B.S. IN FISHERIES & WILDLIFE SCIENCE, OSU

Introduction

Oregon State University requests authorization to consolidate two existing degree programs (B.S. in Fisheries Science and B.S. in Wildlife Science) into a single degree, B.S. in Fisheries and Wildlife Science, effective fall 1998. This consolidation would also reduce the six specific degree options to a single specialty option.

Staff Analysis

1. Rationale

Currently, the two degrees share a common core and differ by as few as 25 credits. The move to a single degree reflects changes in the professions, which emphasize commonalities in the science and management of wild animal resources. The change in options provides students the opportunity to examine their career goals and put together a coherent course of study to support those goals rather than just select one of six specializations. Students in this degree program will be prepared to succeed in complex, multidisciplinary work environments. They will understand fisheries and wildlife resources, as well as the ecosystems with which they interrelate.

2. Program Description

The 180-credit-hour requirements include a fisheries and wildlife core (103-115 credits), a specialty option (41-53 credits), and an internship/"experience" requirement (4-6 credits). The student's specialty option plan, developed prior to the junior year and approved by faculty, is intended to support their career goals. The two "experience activities" are required for graduation, at least one of which must be substantial (minimum three credits). The goal of this requirement is for students to apply the concepts, principles, and skills acquired in the classroom to a professional, real-world context. Additionally, students will gain an understanding of the structure and functions of natural-resource organizations. A three-term sequence in group problem solving has been developed in which a group of six to ten students is presented with a real, multifaceted conservation problem to resolve. Faculty, teamed with natural resource professionals, will serve as mentors.

3. Adequacy of Resources

Only four new courses need to be developed for this program; all other courses are currently being offered. No new resources are required to offer this program. In recent years, the undergraduate programs have enrolled 230 to 270 students annually, graduating 40 to 70 students each year. The programs have been in a stable or slow-growth pattern for the past ten years.

Program Review

The proposed program has been reviewed positively by all appropriate institutional committees and the Academic Council.

Staff Recommendation to the Executive Committee

Staff recommends that the Executive Committee authorize Oregon State University to consolidate two existing degree programs (B.S. in Fisheries Science and B.S. in Wildlife Science) into a single degree, B.S. in Fisheries and Wildlife Science, effective fall 1998, with a follow-up review of the program to be conducted by the OUS Office of Academic Affairs in the 2003-04 academic year. (A vote of the full Board will take place at the October regular meeting.)

EXECUTIVE COMMITTEE ACTION:

RESOLUTION FOR THE SALE OF ARTICLE XI-G & ARTICLE XI-F(1) BONDS

1998 Fall Bond Sale for Capital Projects
Four Campuses Served with Seven Individual Projects; Six Systemwide Allocation Projects
All Projects Approved by the Board and Legislative Assembly
A Total of $37,989,000 Recommended for Sale

Staff Report to the Board

Background. The 1997 Legislative Assembly authorized the Board of Higher Education to issue general obligation bonds, in specified amounts by fiscal year, with the proceeds to be used to finance capital construction and facilities repair and renovation projects in higher education. These bonds were authorized under two sections of the Oregon Constitution, Article XI-G and Article XI-F(1).

Article XI-G bonds are issued to construct and repair facilities classified as Education and General use, including classroom facilities, libraries, teaching laboratories, and general administrative space. These bonds are matched by an appropriation from the state General Fund and are general obligations of the state; the debt service is paid from the General Fund. The legislature established a mechanism whereby the General Fund match may be generated through gifts and federal and local governmental funds. These are first deposited to special project accounts in the Treasury and then treated as General Fund moneys for purpose of the match. Such accounts were permitted by the legislature to be established for the UO Campus Development Project (Phases II and III), PSU Urban Center, Phase I, WOU Library, and SOU Center for the Visual Arts.

Article XI-F(1) bonds are issued to construct and repair facilities that are self-financing and self-supporting as determined by the Board, in accordance with Article XI-F(1) of the Oregon Constitution. Bonds of this type have been issued to cover projects for the construction and renovation of auxiliary enterprises space (such as parking facilities or student housing) where the source of debt service is from auxiliary funds. Bonds have also been approved for projects in student facilities (such as student unions, student health facilities, or student recreation facilities) where the debt service is repaid from the student building fee or from a special fee approved for this purpose by the Board. The preponderance of bonds sold for capital construction in higher education has been under Article XI-F(1).

1997-1999 Higher Education Bond Bill Authorization. House Bill 5036, Chapter 556, authorized a maximum issuance of $34,299,500 of Article XI-G bonds and a maximum issuance of $136,000,000 of Article XI-F(1) bonds this biennium. To date, a total of $44,298,895 of bonds have been sold of which $14,122,702 have been Article XI-G bonds and $30,176,193 have been Article XI-F(1) bonds.

Request for Board Authorization to Issue. The institutions are now seeking authorization from the Board to issue a total of $37,989,000 in bonds, as part of a sale currently planned by the State Treasurer for September 1998. Of this amount, a total of $7,865,000 is requested in Article XI-G bond authorization and a total of $30,124,000 in Article XI-F(1) bond authorization. All projects to be financed by these bonds have been authorized by the legislature or the Emergency Board of the legislature.

Bond issuance costs estimated at two percent will be charged against each project for which bonds are sold under this sale. Prior to sale, the Board's bond counsel may designate a portion of the sale as taxable, owing to space utilization by private entities in the projects to be financed under this sale. At present, the percentage of the total square footage for private use affected under this sale is not sufficient to cause any portion of the sale to be taxable.

Several tables are provided herein:

Table A, included in the Resolution, identifies the Article XI-F(1) projects recommended for the Fall 1998 Bond Sale.

Table B, also included in the Resolution, identifies the Article XI-G projects recommended for the Fall 1998 Bond Sale.

Four tables are provided after the Resolution, to display information on debt service issues:

Table C displays the amount of Article XI-F(1) bonds to be sold, as well as the estimated annual debt service requirements associated with the projects proposed to be included in the Fall 1998 Bond Sale, by campus and Systemwide.

Table D compares the total Article XI-F(1) bonded debt outstanding as of June 30, 1998, Fiscal Year End, to the increment associated with the Fall 1998 Bond Sale, by auxiliary category and repayment sources.

Table E displays information on Article XI-G bonded debt, beginning with 1991-1993, through 1997-1999, assuming approval of the proposed Fall 1998 Bond Sale. It compares the amount of the debt service paid with the total biennial budget for E&G all sources and General Fund E&G.

Table F projects annual Article XI-G bonded debt outstanding and annual debt service beginning with the 1997-1999 biennium through 2004-2005, assuming approval of the proposed Fall 1998 Bond Sale.

In addition, summary information on each of the 14 projects included in the proposed sale is provided in a supplement to this item (on file in the Board's office).

Resolution for the Sale of Bonds for Capital Projects

The Resolution before the Board authorizes staff to pursue the sale of bonds for all projects currently identified by the campuses as needing bond funding consistent with the overall bond limitation imposed by the legislature for the period 1997-1999. With this sale, a total of $21,987,000 of Article XI-G bonds and $60,300,193 of Article XI-F(1) bonds will have been sold during the biennium.

Staff Recommendation to the Executive Committee

Staff recommends that the Executive Committee: 1) find that the projects for which Article XI-F(1) bonds are proposed meet the self-liquidating and self-supporting requirements of Article XI-F(1), Section 2, of the Oregon Constitution; and 2) adopt the following Resolution for authorizing the sale of Article XI-G and Article XI-F(1) bonds for capital projects. (A vote of the full Board will take place at the October regular meeting.)

RESOLUTION FOR THE SALE OF BONDS FOR CAPITAL PROJECTS

WHEREAS, ORS 286.031 states, in part, that the State Treasurer shall issue all general obligation bonds of this state after consultation with the state agency responsible for administering the bonds proceeds; and

WHEREAS, ORS 286.033 states, in part, that the state agency shall authorize issuance of bonds subject to ORS 286.031 by resolution; and

WHEREAS, ORS Chapters 351, 288, and 286 provide further direction as to how bonds are sold and proceeds administered; and

WHEREAS, House Bill 5036, Chapter 556, Oregon Laws 1997, establishes Oregon Constitution limitations on the amount of bonds that may be sold pursuant to Articles XI-G and XI-F(1) for the 1997-1999 biennium; and

WHEREAS, Senate Bill 5536, Chapter 584, Oregon Laws 1997, lists those projects that may be financed pursuant to Articles XI-G and XI-F(1); and

WHEREAS, it is appropriate for this Board to authorize the State Treasurer to issue bonds for projects authorized by Senate Bill 5536 and in amounts not greater than authorized by House Bill 5036 and for other projects as may be provided by law and as otherwise required by law for the 1997-1999 biennium without requiring further action of this Board;

NOW, THEREFORE, be it resolved by the Board of Higher Education of the State of Oregon as follows:

Section 1. Issue. The State of Oregon is authorized to issue general obligation bonds (the "Bonds"), in such series and principal amounts as the State Treasurer, after consultation with the Vice Chancellor for Finance and Administration of the Department of Higher Education, shall determine are required to fund projects authorized by Oregon law. The Bonds shall be designated, dated, authenticated, registered, shall mature, shall be in such denomination, shall bear such interest, be payable, be subject to redemption, and otherwise contain such terms as the State Treasurer determines, including the designations as Oregon Baccalaureate Bonds, after consultation with the Vice Chancellor for Finance and Administration. The maximum net effective interest rate for the Bonds shall not exceed ten percent per annum.

Section 2. Article XI-F(1) Projects. Bonds are authorized to be sold to provide funds for projects and may be authorized by the Oregon legislature and may be revised by the Vice Chancellor for Finance and Administration as authorized by Oregon law.

Table A - Article XI-F(1) Projects Recommended for Fall 1998 Bond Sale

Article XI-F(1) Projects

Estimated Bond Cost, Including 2% Issuance Costs

Term

Systemwide: Repair & Renovation

$3,060,000 15 years
Systemwide: Safety Improvements 1,020,000 20 years
Systemwide: ADA/Accessibility 566,000 20 years
Systemwide: Seismic Improvements 1,270,000 20 years
Systemwide: Land Acquisition 1,020,000 30 years
Systemwide: Project Reserve Contingency

794,000

30 years
OIT: Residence Hall Improvements 224,500 15 years
OSU: Residence Hall Improvements 2,963,000 30 years
OSU: Warehouse Addition 561,000 30 years
PSU: Urban Center 3,560,000 30 years
PSU: Public Health/Environmental Lab 6,171,000 30 years
UO: Recreation and Fitness Center 5,243,000 30 years
UO: Knight Law Center 3,672,000 30 years
TOTAL XI-F(1) Projects $30,124,000 NA

Section 3. Article XI-G Projects. Bonds are authorized to be sold to provide funds for projects and may be authorized by the Oregon legislature and may be revised by the Vice Chancellor for Finance and Administration as authorized by Oregon law.

Table B - Article XI-G Projects Recommended for Fall 1998 Bond Sale

Article XI-G Projects

Estimated Bond Cost

Term

PSU: Urban Center

$7,865,000 30 years
TOTAL XI-F(1) Projects $7,865,000 NA

Section 4. Maintenance of Tax-Exempt Status. The Board covenants for the benefit of the owners of the Bonds to comply with all provisions of the Internal Revenue Code of 1986, as amended (the "Code"), that are required for Bond interest to be excluded from gross income for federal income taxation purposes (except for taxes on corporations), unless the Board obtains an opinion of nationally recognized bond counsel that such compliance is not required in order for the interest to be paid on the Bonds to be so excluded. The Board makes the following specific covenants with respect to the Code:

(a) The Board shall not take or omit any action if the taking or omission would cause the Bonds to become "arbitrage bonds" under Section 148 of the Code, and shall assist in calculations necessary to determine amounts, if any, to allow the State to pay to the United States all "rebates" on "gross proceeds" of the Bonds that are required under Section 148 of the Code.

(b) Covenants of the Board or its designee in its tax certificate for the Bonds shall be enforceable to the same extent as if contained herein.

Section 5. Sale of Bonds. The State Treasurer, with the concurrence of the Vice Chancellor for Finance and Administration, shall sell the Bonds as the State Treasurer deems advantageous.

Section 6. Other Action. The State Treasurer, the Vice Chancellor for Finance and Administration, or the Controller of the Department of Higher Education, is hereby authorized, on behalf of the Board, to take any action that may be required to issue, sell, and deliver the Bonds in accordance with this resolution.

Additional Information on Debt and Debt Service

Table C - Fall 1998 Bond Sale for Article XI-F(1) Bonds:
Magnitude of Bonds to be Sold and Associated Annual Debt Service

(dollars in millions)

Institution Article XI-F(1) Bonds Estimated Annual Debt Service
OIT $ 0.22 $0.02
OSU 3.52 0.23
PSU 9.73 0.64
UO 8.92 0.574
Systemwide 7.73 0.61
TOTAL DEBT ASSOCIATED WITH FALL BOND SALE $30.12 $2.07


Table D - Comparison of Total Article XI-F(1) Bonded Debt Outstanding by Auxiliary Category and Repayment Sources, June 30, 1998 to Fall 1998 Bond Sale
(dollars in millions)

Auxiliary

Bonds Outstanding as of 6/30/98** Annual Debt Service as of 6/30/98** Fall Bond Sale Increment of Bonds Outstanding Fall Bond Sale Increment of Debt Service Revenue Available for Debt Service Dedicated Revenue Source
Consolidated Dorms $ 39.2 $3.9 $39.2 Res & Dining Hall
Independent Dorms 7.7 0.5 3.7 0.2 (same as above) Res & Dining Hall
Parking 14.9 1.5 5.1 Parking Fees
Auxiliary Programs 109.5 7.6 22.0 1.6 33.6 Housing rental income, lease payments, user fees, transfer from E&G
Student Building Fee Program 54.8 6.7 4.4 0.3 7.2 Student Building Fees
TOTAL DEBT OUTSTANDING $226.1 $20.2 $30.1 $2.1

** Excludes OHSU debt outstanding of $44.6 million. Debt service is paid by OHSU per OUS/OHSU Debt Service Agreement.

Table E - Article XI-G Bonded Debt Historical Trends
and Projected Requirements After Fall 1998 Bond Sale

(dollars in millions)

Biennial E&G
All Sources
Debt Service
Percent of E&G Total
General Fund
E&G
Debt Service
General Fund
1991-1993 $ 818 1.55% $515 2.46%
1993-1995 866 1.47% 482 2.64%
1995-1997 980 1.67% 431 3.79%
1997-1999 1,038 1.74% 470 3.84%

E&G = Education & General

Table F - Article XI-G Bonded Debt Outstanding Actual and Projected
(dollars in millions)

Bonds
Outstanding
Annual
Debt Service
Biennial
Debt Service
1997-1998 $ 65.1 $8.5 $18.1
1998-1999 73.6 9.6
1999-2000 75.0 9.4 17.3
2000-2001 68.9 7.9
2001-2002 63.8 8.0 16.0
2002-2003 58.7 8.0
2003-2004 53.9 8.0 14.2
2004-2005 50.2 6.2

EXECUTIVE COMMITTEE ACTION:

RESOLUTION FOR THE BOND REFUNDING SALE OF ARTICLE XI-G & ARTICLE XI-F(1) BONDS

Staff Report to the Board

The Board of Higher Education has an opportunity to achieve significant debt savings by refunding certain outstanding series of bonds. This will require the issuance of refunding bonds. Authorization for the sale is granted by Oregon Revised Statues 286.051 and 288.605 through 288.695.

Based on advice to the Controller's office by the OUS bond underwriters, there is a potential to save about four percent on the debt service projected for certain maturities sold in previous bond sales. The Controller's office is recommending the refunding of approximately $32 million of long-term bonds, from the 1996 Series A and 1996 Series C bond sale. This amount is below the approximately $56 million sold in that sale, the majority of the remainder being for short-term ORRBAC bonds (Oregon Baccalaureate bonds sold in small amounts to small investors, normally for the purpose of financing college tuition). Given current market conditions, the refunding is expected to more than meet the criteria of achieving at least a three percent savings; a savings of approximately $1.4 million has been projected by the underwriters.

Staff Recommendation to the Executive Committee

Staff recommends that the Executive Committee adopt the following bond resolution authorizing the issuance of refunding bonds (a vote of the full Board will take place at the October regular meeting):

RESOLUTION FOR THE SALE OF REFUNDING BONDS

WHEREAS, ORS 286.031 states, in part, that the State Treasurer shall issue all general obligation bonds of this state after consultation with the state agency responsible for administering the bonds proceeds; and

WHEREAS, ORS 286.033 states, in part, that the state agency shall authorize issuance of bonds subject to ORS 286.031 by resolution; and

WHEREAS, ORS Chapters 351, 288, and 286 provide further direction as to how bonds are sold and proceeds administered; and

WHEREAS, ORS Chapter 286.051 authorizes the issuance of refunding bonds and ORS 288.605 et. seq. authorizes the issuance of advance refunding bonds by the State Treasurer upon finding that certain requirements and conditions have been met; and

WHEREAS, it appears advantageous to this Board to sell refunding bonds to refund certain outstanding bonds thereby benefitting the state;

NOW, THEREFORE, be it resolved by the Board of Higher Education of the State of Oregon as follows:

Section 1. Issue. The State of Oregon is authorized to issue general obligation bonds (the "Bonds") in such series and principal amounts as the State Treasurer, after consultation with the Vice Chancellor for Finance and Administration of the Department of Higher Education, shall determine are required to refund all or any portion of its General Obligation Building Bonds, 1996 Series A; 1996 Series C; and any other series of bonds that meet the requirements established by law and approved by the State Treasurer.

Section 2. Maintenance of Tax-Exempt Status. The Board covenants for the benefit of the owners of the Bonds to comply with all provisions of the Internal Revenue Code of 1986, as amended (the "Code"), that are required for Bond interest to be excluded from gross income for federal income taxation purposes (except for taxes on corporations), unless the Board obtains an opinion of nationally recognized bond counsel that such compliance is not required in order for the interest to be paid on the Bonds to be so excluded. The Board makes the following specific covenants with respect to the Code:

(a) The Board shall not take or omit any action if the taking or omission would cause the Bonds to become "arbitrage bonds" under Section 148 of the Code and shall assist in calculations necessary to determine amounts, if any, to allow the State to pay to the United States all "rebates" on "gross proceeds" of the Bonds that are required under Section 148 of the Code.

(b) Covenants of the Board or its designee in its tax certificate for the Bonds shall be enforceable to the same extent as if contained herein.

Section 3. Sale of Bonds. The State Treasurer, with the concurrence of the Vice Chancellor for Finance and Administration, shall sell the Bonds as the State Treasurer deems advantageous.

Section 4. Other Action. The State Treasurer, the Vice Chancellor for Finance and Administration, or the Controller of the Department of Higher Education, is hereby authorized, on behalf of the Board, to take any action that may be required to issue, sell, and deliver the Bonds in accordance with this resolution.

EXECUTIVE COMMITTEE ACTION: