCONN 2000 PHASE 1

CURRENT PROJECT STATUS – PHASE II (as of April 2000)

Current project status- phase II

CURRENT PROJECT FUND SOURCESĀ – PHASE I (as of April 2000)

CURRENT PROJECT FUND SOURCES- PHASE I

CURRENT PROJECT FUND SOURCESĀ – PHASE II (as of April 2000)

Current project fund sources- phase II

CHARTS

TOTAL UCONN ENDOWMENT CHARTTOTAL UCONN GIFTS CHARTUCONN FOUNDATION ASSET GROWTH CHART