COMMITTEE MEMBERS Haywood D. Cochrane Jr., Chair

John P. Preyer, Vice Chair David L. Boliek Jr. Jefferson (Jeff) W. Brown R. Gene Davis Jr. Charles (Chuck) G. Duckett Allie Ray McCullen Dwight D. Stone

Administrative Liaison: Jonathan Pruitt, Vice Chancellor for Finance & Operations David Routh, Vice Chancellor for University Development

FINANCE, INFRASTRUCTURE & AUDIT COMMITTEE

November 20, 2019, 1:00PM Chancellor’s Ballroom West, Carolina Inn

OPEN SESSION

FOR ACTION 1. Designer Selection

• Carmichael Arena – Women’s Basketball Phase II • Central Alarm Network • Kenan Labs Electrical Improvements • Mitchell-Dey Electrical Improvements Anna Wu, Associate Vice Chancellor for Facilities Services

Attachment A Attachment B Attachment C Attachment D

2. Project Authorization • Spending Authority – Fetzer Hall Basket Room Renovations • Spending Authority – Peabody Hall Lobby Renovations • Spending Authority – Craige Residence Hall Renovation of Ground Floor

Student Lounge • Delegated Spending Authority for Capital Projects Anna Wu, Associate Vice Chancellor for Facilities Services

Attachment E Attachment F Attachment G

Attachment H

3. Grant of an Easement at University Lake to Duke Energy Gordon Merklein, Associate Vice Chancellor for University Real Estate Operations

Attachment I

4. Annual Endowment Fund Report Jonathan Pruitt, Vice Chancellor for Finance and Operations

Attachment J

5. Tuition and Fee Proposals Jonathan Pruitt, Vice Chancellor for Finance and Operations

Attachment K

FOR INFORMATION ONLY (No formal action is requested at this time) 1. Development Report

David Routh, Vice Chancellor for University Development

2. FY19 UNC Investment Fund LLC Performance Update Jon King, CEO of UNC Management Company

ATTACHMENT A

DESIGNER SELECTION – WOMEN’S BASKETBALL RENOVATIONS PHASE 2

The project will renovate spaces for the Women’s Basketball program across 7,000 square feet at

Carmichael Arena. The scope includes reconfiguration of office spaces and break room, new

lockers, lighting, and A/V and will result in a more effective layout and upgraded finishes.

The project budget is $750,000 and is being funded by Athletic department reserves. The project

was advertised on October 7, 2019. Four (4) proposals were received. Three (3) firms were

interviewed on October 31, 2019. Members of the Board of Trustees did not participate in the

interviews.

The committee recommended the selection of three (3) firms in the following priority order:

1. XXX XXX, XX

2. XXX XXX, XX

3. XXX XXX, XX

The firms were selected for their past performance on similar projects, the strength of their

consultant team, and experience with campus projects.

RECOMMENDED ACTION

A motion to approve three (3) firms in the following priority order:

1. XXX XXX, XX

2. XXX XXX, XX

3. XXX XXX, XX

ATTACHMENT B

DESIGNER SELECTION – CENTRAL ALARM NETWORK

Replacement of UNC’s Central Alarm Communicator System for University fire alarms with a

radio-mesh network system, including new transceivers from each building to new receiving

stations at UNC Public Safety Building and EHS Building Emergency Operations Center. This

replacement is required as the existing system utilizes AT&T copper telephone lines which AT&T

has announced they will stop maintaining as early as 2020. A study has been completed that

supports this new technology.

The project budget is $500,000 for the design phase and will be funded from Repair & Renovations

funds. The project was advertised on October 7, 2019. Four (4) proposals were received. Three

(3) firms were interviewed on November 7, 2019. Members of the Board of Trustees did not

participate in the interviews.

The committee recommended the selection of three (3) firms in the following priority order:

1. XXX XXX, XX

2. XXX XXX, XX

3. XXX XXX, XX

The firms were selected for their past performance on similar projects, the strength of their

consultant team, and experience with campus projects.

RECOMMENDED ACTION

A motion to approve three (3) firms in the following priority order:

1. XXX XXX, XX

2. XXX XXX, XX

3. XXX XXX, XX

ATTACHMENT C

DESIGNER SELECTION – KENAN LABS ELECTRICAL IMPROVEMENTS

Kenan Laboratories' original three utility transformers and service entrance busways and service

equipment are deteriorating and require replacement and relocation. At a minimum, Phase 1

construction will include a single 480/280 volt service transformer with service duct bank, new

main service disconnect or equipment and step-down transformer to refeed or replace existing

main service equipment, as funding allows. Phase 2 construction will complete replacement of

the existing main service equipment and aged distribution equipment with reconnection to existing

feeders, including both conduit and busway. Design for both phases will be completed in Phase

1.

The project budget is $750,000 and will be funded from Repair & Renovations funds. The project

was advertised on October 10, 2019. Eleven (11) proposals were received. Four (4) firms were

interviewed on November 12, 2019. Members of the Board of Trustees did not participate in the

interviews.

The committee recommended the selection of three (3) firms in the following priority order:

1. XXX XXX, XX

2. XXX XXX, XX

3. XXX XXX, XX

The firms were selected for their past performance on similar projects, the strength of their

consultant team, and experience with the State Construction Office.

RECOMMENDED ACTION

A motion to approve three (3) firms in the following priority order:

1. XXX XXX, XX

2. XXX XXX, XX

3. XXX XXX, XX

ATTACHMENT D

DESIGNER SELECTION – MITCHELL-DEY ELECTRICAL IMPROVEMENTS

This project will require removal of the old obsolete switchgear and distribution and replace with

new electrical switchgear and distribution system. Currently the majority of distribution panels

are full, with limited capacity and space. In Dey Hall, the service replacement will be

coordinated with new service transformer installation and new secondary service duct bank

replacement of bus duct. Existing motor control centers will be removed and replaced with

variable frequency drives serving their respective equipment.

The project budget $700,000 and will be funded from Repair & Renovations funds. The project

was advertised on October 10, 2019. Eleven (11) proposals were received. Four (4) firms were

interviewed on November 14, 2019. Members of the Board of Trustees did not participate in the

interviews.

The committee recommended the selection of three (3) firms in the following priority order:

1. XXX XXX, XX

2. XXX XXX, XX

3. XXX XXX, XX

The firms were selected for their past performance on similar projects, the strength of their

consultant team, and experience with the State Construction Office.

RECOMMENDED ACTION

A motion to approve three (3) firms in the following priority order:

1. XXX XXX, XX

2. XXX XXX, XX

3. XXX XXX, XX

ATTACHMENT E

SPENDING AUTHORITY – FETZER HALL BASKET ROOM RENOVATIONS

Repurpose portion of former 'basket room' into offices for faculty and graduate students, a

conference room, and laboratory space to support research in Department of Exercise and Sport

Science. Project scope also includes associated HVAC and electrical upgrades and ADA

improvements. Total area to be renovated is 5,000 GSF.

The project budget is $549,423 and will be funded from College of Arts and Sciences department

reserves.

RECOMMENDED ACTION

A motion to approve the spending authority as outlined above.

ATTACHMENT F

SPENDING AUTHORITY – PEABODY HALL LOBBY RENOVATIONS

This project will renovate the main entry lobby, including creating a large glazed opening at the

back wall of the space that opens to a small exterior court. Additional scope includes new wall and

ceiling finishes, new lighting, and rerouted HVAC and sprinkler runs. Total area to be renovated

is 2,200 GSF.

The project budget is $551,143 and will be funded from School of Education reserves.

RECOMMENDED ACTION

A motion to approve the spending authority as outlined above.

ATTACHMENT G

SPENDING AUTHORITY – CRAIGE RESIDENCE HALL RENOVATION OF GROUND

FLOOR STUDENT LOUNGE

UNC Housing is renovating the ground floor Student Lounge into an Esports Student Gaming

Lounge. This will include a new HVAC system, Electrical upgrades, toilet room and A/V for

gaming. The space being renovated is approx. 1,865 SF.

The project budget is $547,800 and will be funded from Housing Trust Funds.

RECOMMENDED ACTION

A motion to approve the spending authority as outlined above.

ATTACHMENT H

DELEGATED SPENDING AUTHORITY FOR CAPITAL PROJECTS

Pursuant to G.S. 143C-9-2, the Board of Governors have the authority to approve certain

expenditures for capital improvement projects that will be funded and operated entirely from

non-General Fund money, including expenditure to plan, construct and change the scope of

such projects. At the May, 2019 meeting, the Board of Governors delegated to the president

and boards of trustees the power to approve capital improvement projects that are projected

to cost less than $750,000.

In 1988, the UNC CH Board of Trustees delegated to the University administration authority

for selection of architects and engineers for capital improvement projects with a total project

cost of less than $500,000. The University also has authority to award construction for all

capital improvement projects with a total project cost of less than $500,000.

In order to allow more timely execution of projects with a total project cost of less than

$500,000, it is requested that the Board of Trustees delegate to the Chancellor authority to

approve the expenditures of non-General Fund money to plan, design, and construct projects

where the total project cost is $500,000 or less.

RECOMMENDED ACTION

A motion to recommend that the Chancellor be delegated the authority to approve

expenditures of non-General Fund money for capital improvement projects where the total

project cost is $500,000 or less.

ATTACHMENT I

PROPERTY DISPOSITION BY EASEMENT TO DUKE ENERGY

This request is for approval to authorize disposition of property by permanent easement for

approximately 800 square feet (subject to final survey) of land at University Lake for the limited

purpose of allowing Duke Energy to install a transformer, a new power pole and related

underground and overhead lines. The land on which the work is proposed is leased to the Orange

Water and Sewer Authority (OWASA) until 2056 to allow them to maintain a reservoir that serves

Orange County, including the University campus. OWASA is installing a new pump station that

will benefit from the enhanced electrical service provided by the aforementioned Duke Energy

work. OWASA and Duke Energy will pay for all expenses associated with the design and

construction of these electrical improvements, and said improvements will be constructed in

accordance with design plans approved by UNC, OWASA, and Duke Energy.

RECOMMENDED ACTION

A motion to recommend approval authorizing disposition of property by easement and right-of-

way as described above to Duke Energy for the purpose of installing a transformer, a new pole,

overhead lines and underground lines and related maintenance at University Lake in accordance

with design plans approved by UNC, OWASA, and Duke Energy.

The University of North Carolina at Chapel Hill Endowment Fund Annual Report: Year Ended June 30, 2019

We are pleased to report that for Fiscal Year 2019 (twelve months ended June 30, 2019), The University of North Carolina at Chapel Hill Endowment Fund (“Endowment Fund”) recorded a solid increase in its market value. During the year, the market value of the Endowment Fund increased by $100.2 million to end the year at $1.65 billion. This increase in market value resulted from the combination of positive investment performance and the continuing generosity of donors to the Endowment Fund. The components of the $100.2 million increase in market value during Fiscal Year 2019 are 1) net investment return of $122.1 million, plus 2) net gifts and bequests totaling $53.8 million, less 3) $75.7 million distributed for expenses and program spending.

Over 99% of the Endowment Fund’s assets are invested in The University of North Carolina at Chapel Hill Foundation Investment Fund, Inc. (“Chapel Hill Investment Fund”), which in turn invests all of its assets in the UNC Investment Fund, LLC (“UNC Investment Fund”). The Endowment Fund also owns several commercial properties in Chapel Hill, North Carolina, that collectively represent less than 1% of the Endowment Fund’s total value.

The UNC Investment Fund generated a +7.7% net investment return for the year with each of its primary asset classes generating a positive return. The UNC Investment Fund’s FY 2019 return is strong on both an absolute and relative basis outperforming the +6.7% return generated by both its primary benchmark, the Strategic Investment Policy Portfolio (“SIPP”), and a more “traditional” and equity market focused Global 70/30 Portfolio comprised of 70% global equities (MSCI All Country World Index (“ACWI”)) and 30% bonds (Bloomberg Barclays U.S. Aggregate Bond Index). Relative to peers, the UNC Investment Fund’s FY 2019 return ranks in the top decile of the Cambridge Associates’ College and University universe of endowment funds. Over longer periods, three, five, and twenty years, the UNC Investment Fund’s returns also rank in the top decile relative to peers with the ten-year return ranking in the top quartile. A detailed description of the asset allocation of the Endowment Fund is provided on the following page along with aggregated asset class and benchmark returns.

The $75.7 million distributed from the Endowment Fund for expenses and spending in Fiscal Year 2019 was computed in accordance with the distribution policy of the Chapel Hill Investment Fund and represents 4.4% of the Endowment Fund’s market value at the end of the fiscal year. Funds were distributed to the University for spending on programs supported by the corresponding endowed accounts. At its May 2019 meeting, the Board of the Chapel Hill Investment Fund authorized a 2.0% increase in the annual distribution rate for Fiscal Year 2020. This increase is consistent with the spending policy objective of increasing the distribution amount by the rate of inflation, as measured by CPI, each year.

Mr. Haywood Cochrane served as the Chairman of the Endowment Fund Board of Directors during the year. The other members of the Board at the end of Fiscal Year 2019 were David Carroll, John Ellison, Chancellor Kevin Guskiewicz, Michael Kennedy, Steve Lerner, Sallie Shuping-Russell, Dwight Stone, and John Townsend.

The Board of Trustees of The University of North Carolina at Chapel Hill has approved all transfers from the Endowment Fund for expenditures as recommended by the Chancellor. All expenditures have been made in accordance with the terms of the applicable gift, devise, or bequest.

Respectfully submitted,

The Board of Trustees of the Endowment Fund of The University of North Carolina at Chapel Hill

ENDOWMENT FUND THE UNIVERSITY OF NORTH CAROLINA AT CHAPEL HILL

Asset Allocation as of June 30, 2019

Long Biased Equity $453,153,695 27.5%

Long/Short Equity 255,413,901 15.5%

Diversifying Strategies 163,135,330 9.9%

Fixed Income 154,896,172 9.4%

Private Equity 397,127,420 24.1%

Real Estate 95,574,234 5.8%

Energy & Natural Resources 112,052,550 6.8%

Cash & Other 16,478,316 1.0%

Total $1,647,831,617 100.0%

Asset Class and Benchmark Returns for Fiscal Year Ended June 30, 2019

Public Equity Strategies 3.6% Blended Equity Benchmark* 3.9% Non-Equity Strategies 4.4% Blended Non-Equity Benchmark* 5.1% Private Partnerships 17.1% Blended Composite Benchmark* 11.5% Cash & Other 2.2% 90-Day T-Bill 2.3%

Total UNC Investment Fund 7.7% Strategic Investment Policy Portfolio 6.7%

*Blended benchmarks reflect weighted SIPP benchmarks for the underlying asset classes.

Presented to the Board of Trustees for ApprovalNovember 2019

AY2020-21 Tuition and Fees

Tuition and Student Fee Policy Considerations

2

Task Force Objectives & TimelineReview, develop & recommend tuition & fee rates for consideration by the Chancellor and the Executive Vice Chancellor and Provost:

• Campus Based Tuition Increases (CBTI)• BOG Approved Student Fees• School Based Tuition Increases (SBTI)

Rates to be presented to the Board of Trustees for approval in November.

3

Student Fee Approvals – prior toTuition & Fee Advisory Task Force (TFAT)

•Year-round review; new fee proposals reviewed Sept-Oct

•Student-led / student membership

•Authority to audit any student fee•Provides input and feedback to SFAS

SFACStudent Fee Audit Committee

•Sept-Oct review of all fee requests•Co-chaired by Deputy Vice Chancellor for Finance and Operations & Student Body President (SBP)

•Broad campus representation•Provides recommendations to TFAT

SFASStudent Fee Advisory Subcommittee •October review of all tuition & student

fee requests•Co-chaired by Vice Chancellor for Finance and Operations (VC FO) & SBP

•Broad campus representation•Provides tuition & fee increase recommendations to the Chancellor and the Executive Vice Chancellor and Provost

TFATTuition & Fee Advisory Task Force

4

Tuition & Fees Approval Workflow – fromTuition & Fee Advisory Task Force (TFAT)

•Timeframe: October•Co-Chairs: VC FO & SBP•Reviews & proposes tuition and fee increases to the Chancellor and the Executive Vice Chancellor and Provost including CBTIs, SBTIs and Fees

TFATTuition and Fee Advisory Task Force

• Timeframe: early November

• Finalizes Tuition and Fee Proposal for BOT Approval

Chancellor EVC & Provost • Timeframe: November BOT

Meeting• Provides final on-campus

approval for proposed tuition and fees

UNC-CH BOTBoard of Trustees

• Timeframe: December - March• Reviews and approves UNC

System Tuition & Fees pending final approval from NC General Assembly

UNC BOGBoard of Governors

5

AY 2020-21 Key Considerations and UNC System Office Tuition and Fee Instructions

6

Key Considerations

• NC Constitution• Recent legislative and BOG actions on affordability

• Tuition Guarantee Program• 3% statutory cap on mandatory fees• NC Promise• BOG resolution to reduce tuition and fees while preserving and enhancing

educational quality

• Low tuition and fee rates compared to peers• Faculty and other institutional goals

7

UNC System Office Instructions – AY2020-21 Tuition

• Accessibility and Affordability• All requests are subject to BOG approval• Identify rate reductions for resident undergraduates, if possible• Undergraduate Tuition

• Increases allowed up to 3% for UG residents• UG resident tuition and fees – Bottom quartile• UG nonresident tuition and fees – market driven: at or above, third quartile

• Graduate Tuition• Maintain & Increase Program’s Excellence, Ensuring Access• Market driven based on academic requirements

8

• Accessibility and Affordability• All requests are subject to BOG approval• 3% cap on BOG approved mandatory student fees charged to all

students: • Athletics, Health Services, Student Activities, Ed & Tech, Campus Security,

Debt Service, ASG• Campus Security fee increases will be considered – first time since the $30

fee was established in 2015

• No special fee increases recommended

9

UNC System Office Instructions – AY2020-21 Student Fees

Tuition and Student Fee Market and Peer Information

10

Current AY2019-20 UNC-Chapel Hill Tuition & Fees

11

Rate Type Undergraduate Resident

Undergraduate Nonresident

Graduate Resident

Graduate Nonresident

Tuition 7,019 34,198 10,552 28,278

Fees 1,967 1,967 1,970 1,970

Tuition & Fees 8,986 36,165 12,522 30,248

UNC System-Defined Public Rate Ranking 11 of 11 9 of 11 9 of 11 5 of 11

Public AAU Rate Ranking 34 of 35 19 of 35 26 of 36 15 of 36AAU Average Rate Increase 1.9% 2.6% 2.1% 1.9%

UNC-CH Rate vs AAU average $(3,881) $23 $(2,475) $(391)

Sources: - AAUDE annual Tuition and Fees survey, as of September 25, 2019- For institutions that have not responded to the 2019-20 or 2018-19 AAUDE surveys, tuition information has been gathered from individual institution websites.Data provided by: Institutional Research and Assessment (IRA), September 26, 2019

Proposed AY2020-21 UNC-Chapel Hill Tuition & Fees

12

Rate Type Undergraduate Resident

Undergraduate Nonresident

Graduate Resident

Graduate Nonresident

Tuition 7,230 35,224 10,869 28,595

Fees 1,994 1,994 1,998 1,998

Tuition & Fees 9,224 37,218 12,867 30,593

UNC System-Defined Public Rate Ranking * 11 of 11 8 of 11 9 of 11 4 of 11

Public AAU Rate Ranking * 34 of 35 15 of 35 25 of 36 14 of 36AAU Average Rate Increase 1.9% 2.6% 2.1% 1.9%

UNC-CH Rate vs AAU average $(3,644) $1,076 $(2,130) $(46)

Sources: - AAUDE annual Tuition and Fees survey, as of September 25, 2019- For institutions that have not responded to the 2019-20 or 2018-19 AAUDE surveys, tuition information has been gathered from individual institution websites.Data provided by: Institutional Research and Assessment (IRA), September 26, 2019* UNC-CH proposed AY2020-21 rate compared to actual AY2019-20 peer rates.

https://www.northcarolina.edu/sites/default/files/2019-20_ug_tuition_and_fees.pdf13

https://www.northcarolina.edu/sites/default/files/2019-20_grad_tuition_and_fees.pdf14

Undergraduate Tuition and Fees Peers Comparison2019-20, 2018-19, and Percentage Change

In-State Peer TuitionRanking

Out-of-State Peer TuitionRankingInstitution 2019-20 2018-19 % Change Institution 2019-20 2018-19 % Change

Public Peers Public PeersPittsburgh $19,718 $19,080 3.34% 1 Michigan $51,200 $49,350 3.75% 1Virginia $17,641 $17,641 0.00% 2 Virginia $49,020 $49,020 0.00% 2Michigan $15,558 $15,262 1.94% 3 Berkeley $44,007 $43,176 1.92% 3Minnesota $15,027 $14,693 2.27% 4 UCLA $42,994 $42,193 1.90% 4Berkeley $14,253 $14,184 0.49% 5 Texas $38,228 $37,580 1.72% 5UCLA $13,240 $13,201 0.30% 6 Washington $38,166 $36,588 4.31% 6Washington $11,465 $11,207 2.30% 7 Wisconsin $37,785 $36,805 2.66% 7Texas $10,818 $10,610 1.96% 8 Maryland $36,891 $35,216 4.76% 8Maryland $10,779 $10,595 1.74% 9 UNC-Chapel Hill $36,165 $35,170 2.83% 9Wisconsin $10,725 $10,556 1.61% 10 Pittsburgh $33,746 $32,052 5.29% 10UNC-Chapel Hill $8,986 $8,987 -0.01% 11 Minnesota $33,325 $30,371 9.73% 11

Private Peers Private PeersSo. California* $58,583 $56,162 4.31% So. California* $58,583 $56,162 4.31%Duke $57,931 $55,695 4.01% Duke $57,931 $55,695 4.01%Pennsylvania $57,770 $55,584 3.93% Pennsylvania $57,770 $55,584 3.93%Northwestern $56,691 $54,568 3.89% Northwestern $56,691 $54,568 3.89%Johns Hopkins* $55,350 $53,740 3.00% Johns Hopkins* $55,350 $53,740 3.00%

* Indicates institutions that have not reported their 2019-20 or 2018-19 tuition and fees data to AAUDESources: - AAUDE annual Tuition and Fees survey, as of September 25, 2019- For institutions that have not responded to the 2019-20 or 2018-19 AAUDE surveys, tuition information has been gathered from individual institution websites.Prepared by: Institutional Research and Assessment (IRA), September 26, 2019

2019-20 Tuition and Fees at Competitor Peers for First-Year Full-Time Students

* Reported required fees include fees that may be waived —Health Insurance Fee $2,627 and Book Rental Fee $298.

Source: Tuition information gathered from individual institution websites.Prepared by: Institutional Research and Assessment (IRA), September 27, 2019

InstitutionsOn-Campus

In-State Out-of-StateDuke University $57,931 $57,931Wake Forest University $55,440 $55,440Davidson College $52,991 $52,991Campbell University $52,450 $52,450Vanderbilt University $52,070 $52,070Furman University $50,844 $50,844Emory University $41,800 $41,800Elon University $36,571 $36,571University of Virginia $17,641 $49,020Clemson University $15,558 $38,550Virginia Polytechnic Institute $14,020 $23,830University of South Carolina $12,738 $33,677Georgia Institute of Technology $12,682 $33,794University of Georgia $12,080 $31,120North Carolina State University $9,100 $29,220UNC-Chapel Hill $8,986 $36,165Appalachian State University $7,710 $22,517UNC-Greensboro $7,403 $22,562East Carolina University $7,239 $23,516UNC-Wilmington $7,138 $21,246UNC-Charlotte $7,096 $20,530Western Carolina University* $6,904 $10,904UNC-Asheville $3,615 $12,289

Graduate Tuition and Fees Peers Comparison2019-20, 2018-19, and Percentage Change

In-State Peer TuitionRanking

Out-of-State Peer TuitionRankingInstitution 2019-20 2018-19 % Change Institution 2019-20 2018-19 % Change

Public Peers Public PeersPittsburgh $24,480 $23,696 3.31% 1 Michigan $48,532 $47,006 3.25% 1Michigan $24,218 $23,456 3.25% 2 Pittsburgh $40,848 $39,586 3.19% 2Minnesota $19,221 $18,583 3.43% 3 Maryland $40,636 $38,772 4.81% 3Maryland $19,180 $18,828 1.87% 4 Virginia $30,342 $30,342 0.00% 4Virginia $18,848 $18,848 0.00% 5 UNC-Chapel Hill $30,248 $29,423 2.80% 5Washington $16,977 $16,590 2.33% 6 Washington $29,562 $28,881 2.36% 6Berkeley $14,187 $14,131 0.40% 7 Berkeley $29,289 $29,233 0.19% 7UCLA $12,953 $12,943 0.08% 8 Minnesota $28,845 $27,931 3.27% 8UNC-Chapel Hill $12,522 $12,212 2.54% 9 UCLA $28,055 $28,045 0.04% 9Wisconsin $12,179 $12,010 1.41% 10 Wisconsin $25,506 $25,336 0.67% 10Texas $11,978 $11,742 2.01% 11 Texas $23,016 $22,564 2.00% 11

Private Peers Private PeersSo. California* $58,146 $56,114 3.62% So. California* $58,146 $56,114 3.62%Duke $56,888 $54,711 3.98% Duke $56,888 $54,711 3.98%Northwestern $56,567 $54,620 3.56% Northwestern $56,567 $54,620 3.56%Johns Hopkins* $55,350 $53,740 3.00% Johns Hopkins* $55,360 $53,740 3.01%Pennsylvania $40,182 $38,630 4.02% Pennsylvania $40,182 $38,630 4.02%

* Indicates institutions that have not reported their 2019-20 or 2018-19 tuition and fees data to AAUDESources: - AAUDE annual Tuition and Fees survey, as of September 25, 2019- For institutions that have not responded to the 2019-20 or 2018-19 AAUDE surveys, tuition information has been gathered from individual institution websites.Prepared by: Institutional Research and Assessment (IRA), September 26, 2019

AY 2020-21 Proposed Campus Based Tuition Increases(CBTI)

18

Proposed AY2020-21 CBTIUndergraduate: 3.0%; Graduate $317

19

Proposed Increase 2

Proposed Tuition Rate2

Additional Revenue2

- 7,019 -

211 7,230 .78 M 1,026 35,224 2.44 M

1,017 34,906 .81 M 317 10,869 1.50 M 317 28,595 0.78 M

$ 6.31 M

Option B - 3%, lower Grad NR

Student TypeCurrent Tuition

UG Resident - Tuition Guarantee: 2017-20 7,019

UG Resident - Current Rate 7,019 UG Nonresident - current rate 34,198 UG Nonresident - continuing from AY2017-18 33,889 Graduate Resident 10,552 Graduate Nonresident 28,278 Total

TFAT CBTI Recommendation for AY2020-21

Student Type

Current Tuition

AY2019-20Proposed Increase

Proposed Tuition

Rate

ProjectedAdditional Revenue

UG Resident - Tuition Guarantee:UG Resident - Guarantee AY2017-18 7,019 - 7,019 -UG Resident - Guarantee AY2018-19 7,019 - 7,019 -UG Resident - Guarantee AY2019-20 7,019 - 7,019 -

UG Resident - current rate 7,019 211 7,230 0.8 MUG Nonresident - current rate 34,198 1,026 35,224 2.4 MUG Nonresident - continuing from AY2017-18 33,889 1,017 34,906 0.8 MGraduate Resident 10,552 317 10,869 1.5 MGraduate Nonresident 28,278 317 28,595 0.8 MTotal $ 6.3 M

Proposed AY2020-21 UNC-Chapel Hill Tuition & Fees

20

Rate Type Undergraduate Resident

Undergraduate Nonresident

Graduate Resident

Graduate Nonresident

Tuition 7,230 35,224 10,869 28,595

Fees 1,994 1,994 1,998 1,998

Tuition & Fees 9,224 37,218 12,867 30,593

UNC System-Defined Public Rate Ranking * 11 of 11 8 of 11 9 of 11 4 of 11

Public AAU Rate Ranking * 34 of 35 15 of 35 25 of 36 14 of 36AAU Average Rate Increase 1.9% 2.6% 2.1% 1.9%

UNC-CH Rate vs AAU average $(3,644) $1,076 $(2,130) $(46)

Sources: - AAUDE annual Tuition and Fees survey, as of September 25, 2019- For institutions that have not responded to the 2019-20 or 2018-19 AAUDE surveys, tuition information has been gathered from individual institution websites.Data provided by: Institutional Research and Assessment (IRA), September 26, 2019* UNC-CH proposed AY2020-21 rate compared to actual AY2019-20 peer rates.

AY2020-21 Proposed Student Fees

21

Key Factors Considered

• Student fees are charged only for limited, dedicated purposes. Fees shall not be used to defray the cost of general academic and administrative operations of campuses, including academic programs and faculty and administrative salaries and benefits.

• Statutory 3% cap applies to mandatory student fees charged to all students and approved by the BOG.

• BOG guidance:• No new Special Fees or increases to existing Special Fees

• Special Fees are applicable to students engaged in particular activities or course of study

• Consider allowance for potential campus security fee increase

22

Framework for Student Fee Evaluations

• Comprehensive review of current student fee proposals (fee forms)• Review proposed budget and justification:

Is the value to students clearly defined? Are needs clearly identified and justified? Are there existing resources available to support the fee-funded service? Does the proposed budget fully address the needs supported by the requested

increase? Does the proposed budget contain accurate calculations? Are there university needs not addressed by the current proposals?

• In person stakeholder presentation and discussion for proposed increases.

23

Proposed AY2020-21 Student Fee Adjustments

Remaining Cap Space

$ 19.34

Student fees in bold are considered General Fees and are included within the 3% fee cap. 24

Summary of AY2020-21 Student Fee Requests

Fee Name Fee Type2020-21 SFAS

Recommended Increase

Proposed 2020-21 Fee

Amount % Increase

Educational and Technology Fees: General Fee (2.56) 439.74 -0.58%

Educational Component General Fee - 206.81 0.00%

Technology Component General Fee (2.56) 232.93 -1.09%

Student Health Fee General Fee 10.00 410.15 2.50%

Campus Recreation Fee Student Activity Fee 3.88 133.10 3.00%

Carolina Union Operating Fee Student Activity Fee 4.31 163.91 2.70%

BeAM Enhancement Fee Student Activity Fee 17.00 17.00 New

General Fees Summary * General Fees 32.63 1,765.10 1.88%

Biomedical Engineering Prg Enhancement Fee Special Fee 500.00 1,500.00 50.00%

Student Transit/Safe Ride Fee (Student Transit, Safe Ride, Night Parking) Miscellaneous 2.00 213.31 0.95%

Grad Student Programming Fee Miscellaneous 2.00 26.50 8.16%

* General Fees Summary includes ASG and Campus Security Fee and excludes miscellaneous & special fees.

AY 2020-21 School Based Tuition Increases(SBTI)

25

SBTI Proposal Instructions

• Maintain Access and Affordability• Address why SBTI is necessary to support program specific

academic needs• Identify the benefits to students• Document student involvement and consultation• Reflect market based rates

26

Proposed AY2020-21 SBTI and CBTI

27

Next Steps

28

Questions

29

David S. RouthVice Chancellor for Development

CAROLINA FIRST (1999-2007) $2.384 Billion

$1B

$2B

$3B

$4B

$4.2

5B

$2.966 Billion

$1.04B

$443M

$1.49B

$1.06B

Campaign Dashboard

70%

PERCENT TOGOAL

60%

TIMEELAPSED

175,826

TOTALDONORS

25%

ALUMNIPARTICIPATION

TOTAL CAMPAIGN ACTIVITY

THE NEW GRADUATE

THE 21ST C. PROFESSORIATE

A CULTURE OF INNOVATION

SIGNATUREINITIATIVES

Campaign Pillars

Acronyms key available online at:https://unc.live/acronyms

Has met goal.

$2,966,042,207Unit Progress

DATA AS OF Nov. 3, 2019.

$85$103

$175

$137 $150

$0

$25

$50

$75

$100

$125

$150

$175

$200

FY16 FY17 FY18 FY19 FY20

New Cash & Commitments Totals Through 11/4

Amounts in millions

+9%

LAUNCHYEAR

$53

$32

$85

$58 $58

$116

$0

$20

$40

$60

$80

$100

$120

$140

Gifts Grants Cash TotalFY19 FY20

+36%

+81%+9%

Amounts in millions

Cash Totals Through 11/4

Campaign Announcements and Events

Naming of the UNC Hussman School of

Journalism and Media

Carolina Pride Alumni Network

Homecoming Weekend

Chancellor’s Philanthropic Council

Fall Meeting

Morehead City Salon Event at the home of

Tom and Jody Darden

David S. RouthVice Chancellor for Development

November 20, 2019

1

UNC Investment Fund, LLCFiscal Year 2019 ReviewPresentation to The Board of Trustees of The University of North Carolina at Chapel Hill

2

The UNC Investment Fund (“UNCIF” or “Fund”) returned +7.7% for FY 2019 (12 months)

+10.2% for CYTD 2019(2) through September

1) FY 2019: July 1, 2018 to June 30, 2019 (12 months)2) CYTD 2019: January 1, 2019 to September 30, 2019 (9 months)

FY 2019 HeadlinesUNCIF had another strong year in FY 2019(1)

UNCIF’s full-year FY 2019 return rebounded sharply after recording a loss in the first half of the fiscal year

3

UNCIF beat its benchmarks The Fund’s +7.7% return beat:

− Primary SIPP benchmark: +6.7% − Global 70/30 Portfolio(1): +6.7%

UNCIF was a top decile performer The Fund’s return ranks in the top decile of the BNY Mellon

Endowment & Foundation universe

Second consecutive year UNCIF has achieved a top decile ranking UNCIF has been a top decile performer three of the past five years

:

(1) Global 70/30 Portfolio: 70% MSCI All Country World Index (ACWI), 30% Bloomberg Barclays U.S. Aggregate Bond Index

FY 2019 HighlightsUNCIF’s FY 2019 return is strong on an absolute and relative basis

FY 2019 is UNCIF’s second consecutive year of strong absolute and very strong relative performance

4

First half of FY 2019: Equity markets suffered their sharpest drawdown in years

FY 2019: A Tale of Two Markets, Part 1Equity Market Returns: July 1, 2018 – December 31, 2018

85

90

95

100

105

110

115

6/30/2018 7/31/2018 8/31/2018 9/30/2018 10/31/2018 11/30/2018 12/31/2018 1/31/2019 2/28/2019 3/31/2019 4/30/2019 5/31/2019 6/30/201

S&P 500 MSCI ACWI MSCI EAFE

5

Second half of FY 2019: Equity markets rebounded sharply and recorded gains for the year

FY 2019: A Tale of Two Markets, Part 2Equity Market Returns: July 1, 2018 – June 30, 2019

80

85

90

95

100

105

110

115

6/30/2018 7/31/2018 8/31/2018 9/30/2018 10/31/2018 11/30/2018 12/31/2018 1/31/2019 2/28/2019 3/31/2019 4/30/2019 5/31/2019 6/30/201

S&P 500 MSCI ACWI MSCI EAFE

5.7%

10.4%

1.1% 1.2%

7.5% 7.9%

13.8%

-6.8%

12.5%

1.5%0.3%

-10%

-5%

0%

5%

10%

15%

MSCI AllCountryWorld

S&P 500 MSCI EAFE MSCIEmergingMarkets

BloombergBarclays

U.S.CorporateHigh Yield

BloombergBarclays

U.S.Aggregate

Bond

BloombergBarclays

U.S.Gov't/CreditLong Term

BloombergCommodity

Index

Spot Gold HFRI FundWeighted

Composite

HFRI EquityHedge

6

Equities Fixed Income Commodities Hedge Funds

The equity bull market persisted in FY 2019, led by domestic equities

Financial Markets Summary: FY 2019 Despite a difficult Q2 FY 2019, equities continued to climb

Equity-oriented hedge funds failed to keep pace with the strong

domestic equity markets

Performance is for FY 2019: July 1, 2018 to June 30, 2019 (12 months)

FY 2019: U.S. equities

outperformed international

7

All seven of the Fund’s primary asset classes generated a positive investment return for the year

Top performers for the year: Private Equity: Drove the Fund’s FY 2019 return

- Absolute Performance: +23.0%- Relative Performance: 7.1% ahead of benchmark

Real Estate: Solid absolute and relative performance- Absolute Performance: +11.3%- Relative Performance: 3.1% ahead of benchmark

Long/Short Equity: Very strong relative performance- Absolute Performance: +7.3%- Relative Performance: 7.0% ahead of benchmark, 1.6% ahead of global equities

Return Highlights: FY 2019UNCIF’s strong FY 2019 performance was driven by Private Equity

Alternative asset classes (privates & hedge funds) drove UNCIF’s strong relative performance in FY 2019

Longer Term Return SummaryUNCIF’s performance is strong across time horizons

8

Note: Annualized performance for periods ending June 30, 20191) Global 70/30 Portfolio: 70% MSCI All Country World Index (ACWI), 30% Bloomberg Barclays U.S. Aggregate Bond Index2) BNY Mellon Endowment & Foundation universe adjusted for internal fees

1Year

3Years

5 Years

7 Years

10 Years

UNC Investment Fund 7.7% 10.6% 7.7% 9.4% 9.0%

Primary Benchmark: SIPP 6.7% 9.1% 5.8% 7.8% 8.9%

Traditional Portfolio: Global 70/30(1) 6.7% 8.9% 5.4% 7.8% 8.5%

Peer Universe(2)

Median 5.3% 8.8% 5.5% 7.9% 8.7%Top 10% 7.3% 10.5% 7.1% 9.3% 10.1%

UNCIF has consistently outperformed its primary SIPP benchmark and a Global 70/30 Portfolio(1) and is strong relative to peers

UNC Investment FundPrimary Objective

9

Primary Objective Preserve the inflation-adjusted purchasing power of the endowment while

providing a predictable and growing stream of spending distributions

To accomplish this objective - - the endowment must earn an annualized net return exceeding the spending rate + inflation over rolling 5 – 10 year (and longer) periods

UNCIF’s stated return objective is 5.5% + CPI

Managing the return volatility of the endowment helps to stabilize the annual spending distribution

Spending + Inflation Return Objective > 7.5%5.5% 2%+

:

10

Asset Allocation

The portfolio management process starts with asset allocation Strategic Investment Policy Portfolio (“SIPP”) targets established

by UNCIF’s Board of Directors

External Investment Management

Board of Directors Approval

UNCMC hires third-party (external) investment management firms, allocating the Fund to investment managers based on the respective firm’s investment strategy, liquidity, risk profile, and other factors

The Executive Committee of UNCIF’s Board of Directors must approve all investment manager hires recommended by UNCMC

UNC Investment FundInvestment Implementation

11

Asset Class Target Range

Long Equity 30% 24 - 36%

Long / Short Equity 15% 10 - 20%

Diversifying Strategies 10% 6 - 14%

Fixed Income 9% 5 - 14%

Cash 2% -2 - 8%

Private Equity 20% 15 - 25%

Real Estate 8% 5 - 12%

Energy & Natural Resources 6% 3 - 9%

Private Portfolio

PublicPortfolio

Long Equity30%

Long/Short Equity15%

DiversifyingStrategies

10%

FixedIncome

9%

Private Equity20%

RealEstate

8%

Cash2%Energy &

Nat. Resources6%

Strategic Investment Policy Portfolio (“SIPP”)Asset Allocation Framework(1)

1) Effective July 1, 2019

Diversification & private investments needed: UNCIF achieves its primary objective when a traditional equity/bond portfolio does not

12

Relative Long-Term PerformanceOver the medium and long term, the Fund has achieved its return objective

(1)

Note: Annualized performance for periods ending June 30, 2019(1) 5, 10, 15 Years: Global 70/30 Portfolio - 70% MSCI All Country World Index (ACWI) / 30% Bloomberg Barclays U.S. Aggregate Bond Index

20 Years: Domestic 70/30 Portfolio - 70% S&P 500 Index / 30% Bloomberg Barclays U.S. Aggregate Bond Index

7.7%

9.0% 8.7% 8.5%

5.4%

8.5%

6.5%5.9%

7.0% 7.2%7.5% 7.7%

0%

2%

4%

6%

8%

10%

5 Years 10 Years 15 Years 20 Years

Ann

ualiz

ed P

erfo

rman

ce

UNCIF 70% Equity / 30% Bond Portfolio CPI + 5.5% (L-T Return Objective)

Statutory Endowment of

UNC Chapel Hill

Other UNC Chapel Hill

Affiliated Funds

UNC Investment FundInvestment Entity Structure

13

UNC Investment Fund, LLC (“UNCIF”)$6.6 billion

UNC Management Company, Inc. (“UNCMC”)

Manager

Controlling Member

Other UNC Campuses and

Affiliates

Other Members

UNC Chapel Hill Foundation, Inc.

UNC-CH entities invest alongside other UNC campuses & affiliates

Note: As of June 30, 2019

UNC Chapel Hill Foundation Investment Fund, Inc. (“CHIF”)

$3.6 billion

14

UNC Chapel Hill Foundation Investment Fund$3.6 billion

Invested in UNC Investment Fund ($6.6 billion)

Foundation Unitholders Scholarships Professorships etc.

Endowment Unitholders Scholarships Professorships etc.

Foundation Unitholders Scholarships Professorships etc.

UNC Chapel Hill Statutory Endowment

$1.6 billion

UNC Chapel Hill Foundation

$340.3 million

UNC Chapel HillAffiliated Foundations & Other

$1.7 billion total 15 affiliated fdns

including: Educational Fdn

Arts & Sciences Fdn Law Fdn

Public Health Fdn Medical Fdn

KFBS Fdn 8 others (non-fdns)

Chapel Hill Investment Fund (“CHIF”)Member Composition

Note: As of June 30, 2019

Chapel Hill Investment Fund (“CHIF”)FY 2019 Change in Market Value

15

In FY 2019 CHIF increased in value by $212.3 million:+ net investment gain of $269.6 million

+ $109.9 million in net contributions

− less, annual endowment spending distribution of $167.2 million

June 30, 2018($ millions)

June 30, 2019($ millions)

FY 2019 Change($ millions)

Statutory Endowment $1,547.5 $1,647.8 $100.3UNC Chapel Hill Foundation 327.1 340.3 13.2Other Affiliated Foundations 1,334.3 1,382.0 47.7Other CHIF participants 218.2 269.3 51.1

Total CHIF $3,427.1 $3,639.4 $212.3

Note: Totals may not sum due to rounding

Chapel Hill Investment Fund (“CHIF”)10 Year Change in Market Value

16

10 Years Ended June 30, 2019($ in millions)

Market Value - - June 30, 2009 $ 1,783.7

Net Investment Gains 2,272.8

Net Additions 1,094.4

Annual Spending Distributions and Development Support (1,511.5)

Market Value - - June 30, 2019 $ 3,639.4

CHIF’s market value has more than doubled over the past ten years after distributing > $1.5 billion to support University programs and development

17

Chapel Hill Investment Fund (“CHIF”)Per Unit Distribution Amount

At its May 2019 meeting, CHIF’s Board of Directors: approved the FY 2020 Annual Distribution Rate of $463 per CHIF unit

increasing the per unit distribution rate by 2.0% over FY 2019

the $463 per unit rate will be distributed to CHIF participants on 6/30/2020

$319$329 $333 $333 $339

$350$362

$380

$418

$387$397

$409 $413$420

$427 $432 $435$444

$454$463

$300

$350

$400

$450

$500

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Per U

nit D

istr

ibut

ion

Amou

nt

Fiscal Year

18

Chapel Hill Investment Fund (“CHIF”)Distribution $ Amount as a % of Ending Market Value

The distribution rate as a percent of market value is a by-product of the “constant growth rule” methodology

5.0%

5.4%

5.7%

5.3%

4.9%

4.5%

4.0%4.1%

5.8%

5.3%5.0%

5.3%

5.1%4.7%

4.6%

5.0%

4.7%

4.5% 4.5%

3.0%

4.0%

5.0%

6.0%

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Dis

trib

utio

n R

ate

(as

a %

of E

ndin

g M

arke

t Val

ue)

Fiscal Year

Return Summary: FYTD 2020 Data is for periods ending September 30, 2019

19

6 of 7 asset classes beat their benchmark over the 10-year periodFYTD 2020

(3 months)

CYTD 2019

(9 months)1 Year

UNCIF 1.4% 10.2% 6.4%

Primary Benchmark: SIPP 1.3% 9.8% 4.9%

Traditional Portfolio: Global 70/30(1) 0.7% 14.1% 4.3%

Domestic Equities: S&P 500 Index 1.7% 20.6% 4.3%

Global Equities: MSCI ACWI 0.0% 16.2% 1.4%

(1) Global 70/30 Portfolio: 70% MSCI All Country World Index (ACWI), 30% Bloomberg Barclays U.S. Aggregate Bond Index

The Fund is off to a positive start (both absolute and relative) in FY 2020

Our Fundamental BeliefsOver the long term, the Fund has achieved its objectives

20

Maintaining conviction in our investment approach and philosophy has led to the Fund achieving its long-term objectives

− Maintain a long-term time horizon

− Portfolio diversification is a key component in managing risk

− Focus assets with our highest conviction investment managers

− Alternative asset classes play a significant role

− Tactical portfolio shifts can be utilized selectively to capture shorter-term opportunities

− Downside protection matters

The most important and difficult challenge remains striking the proper balance between upside participation and downside protection

21

The Fund returned +7.7% for FY 2019 All asset classes generated positive performance

Private Equity and Real Estate drove FY 2019’s strong performance

Over Longer Time Horizons For the 1-, 3-, 5- and 7-year periods ended June 30, UNCIF:

- Beat its primary benchmarks by significant margins - Ranks in the top decile relative to peers

The Fund has achieved its primary return objective for the 5-, 10, 15- and 20-year periods ended June 30, 2019

Wrap-UpUNCIF’s FY 2019 return is strong on an absolute and relative basis

UNCIF continues to generate solid returns