REVISED ED Board of Visitors Finance Committee Meeting March 2017 - - PowerPoint PPT Presentation

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REVISED ED Board of Visitors Finance Committee Meeting March 2017 - - PowerPoint PPT Presentation

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REVISED ED Board of Visitors Finance Committee Meeting March 2017 Finance Committee Agenda ACTIO ION I N ITEMS MS A. 2017-2018 Faculty, Staff, and Student Housing Rates B. 2017-2018 Contract Rates for Dining Services C. Signatory

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Board of Visitors Finance Committee Meeting March 2017 REVISED ED

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Finance Committee Agenda

ACTIO ION I N ITEMS MS

  • A. 2017-2018 Faculty, Staff, and Student Housing Rates
  • B. 2017-2018 Contract Rates for Dining Services
  • C. Signatory Authority for Contract for Scientific Goods
  • D. Signatory Authority for Medical Center Contract for

Hospital Bed Replacement Project

  • E. Signatory Authority for Master Brokerage and

Consulting Services Agreement and Resultant Contracts for Employee Benefits REPORT RTS

  • A. Endowment Report: Market Value and Performance

as of December 31, 2016

  • B. VP & CHRO Report on First Six Months
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2017-2018 Faculty , Staff, and Student Housing Rates

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UVa a Fac acul ulty ty and and Staf aff Prope

  • perty Rents

ents

State policy requires rents to reflect market rate for similar properties 80 Units 3.49% Average Increase

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Studen tudent H Hous

  • using R

ng Rates ates

2017-2018 Acad ademic ic Y Year Ac Academic D Division College a e at Wise Number of Beds 6,804 706 Occupancy rate (fall 2016) 97% 75% Average increase (decrease) $166 or 2.8% ($31) or (.5%) Average double room charge (nine-month lease) $6,042 $6,212 5

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Break reakdow down of

  • f Studen

tudent Hous

  • using

ng Rate ate Inc ncre reas ase

Cat atego egory Average P Per- Stud udent nt In Increase Percent of (3.4 .49% overall) In Increase Total Do Dollars Generated ed Debt Service Expense1 $180 109% $1,609,000 Capital Renewal and Replacement2 53 32% 475,000 Operational Savings3 (67) (41%) (604,000) Total $1 $166 66 100% 00% $1, 1,480, 80,000 000

1. Includes increases in debt service for International Residential College renovations, site work for McCormick Road Residence Halls renovations, and Gooch Dillard renovations; less decreases for Gibbons House (adjusted to reflect final cost) and Woody House (debt satisfied May 2018). 2. Consistent with Board of Visitors’ policy on capital renewal and replacement which requires maintaining 1.5% of replacement value. The proposed increase also reflects increased capital costs associated with undergraduate enrollment growth and additional investments in major maintenance and repairs of existing facilities. 3. Reflects operational efficiencies.

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201 016-2017 UVa a Studen tudent H Hous

  • using R

ng Rates ates

VA A Publ Public, Pe Peer, & Sel Selected Ot Other her Ins nstitut utions Do Doubl uble Room

  • m Rat

Rate

Sources: SCHEV 2016-2017 Public Institutions survey & Business Operations web-based survey $0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $7,000 $8,000 $9,000 $10,000 UV UVa = = $5, $5,876 Ave verage "Peer" & & Selected O Others = = $7,6 ,643 Ave verage V VA Public S c Sch chools = = $5, $5,813

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201 016-20 2017 7 UVa-Wise S e Studen tudent H Hous

  • using R

ng Rates ates

VA A Publ Public, Pe Peer, & Sel Selected Ot Other her Ins nstitut utions Do Doubl uble Room

  • m Rat

Rate

$0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $7,000 $8,000 UVa Va-Wise = = $6, $6,234

  • - - - Average "Peer" & Selected Others(UMW) = $5,334

....... .... Average VA Public Schools = $5,813

Sources: SCHEV 2016-2017 Public Institutions survey & Business Operations web-based survey

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2017-2018 Contract Rates for Dining Services

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2017 17-2018 D Dini ning ng Ser ervice R Rates ates

2017-2018 Acad ademic ic Y Year Ac Academic D Division College a e at Wise Average increase 1.3% 0.0% Meal Plan Rate Range $100 - $5,320 $165 - $4,112 10

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201 016-2017 UVa a Dini ning ng Meal Meal Plan an Rates ates

VA A Publ Public, Pe Peer & Se Selected Ot d Othe her Ins nstitut utions ns F Ful ull M Meal al Pl Plan an Rat Rate

$0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $7,000 UV UVa = = $4, $4,850 Ave verage "Peer" & & Selected O Others = = $5,3 ,338 Ave verage V VA Public S c Sch chools = = $4, $4,550 Sources: SCHEV 2016-2017 Public Institutions survey & Business Operations web-based survey

1 1

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201 016-20 2017 7 UVa-Wise e Dini ning ng Meal Meal Plan an Rates ates

VA A Publ Public, Pe Peer, & Sel Selected Ot Other her Ins nstitut utions Ful ull Meal al Pl Plan an Rat Rate

Sources: SCHEV 2016-2017 Public Institutions survey & Business Operations web-based survey $0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $7,000 UVa Va-Wise = = $4, $4,112

  • - - - Average "Peer" & Selected Others = $4,152

.... .... Average VA Public Schools = $4,550

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Signatory Authority for Contract for Scientific Goods

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Signat gnatory A Author uthority to

  • Ex

Exec ecute C e Contra

  • ntract

for

  • r Scient

entific Goods Goods

  • Cooperative contract through Virginia Association of State College and

University Purchasing Professionals

  • Term contract to procure scientific equipment, supplies and chemicals, to be

utilized by multiple academic departments

  • This contract streamlines the process, as departments previously used many

individually negotiated sole source or competitively bid contracts.

  • Two year contract, with option to renew for four additional two year terms
  • Estimated annual spend will exceed $5 million

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Signatory Authority for Medical Center Contract for Hospital Bed Replacement Project

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Signat gnatory A Author uthority to

  • Ex

Exec ecute Medi e Medical al Cente enter Cont

  • ntract for
  • r Hos
  • spi

pital Bed ed Repl eplac acem ement Proj

  • ject

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  • Negotiated a contract to replace approximately 100

Intensive Care Unit beds and 450 Acute Care beds

  • Total contract value of $12 million
  • Estimated annual spend will exceed $5 million
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Signatory Authority for Master Brokerage and Consulting Services Agreement and Resultant Contracts for Employee Benefits

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Si Signa natory Aut utho hority for Mas aster Br Brokerag age and and Co Cons nsul ulting Se Services Agree eemen ent and and Resul ultan ant Co Cont ntrac acts for Em Empl ployee Be Bene nefits

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  • Negotiated a master brokerage agreement to procure employee

benefit related insurance and services

  • This contract provides access to expert knowledge, efficiency

gains and better pricing

  • Estimated annual value of premiums associated with the

contracts to be executed under the master brokerage agreement is expected to exceed $5 million annually

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Endowment Report

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Outl utline ne

 Governance and Staffing  Performance Review  Asset Allocation  Current Environment  Going Forward

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Go Gover ernan nance and and Staf affing ng

Board of Directors

  • 11 members led by David MacFarlane as Chair, three appointed by the BOV, and one

by the President

  • BOV representatives are John Harris, John Macfarlane and Timothy O’Hara
  • Meets four times a year

Staff

  • 36 UVIMCO team members
  • Investment team comprised of CEO/CIO, six Managing Directors, two Senior

Investment Associates, four Investment Associates, and one Investment Analyst

  • Average of 20 years of investment experience among senior staff

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Perform

  • rmanc

nce R e Rev eview

As o

  • f D

Decem ecember er 3 31, 2 2016 FYTD $ Millions % 1 YR 3 YR 5 YR 10 YR 20 YR Dec-16 Long Term Pool 8,035 100.0 4.4 7.0 10.4 8.0 11.1 5.3 Policy Benchmark 100.0 6.6 4.3 8.0 4.4 6.3 2.8 Equity Public 1,996 24.8 7.1 6.2 13.7 8.4 10.9 7.4 Long / Short 1,673 20.8 (0.3) 3.4 9.0 7.2 10.7 3.6 Private 1,322 16.5 (2.5) 15.7 15.9 11.8 18.5 2.7 Total Equity 4,991 62.1 1.9 7.9 12.6 9.3 13.2 4.8 MSCI All Country World Equity 60.0 8.5 3.7 10.0 4.1 6.1 6.8 Real Assets Real Estate 456 5.7 8.4 14.9 14.1 (1.9) 3.8 3.8 Resources 456 5.7 23.5 3.5 5.4 12.6

  • 24.3

Total Real Assets 912 11.4 16.2 11.2 11.1 6.9 11.1 13.1 MSCI Real Estate 10.0 3.7 8.6 10.0 2.5 6.7 (5.6) Fixed Income, Cash & MAC Marketable Alternatives and Credit 1,138 14.2 9.4 4.0 7.3 6.6 6.5 5.3 Government Bonds 733 9.0 0.8 0.5 0.4 3.4 5.7 (0.5) Cash & Currency 262 3.3 0.3 0.1 0.1

  • 0.2

Total Fixed Income, Cash & MAC 2,133 26.5 5.7 2.5 3.8 5.1 6.2 2.7 Barclays Aggregate Bond 30.0 3.3 3.6 2.9 4.4 5.3 (2.2) Market Value Annualized

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Asset A Alloc

  • cati

ation

  • n

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

As of December 31, 2016

Public Equity Long/Short Equity Private Equity Real Estate Resources Marketable Alternatives & Credit Bonds & Cash

24.8% 20.8% 16.5% 5.7% 5.7% 14.2% 12.3% 30% Fixed Income 10% Real Assets 60% Equity Policy Portfolio

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Curr urrent nt Env Environ

  • nment

nt

Valuations Macroeconomic challenges: wide range of outcomes

  • Inflation/Interest rates
  • Central bank policies
  • Geopolitical risks (e.g., Europe, China)
  • Trade policy
  • Fiscal stimulus
  • US tax reform

Competing pools of capital/opportunities 24

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Goi Going ng For

  • rwar

ard

 Constantly reassess the current portfolio  Manage risk and rebalance  Use market weakness as an opportunity to add to high conviction managers  Continue to co-invest with our managers  Be opportunistic  Most importantly, understand our edge

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VP & CHRO REPORT

  • n First Six Months