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Regents Approve Construction‑Related F5 Despite Objection Over Guaranteed‑Max Practice
Summary
The Board approved Item F5, a finance item involving cost increases on a delegated project; Regent Makarishan objected to the practice of entering guaranteed‑maximum price contracts then returning for substantial augmentation (he cited a roughly 33% increase) and said he would abstain or withhold support.
Regents approved Item F5, which concerns a campus construction project that began under delegated authority and later required additional funding. Chair Cohen summarized that the project’s cost increases were outside the university’s control and warranted board action because they exceeded delegated authorities.
Regent Makarishan spoke against the practice of approving guaranteed‑maximum price (GMP) contracts that later require supplemental approvals. He said the board was setting a bad precedent when GMP contracts were later augmented and described an example of a roughly 33% augmentation above a prior GMP. "What does guaranteed max contract mean, if you keep doing this type of approval?" he asked, and said he would abstain to register his objection.
The roll call was taken and Item F5 was approved. The transcript records both 'no' and 'abstain' votes for some regents and multiple 'aye' votes, and it shows the chair declaring the item approved.
Regents and staff did not, in open session, change the university’s procurement rules during the discussion; the exchange focused on the need for clearer processes and for oversight when delegated projects grow in cost.
The board moved on after the vote and later took up other finance and governance matters.
