xt7zkh0dvz73 https://exploreuk.uky.edu/dips/xt7zkh0dvz73/data/mets.xml Lexington, Kentucky University of Kentucky 19780520 minutes English University of Kentucky Contact the Special Collections Research Center for information regarding rights and use of this collection. Minutes of the University of Kentucky Board of Trustees Minutes of the University of Kentucky Board of Trustees, 1978-05-jun20. text Minutes of the University of Kentucky Board of Trustees, 1978-05-jun20. 1978 2011 true xt7zkh0dvz73 section xt7zkh0dvz73
Minutes of the Special Called Meeting of the Board of Trustees,
University of Kentucky, Tuesday, June 20, 1978.
The Board of Trustees of the University of Kentucky convened in
the Board Room on the eighteenth floor of the Patterson Office Tower on the
Lexington campus at 2:00 p. m. (EDT), on Tuesday, June 20, 1978, pursuant
to a Notice which was sent by first class mail, postage prepaid, to all
members of the Board by the Secretary on June 6, 1978, with distribution of
copies to all parties required to be given notice pursuant to KRS 61. 825.
The following members answered the call of the roll: Mr. William B.
Sturgill, Chairman, Mr. William R. Black, Mrs. Betty Carol Clark,
Mr. Albert G. Clay, former Governor Albert B. Chandler, Mr. George
W. Griffin, Mr. Homer W. Ramsey, Mrs. Sally Hermansdorfer, Mr.
L. D. Gorman, Mr. Thomas B. Kessinger, Dr. David A. Hull, Mr.
Frank Ramsey, Professor Michael Adelstein, Professor Paul G. Sears,
and Mr. Eugene Tichenor. Absent were Mr. Richard E. Cooper (who is
officially a member of the Board until his replacement is sworn in), Mr.
John R. Gaines, Mr. Zirl A. Palmer, and Dr. John R. Woodyard. The
University Administration was represented by President Otis A. Singletary;
Vice Presidents Lewis W. Cochran, Peter P. Bosomworth, Raymond
R. Hornback, Jack C. Blanton, John T. Smith, and Donald B. Clapp; Dr.
David Stockham representing Vice President Robert Zumwinkle; Dr. Wimberly
C. Royster, Dean of the Graduate School and Coordinator of Research;
and Mr. John C. Darsie, Legal Counsel.
A. Meeting Opened
The Chairman called the meeting to order at 2:00 p.m., and
the Invocation was pronounced by Mrs. Betty Carol Clark. Following call
of the roll, to which 15 answered with only 4 being absent, the Chairman
announced that a quorum was present for the conduct of business, and
called the meeting to order at 2:03 o'clock.
B. Oath of Office Administered
Mr. Sturgill welcomed the newest member of the Board, Mr. Eugene
Tichenor, student member. At the Chairman's request, the oath of office
was administered to Mr. Tichenor by Mr. John Darsie, Legal Counsel.
C. Comments by President Singletary
President Singletary made several clarifying comments relative to
the controversial athletic dormitory situation which recently had received an
unusually high level of coverage in the news media. He reviewed that
Governor Carroll's offer of assistance was declined in a joint statement
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issued last Friday by Dr. J. David Grissom, Chairman of the Council on
Higher Education, and himself. President Singletary then requested and
received authorization from the Board to express to Governor Carroll the
University's thanks and appreciation for the intended helpfulness and fairness
of treatment inherent in the Governor's offer to assist the University of
Kentucky and its athletic program. Mr. Sturgill, as Chairman of the Board,
indicated that he also would convey a similar expression to Governor Carroll
on behalf of the Board.
D. Authorization of $6, 325, 000 "University of Kentucky Housing
and Dining System Revenue Bonds, Series J, " and the Requisite Series J
Supplemental Trust Indenture; Delegation to the Executive Committee of
Full Power to Act in the Sale Thereof; Authorization of 'University of
Kentucky Housing and Dining System Revenue Bonds, Series K, " in an
Amount Estimated to Be $284, 000 and Delegation of Power to the Executive
Committee To Make Final Determinations With Regard to the Details Thereof
and Proceed in the Public Sale Thereof; Requesting that the State Property and
Buildings Commission Approve and Authorize the Issuance of Said Series J
and Series K Revenue Bond Issues.
Board Member Albert Clay introduced, caused to be read and moved
immediate adoption of a proposed Resolution, copies of which had been sent
out to all Board Members with the Notice of the meeting, as follows:
A RESOLUTION OF THE BOARD OF TRUSTEES OF THE
UNIVERSITY OF KENTUCKY (A) DETERMINING THAT THERE
IS A PRESENT NEED FOR THE IMMEDIATE AUTHORIZATION,
PUBLIC SALE AND ISSUANCE OF ''UNIVERSITY OF KENTUCKY
HOUSING AND DINING SYSTEM REVENUE BONDS, SERIES J, "
IN THE PRINCIPAL AMOUNT OF $6, 325, 000; (B) DETERMINING
THAT COMPLIANCE HAS BEEN SHOWN WITH PARITY BOND
CONDITIONS SET FORTH IN THE CONTROLLING TRUST INDENTURE;
(C) AUTHORIZING SUCH SERIES J BONDS; (D) APPROVING THE FORM
OF SERIES J SUPPLEMENTAL TRUST INDENTURE PREPARED
AND TENDERED BY THE FISCAL AGENT AND BOND COUNSEL;
(E) DETERMINING THAT THERE WILL SHORTLY BE A NEED FOR
THE AUTHORIZATION AND ISSUANCE OF "UNIVERSITY OF KENTUCKY
HOUSING AND DINING SYSTEM REVENUE BONDS, SERIES K, " IN
AN AMOUNT PRESENTLY ESTIMATED TO BE $284, 000, AND THAT
THE POWER TO AUTHORIZE THE SAME, DETERMINE THE
DETAILS THEREOF AND PROCEED IN THE PUBLIC SALE THEREOF
IS DELEGATED TO THE BOARD' S EXECUTIVE COMMITTEE,
TOGETHER WITH THE POWER TO RECEIVE, CONSIDER AND
ACT UPON BIDS RECEIVED AT PUBLIC SALE FOR THE SERIES J
BONDS IN ORDER THAT TH-1EY MAY BE ISSUED WITHOUT DELAY;
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(F) REQUESTING THAT THE STATE PROPERTY AND BUILDINGS
COMMISSION APPROVE AND AUTHORIZE THE ISSUANCE OF THE
SERIES J AND SERIES K BOND ISSUES: AND (G) REQUESTING
THAT THE STATE PROPERTY AND BUILDINGS COMMISSION
TAKE SPECIFIC ACTION, AS IN THE PAST, AUTHORIZING THE
INCLUSION IN EACH OF SAID BOND ISSUES OF A COVENANT OF
THE COMMONWEALTH TO PAY THE INCREASED COST OF
OPERATING AND MAINTAINING THE UNIVERSITY'S HOUSING
AND DINING SYSTEM, AS SO ENLARGED, TO THE EXTENT THAT
REVENUES OF THE SYSTEM MAY BE INSUFFICIENT FOR THAT
PURPOSE AFTER PROVISION IS MADE FROM TIME TO TIME
FOR THE PAYMENT OF ALL PRINCIPAL AND INTEREST REQUIRE-
MENTS AND THE ACCUMULATION OF PRESCRIBED RESERVES.
and a true copy of which is attached to these minutes. The motion for the
adoption of said Resolution was seconded by Board Member George Griffin.
After full discussion the Chairman put the question and upon call of the roll
the vote thereon was recorded as follows: Voting "Aye": Chairman William
B. Sturgill, Vice Chairman Albert G. Clay, Mr. William R. Black, Governor
Albert Benjamin Chandler, Mrs. Betty Carol Clark, Mr. L. D. Gorman, Mr.
George W. Griffin, Jr., Mrs. Sally Hermansdorfer, Dr. David A. Hull, Mr.
Thomas B. Kessinger, Mt. Frank Ramsey, Jr., Mr. Homer W. Ramsey,
Mr. Eugene Tichenor, Professor Paul Sears and Professor Michael Adelstein.
Voting "Nay": None.
The Chairman thereupon announced that said Resolution had been
duly adopted and that the same was in full force and effect. (See FCR 1
at the end of the Minutes. )
E. Board of Trustees Resolution Regarding Medical Practice Plan (MCCRI)
Mr. Black, Chairman of the Board's Medical Center Committee,
expressed the thanks of the committee to President Singletary and his staff;
Vice President Bosomworth and his staff; and Dean Clawson and his staff for
their assistance in the preparation of this document. Mr. Black then called
on the President to make some introductory overview comments about the
new geographic full-time medical service plan for the University of Kentucky
College of Medicine (hereinafter referred to as the "new plan"). The President
in turn called on Vice President Bosomworth, Dean Clawson, and Vice President
Clapp for consecutive presentations relative to the new plan.
Vice President Bosomworth's discussion related to the contents of,
and difference between, the existing Physicians' Service Plan and the new plan.
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Dean Clawson discussed, both qualitatively and quantitatively, the
responses of the faculties in the departments of the College of Medicine to the
new plan. He also expressed his appreciation to the Medical Center Committee,
the concerned University administrators and their staff, and the faculty of the
College of Medicine for their combined efforts in the development of this new
plan.
Vice President Clapp next discussed the concerns and remaining
essential steps to be taken during the transition period associated with the
implementation of the new plan.
Mr. Black moved that the policy statement contained in MCCR I
be approved. His motion was seconded by Governor Chandler and passed
without dissent. (See MCCR I at the end of the Minutes.)
F. Meeting Adjourned
Since there were no other matters to come before the meeting, on
motion duly made, seconded, and carried the chairman declared the
meeting officially adjourned at 3:05 o'clock.
Respectfully submitted,
Paul G. Sears, Secretary
Board of Trustees
(FCR 1 and MCCR 1 which follow areofficial parts of the Minutes of the
Meeting. )
Office of the President
June 20, 1978
FG R I
Members, Board of Trustees:
RESOLUTION AUTHORIZING ISSUANCE
OF HOUSING & DINING SYSTEM
REVENUE BONDS
Recommendation: That the Board of Trustees approve
the following: A Resolution Authorizing the Issuance
of University Housing and Dining System Revenue Bonds,
Series J, in the principal amount of $6,325,000, and
Series K, in an amount presently estimated to be
$284,000, a copy of which is attached and made a part
of this resolution. Further, that the Board authorize
the publication of a Notice of Sale of Bonds and the
dissemination of an Official Statement and Official
Bid Form, copies of which are attached and made a part
of this resolution.
Background: Series J, University of Kentucky Housing
and Dining System Revenue Bonds, will be issued to
provide funds for construction of 200 apartment type
units of housing for 650 students on a 23 acre tract
on the University's south campus, and to provide funds
for the acquisition of three existing apartment buildings
located adjacent to the campus and containing 34 apart-
ments, the purchase of which having been previously
authorized by the Board.
Series K, University of Kentucky Housing and Dining
System Revenue Bonds, will be issued to provide funds
to replace windows and install thermostat control valves
in Boyd, Patterson and Jewell Resident Halls, which
would save approximately 35% of the heating energy
presently required. Housing and Urban Development (HUD)
has reserved funds to make a loan at 3% interest for
this project.
J u me 20 , 1978.
Action: Approved X Disapproved Other
Date:
A RESOLUTION OF THE BOARD OF TRUSTEES OF THE
UNIVERSITY OF KENTUCKY (A) DETERMINING THAT THERE
IS A PRESENT NEED FOR THE IMTEDIATE AUTHORIZATION,
PUBLIC SALE AND ISSUANCE OF "UNIVERSITY OF KENTUCKY
HOUSING AND DINING SYSTEM REVENUE BONDS, SERIES J,"
IN THE PRINCIPAL AMOUNT OF $6,325,000; (B) DETERMINING
THAT COMPLIANCE HAS BEEN SHOWN WITH PARITY BOND CONDITIONS
SET FORTH IN THE CONTROLLING TRUST INDENTURE; (C) AUTHOR-
IZING SUCH SERIES J BONDS; (D) APPROVING THE FORM OF
SERIES J SUPPLEMENTAL TRUST INDENTURE PREPARED AND
TENDERED BY THE FISCAL AGENT AND BOND COUNSEL; (E) DETER-
MINING THAT THERE WILL SHORTLY BE A NEED FOR THE AUTHORI-
ZAT1ON AND ISSUANCE OF "UNIVERSITY OF KENTUCKY HOUSING
AND DINING SYSTEM REVENUE BONDS, SERIES K," IN AN AMOUNT
PRESENTLY ESTIMATED TO BE $284,000, AND THAT THE POWfER
TO AUTHORIZE THE SAME, DETERIMINE THE DETAILS THEREOF AND
PROCEED IN THE PUBLIC SALE THEREOF IS DELEGATED TO THE
BOARD'S EXECUTIVE COMMITTEE, TOGETHER WITH THE POWER TO
RECEIVE, CONSIDER AND ACT UPON BIDS RECEIVED AT PUBLIC
SALE FOR THE SERIES J BONDS IN ORDER THAT THEY MAY BE
ISSUED WITHOUT DELAY; (F) REQUESTING THAT THE STATE
PROPERTY AND BUILDINGS COMMISSION APPROVE AND AUTHORIZE
THE ISSUANCE OF THE SERIES J AND SERIES K BOND ISSUES;
AND (G) REQUESTING THAT THE STATE PROPERTY AND BUILDINGS
COMMISSION TAKE SPECIFIC ACTION, AS IN THE PAST,
AUTHORIZING THE INCLUSION IN EACH OF SAID BOND ISSUES
OF A COVENANT OF THE COMMONWEALTI- TO PAY THE INCREASED
COST OF OPERATING AND MAINTAINING THE UNIVERSITY'S HOUSING
AND DINING SYSTEM, AS SO ENLARGED, TO THE EXTENT THAT
REVENUES OF THE SYSTEM MAY BE INSUFFICIENT FOR THAT PURPOSE
AFTER PROVISION IS MADE FROM TINE TO TIME FOR THIE PAYMlENT
OF ALL PRINCIPAL AND INTEREST REQUIREMENTS AND THE
ACCUMULATION OF PRESCRIBED RESERVES.
THE BOARD OF TRUSTEES OF THE UNIVERSITY OF KENTUCKY DOES
IIEREBY RESOLVE * AS FOLLOWS:
Section 1. History, Background and Recommendations.
Certain past actions of this Board and of other public
bodies and public officers, together with recent developments and
recomnmendations concerning them, are necessary to an understanding
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of the purposes intended to be accomplished by this Resolution
and they are herein recited:
(A) In 1966 this Board issued its $35,075,000 "University
of Kentucky Housing and Dining System Revenue Bonds," Series A to
Series I, Inclusive, pursuant to a Trust Indenture dated as of
June 1, 1965, made by this Board with Farmers Bank & Capital Trust
Company, Frankfort, Kentucky, as Trustee (hereinafter the "1965
Trust Indenture" or "Indenture"). Since that time this Board has not
authorized or issued any additional Series of such Bonds.
(B) In 1977 increased student enrollment gave rise to an
urgent need and demand for additional student housing facilities at
the Main Campus of the University. With authority from the State
Property and Buildings Commission, and on an emergency basis, this
Board advanced $381,000 from its reserves in the purchase and
acquisition of 34 apartment units in Lexington, Kentucky, generally
known as the "Linden Walk-Rose Lane Apartments," consisting of
three buildings: (i) at 404 Linden Walk, comprising 16 efficiency
units, (ii) at 411 Linden Walk, comprising 8 1-bedroom units, and
(iii) at 468 Rose Lane, comprising 10 efficiency units; and made a
determination that the issuance of another Series of its Housing and
Dining System Revenue Bonds pursuant to the 1965 Trust Indenture
would be necessary, and that this advance would be reimbursed to
this Board from the proceeds of the newm Series of such Bonds when the
same are issued. It was ascertained upon advice of legal counsel
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that this Board's statutory authority to finance educational build-
ings extends to the purchase and acquisition of existing buildings
as well as to the erection of new buildings, according to the
decision of the Highest Court of the Commonwealth in Morgan v.
Fayette County Board of Education (1943), 172 SW 2d 64, construing
statutes which are incorporated by reference into this Board's
statutory powers as sec forth in KRS 162.350.
(C) The increased demand for additional student housing
facilities was not satisfied by the acquisition of the Linden Walk-
Rose Lane Apartments. With authority from the Council on Public
Higher Education in Kentucky and with the approval of the State
Property and Buildings Commission and of the Secretary of the
Executive Department for Finance and Administration (hereinafter,
the "Secretary"), this Board authorized the undertaking of a projects
for the construction of a building on the Main Campus of the Univer-
sity at Lexington to contain 200 apartment-type units of housing
designed to accommodate students or married student families. The
Commonwealth's Division of Purchases publicly solicited the submission
of proposals for the design and construction thereof, including
mechanical systems and site improvement, but excluding movable
furnishings and fixtures, through a Design-Build Concept commonly
referred to as "Turnkey Contracting" under authority of KRS 45.360(1l),
whereby the Division of Purchases is directed to attempt in every
practicable way to insure the supplyint of the real needs of the
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Commonwealth at the lowest possible cost. Responsive to such solici-
tation the Division of Purchases has received a joint proposal of
C. E. Pennington, individually, and C. E. Pennington Company, Inc., a
responsible contracting corporation of Lexington, Kentucky, to design
and construct such housing building and requisite appurtenant facili-
ties (excluding equipment and furnishings) for the fixed sum of
$4,850,000 and it has been estimated by the Division of Purchases that
the cost of equipment and furnishings will be $575,000. It is urgently
required that this Board go forward immediately with the financing of
this housing project in order that it may be completed and ready
for occupancy at the beginning of the 1979/80 Academic Year in
September 1979. Execution of said contract is authorized.
(D) Consistent with a new federal program for the con-
servation of energy, the University has applied to the United States
Department of Housing and Urban Development ("HUD") for a 3% loan
to finance the cost of substantial reconstruction of three build-
ings which constitute parts of the University's Housing and Dining
System, in that all windows will be taken out and new thermal
windows, together with thermostat control valves, installed at
a cost, including administrative expense and the expense of
issuing bonds, estimated to be $284,000. The University has
been notified that funds for this project have been reserved by
HUD and has submitted a formal application for the issuance of a
HUD Loan Agreement. This financing could have been included in
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the proposed Series J Housing and Dining System Revenue Bond issue
except for the fact that it will probably require upwards of sixty
days for the Application to be processed so that the detailed HUD
Loan Agreement will be available, and the issuance of the Series J
Bonds cannot be delayed. It is the recommendation of the Vice
President for Business Affairs, in. which the President concurs,
that this financing be deferred and represented by a small subsequent
Series K Housing and Dining System Revenue Bond issue. It is
recommended that authority be delegated to the Board's Executive
Committee to proceed in the adoption of a resolution authorizing
this Series K issue, including determination of the principal amount
and all details thereof, conforming to the details of the HUD Loan
Agreement, when it is received, and in the authorization of a
Series K Supplemental Trust Indenture and the public sale of the
Series K Bonds if it is found to be appropriate and desirable that
these actions be taken by the Executive Committee rather than by
the full Board.
(E) It has been determined by the University's Vice
President for Business Affairs, in conjunction with the Secretary
and the Fiscal Agent designated by the Secretary, that in order to
finance the construction, equipping and furnishing of such new
student apartment housing project, to reimburse this Board for the
cost of acquiring the Linden Walk-Rose Lane Apartments, to make
reasonable and proper provision for unforeseen contingencies, to
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allow for a discount not to exceed 1-1/2% in the sale of bonds and
to cover the cost of issuance of bonds and administrative costs, it
is necessary that this Board authorize at this time the issuance of
"University of Kentucky Housing and Dining System Revenue Bonds,
Series J," to be dated as of June 1, 1978, in the principal amount
of $6,325,000, details of the amount of the bond issue and the
sources of funds being shown, as follows:
Construction/Development Contract for the new
building containing 200 residental units .... .... $ 4,850,000
Equipment and furnishings thereof .... ........... 575,000
Reimbursement to the University for the cost of
acquiring the 34 apartment units .... ............. 381,000
Interest during construction (1 year) at an
estimated interest rate of 6-1/2% .... ........... 411,125
Bond Discount (1-1/2% Maximum) ...... ............. 94,875
Costs of Issuance of Bonds ..... .................. 35,975
Administrative Costs ............................. 20,000
Allowance for Contingencies ..... ................ 123,375
Total Project Costs ........................ $ 6,491,350
Sources of Funds:
Housing and Dining System Revenue Bonds, Series J $ 6,325,000
Earnings on Investment of Construction Fund and
Capitalized Interest ($5,545,000) for 6 months
at 6 ............................................. 166.350
Total Available Funds ...... ................ $ 6,491,350
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Section 2. Determination of Financing Needs.
This Board hereby determines that the financing needs of
this Board and of the University of Kentucky require:
(A) Authorization at this time of the issuance by
.this Board of its "Housing and Dining System Revenue Bonds,
Series J" (hereinafter the "Series J Bonds!'), in the principal
amount of $6,325,000, according to the maturity schedule,
redemption provisions and other details set forth in Section 4
of this Resolution; and the advertising of the Series J Bonds
at public sale;
(B) Securing the Series J Bonds by the execution of a
"Series J Supplemental Trust Indenture" (hereinafter the
"Series J Indenture"), supplemental to the 1965 Trust Indenture,
according to the text prepared by Bond.Counsel and submitted by
the Fiscal Agent, which text is incorporated in full in
Section 5 of this Resolution;
(C) Delegating to this Board's statutory Executive
Committee full power and authority to receive, consider and
act in the matter of accepting the best bid which may be
received for the Series J Bonds, or in rejecting all bids and
re-advertising; and if a bid is accepted, to award the Series J
Bonds and make determination of the interest coupon rates in
conformity therewith, and to proceed in the delivery of the
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Series J Bonds to the purchasers thereof; all as set forth
in Section 6 of this Resolution;
(D) Authorization at this time of the issuance by this
Board of its "Housing and Dining System Revenue Bonds, Series K"
(hereinafter the "Series K Bonds"), to conform as to principal
amount, maturity schedule, redemption provisions, form, and
conditions with the HUD Loan Agreement, when received; acceptance
of the HUD Loan Agreement, when received; and securing the
Series K Bonds by the execution of a "Series K Supplemental
Trust Indenture" (hereinafter the "Series K Indenture"), supple-
mental to the 1965 Trust Indenture, in such form as may be
required when the details of the HUD Loan Agreement are kno=-m;
and delegation by this Board to its statutory Executive Con..ittee
of full power to act in the matters of (i) accepting the HUD-
Loan Agreement, if it is found to be consistent with the 1965
Trust Indenture, (ii) determining the principal amount, maturity
schedule, form, conditions of sale and all other details of
the Series K Bonds, (iii) advertising a public sale of the
Series K Bonds, (iv) receiving, considering and acting upon
such bids as may be received for the Series K Bonds; accepting
the best bid, and awarding the Series K Bonds to the best bidder,
and (v) proceeding with delivery of the Series K Bonds to the
purchaser or purchasers thereof; all as set forth in Section 7
of this Resolution;
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(E) Requesting adoption of a Resolution of the State
Property and Buildings Commission approving and authorizing
all of the actions herein found to be necessary, and herein-
after authorized; and, specifically, consistent with a certain
Resolution which was adopted by the State Property and Buildings
Commission on the 21st day of August, 1964., ratifying, approving
and consenting to this Board's inclusion in the Series J Inden-
ture, incorporated in full in Section 5 of this Resolution, and
in the Series K Indenture, when the form and execution thereof
are authorized at a later date by this Board's statutory
Executive Conmittee, and also in the text of the Series J Bonds
and of the Series K Bonds, of a binding and continuing covenant
of the Commonwealth that it will pay the cost of operating and
maintaining the University's Housing and Dining System, as .to
be enlarged through the application of the Series J and
Series K Bonds, to the extent, if necessary, to supply any
deficiency if the Revenues of said System shall at any time
prove inadequate to pay the costs of operation and maintenance
after the Revenues have first been applied to the transfers
and deposits required by the 1965 Trust Indenture to be made from
the Revenue Fund into the "University of Kentucky Housing and
Dining System Revenue Bond and Interest Sinking Fund Account"
(hereinafter the "Sinking Fund"), including transfers and
deposits to accumulate and maintain the Debt Service Reserve
- 9 -
therein, and transfers and deposits required by the provisions
of the 1965 Trust Indenture to be made from the Revenue Fund
into the "University of Kentucky Housing and Dining System Repair
and Maintenance Reserve" (hereinafter the "Repair and Maintenance
Reserve"); and to ratify, approve and consent to evidencing of
such binding and continuing contract of the Commonwealth by
causing a facsimile signature of the Secretary to appear upon
the face of each Bond; provided, however, it is understood, as
set forth in the aforesaid August 21, 1964 Resolution of the
State Property and Buildings Commission, that the ratification,
approval and consent of the State Property. and Buildings Commis-
sion to such covenant shall not be construed to be a representa-
tion that the State Property and Buildings Commission has any
power or authority to enter into a contractual covenant or.commit-
ment for the Commonwealth that any part of the principal of or
interest on any revenue bond (as distinguished from the costs
and expenses of operation and maintenance of public properties)
will be paid except from the revenues provided and pledged therefor
or from such revenues as may feasibly be increased or adjusted
from time to time without impairing the ability of the University
to perform its educational functions in the public interest.
Section 3. Determination That Compliance Has Been Shown
With Conditions Precedent to the Issuance of the Series J and
Series K Bonds.
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This Board hereby finds and determines:
(A) The Linden Walk-Rose Lane Apartments and the new
200-unit apartment-type student housing building, both of which
are to be financed from the proceeds of the Series J Bonds, are
hereby made parts of the University's Housing and Dining System,
and the revenues to be derived therefrom shall constitute Revenues
of the System for deposit and disposition as in the case of existing
Revenues. The housing buildings to be substantially reconstructed
through application of the proceeds of the Series K Bonds are recog-
nized to be parts of the existing Housing and Dining System and the
Revenues thereof are already pledged as provided in the 1965 Trust
Indenture. This Board is not in default under the 1965 Trust Indenture.
(B) That the Housing Director of the University, being
the officer or employee of the Board who is at this time principally
charged with responsibility for the maintenance and repair of the
housing and dining buildings and appurtenant facilities comprising
the present facilities of the University's Housing and Dining System,
has tendered his Certificate that a physical inspection of the said
housing and dining buildings and appurtenant facilities of the System
has been made and that the same are found and are represented to be
in a good and current state of tenantability and repair, subject to
no exceptions other than for current routine matters which are
scheduled for attention in the ordinary course of business and for
which budget provision has been made; that said Certificate of the
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Housing Director has been approved by the President of the University
as evidenced by his signature appearing thereon; and that said
Certificate is hereby approved by this Board as constituting compliance
with the requirements of Section 1101(c) of the 1965 Trust Indenture
as one of the conditions incident to the issuance of the Series J and
Series K Bonds. Said Certificate bearing the endorsement of the
President of the University, together with a certified copy of this
Resolution, shall be delivered to the Trustee under the 1965 Trust
Indenture, and the Trustee is requested to accept the same as consti-
tuting compliance with the identified condition of the 1965 Trust
Indenture with respect to the issuance of both the Series J Bonds,
hereinafter authorized, and the Series K Bonds when the same are
hereafter authorized in detail and offered at public sale by this
Board's statutory Executive Committee; and
(C) That the Treasurer of the University and of this Board
has tendered a statement, approved by the Secretary of the Executive
Department for Finance and Administration, showing that the average
of the audited annual Revenues of the Housing and Dining System For
the two fiscal years immediately preceding the issuance of the
Series J Bonds and the Series K Bonds, with such adjustments as are
permitted by the provisions of the 1965 Trust Indenture, is equal
to not less than one and thirty hundredths (1.30) times the ma::-imua
amount which will be required in any future fiscal year for payment
of the principal of and interest on the Housing and Dining System
- 12 -
Revenue Bonds previously issued and now outstanding, together .-:ith
the Series J and Series K Bonds; it being noted that the Treasurer
has attached to such statement the schedules of Revenues and estimated
Revenues upon which his conclusion was reached, including a showing
that the Treasurer has not taken into account occupancy rates exceeding
those which are permitted by the provisions of the 1965 Trust Inden-
ture. This Board hereby approves said statement of the Treasurer,
as so approved by the Secretary, and a copy thereof, together with
a certified copy of this Resolution, shall be tendered to the Trustee
with a request that it be accepted as constituting compliance with
the provisions of Section 1101(d) of the 1965 Trust Indenture as an
incident to the issuance of both the Series J Bonds and the Series K
Bonds. In this connection it is recognized that the maturity
schedule of the Series K Bonds has not nor can be fixed until the
HUD Loan Agreement is received; but this is deemed to be immaterial
inasmuch as the statement of the Treasurer shows a "coverage" in
excess of five (5) times future maximum principal and interest
requirements of the outstanding Bonds of Series A to Series I, inclu-
sive, and Series J, -- with the result that no schedule for the
principal maturities of the small Series K Bond issue could possibly
reduce the indicated coverage to any figure approaching the ntinimumn
requirement of 1.30 times.
Section 4. Authorization of the Series J Bonds.
In order to accomplish the purposes set forth in paragraph
- 13 -
(E) of Section 1 of this Resolution and to implement the determina-
tion o