Please summarize what you have completed, and what you still have left to complete, and your status on the incomplete recommendations.

Recommendation #1:  BUILDING RESERVE DEFICIENCY: 

The MU continually analyzes anticipated needs of the facilities we manage and the resources to accomplish them.  Reconciling the differences between project expense projections and resources is a matter of keeping all options open.  As an example, some of the anticipated needs can be taken care of by transferring surplus cash above the State and SIFC guidelines for cash reserves to the Building Reserve.  However, because of the uncertainties of the current construction project, we are holding off on doing so, because some project expenses may not qualify for a reserve account transaction, and would be better coming from an operating account.  Once we are beyond the construction period, we can more safely transfer any remaining cash to meet future obligations on our capital list.  If the list is still deficient in cash, then requests to adjust the reserve contribution can be made to the MU Board and SIFC at that time.  We can also adjust the timing of the work to coincide with sufficient cash to accomplish the project.

Recommendation #2:  FUND BALANCE IN FORMER SI FUND:

Below is a chart showing the distribution of the old Student Involvement fund balance.  Approximately 43% will be used to cover some large upfront cost for Student Leadership and Involvement (SLI) and 57% will go to Furniture, Fixtures and Equipment (FF&E) in the new Student Experience Center (SEC).

Recommendation #3:  MU AGREEMENT WITH MURFS:  Proposed changes to the MURFS Rental Agreements

Goal:  Analyze current model in comparison to other campus partnerships

Current Practice:

• Java II pays 5% of gross sales to Valley Library.  This agreement started five years after the partnership came into affect.  Rent was waived for the first five years in lieu of furnishing the Java II seating area.  After the five years were up, the furnishing became the property of Java II.  Rent has remained unchanged since the inception of the M.O.U.
• Dixon Café pays $5,000 annually to Recreational Sports.  This was re-negotiated from a higher amount after Recreational Sports payment exceeded return to the Memorial Union.
• E.Cafe and Ava’s Café do not pay any rent.  MU Retail Food Service will not enter into any additional contracts where rent is expected.

MU Retail Food Service Pricing Model

• Retail pricing is set to compete with UHDS and the Corvallis market.
• The current pricing is set to capture roughly $50,000 annually
• 2011/2012 fell short of that goal due to not raising prices to offset costs
• Money that MURFS earns affords the department the opportunity to re-invest in equipment, re-models, and new locations.
• University assessments are increasing between 3 – 6% every year, directly affecting the bottom line
• Credit card fees have increased from 2% to 4.5%
• Orange Rewards is costing 2-3% of gross sales

MU Retail Food Service Proposal

• Instead of the flat fee of $59,000 annually, have the four Memorial Union locations (Java Stop, Pangea, Buenos Burritos and Bites) and pay 3% of net sales to the Memorial Union (after Orange Rewards) and have the out of building locations (Java II, Dixon Cafe, Ava’s Cafe, and E.Cafe) and pay 1.5% of net sales.
• Projection for 2013-2014 based on this figure:  $62,580 (6% increase)
• If sales are higher than projected, net to the Memorial Union will increase proportionately

Recommendation #4:  CULTURAL MEAL KITCHEN RATES: 

The fee structure of the Cultural Meals Kitchen is reviewed annually as part of the Fee book structure.  Rates are approved through the Fee book process.  Rates for use of equipment are comparable to costs from local rental agencies, i.e.: Special Occasions, and Corvallis Rental.

The hourly and day of event fees are categorized with student organizations receiving the lowest cost point.  At this time, only student organizations have accessed the program.

The current fee structure of the Cultural Meals Program provides affordable access to student organizations for preparation of food and beverage as part of campus activities.  On average, the rental fee of the kitchen adds $1.00 cost per meal served making the average meal cost $3.50. These organizations also provide sweat equity in the development, production and serving of these meals.

Currently, 99% of users pay rental fees with student fee funded budgets.  Increasing rates for access to this program could increase revenue, but it could also negatively impact the revenue by creating less perceived value of choosing self- production over catering. If catering were chosen the average cost of a meal would raise substantially, $12 on average. Student organization could seek to cover these costs through request of higher budgets from SIFC or moving towards a fee for attendance.  A ticket fee then would trigger higher cost for space use, marketing, etc., which could then also impact the Student Fee request.

The loop of impact to the student fees continues through University assessments, etc.  The value of maintaining a low cost access to this program far outweighs the cost of annual cost of business increase of 2-3%, which may be seen through the CMP budget request annually.   Actual growth of the program will provide new revenue to support the growth of the program. Currently we do not anticipate an increased budget request to cover expansion through the MUNCMS budget.

Increasing the fee structure of the kitchen could potentially drive students to choosing a higher cost caterer to facilitate meal and beverage service.

Student Leadership and Involvement is the primary programming arm of the Memorial Union Organization (which consists of the MU Building and Services, Student Media, and SLI).  Our programs are the cornerstones for student involvement opportunities on campus.  Our goals are:

• To provide and support meaningful and diverse experiences that foster personal, group, and community-wide development.
• To bring awareness to social issues, promote civic engagement, and develop the capacity to lead in creating positive change.

In so doing, we support the Student Events and Activities Center (consisting of MUPC, ISOSU nearly 400 clubs and organizations, the Cultural Kitchen, student event and activity support), the Center for Civic Engagement (which also supports the Student Sustainability Initiative), Team Liberation, the Center for Leadership Development, and the Center for Fraternity and Sorority Life.  In addition, our Snell Hall Helpdesk supports ASOSU and the Office of Advocacy as well as many of the programs co-located in Snell hall.

-What is the “other services” line item (24xxx from the FY 13 budget request) under the SLI index?

The other service is an account code on the SLI consolidated budget that rolls up all of the operational costs accounted for in all of our indices.  The “other services” that were rolled into this area from the other budgets include advertising, software maintenance, public relations/performance contracts, security service, rentals, laundry and dry cleaning service, personal service contracts, and hosting guests and groups.

IMPLEMENTATION of PROJECTS

• New Building Switchgear installation:  The MU is positioned to take advantage of the installation of the new power project feed that is bringing a new transformer set to the building during the SEC Construction Project.  $300,000 is set-aside in the MU Reserve Budget to buy new building switchgear and install it in space made available by the relocation of building parts storage.  This gear will be commissioned and left operational and ready for a phased “cut-over” of building electrical distributed power as time and funding allows.  Advantages include elimination of a dangerous main power feed to the MU, elimination of obsolescent and aging switchgear with a high potential for failure, and new and better power metering which may determine if the MU has been over-paying for power for a number of years.
• ADA Ramps, Rails and Contrasting Stairs.  The MU is working with the MUE Project Manager to scope the removal of several ADA barriers into the project.  The intent is to use the project general contractor to remove the barriers, saving cost of separate development of scope and design as well as contractor mobilization and using the project dollars set aside for ADA improvements to remove these barriers in accordance with the MU ADA Assessment report.  Project Architect is developing the scope of work to determine what barriers are included in the project and the remainder will be removed by the MU.  The scope will typically include handrail remediation and ramp and landings, while the MU scope will be to remove barriers where contrasting stairs are lacking.

DEFERRAL of PROJECTS

• Type I Hoods and Ducts study:  This project has been downgraded due to new information provided during service meetings and walkthrough with professional hood cleaning and maintenance suppliers. This information is leading to benchmarking of services and selection of a new vendor for cleaning and servicing these hoods, and is also informing us what service life expectations should be for these critical systems.  This project has been deferred until a better scope of services can be determined.
• Add gas fire logs, flue and piping to 6 fireplaces:  This project estimate was developed at the request of the MU to determine cost and feasibility of bringing the ambience of the fireplaces back to life in the MU Main Lounge, Board and Council Rooms.  Cost does not include the ongoing cost of natural gas to operate these fireplaces, which is substantial.  Project is deferred while ongoing efforts to develop the scope and lower the operational costs continue.
• Main Lounge Ceiling Repairs: The MU has been working to understand the extent of repairs needed to the ceiling of the Main Lounge.  The Main Lounge is a historically accurate room and the ceiling has been repeatedly damaged over decades from several generations of leaking roofs and gutters. Staff has not had the time to move this project forward.  Given the renewed assurance of a leak-free roof, we have time to defer this work and do it right the first time, when resources are more available.

1. How will we support the new programming capacity that these new facilities (SEC and MU East Wing Renovation) will provide? MU Event Services is not dependent upon internal Memorial Union programs alone for business velocity.  Other student organizations (both fee-funded and non-fee funded) generate a greater proportion of the business volume.  The new spaces being created simply open opportunities for MU programs to grow.  Those decisions will need to be vetted program proposal by program proposal, just as we do now.
2. What will we do to support those program entities that are left in Snell and chose not to or were unable to relocate to the SEC?  The FY 15 budget will reflect a small budget for Snell to maintain adequate space for HSRC to operate until a new facility specifically for HSRC is online to support the program.  All other spaces will be shutdown.
3. How will the changes in foot traffic patterns impact our retail operations, programs, and wear and tear on our facilities?  Predicting behavior of the campus is difficult, but we do expect that the overall traffic will increase through the Memorial Union.  Careful decisions to locate building resources in the East Wing of the MU that will be in demand are a critical factor.  Two different consulting groups (Brailsford-Dunlavey and OPSIS) have been used to make sure we are making the best predictions as possible.
4. How will we fund the many aspects of the older portions of the MU that were not provided for in the current improvement plans?  Most of what had been Memorial Union Phase III (continued from work on the Memorial Union in the 1990’s) has now been broken up into individual projects funded through Memorial Union annual budget, MU reserves, or the ADA allocation from Raising Reser.  It will be done over a longer period of time, but should not require a Capital Construction or Renovation allocation or referendum.

We have planned to assess effectiveness on several different levels.  We have an annual assessment program that compares the Memorial Union to other colleges nationwide (benchmarking) and well historical comparison of our past performance (longitudinal).  We also have individual program assessment of both performance and satisfaction.

For the Strategic Objective related to Diversity, we will track the breadth and depth of participation in training, and we will seek feedback from staff, as well as diverse communities and partners. Other long-term assessments will be implemented as these initiatives are further developed.

1. A report from the Fee Impact committee would be satisfactory?  We are on target with all of the plans made by the past two years of work by the Fee Impact Committee.  Prior to the referendum, we anticipated the amount of student fee increase needed to fund the SEC operation and that forecast is holding, while only being adjusted for inflation.  The plan includes three new service/retail operations being housed in the MU that will pay rent, a new retail food operation and increased meeting and event space that can generate revenue.

1. Impact and analysis:  The body count in the SEC shows that it will be a low density building.  During the primary lunch period, density in the building will be less than 100 people.  The MU Retail Food Services profile for considering restaurant placement doesn’t begin until density reaches 1,000 or more persons in a building.  We can take advantage of foot traffic that will increase along the northern edge of the Memorial Union by the placement of the new restaurant that will be in the East Wing of the Memorial Union.

We have two new meeting facilities coming on line as a result of the Memorial Union East Wing renovation.  Both will be better meeting facilities than is the 109 suite.  Income analysis showed that we would lose about $5K per year in Event Services income, but gain $47K per year in lease income….a net gain of $42K per year.  The only loss of space will be for about six months during Fall and Winter Term of FY 14 while the Memorial Union East Wing is undergoing renovation.  By the end of Winter Term, the new facilities will be on line to replace the 109 suites.  The two new event spaces should generate significantly more revenue than MU 109.

Please include the funding sources for these renovations (Raising Reser dollars, building reserves, budget, working capital):  ADA Ramps, Rails and Contrasting Stairs.  The MU is working with the MUE Project Manager to scope the removal of several ADA barriers into the project.  The intent is to use the project general contractor to remove the barriers, saving cost of separate development of scope and design as well as contractor mobilization and using the project dollars set aside for ADA improvements to remove these barriers in accordance with the MU ADA Assessment report.  Project Architect is developing the scope of work to determine what barriers are included in the project and the remainder will be removed by the MU.  The scope will typically include handrail remediation and ramp and landings, while the MU scope will be to remove barriers where contrasting stairs are lacking.