The letter below, and the message from Executive Vice President John Fry, were submitted independently of each other and of the SEC Actions of January 20.--Ed.

A Letter to the Penn Community on the Faculty Club

by Elsa L. Ramsden, Chair of the Board of Governors

Recent events and many conversations prompt me to add my perspective about the move of the Faculty Club into new quarters at the Inn at Penn when it opens next fall. First I will give a bit of history that may put the current situation into context. Then I will outline the basic ingredients of the two documents that have been developed: one to set the terms of agreement for the move, and the other a basic management and operating framework for the relationship among the three players: the manager of the Inn (Doubletree), the University, and the Board of Governors. And finally I will identify those on the Board with whom you should discuss your questions and concerns.

When I first become a member of the Board in 1994, I learned about some of the problems attendant to operating the building with a full-time union staff for a part-day income-producing activity, about the indirect costs of maintaining the facility, and about the direct costs of day-to-day activities. All of that takes place while trying to meet the wide range of interests and tastes of faculty and staff who range in age from 20 to 90. And all of that is set within the framework of social change that has taken place since the '60s when the second half of the building was completed.

I learned that the Faculty Club lease expires in 2009, and I was convinced that the University would not extend it beyond that time. When I first learned about plans for the Inn at Penn I "knew" that once the Inn was up and running the University would no longer cover any portion of the deficit. (Please realize that no faculty club in the country has a balanced budget--with the exception of one that is heavily endowed, and a few that have hotel operations as part of their activity. Every club is subsidized by the institution within which it sits.) It proved prudent that we had already begun a long-range planning process with Steve Murray and Marie Witt in the Office of Business Services.

The results of all the studies have been reported in the past and are available on the website . They confirmed the observations of many on the Board and across campus--that many people were eating lunch at their desks and in meetings, in a shortened lunch hour; they were not walking to the Faculty Club to have a discussion with colleagues. The suggestion was posed to the Board that the Faculty Club move to the Inn, into new quarters, with new decor with no overhead or maintenance costs to the Club. After much discussion and thought the Board agreed in principle to such a move. An Ad Hoc Committee* was selected to work with Steve and Marie on terms for the move, and on a separate document related to management and operations of the facility.

The Board agreed in principle to the terms of the first document, contingent upon approval of the second. Meanwhile, a subcommittee worked with the consultant responsible for interior design and decor to plan the appointments of the Club space, including details that ranged from the grain and color of the wood paneling to the design and colors of all fabrics, style of furniture and fixtures and window treatments. With expert advice from faculty talented in these areas, we arrived at a final result that we all believe to be quite special.

The Ad Hoc Committee worked long and hard crafting language--making a compromise here and a gain there--to get to the point where attorneys for the University and for the Board could critique it. Many iterations have gone back and forth to arrive where we are today. This week the drafts of both documents [summarized below] go to the Board for discussion.

In another arena, but related to the discussion about the future of the Faculty Club, is the issue of union staff employed at the Faculty Club, some of whom have been there many years. Both the Board and the Office of Business Services have stated publicly and often that the employees at the Club should and will have priority opportunity to interview for positions at the Inn. The University negotiator has been working for many months to come to terms with the union. I am not in a position to represent that process in any way. The Board is concerned about the long and loyal service of its employees. With ample precedent, those are realistic concerns. The corporate nature of running large academic institutions has caused many faculty to worry about the values inherent in the academy that we think are important

When the Board has studied and voted on the documents, their contents will be made available through a special meeting of the membership. If anyone wishes to discuss those matters with me or any Board member, please feel free to contact us, or Peter Conn who is the SEC liaison to the Board.

The Board members are:

 Elijah Anderson  Michael Cohen  Nicholas Constan  Peter Freyd
 Morris Mendleson  Elsa Ramsden  Robert Regan  Anthony Santomero
 Edward Shils  Jerome Singerman  Albert Stunkard  Anthony Tomazinis
 D-LWormley  SEC Liaison: Peter Conn;  Board's Attorney: Leonard Saner

* Ad Hoc Committee members are Peter Conn (SEC liaison), Saul Katzman, Morris Mendleson, Elsa Ramsden, Anthony Santomero, Jerome Singerman, Terri White, and Marie Witt

Dr. Ramsden's Summaries of Two Agreements to be Signed

A. On the Basic Relocation Agreement

After a background discussion and several "Whereases" statements, the gist of this agreement is in eight sections that say, in sum:

1. The University recognizes and acknowledges the Club as an integral entity within the University; agrees to relocate the Club to the Inn for the term of this agreement, as it may be extended, and provides for contingencies that may require relocation at some unforeseen time to comparable premises under comparable financial terms.

2. No rent will be charged to the Club for a space of 5,240 square feet--consisting of à la carte and cafeteria dining space; a small dining room; art gallery, and reception space--to be used exclusively for Club members and guests under terms identified in the Management Agreement,

3. The Club acknowledges that the University has entered into an agreement with the Inn operator for overall management and operation of the Inn, which shall have responsibility for day-to-day control of Club space and operations, subject to the Management Agreement. The operator shall provide food and beverages for the Club using operator's own employees. Specific terms appear in the Management Agreement.

4. The Club's Board of Governors continues to have exclusive authority related to membership, dues, program, monitoring quality of food and services, display of art, special functions, and business systems related to these activities.

5. The Club is responsible for hiring and compensation of a Club coordinator and any other employees it chooses to have, plus telephone and toll charges.

6. The University retains all gross revenues from the performance of services, and provides all building upkeep and renovations; requires the Inn operator to staff Club functions with sufficient experienced and qualified employees to provide quality food and service to members, with a view to providing a consistent cadre of staff for the Club; has sole responsibility for payment of real-estate and use and occupancy taxes if applicable; assumes responsibility for preparing and filing appropriate tax returns; and provides Club members and their guests with meeting room and sleeping accommodations as set forth in the Management Agreement.

7. Any property that the Club may own and disposition of such, and account for it if moved to the Inn.

8. The Lease will extend to 2019 and automatically be extended for additional one-year periods on the same terms and conditions (with usual terms of advance notice to the contrary). If, prior to 30 June 2019, the University determines based upon monthly reporting of the operator, that the Club has, for a period of not less than 12 months, failed adequately to fulfill its purpose and mission by reason of a decline of 20% or more in membership, gross revenues or food orders from comparable data in FY '98-'99, the University may notify the Club in writing of its determination to terminate the agreement. Specific definitions are identified to clarify terms for calculation. Such an action would involve a 6-month advance notification with the following provisions: a Club review committee including 3 members from University administration, 3 members of the Club Board, and 3 from the Faculty Senate; and a 60-day review period, followed by a report to the Trustees, who will make the determination whether to approve the University recommendation. In the absence of a decline of 20% and 6 months prior to the expiration of this Agreement the University and the Club shall consider the extension of the agreement or relocation.

B. On the Management/Operating Agreement

Again following "Whereas" statements, seven sections cover the basics of this agreement:

1. A long section identifies the space and definitions of use--à la carte, cafeteria, small dining room, art gallery, reception, approach and entry to the Club space, location immediately next to the University Living room [which is not dedicated to use by the Club but available to the University community and guests in the Inn]. Meeting and conference rooms priced at the University discount rate may be reserved through the Club coordinator or the Inn. It goes on to define the exclusivity of Club space during normal Club hours with the exception of the cafeteria breakfast in the morning, which will be available to hotel guests and the public between 5 and 10 a.m. The Inn may use Club space for non-Club purposes during such hours that the Club is not open for operation [discussed further in #5 below].

2. Inn cost and expense definitions for all staff and services. Methods of payment are outlined to include all those presently available plus Penncard/Penn cash. Menu selection and general management of Club programs and activities are made subject to the policy governance of the Board. The Board and the Inn will review quality and pricing parameters at least annually to consider necessary changes for the succeeding year. The fixed price of lunch in the cafeteria will remain the same for FY 2000. Pricing in the à la carte dining room will remain competitive with the prevailing market. A review mechanism is identified. Dress of staff serving in the Club will be distinctive and different from that worn elsewhere in the Inn; it will have a Club logo, and will not have an Inn logo or identification.

3. Customer service standards are set, with accountability for cost to the Inn; reporting mechanisms and time frame are given, with periodic surveys specified.

4. Special privileges are specified, including a 10% discount in the Inn restaurant and bar and the University Living room.

5. Hours of operation are detailed, with the exclusive use by Club members and their guests during specified hours and other hours as may be necessary or appropriate to meet the needs of the membership activity. Specifics include: morning coffee and baked goods at no cost Monday through Friday, 8-11 a.m. in the à la carte dining room; breakfast in the buffet area, 5 -10 a.m. (as noted in Section 1, this one mealtime is shared with Inn guests and general public); lunch, 11:30 a.m.-1 p.m. excluding holidays; Wednesday evening dinners, 5-9 p.m. excluding holidays. This section also outlines rental charges by the Club for use of rooms during the hours identified; makes regular hours subject to expansion supported by reliable demand and Club activity; and gives conditions for special functions and events. It provides a first right of Club to schedule events in Club space; gives terms for Inn use of space with approval of the Club coordinator; and provides that the nature of promotional materials for events in Club space not sponsored by the Club are conditional on Board approval.

6. This section is devoted to the Club coordinator and responsibilities of the Club for that position.

7. This specifies the Inn operator's reporting, which includes monthly statements on food orders, special functions, and use of space, and monthly revenue and expense reports to the Board and University.


Almanac, Vol. 45, No. 18, January 26, 1999