UM ends investment contract, approves operating budget

The UM Board of Curators voted unanimously to end its contract with one of the University of Missouri System investment managers at a meet-ing Thursday.

DKR Capital Inc., an asset management firm in Stamford, Conn., manages $7.5 million in endowment funds and $25 million in UM’s retirement plan, according to documents presented for the meeting at MU. The documents state that DKR’s performance has been “acceptable,” but Nikki Krawitz, UM vice president of finance and administration, said there were other problems.

“We have not been happy with what we have observed within the firm,” Krawitz said at Thursday’s meeting.

The board voted now in order to comply with the rules of the contract. It required the board to notify the firm of its termination 60 days before the end of the next business quarter, which is in September.

The board also voted to approve the UM System’s operating budget for fiscal year 2006.

The system has about $2.02 billion in its general operating budget, Krawitz said. This is $108 million larger than fiscal year 2005’s general operat-ing budget, an increase of 5 percent.

Krawitz pointed out that student fees are covering a larger portion of operating funds than state appropriations and will continue to do so for 2006.

Student fees are expected to cover 45.81 percent of the funds, while state appropriations will cover 39.33 percent. In 2001, students covered 35.58 percent while state appropriations covered 55.44 percent.

This drop in state support worried curators throughout the meeting.

“One of these days,” said board President Thomas Atkins, “money from the state government is going to be very small.”

After members voiced some apprehension, the board also moved forward with plans for the expansion and renovation of Brady Commons by voting to continue using the consultant firm Mackey Mitchell Associates to develop the project.

Although most curators appeared to favor the project, one point gave Curator Doug Russell pause: Although students voted in April to allow a fee increase to help pay for the project, most of them will no longer be at MU when students begin to be charged, he said.