||Questions to the President.
President Powers indicated that he was willing to answer the questions submitted to him in writing prior to the meeting, but his preparation for presenting detailed responses had been impeded because he had been ill much of the previous week. He asked Professor David Hillis (integrative biology and past Council chair) to present the questions.
At our last FC meeting, you gave us information for the past five years on the uses of the UT Trademark Income. In addition to transfers to the President's Discretionary Fund, there are a few additional direct transfers for academic purposes. For example, one academic department, Kinesiology, received a direct transfer from this account.
The questions that had been submitted for President Powers to address were the following:
||Who, or what committee, is in charge of deciding which academic programs get direct funding from this account?
||What is the process for evaluating competing proposals for these funds?
|| How can other academic programs apply to be considered for direct funding from this account?
||Is there a way to involve UT faculty in the review process for funding from this account?
||Is this a charge that could be assigned to the Faculty Budget Committee, which otherwise seems to have little function?
President Powers prefaced his answers by indicating there could be overlap in his responses to the individual questions. With regard to question 1, he said he met with athletics administrators when he became president and secured an agreement that a regular part of trademark and licensing money would be contributed to academic programs. According to the president, the automatic annual contribution from athletics is about 10 percent of the profits from trademark and licensing revenues, which he said had been “about $600,000-700,000” with other payments being contingent on profitability. He said the 10 percent amount was added to the regular academic budget in the same manner that other funds, such as the Available University Funds (AUF), to pay bills and expenses in accordance to normal accounting procedures. Additional contributions above the 10 percent amount, which according to the president have recently brought the annual total to about $1 million, have been used for specific projects, including renovation to Main 212, undergraduate studies, and a chair in the LBJ School of Public Affairs. President Powers said there was $1.4 million in unspent funds that he wants to keep in reserve until the budget situation stabilizes. He said the funds contributed by athletics to the Department of Kinesiology had followed a different process, which he thought department personnel had coordinated through the provost’s office and athletics to fund a special project.
President Powers said confusion occurred because the athletics contribution had been referred to as a discretionary fund. He described his view of the funding contributions from athletics as follows:
It’s not a discretionary fund where it just sits there, and I decide let’s use it for this or that. Normally, there’s been a use in mind for either this room or undergraduate studies. Again, we have not done that on the $1.4 million, and that’ll just wait to see what the budget situation is as we get toward the summer. I’m sure there will be important uses to keep the academic programs going. We don’t know what those would be at this point.
After clarifying that the athletic contributions received from trademark and licensing revenues follows the normal University budget process as funds from other sources, President Powers said there was not a committee that reviewed and determined how the funds would be used. He said he had made an effort to see that the athletic contributions were channeled toward University priorities “at the core of the academic process, like undergraduate studies.” He said the decision to renovate Main 212 had been made at a time before the need for budget cuts had surfaced. Although President Powers thought it was a good idea to renovate the room and was glad the work had been completed, he felt the decision to renovate would have been unlikely in today’s financial environment. President Powers said the Policy Planning and Advisory Committee (PPAC), after gathering information over a two-year period, had set general priorities for the University, which included increasing faculty salaries and graduate stipends to competitive levels, providing leave support for faculty, and solving space limitations for research and scholarship. As a result of this work, the president said he was “highly motivated to follow those priorities” should any new funds be forthcoming.
Professor Hillis sought clarification regarding the president’s discretionary fund or the athletics contributions that go into the general University budget. He asked if the allocations to kinesiology or the UT Film Institute were made by the president or by athletics department personnel. President Powers said he thought the kinesiology funding decision was made outside of the normal process; his perception was that kinesiology, through the College of Education and the provost’s office, presented a proposal for funding to support a special project. He said that all the other allocation decisions went through the normal process that he had previously described, and he thought the phrase “discretionary fund” had been used by athletics “because they didn’t know what else to call it.” President Powers said he called this money “the project fund,” which currently would be used “to help us further protect the core as we go through these budget cuts.”
Professor Hillis asked if the other payments he had previously mentioned had resulted “where particular needs were brought to athletics and athletics funded them?” President Powers responded by saying, “Correct, that’s my understanding.” When Professor Hillis asked what procedures others should follow to compete for the trademark and licensing funds, such as those allocated to kinesiology and the UT Film Institute, President Powers said requests from a department or program should progress via the normal channel through the respective college/school to the provost’s office as part of the Deans/Provost Academic Core Planning process (DPAC). He said this involved a high level of budget specificity where proposals were reviewed by the dean and provost in the context of the unit’s priorities and the availability of resources to support those priorities
From the prior discussion, Professor Hillis asked if the answer to question 3 could be summed up as follows: proposals from academic units for these funds should progress through the dean to the provost and the provost would take the proposal to athletics. President Powers responded in the affirmative but added that this was the process for proposals for any funding sources and not just for the athletics contributions. He said the funds from athletics, AUF, increased enrollment, and undesignated gifts at the president or provost levels were all relatively fungible. He explained that the process was not one where proposals were requested to compete for a particular source of funding, but that all proposals should progress through the DPAC process on the academic side of the University.
Professor Hillis said the last two questions regarding faculty input and the Faculty Budget Advisory Committee were related and could be addressed together. President Powers said he thought it would be a good idea to consider making the Faculty Budget Advisory Committee “more robust.” He said the PPAC involved faculty as well as staff and students in an effort to determine a broad-based view of University priorities while the Faculty Budget Advisory Committee’s review of the budget has often been done retrospectively. He said he thought the Faculty Budget Advisory Committee could provide valuable input regarding these overall priorities and their implicit trade-offs, such as those involved in allocation decisions for faculty raises, staff raises, graduate stipends, and research. He said these were the issues addressed by PPAC in the past, but he felt the Faculty Budget Advisory Committee’s role could be important in providing the “faculty view at that broad-brush level.” In addition, President Powers said a retrospective review of budgetary decisions could also prove helpful in making recommendations regarding future directions and choices.
Professor Hillis explained that the questions had grown from a concern that allocations of the trademark and licensing funds were being decided on an ad hoc basis, and there was a need for a process whereby faculty input could be included in the consideration of alternative uses for the money. President Powers said he understood the concern, but the decisions of what to fund had not been made by athletics. He said he had considered important academic priorities when making his decisions, and he believed the most important need right now was to manage the financial situation “with the least dislocation to the academic side of the campus.” Because the colleges and schools are experiencing difficulty in making the relatively small reductions and reallocations that have been requested, President Powers said he felt it was worthwhile to use the athletics contributions to help cope with the financial stresses and trade-offs that academic programs are facing.
Professor Andrea Gore (pharmacy) asked if the fiscal difficulties were going to impact the administration and use of funds from National Institutes of Health grants. She said a colleague at another state university had been told that she could not travel during the next six months even though she had travel funds available from her grant. President Powers said similar questions had been asked about whether the University raise policy applied to employees paid by grants where funding for raises had been planned and was available in the grant’s budget. President Powers said there was a feeling on one side that everyone should share in the pain of the economic downturn while others believe that the grants need to be honored since they are contractual and generating indirect costs. He also pointed out that employees working on grant-funded projects do not have the same kinds of protection that regular University employees have. Although President Powers said UT Austin tended to edge toward the shared-pain approach, he thought in the future this would need flexibility in order to honor the grant specification and the research needs of principal investigators.
Chair Janet Staiger (radio-television-film) expressed her appreciation to President Powers for his efforts to regularly attend Council meetings and for his presence at the current meeting given he was recovering from an illness. She said faculty members were concerned about the budget reductions so his presentation had been especially helpful.