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Chairman Miller outlined the timetable for the review, saying the specifics would beavailable within the next week. The Group’s report will be complete in mid-April, andthe report will be the subject of a special called meeting of the Board of Regents inlate April 2004 to make most decisions that are needed. Mr. Miller said the remainingdecisions would be made at the regular Board meeting in May, with additionaldecisions to be made during the regular budgetary process in the summer months.Upon invitation by Chairman Miller to make a few comments, Mr. Charles Szalkowskisaid he looked forward to input from members of the U. T. Board of Regents. Mr.Miller also said representatives from Ennis Knupp Associates were available forcomment and called on Vice-Chairman Hunt for any remarks.Vice-Chairman Hunt provided the following comments:Statement by Vice-Chairman HuntThank you, Mr. Chairman. I am supportive of the review process asapproved in our December Board meeting with the goal, at least from myperspective, for the Chairman of UTIMCO to institutionalizecompetitiveness and accountability for the management of ourendowment funds. As an institution with 170,000 students, significantresearch activities, clinical services, and 15 different locations around thestate on any given day, at any given moment and at the same time, wehave to manage 15 billion of assets. From a Board of Regents’standpoint, as I look at my fiduciary responsibility, I know I cannot bein the classroom, I cannot be in research, I cannot be in the operatingroom, and I cannot be managing assets. We need to institutionalize aprocess that is going to make us competitive, and we need to hold thatprocess accountable. I am particularly concerned with my final commenton the performance cap. In a highly competitive world, over the last 10years as we have communicated to everyone on the Board, if wecompare the management of our funds against a median of the large,higher education endowments in the country of 1 billion and over ofwhich there are 39, if we had just average performance over the last 10years, we would be 3.5 billion better off in our endowment funds. U. T.Austin would have received about 60 million more in the last year indistribution. That is what it is about to be competitive in a world where weare competing with others for research dollars, for students, for faculty,and for charitable dollars. The discretionary dollars that come out ofinvestment return are a part of that competitiveness, and I am hopefulthis review will help to contribute to institutionalizing a process ofcompetitiveness and accountability to where, at this Board level, we arenot a manager of assets, but we hold those managers accountable forthe process.RECESS.--At 1:40 p.m., Chairman Miller announced that the Board would recessto meetings of the standing committees. The Board would reconvene at 9:30 a.m. inOpen Session on Wednesday, February 4, 2004, in El Gran Salón of the StudentUnion at The University of Texas at Brownsville, Brownsville, Texas.4

WEDNESDAY, FEBRUARY 4, 2004.--The members of the Board of Regents ofThe University of Texas System reconvened at 10:10 a.m. on Wednesday, February 4, 2004, in El Gran Salón of the Student Union at The University of Texas atBrownsville, 80 Fort Brown, Brownsville, Texas, with the following in attendance:ATTENDANCE.-PresentChairman Miller, presidingVice-Chairman ClementsVice-Chairman HuntVice-Chairman KrierRegent BarnhillRegent CavenRegent CravenRegent EstradaRegent HuffinesAbsentCounsel and Secretary FrederickChairman Miller announced a quorum present and called the meeting to order.U. T. System: Annual meeting with officers of the U. T. System Faculty AdvisoryCouncilDr. Terese Verklan, Chair of The University of Texas System Faculty AdvisoryCouncil, spoke about overall concerns of the Council. With increasing growth andenrollment, money is lacking for buildings and faculty and other needs to make agood educational environment. She indicated that involvement of faculty in the earlystages of goal-setting would make mutual goals more realistic and attainable. Shediscussed the impact of the 80-hour workweek for residents on certain faculty interms of scholarly activity and post-tenure or annual review. Accountability was alsomentioned as a topic of interest to the Council. Dr. Verklan then introduced membersof the Council’s Executive Committee for their presentations.a.Peer review and annual evaluation processDr. Cynthia Brown, The University of Texas - Pan American, Academic AffairsCommittee Co-ChairDr. Brown reviewed the peer review and annual evaluation process and saidthe Council was asking the Board to endorse peer review as a part of theannual faculty review process at each component institution. She saidadopting a peer review process for merit raises will help to address the issueof salary compression, which was a major concern identified in the facultysatisfaction survey last year.5

Chancellor Yudof endorsed peer review as a significant factor in facultyevaluations and Chairman Miller said he would like to see state fundsdedicated to peer review incentives, especially in areas that encouragecollaboration in science, technology, and medicine.b.Long-term contracts for nontenure track clinical facultyDavid Lakey, M.D., The University of Texas Health Center at Tyler, HealthAffairs CommitteeDr. Lakey said the Council recommends all component institutions of the U. T.System move toward longer term commitments for faculty. He said this willhelp fulfill the U. T. System’s mission to become a first-rate university byrecruiting and retaining high quality faculty. He said only 49% of the facultyat the academic institutions are in tenure-track positions, with a lowerpercentage at the health institutions. He said providing job security will help toprovide stability for both the U. T. System and the faculty to ensure excellence.c.Tenure retention for full-time faculty requesting a part-time appointmentDr. Regina Lederman, The University of Texas Medical Branch at Galveston,Health Affairs CommitteeDr. Lederman said the Regents’ Rules and Regulations do not specificallyaddress retention of tenure for faculty with less than full-time appointments.She said the Council recommends tenure retention for current tenured, fulltime faculty seeking a part-time appointment for at least 50% time at any U. T.System component institution. She said the Council’s recommendation forpart-time tenure appointment is for no more than three years and is renewableif necessary. Retirement and health insurance benefits were also included inthe proposal, and Dr. Lederman clarified that those most likely to request apart-time appointment are faculty who collaborate with industry in smallbusiness innovation research grants and small business technology transfergrants.Chairman Miller noted the Regents’ Rules and Regulations do not prohibitretention of tenure or appointment of a tenured faculty member to less than afull-time appointment.6

d.Cross-Component Collaborative Initiatives (CCCI)Dr. James Bartlett, The University of Texas at Dallas, Chair-ElectDr. Bartlett spoke about synergies that exist in the U. T. System betweenacademic campuses and medical schools and said a new initiative wouldpromote collaborations from the bottom up to allow faculty from differentcampuses to work together. He identified time and space for faculty to gettogether as major constraints to collaboration. The goal of the proposed CCCIis to promote multidisciplinary research and scholarly collaborations that willenhance the academic standing of the U. T. System by providing efficient andcost-effective mechanisms for such collaborations among as many differentdisciplines and components as possible. He suggested CCCI be a Systemwide effort to increase the number and productivity of collaborations. Hedescribed how the Initiative would work with a minimal draw on instructionalfunds but suggested U. T. System might set aside funds for this effort.Regent Krier recommended the Council consult the on-line list of collaborationscompiled to complement this proposal Chancellor Yudof said this should involve peer review. He said if done right, itcould have an enormous effect. He noted he would like to work with thepresidents and the Faculty Advisory Council.Chairman Miller asked Chancellor Yudof to prepare responses to the FacultyAdvisory Council on these academic and health issues.APPRECIATION TO PRESIDENT JULIET V. GARCĺA.--Chairman Miller said theBoard was pleased to be meeting at The University of Texas at Brownsville andthanked President García for her hospitality in hosting this meeting. On behalf of theinstitution, President García welcomed members of the Board and other guests to thecampus.U. T. BOARD OF REGENTS: APPROVAL OF MINUTES OF REGULAR MEETINGHELD NOVEMBER 12-13, 2003, AND SPECIAL MEETINGS HELD NOVEMBER 18-19AND DECEMBER 19, 2003.--The Minutes of the regular meeting of the Board ofRegents of The University of Texas System held on November 12-13, 2003, in Odessa,Texas, were approved as prepared by the Counsel and Secretary to the Board. Theofficial copy of these Minutes is recorded in the Permanent Minutes, Volume LI,Pages 11 - 147.The Board also approved the Minutes of the special meetings of the Board of Regentsof the U. T. System held on November 18-19 and December 19, 2003, in Austin,Texas, as prepared by the Counsel and Secretary to the Board. The official copy ofthese Minutes is recorded in the Permanent Minutes, Volume LI, Pages 148 - 227.7

SPECIAL ITEMS1.U. T. System: Approval of the U. T. System Administration Mission and GoalsStatement and U. T. System Mission StatementThe Board approved The University of Texas System Administration Missionand Goals Statement on Pages 9 - 11 and approved, for the record, the U. T.System Mission Statement attached on Page 12 .The U. T. System Mission Statement, prepared in 1998, has been used andcirculated broadly but had not received formal approval by the Board.8

The University of Texas System AdministrationMission and GoalsMission. The University of Texas System Administration leads and serves ouracademic and health institutions to create and sustain excellence in educationalopportunities, research, and health care.Vision. The vision of the U. T. System Administration is to be the nationalmodel in system leadership of academic and health care institutions.Role. The U. T. System Administration adds value on behalf of U. T.institutions by undertaking certain central responsibilities that result in greaterefficiency or higher quality than could be achieved by individual institutions orthat fulfill legal requirements. In these activities, the U. T. SystemAdministration:Facilitates achievement of component institution goals;Serves as the agent of the U. T. Board of Regents;Exerts leadership on national and state higher education policies; andProvides oversight of and assistance for institution operations.Values. In support of the System’s broad mission, the U. T. SystemAdministration values excellence, innovation, integrity, focus on results,accountability, service, inclusion, collaboration, and resource stewardship.9

Scope. To achieve its mission, U. T. System Administration offices perform thefollowing roles and add value to the operations and achievements of U. T.institutions:Facilitating achievement of component institution goals Enhancing the quality of academic and health programs and expanding the researchcapability of U. T. institutions. Developing communications and development strategies to foster greater publicunderstanding, increased private support, and statewide advocacy at the institutionaland System-wide level. Leveraging the System’s collective size and diversity to facilitate opportunities forgrowth and efficient operations at academic and health institutions. Helping to secure and increase federal funding and support. Assisting in development and fundraising initiatives and training. Offering consulting, problem-solving services, and best practice models.Serving as the agent of the Board of Regents Implementing Board policies. Facilitating Board decision making. Implementing federal and state legal requirements. Developing and coordinating the System’s public policy agenda andcommunications. Reporting to the Board of Regents on behalf of component institutions.Exerting leadership on national and state higher education policies Leading and fostering understanding and support for higher education and for the U.T. System through comprehensive, strategic, and timely communications with thepublic.Providing oversight of and assistance for institution operations Managing the System-wide facilities inventory, the Capital Improvement Program,and project-specific facilities planning, property acquisitions, anddesign/construction management services. Providing investment funds management, debt financing, consolidation accounting,endowment asset management, and employee benefits. Providing legal services and managing the Medical Liability Benefit Plan and theDirectors and Officers Liability and Employment Practices Liability Plan. Facilitating information technology collaborations to obtain products and servicesand develop System-wide standards and guidelines. Continuously improving the quality, productivity, and efficiency at SystemAdministration. Assuring accountability, compliance, and quality processes.10

U. T. System Administration Goals Lead the national and state debate on key policy issues in public highereducation including access, affordability, accountability, and economicvalue. Establish a nationally recognized comprehensive plan to create anddisseminate knowledge on key public higher education issues of access,affordability, accountability, research, and economic value. Foster public understanding about the value and contributions of the U. T.System. Improve student access, success, and patient outcomes. Foster more strategic collaborations among U. T. institutions. Build more research institutions and enhance the research presence for allU. T. institutions. Create a risk-tolerant creative culture. Simplify policies and procedures. Create a desirable workplace.11

The University of Texas System Mission StatementThe mission of The University of Texas System is to provide high-quality educational opportunities for theenhancement of the human resources of Texas, the nation, and the world through intellectual and personalgrowth.This comprehensive mission statement applies to the varied elements and complexities of a large group ofacademic and health institutions. Individually, these institutions have distinct missions, histories, cultures,goals, programs, and challenges. Collectively, these institutions share a common vision and a fundamentalcommitment to enhance the lives of individuals and to advance a free society. Through one or more of itsindividual institutions, The University of Texas System seeks: To provide superior, accessible, affordable instruction and learning opportunities to undergraduate,graduate, and professional school students from a wide range of social, ethnic, cultural, and economicbackgrounds, thereby preparing educated, productive citizens who can meet the rigorous challenges of anincreasingly diverse society and an ever-changing global community; To cultivate in students the ethical and moral values that are the basis of a humane social order; To engage in high-quality, innovative research that entails the discovery, dissemination, andapplication of knowledge; To render service to the public that produces economic, technical, social, cultural, and educationalbenefits through interactions with individuals and with local, Texas, national, and international organizationsand communities; To provide excellent, affordable, and compassionate patient care through hospitals and clinics that areof central importance to programs of teaching, scholarship, research, and service associated with medicineand related health sciences; To enrich and expand the appreciation and preservation of our civilization through the arts, scholarlyendeavors, and programs and events which demonstrate the intellectual, physical, and performance skillsand accomplishments of individuals and groups; and To serve as a leader of higher education in Texas and to encourage the support and development of asuperior, seamless system of education – from pre-kindergarten through advanced post-graduateprograms, and encompassing lifelong learning and continuing education.To accomplish its mission, The University of Texas System must: Attract and support serious and promising students from many cultures who are dedicated to thepursuit of broad, general educational experiences, in combination with the pursuit of areas of personal,professional, or special interest; Acquire, retain, and nourish a high-quality, dedicated, diverse faculty of competence, distinction, anduncompromising integrity; Recruit and appropriately recognize exemplary administrators and staff members who provideleadership and support of the educational enterprise in an energetic, creative, caring, and responsiblemanner; Create and sustain physical environments that enhance and complement educational goals, includingappropriate classrooms, libraries, laboratories, hospitals, clinics, computer and advanced technologicalfacilities, as well as university centers, museums, performance facilities, athletic spaces, and otherresources consistent with institutional objectives; and Encourage public and private-sector support of higher education through interaction and involvementwith alumni, elected officials, civic, business, community and educational leaders, and the general public.[1998]12

2.U. T. System: Approval regarding possible bid to manage Los AlamosNational LaboratoryChancellor Yudof made the following statement regarding a possible bid tomanage the Los Alamos National Laboratory:Statement by Chancellor Yudof on Los Alamos NationalLaboratoryToday we bring to the Board the issue of a potential bid by TheUniversity of Texas System for the management contract forLos Alamos National Laboratory.I will be asking the Board to authorize that the SystemAdministration take steps to plan for a potential bid for thiscontract, including authorization for an appropriat

University of Texas at Brownsville to convene in Executive Session pursuant to Texas Government Code Sections 551.071 and 551.074 to consider those matters listed on the Executive Session agenda. RECONVENE.--At 1:30 p.m., the Board reconvened in open session in El Gran Salón of the Student Union at The University of Texas at Brownsville.