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       He explained that the capital plan is guided by the Strategic Plan that comes to the
Board and is approved by the Board. Two of the priorities set forth in the Strategic Plan
are insuring that the University's land, buildings and equipment are utilized effectively,
that they are well maintained, improved, and managed in an environmentally-conscious
manner and that quality library and information technology support, equipment and
facilities appropriate to a leading public university be provided.

       Through a series of slides, Mr. Carter provided a summary of the Capital Request,
reviewing each item and cost. In conclusion, he explained that the Capital Request would
go forward, if it is approved by the Board, to the Council on Postsecondary Education.
The Council on Postsecondary Education will then pass their recommendation and action
to the governor and the legislature.

       President Wethington reminded the Board that this request is roughly the size of
the scope of the request two years ago. The increase in the amount of the request is
largely due to inflation and the cost of the prevailing wage requirements that are now
placed on all public university projects in the Commonwealth. He said they would be
pleased to respond to any questions.

       Professor Mather had a question pertaining to the portion of the budget for new
programs and initiatives. He asked, "What is going to happen to this new initiatives
phase now with this new type of budgeting?"

       President Wethington said that the approach is going to be somewhat different
but, in certain respects, it is the approach that has been followed, through either
reallocation or the attraction of resources from sources other than state support. He
believes that through the University's own generation of resources, through the
reallocation process, and through the incentive pool, the University will be able to pursue
new initiatives in 1997-98, 1998-99, and beyond.

       Professor Mather clarified that a new initiative, not necessarily research and
graduate education, will be funded through internal reallocation rather than new money to
the base, and President Wethington stated that it was a fair assessment based on the
information the University currently has.

       Mr. Hardymon moved that the 1998-2000 Capital Request for the University
System, the University Hospital, and the Community College System be approved for
submission to the Council on Postsecondary Education. The motion, seconded by Mrs.
Bell, carried.