Funds for priciest building in university's history derived from private Educational Foundation's historic gift
The new Darla Moore School of Business will cost $15 million more than previously planned, according to a vote from USC’s board of trustees.
The board’s building and grounds committee approved the increase from $91.5 million to $106.5 million after discussion in a private executive session Friday afternoon. The building will be the most expensive in the university's history and will face a final stamp of approval from the board Oct. 7. Construction is scheduled for completion by December 2013, according to Ed Walton, the university’s chief financial officer.
The extra funds will add natural light and an open-air pavilion to the new school. It will allow USC to meet top environmental certifications and become “net zero” efficient, according to Walton.
The changes will also move the school’s food preparation areas into the basement; they were originally on the first floor. The first floor will have open windows in all directions and wouldn’t be conducive to “serving and preparing food,” Walton said. The cafe will remain on ground level, said USC spokeswoman Margaret Lamb.
The increase will be funded with a $15 million gift from USC’s private Educational Foundation. The foundation — designed to serve as the university’s chief fundraising foundation for all its colleges and missions — unanimously agreed to the contribution during its May meeting.
Russ Meekins, chief financial officer of USC Foundations, said the contribution is currently the foundation’s largest contribution to any building project. It gave $4 million to the library’s new special collections wing but could eventually give more than $15 million to a new law school, Meekins said. The foundation has already raised about $8 million for the new law school, according to Meekins.
Records show USC’s Educational Foundation had $25 million in expenses during the last fiscal year, meaning this gift toward the new business school represents 60 percent of what the foundation spent last year. Meekins said $15 million is “a lot of money no matter how you slice it” for the foundation but said it was fully capable of providing the contribution, which he said will be paid in increments.
The foundation had about $3.3 million in cash as of June 30, 2010, but is valued at about $276 million with assets and investments. Meekins said the foundation hoped to raise the $15 million as part of the university’s Carolina’s Promise capital campaign. If the money can’t be raised, Meekins said the foundation would hope for “gifts in trust” — or money left by donors in their will. Darla Moore’s previous $70 million in pledged donations to the business school will be given to the university upon the death of her husband, according to the terms of the gifts. Her $5 million gift to the aerospace center is expected to arrive this fall, Provost Michael Amiridis recently told The Daily Gamecock.
If the “gifts in trust” don’t come through in time for the university, the foundation would dive into its investments, Meekins said.
Meekins said the foundation doesn’t set priorities for the university but only attempts to grant the requests it is asked to meet. Walton said the university approached the Educational Foundation instead of the business school’s private foundation or another organization because it “is the primary fundraising foundation and money management supporting organization for the university.”
The executive session meeting during Friday’s board of trustees session was to discuss a contractual matter with the board regarding the contracts between the university and private firms to build the school, said Tommy Stepp, secretary to USC’s board of trustees. State law allows public bodies to discuss contractual matters and other issues in private sessions if specific conditions are met. Whether those conditions were met is unclear.
Walton said he was prepared to share information about changes in the project’s scope after the closed-door meeting, but USC trustees moved forward in the sake of time. The changes would have been discussed in open session had “protocol been followed,” Walton said.
According to Walton, the university realized a while back it would have to increase the price of the project but wanted to develop the full proposal before presenting to the board of trustees, which unanimously approved the uptick in price without discussion after the private meeting.
Walton said Darla Moore hadn’t asked for any of the changes “to his knowledge.” The new school will be located in the heart of Innovista near the Carolina Coliseum and the Koger Center.