LEXINGTON, Ky. (WDRB) – When Eli Capilouto became President of the University of Kentucky in 2011, he saw a campus that needed a facelift.

Only 600 of 6,000 beds in student dormitories were considered modern, and a Depression-era student center had “outlived its usefulness,” he said.

The university has spent more than $2 billion since then, building and renovating six million square feet on 125 projects paid for with public and private funds. Among them: a $265 million health research building and a $200 million student center both under construction.

“I felt it was important to rebuild the campus,” Capilouto said. “I believe to succeed you need talent and infrastructure. I think we have exceptional talent here. We want to keep that talent here. We want to bring more talent. They need a great place to teach, learn and discover – so we needed to transform those places.”

In his sixth year at the helm of Kentucky’s flagship university, Capilouto now is overseeing a strategic plan that seeks to boost graduation rates, diversify the student body and faculty and spend more on research and development by 2020. The ambitious goals come as state government has reduced funding to UK and other public universities.     

A string of retirements and departures among leaders of state schools also has put Capilouto on the verge of becoming the longest-tenured of Kentucky’s current university presidents. He is set to assume that role once Western Kentucky University President Gary Ransdell and Morehead State University’s Wayne D. Andrews step down in June.

In a wide-ranging interview with WDRB News last week, Capilouto praised the campus building boom, mapped out the university’s approach to retaining students and defended UK’s decision to sue the Kentucky Kernel, an independent student newspaper, in a public records fight over a former professor’s sexual misconduct case.

He declined to take a position on a bill in the Kentucky General Assembly that would give Gov. Matt Bevin broad discretion to remove university board members. But Capilouto, who last year called Bevin’s plan to cut funding to UK “draconian,” said he remains hopeful about the prospect of additional appropriations, calling it a good investment for the state.

UK’s Board of Trustees extended Capilouto’s contract last summer through June 2021 and raised his annual base salary from $535,500 to $790,000. Board chairman Britt Brockman told trustees that Capilouto’s tenure had included record enrollment growth to more than 30,000 students and increases in student aid, scholarships and financial gifts, according to UK.

UK has seen a “marked improvement” under Capilouto, said Robert B. Grossman, a chemistry professor who has served as a faculty member on the trustee board since 2014.

He singled out Capilouto’s support for a bill approved by the legislature in 2013 that gave UK more flexibility to issue its own debt – paid off with university revenue, not state resources – as key to allowing the university to erect new buildings.

And Capilouto’s role in convincing UK’s athletics department to pay for two-thirds of the $100 million Jacobs Science Building was a “huge accomplishment,” Grossman said.

“That is completely unprecedented at UK and almost unheard of in the country,” he said.

Grossman said Capilouto has made faculty raises a priority, even as at times “communication has been noted as an area where he can improve in all his performance evaluations.”

The on-campus construction has been a “staple” of the Capilouto administration, said Rowan Reid, a Louisville senior who sits on the board of trustees.

The work has closed parts of campus, and some students say the construction has jolted them awake. For her part, Reid said she focuses on the big picture.

“We know that it’s just going to create a better environment for students who are attending the university after us,” she said.

Building booms, tuition rises

The bulk of the $2.2 billion in capital investment is being spent on student housing and other projects meant to improve the “quality of life” on campus.

By comparison, the University of Louisville spent $309 million on campus projects from 2012 to 2016, while Western Kentucky University completed roughly $292 million in construction from 2011 to 2016.

At UK, $422 million in housing construction is underway or completed, adding more than 6,500 beds by the fall, according to the university. EdR of Memphis, Tenn., paid for the new dorms under a profit-sharing agreement with the university.

Private donations also paid for a $65 million renovation and expansion of the Gatton College of Business and Economics building. Such gifts account for about seven percent of the new projects’ funding.

At 37 percent, university debt makes up the biggest source of funds for the capital projects, followed by private investment of 26 percent. Capilouto cited UK’s partnership with Kentucky-based Tempur-Pedic, which provided beds for new student housing, as an example of a public-private partnership.

“That’s symbolic of what these buildings were,” he said. “We partnered with a publicly-traded firm that has built tens of thousands of beds.”  

But as buildings have gone up on campus, so has tuition. From 2011 to 2016, the average annual increase in tuition and fees at UK was 4.6 percent, according to the Kentucky Council on Postsecondary Education.

For an undergraduate student from Kentucky, it costs $28,000 in tuition and other fees to attend UK during the 2016-17 school year.

Against this backdrop, UK is seeking to increase graduation rates and have fewer students leave school because they can’t afford the costs.

By 2020, UK aims to increase its six-year graduation rate to 70 percent, from current levels of 64 percent. (The six-year rate applies to students who start at UK in the fall of their freshman year.)

“The reason we want to get there is it’s going to mean more Kentuckians getting what we think is an indispensable credential,” Capilouto said.

To do that, UK wants to cut down on the number of students who leave school for financial reasons – even if they’re doing well in the classroom.

In 2016, Capilouto said, the university analyzed 900 students who didn’t return to UK after their freshman year. Of those, 300 had a grade point average of 3.0 or higher.

When compared with all other UK students with the same GPA, the main difference was what university officials call “unmet financial need” – the amount needed to afford tuition and fees.

The students who didn’t return had a gap of $6,000, on average. The students who did return had no gap.

In an effort to retain students from low- and middle-income families, UK plans to shift how it distributes financial aid in the next four years. While about 90 percent of current aid is based on students’ academic performance and other merits, by 2021 the university hopes to make 65 percent of aid based on financial need.

“There are some trade-offs with this. So, we may have fewer National Merit Scholars. I think we’ll still have a good representation,” Capilouto said. “But we hope we open our doors a little wider, both at the front end to invite students in and more importantly keep that door open wide to exit with a degree.”

State support

When the General Assembly reconvenes next week, it’s likely to consider a measure that would give the governor the ability to remove an entire university board if he decides it is “no longer functioning according to its statutory mandate.” 

Capilouto said he has read Senate Bill 107, sponsored by Senate President Robert Stivers, but declined to say if he has taken a position on it. “I certainly have some questions about it that I’ll ask people,” he said.

Attorney General Andy Beshear told the Lexington Herald-Leader in January that he has concerns that the bill could create accrediting concerns for universities. Capilouto did not directly respond to a question about Beshear’s criticism, saying only: “I think it’s wise for everybody to step back and look at a variety of ways that boards can be appointed.”

The legislature doesn’t allocate university funds this year, but Capilouto said he is “hopeful” that state support to UK will increase in the future. He noted that the university has had its state appropriation cut during two governors.

“I hope that our legislature and governor find us worthy of investment," he said. "I think investment in the University of Kentucky has a credible return.”

COMING THURSDAY: Capilouto defends UK’s lawsuit against the Kentucky Kernel student newspaper

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