The following committee report was presented to the Executive Committee of the Faculty Senate on April 17, 2000.
A Financial Review of the Construction and
Operation of the Thompson-Boling Assembly
Center and Arena
A Report to the Faculty Senate Executive Committee
Submitted and Approved by the
Faculty Senate Athletics Committee
Authored by Daniel P. Murphy, Associate Professor
April 6, 2000
|To:||Faculty Senate Executive Committee|
|From:||Faculty Senate Athletics Committee, Burton English, Chair|
|Date:||March xx, 2000|
|Re:||Construction Financing and Operating Costs Funding of the Thompson-Boling Assembly Center and Arena|
A Review of the Construction Financing and Operating Costs
Funding of the Thompson-Boling Assembly Center and Arena
Background and Scope of the ReviewIn 1983, 86 University of Tennessee professors filed suit against the Public Building Authority in the Chancery Court for Knox County challenging the plan to finance the construction of the planned assembly center and arena. The lawsuit was motivated by faculty concern that the university's academic budgets and student fees would be used to finance the construction costs.
A review of the Thompson-Boling Assembly Center and Arena (TB) construction project to determine whether costs exceeded $30 million. If so, confirmation must be made that these additional funds came from the Athletics Department and not other university sources.
An examination of the financing for the TB project. Specifically, details must be provided that disclose the total debt amount, how the debt is currently serviced, and what is the schedule for debt repayment.
A Sources and Uses of Funds statement for TB needs to be prepared that details the various operating costs and identifies the revenue source(s) used to cover these costs.
An attestation that university funds, other than those from the Athletics Department, have not been used to pay for either TB construction or operation costs.
A confirmation that University of Tennessee student fees are not and have not been used to operate TB.
University Disclosures to the Senate Athletics Committee
A Review of TB Construction Costs
The total TB construction costs far exceeded $30 million. The schedule below summarizes the TB construction costs and funding sources.
TB Assembly Center and Arena Expenditure and Funding Schedule
|State of Tennessee Capital Outlay||$7,000,000.00|
|Tennessee State School Bond Authority||8,000,000.00|
|Knox County Public Building Authority||10,000,000.00|
|USF&G Insurance Payment||16,309,861.00|
|C.N.A. Insurance Payment||2,116,977.00|
|UT Men's Athletics Department||7,423,765.87|
Source: University of Tennessee Office of the Treasurer
ConclusionThe purpose of the 1983 lawsuit settlement was to ensure that funds used to finance and operate the Thompson-Boling Assembly Center and Arena did not come from sources that would otherwise be used for academic purposes or from student funds. After meeting with members of the UT Athletics Department and the Office of the Treasurer and reviewing pertinent documents, it is our judgment that the University of Tennessee is complying with the terms of the settlement.