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U.Va. forwards 2001 budget request list to Richmond

By Dan Heuchert

The 2000-02 biennial budget took effect just three months ago, and the 2001 session of the Virginia General Assembly does not convene until January. But state agencies are now submitting their priority lists for budget changes they would like to see.

The Board of Visitors met by telephone Oct. 2 to approve the University's budget amendment requests, which were subsequently forwarded to Richmond. Among the top priorities were a proposal to allow the Medical Center to keep $4.4 million in interest, generated mainly by patient revenue, rather than turn it over to the state treasury; and $4 million in support for the Integrated Systems Project.

The requests fall into two general categories: those to be supported from state coffers, or the "general fund"; and "non-general fund" projects, paid for through other revenue streams. Many capital projects, to be funded through anticipated revenue or by donors, fall under the non-general fund heading, but the University still must receive state approval for the expenditures.

"Typically, we have a pretty good track record there," said Nancy Rivers, director of the Office of State Governmental Relations.

Among the $45.8 million worth of proposed academic-side projects to be paid for entirely by non-general funds: renovations to Garrett Hall, improvements to the Lambeth Field student apartments and the neurosurgery department's offices, additions to Campbell Hall and Monroe Hall, construction of a new vivarium facility at the University Research Farm on Route 20 south of Charlottesville, another 600-space parking garage for the Medical Center, an addition to the Aquatics and Fitness Center, and a $200,000 increase in endowment spending for the Eminent Scholars program.

The Medical Center is requesting almost $20.5 million in non-general funds for capital projects, including improvements to the surgery and neurosurgery clinics and intensive care units on the third, fourth and fifth levels of the University Hospital; establishment of a Breast Health Center; creation of a transitional nursery to train parents in the specialized care of their newborns as they leave the pediatric and neonatal intensive care units; an addition to the Northridge clinical facility to house a cosmetic surgery center; a planning authorization for future hospital expansion; and acquisition of medical facilities in the Short Pump area of Goochland County and a radiation therapy center in Augusta County.

The projects to be paid for with general funds face far more competition for a limited amount of state funds.

The University's top legislative priority is the proposal to allow the Health System to retain interest generated from patient revenue. Currently, patient revenues technically go through the state treasury before they are returned to the University; while the University keeps those revenues, the state keeps the interest income generated, Rivers said.

If approved, the estimated $4.4 million that this proposal would generate for the University -- and drain from state coffers -- could amount to about 20 percent of the Health System's target operating margin. The Medical College of Virginia in Richmond received similar authorization in 1997.

On the academic side, U.Va. will request just over $71 million for general-fund projects. The two biggest-ticket items are $25 million to construct "MR-6," a proposed medical research building (to be supplemented by $21 million in non-general funds), and $12.5 million for an Engineering Information Technology Building (to be matched with a similar amount of non-general funds).

The 1999 General Assembly had authorized $11 million in non-general funds to construct a Materials Research and Science Engineering Center. In the wake of receiving a National Science Foundation grant to establish a center for nanotechnology, the University is seeking to increase that authorization to $14 million, of which $7 million would come from general funds.

The University is also seeking $4 million in continued support for the Integrated Systems Project, which will replace its various record-keeping and financial software programs with an interlocking Oracle software suite, and an identical amount to establish a scientific research investment fund, to attract new world-class faculty in science and engineering.

U.Va. is also asking for $210,000 to fund a summer program for eighth- and ninth-graders from disadvantaged and underrepresented backgrounds.

The amendments also include requests for general-fund capital projects, including a replacement for the Campbell Hall chiller that would support the planned arts precinct, renovation of Fayerweather Hall, a storm-water management plan for the planned arts precinct and basketball arena, $5 million to renovate Cocke Hall; and $500,000 to renovate classrooms with information technology and provide for its support.

The University is seeking nearly $900,000 to maintain new facilities that are expected to come online within the budget year and $1.1 million to reduce the current maintenance backlog.

In addition, U.Va. is requesting $2 million in continued funding to recoup the cost of indigent care at the hospital, to be applied to undergraduate medical education; $250,000 for four more Nursing School faculty members; and $300,000 for unexpected insurance premium increases due to a change in how state agencies are charged.

Gov. Jim Gilmore is expected to announced his budget amendment proposals in December. It is unclear how much funding the General Assembly will have to work with when it meets in January. A state Department of Finance spokesperson said a projected revenue forecast will not be completed until mid-November.


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