Thanks to the 2008 General Assembly,
VCU will become more independent
from state government and
will have more flexibility in spending
money such as tuition.
A management agreement between
the commonwealth and VCU
establishes the university’s newly
granted flexibilities. Starting July 1, the
university will gain more freedom to
decide on projects that are not funded
with money from the commonwealth,
such as building residence halls, dining
facilities and student commons.
John Bennett, VCU’s senior vice
president for finance and administration,
said the management agreement
gives VCU Tier 3 status, the highest
level of flexibility a university can have
with state government.
“Tier 3 schools are granted the
most freedom from state oversight,”
Bennett said.
The agreement will help expedite the
completion of capital projects funded
with gifts and investment earnings, as
well as tuition and fees, VCU officials
say.The agreement affects capital outlay,
real-estate leasing, procurement, human
resources, information technology
and finance and accounting. The new
VCU School of Engineering building,
for example, would have qualified as
one of those projects.
In exchange for the increased flexibility
on spending, VCU must meet 12
goals prescribed by the State Council
of Higher Education for Virginia. The
goals include a higher degree of campus
safety, affordable education, student
access and student retention.
Bennett said the university is
thinking about building an additional
residence hall and an additional parking
deck; both projects are in a very early
planning stage. Those projects would be
affected by the management agreement,
because planning and development
would happen after the pact has been
put in place.
As the university would be more independent
when planning the projects,
and Virginia officials would have to
approve fewer details, the construction
would go faster.
Sen. John Watkins, R-Midlothian,
who introduced the legislation on
behalf of VCU, said the agreement
would reduce the bureaucratic
burden that Virginia agencies place
on the university. Watkins said other
states have seen success in making
such agreements with institutions of
higher education.
“Some of the neighboring states
have turned this restructuring into
an economic-development benefit,”
Watkins said. “The best example that
I can provide for you is in North
Carolina with the Research Triangle,
which specifically came out of a
similar restructuring arrangement
in higher education there.”
The Research Triangle, which
is home to numerous high-tech
companies, was built around Duke
University, North Carolina State
University and the University of
North Carolina at Chapel Hill.
VCU will join University of
Virginia, the College of William and
Mary and Virginia Tech, all three of
which received their Tier 3 ranking
in 2005 when the concept was first
introduced.
The legislation authorizing VCU’s
management agreement was introduced
in both the House of Delegates
and the Senate. House Bill 1124 and
Senate Bill 358 were identical and
passed the General Assembly with no
opposition in the subcommittees or
committees or on the chamber floors.
Gov. Timothy M. Kaine signed the
legislation March 12.
Jibran Muhammad, the presumed
Student Government Association
president-elect, said he was pleased
to see the change.
“This is a very proud moment
for VCU,” he said. “Achieving this
status is a tribute to the inspired
leadership of President Trani and
the relationship he has developed
with the government of the commonwealth.
“This recognition adds significant
value to the education of every
student. It is but another indication
of the golden days ahead as VCU
progresses toward realizing its full
potential.”
Watkins said the VCU’s Medical
College of Virginia Hospitals
received similar status a few years
ago and used this authority to
successfully restructure the Medical
Center.
“It allowed the VCU Medical
Center to put itself on a much more
stable financial setting,” Watkins
said.
Dietra Trent, Virginia’s deputy
secretary of education for higher
education, said the relationship
between the governor and VCU
won’t change.
“VCU remains a state institution
and continues to receive state funding,”
Trent said. “Therefore, the Tier
3 status primarily affects the way (the
institution does) business, meaning
the Board of Visitors can set tuition,
and they are exempt from other state
regulations in the areas” affected by
the agreement.
Unless extended, the Tier 3 agreement
will expire June 30, 2012. The
agreement could be renewed, modi-
fied or terminated by the General
Assembly or the governor.
At a glance
What: A management
agreement between VCU and
the state.
Why: To give VCU more
flexibility on spending and
other decisions. In return,
VCU must meet Virginia’s
goals regarding affordability,
retention and other criteria.
Who: Legislators approved
the agreement in recent
months and Gov. Timothy
M. Kaine signed it March 12.
When: The agreement
will take effect July 1 and run
for at least four years.