These minutes reflect
discussion and debate at a meeting of a committee of the
Minutes
Senate Committee on Finance and Planning
238A Morrill Hall
Present:
Charles Campbell (chair), Calvin Alexander, Brittny
McCarthy Barnes, Stanley Bonnema, Thomas Klein, Yi Li, Richard Pfutzenreuter, Terry
Roe, Charles Speaks, Sue Van Voorhis, Warren Warwick, Susan Carlson Weinberg
Absent:
none counted for a special meeting called on short notice
Guests:
Professor Art Erdman (Advisory Committee on
Athletics); Vice President Kathryn Brown,
[In these minutes: football stadium principles]
Stadium
Principles
Professor
Campbell convened the meeting at
Professor Feeney last week drafted a revised set of
principles that drew on a number of email exchanges between FCC members and the
original FCC statement of principles prepared when the University was
considering a joint-use Gopher-Vikings stadium.
The Committee has received Professor Feeney's draft, comments from three
members of this Committee, and a letter that President Bruininks sent to
Professors Martin and Erdman in response to the draft from Professor Feeney (a
copy of which was provided to the President last week).
Vice President Brown said that the administration would
incorporate concepts from the three committees in the draft principles for the
Board of Regents; a small group will work to refine the draft, there will be a
work session at the Regents' meeting at which time Board members can comment on
the draft, and then a final working document will be prepared. They are trying not to create new principles
but rather to refine the ones that were presented last year. The principles will also not be carved in
stone; the Board endorsed the principles last year as guidelines but did not
explicitly adopt them as "policy."
She said she expected that the Board would do the same with a revised
set of principles dealing with a Gopher-only stadium.
Professor Warwick asked Professor Campbell to sum up the
assumptions that underlie all of the documents.
Professor Campbell said he had tried to do that in his own email to the
Committee earlier in the day, although it was difficult. But they appear to be these: (1) The Twins and Vikings will abandon the
Metrodome by 2011, therefore the University must
decide where its football team will play.
It could take over the Metrodome, build a new stadium, or play football
in
There is an unstated assumption, Professor Warwick said,
that the Metrodome is not one of the possibilities as a place for the Gophers
to play. Perhaps if the roof were
removed, it could be considered. The
other alternatives are lose-lose, he said.
Mr. Pfutzenreuter interjected that it is not possible to take the roof
off the Metrodome: it holds up the
walls. Professor Speaks recalled that
the Committee had been told that in the past.
Former Vice President Tonya Brown's financial analysis also projected an
additional $3 million per year in ticket revenues if the Metrodome were sold
out for every Gopher game unless there were a new lease,
which is not promising given the amount of the institutional subsidy. Professor Speaks also recalled that former
Vice President Kruse told this Committee that his worst nightmare was that the
University would inherit the Metrodome--a facility that is very expensive to
operate, at an annual cost of about $7 million or more.
Mr.
Pfutzenreuter added that he did not know if the Metropolitan Sports Facilities
Commission would remain in the picture if the Metrodome were no longer being
used by anyone except the University.
Essentially the only source of revenue for the Metrodome is the Vikings,
he said; the Twins pay very little and the University pays nothing. If the two professional sports teams leave,
the revenue gap will be huge.
Apropos
the stadium feasibility analysis that Mr. Pfutzenreuter had discussed with the
Committee last week, Professor Roe said it should include a cost-benefit
analysis. Mr. Pfutzenreuter said there
will be a project pro forma, which will include an analysis of the revenues and
expenses that be expected. It will be a stadium pro forma, without
indication of where the revenues (e.g., from parking) should be directed, he
said in response to a query from Professor Speaks.
Will
the feasibility study include opportunity costs, Ms. McCarthy Barnes asked? When they plan and site the stadium, they
will put back as much surface parking as possible, Mr. Pfutzenreuter
explained. They are keeping an eye on
the need for future academic buildings as they go into the project so that
other facilities could be built. The
stadium will not use up all the space in the area.
Professor
Campbell said that the feasibility study will be very important; at this point
the Committee can only consider broad principles. He urged that there also be an academic
impact statement developed in parallel with the feasibility study so that there
is an airing of all the issues. Has
there been such a study with other projects, Mr. Klein asked? What would it look like? Professor Campbell said that when the
biennial budget is developed, the Committee typically asks how it supports the
academic mission; that is the closest thing to an academic impact
statement. He has heard calls, however,
that there should be more focused assessments.
Most statements have to do with the financial impact on the teaching,
research, and service missions; one question is whether the stadium will affect
the ability of the University to carry out those missions. There are also questions about how effective
fund-raising would be and its costs. It
is difficult to separate these things but he thought it reasonable to go
through the exercise as a way to identify issues that can be discussed at a
later date.
Professor
Roe asked if it would not be best to comment on the draft "Guiding
Principles" prepared by the administration. Professor
Professor
Speaks said that he supported the draft "Guiding Principles" with
only a modest amendment to one of the points.
He suggested the language about limiting financial or other risks be
made stronger. Professor Roe noted that
the Committee had been concerned about parking and the extent to which others
would pick up extra costs. He also
suggested that with recent tuition increases, students should be consulted very
extensively about contributing to the cost of a stadium.
Ms.
McCarthy Barnes said she was concerned that the initial document FCC statement included
language about where stadium funding should come from and that it was
inappropriate to include a reference to the possibility of student fees in the
same discussion about earmarked private funds and alumni association
support. The latter two sources of funds
are given willingly; student funds may not be.
She said she did not know if the students would support funding a
stadium.
Mr.
Pfutzenreuter suggested the Committee focus on the broader principles; after it
tinkers with those, it could later articulate additional operating principles
to advise the administration. He assured
the Committee there would be ample time after the Board endorsed any principles
for more specific advice to be provided.
Professor Speaks concurred with Mr. Pfutzenreuter's suggestion and said
the Committee should not seek to include any more detail in the draft
principles; it can later develop operating recommendations for the
administration.
Mr.
Klein suggested including language about seeking over the long term for greater
self-sufficiency in athletics. That goal
should frame the stadium discussion, he said.
This Committee has spent much time on that topic in the past, Professor
Campbell observed, and has made stronger statements than that about it.
Ms.
McCarthy Barnes noted that the original statement was from FCC; where do
students fit in, she asked? Professor
Campbell reported that the Senate Consultative Committee (SCC; which includes a
number of students) discussed the stadium last week. It is early in the process, he pointed
out. Professor Erdman noted that there
are also students on the Advisory Committee on Athletics; he had urged the
students on SCC to contact the students on the Advisory Committee to make their
views known.
Professor
Warwick said that students got a bad deal on Coffman Union, when some of them
were at the University for four years but never had a student union. He said he would hate to see the same thing
happen to students with a football stadium.
He asked about the three lines engraved on the façade of Northrop Auditorium
(which no one at the meeting could recall exactly): Is the stadium in keeping with that
message? [The exact words are "Founded in faith that men are ennobled by
understanding; Dedicated to the advancement of learning and the search for
truth; Devoted to the instruction of youth and the welfare of the state."] Those phrases should be at the start of any
statement about the stadium, he urged.
The Committee voted unanimously in favor of a
generally-worded statement from Professor Speaks that it endorsed the draft
"Guiding Principles" subject to the understanding that the financial
risk language would be strengthened, that there be an assertion about the
long-term goal of decreased institutional support for athletics, that student
concerns about funding must be addressed, and that the ideals expressed in the
words on Northrop should be included in a cover letter.
Professor Roe suggested that the Committee wait on
consideration of more detailed operating statements until the stadium
feasibility study was completed, which is expected by November 1. Professor Campbell said his concerns were
that the Committee stay ahead of the process with
respect to fund-raising and that it will be difficult to delineate the
competition for funds between academic and stadium needs.
Professor Alexander said the Environmental Impact
Statement (EIS) will be a major cost item that could affect construction costs
as well as long term operating costs. It
will have the potential to torque the financial statements. Who will do the EIS, asked? Mr. Pfutzenreuter said that has not been
decided; they know roughly what it will cost but not who will shepherd it or
what staff will work on it. He also said
he did not know what would trigger an EIS.
Professor Campbell asked, about the $125,000 in
Foundation funds that will be used to pay for the feasibility study, how the
Committee could assess whether even THOSE funds would not otherwise be
available for academic purposes? Mr.
Pfutzenreuter said the Committee should inquire of Mr. Fischer, head of the
Foundation. No one will EVER know for
sure if a donor would have given other funds to the University, he said. If an ex-football player from the 1950s gives
funds for a stadium but has never otherwise donated money to the University,
one can make a reasonable guess. If
someone has also given to the University for academic purposes in the past, and
now gives also for a stadium, will that reduce giving for academic
purposes? There is no way to tell.
Is it conceivable that the stadium could be built
without debt service, Professor Warwick asked?
It is CONCEIVABLE, Mr. Pfutzenreuter said, if
all the cash were provided up front, but it is not likely. If there is a gap between the time
construction costs must be paid and donated funds come in, the University would
have to provide bridge financing--and the cost of that bridge funding would be
included as part of the project cost.
The University has provided bridge funding for other projects (e.g., is
doing so for the Translational Research Facility). The debt for the stadium will not be counted
by rating agencies against the University's indebtedness if there is a legal
pledge of donor funds and the dollars are in the pipeline. The stadium will have debt; the amount will
depend on the revenue streams, fund-raising, and so on.
Is there enough information from the previous
stadium study to compare the on-campus Gopher-only stadium with the joint-use
Gopher-Vikings stadium, Mr. Klein asked?
There is with respect to the site/land/environmental issues, Mr.
Pfutzenreuter said, and with respect to the transportation/district
issues. The remainder, however, is a
blank tablet. Will the study allow a
comparison to determine if one had more financial strength than the other, Mr.
Klein then asked? Mr. Pfutzenreuter said
they are not focusing on the joint-use possibility, and the study of it was
never completed because it was pulled off the table. Would it lessen the risk profile if there
were another entity involved, Mr. Klein inquired? The University wanted the Vikings to pay for
the maintenance and other costs of a joint-use stadium, Mr. Pfutzenreuter said.
The phrase "Gopher-only" keeps being
used, Professor Alexander said, but the President has referred to a general use
stadium. Will other activities be
factored into the revenue stream? They
will, Mr. Pfutzenreuter said--but there is not a lot else that it can be used
for. It will accommodate soccer, the
high schools, and the Marching Band, but the new turf grass being used in
stadiums would not allow for things like a tractor pull. Professor Alexander commented that he did not
see that as a drawback.
Professor Campbell said he would prepare a
communication to Professors Erdman and Martin about the actions of the
Committee, and adjourned the meeting at
--
Gary Engstrand
University
of Minnesota