U. looks for ways to fund Agenda plans

President Rodin estimates the "Agenda for Excellence" proposals will cost the University at least $1 billion. The University's "Agenda for Excellence" and the component plans released by the individual schools last week feature more than just requests for new faculty and programs -- they also carry a hefty price tag. University President Judith Rodin said the complete list of programming and capital projects discussed in the Agenda will cost no less than $1 billion. This estimate does not include any plans to alter the residential system -- which may be forthcoming later. Rodin said the University will use three major techniques to cover the Agenda's costs -- capital ventures, administrative cost-cutting and fundraising. Vice President for Business Services Steve Murray explained that the PennCard computer chip -- scheduled to be incorporated in cards issued next fall -- may provide the University with a new profit opportunity. The cards will be capable of handling banking, phone card and credit card services, and the University plans to establish a partnership with a local bank to allow students access to money access center (MAC) services using their PennCards, he said. This option would represent the reversal of the strategy of outsourcing University operations to independent corporations. The University would actually take on functions of independent companies for profit reasons, Rodin explained. But she added that administrative cost-cutting --which could mean outsourcing and employee benefit restructuring -- remains a major way to generate funds. Executive Vice President John Fry said administrators are looking at the benefits system to find a way to cut costs while still offering competitive packages. He added that the University is on track for the $50 million in administrative cost-cutting the Agenda specifies. Initial cuts have been made in areas that do not directly affect employees, including energy, purchasing goods and services and contracts like life insurance. But Fry added that certain areas which have been overstaffed or have not produced quality output have been targeted for direct cuts in the number of employees. Staffing levels in the University's purchasing department, for example, have been cut by 50 percent. And the University continues to study whether it is the "best provider of services" or whether it could cut costs and increase services through outsourcing, Fry said. Outsourcing will be considered for all areas in which external providers are available. "We will continue to ask that question, not because we are going to outsource everything, but because we believe that unless we are asking that question we are clearly not doing the students and faculty a service," Fry said. He added that while maintaining expensive and less efficient services may preserve jobs, that would hurt student and faculty satisfaction. Outsourcing is currently being considered for dining and residential services, he said. Rodin said outsourcing and capital venture efforts will help keep the University's focus on education. "Penn is trying to run less and not more so that we can run what it is -- an institution of higher learning" Rodin said. The Office of Development and Alumni Relations will spend the spring term determining a target amount and a plan for fundraising efforts. Board of Trustees Chairperson Roy Vagelos said University officials plan to approach corporate donors, foundations and alumni for funds. Vagelos noted, however, that while corporations and foundations often fund programs, these grants are usually given in support of technical areas such as research. "Generally [corporations and foundations] don't like to fund bricks and mortar," Vagelos said.

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