University of Virginia Library

The extent to which the Consolidated Endowment Fund is invested in marketable securities
(presently aggregating the sum of $5,495,674.01) is annually reported to the Board by your Committee,
and officers of its Custodian and Investment Counsel, the State-Planters Bank and Trust
Company, appear and personally review such investments in order that a full understanding may be
had by the Board of the manner in which the Endowment Fund is being handled.

So much of the Consolidated Endowment Fund as is invested in mortgage loans is not,
however, handled through the State-Planters Bank and Trust Company, but under an agreement with
The Peoples National Bank of Charlottesville, acting as Custodian and service agent. A statement
of the principal amounts of these mortgage loans and their maturity dates is attached hereto. It
will be noted that eight of these sixteen mortgage secured loans have been made to Greek-letter
fraternities having chapter houses at the University of Virginia.

Pursuant to a resolution of the Board adopted at its meeting held June 1, 1946, the
interest on all fraternity loans was reduced to 4 per cent as of January 1, 1942, and counsel for
the University was requested to work out new contracts with each fraternity upon the basis of the
balances arrived at by the application of a formula included in that resolution. Mr. Perkins has
been working steadily upon this matter, and on July 6, 1949, advised your Committee that five of
the eight loans had been refinanced in accordance with the wishes of the Board, and mortgage loan
papers reflecting the results of his efforts are now in the hands of The Peoples National Bank of
Charlottesville

As of the date of Mr. Perkins' letter, a copy of which is attached hereto as information,
new contracts had not been worked out with (1) Alpha Home Association of Chi Phi Fraternity,
(2) Delta Kappa Epsilon Corporation, and (3) Omicron Chapter House Society of Phi Gamma
Delta. Mr. Perkins advised your Committee on October 11th that he had just succeeded in completing
the refinancing of Alpha Home Association of Chi Phi Fraternity, so that there now remain
only two of these fraternity loans which have not been refinanced in the manner contemplated by
the resolution of the Board of July 1, 1946.

Mr. Perkins has had a great deal of difficulty in finding responsible representatives
of these fraternities with whom to undertake negotiations, or to have them represented by independent
counsel, since he of course cannot function in the matter except as counsel for the University.
He has been pursuing the matter vigorously, however, and your Committee hopes to be
able to report shortly that each of the eight loans now made to fraternities at the University
are in current and proper form.

Since this Committee was appointed by the present Rector on June 2, 1949, the following
loans have been approved for the account of the Consolidated Endowment Fund

(1) Charles W. Woltz, Assistant Dean of the Law School - $16,000.00. This Committee
has agreed to refinance a construction loan which Mr. Woltz will arrange with some financial institution,
to be secured by a mortgage upon the residence which he proposes to construct in
Meadowbrook Heights, just off Dairy Road, the loan not to exceed 60 per cent of the appraised
value of the property (building and grounds) after completion of the improvements, to run for a
period of not more than 15 years, to bear interest at 4-1/2 per cent, if such curtails can be
made monthly in an amount not to exceed 20 per cent of Mr. Woltz's fixed income after deducting
fire insurance premiums, taxes and any other financial obligations he may have incurred requiring
monthly or other curtails out of his income.

(2) Delta Kappa Epsilon. This fraternity borrowed $6,000.00 in 1943 and the loan has
now been reduced to $4,500.00. An increase in the loan in the amount of $3,000.00 has been approved
by your Committee, making a total loan obligation of $7,500.00, provided curtails in the
amount of $100.00 per month, with accrued interest, are made during each of the nine months of
the college year. The fraternity house is insured for $25,000.00 and your Committee is informed
is probably worth considerably in excess of that amount. The increase in the loan is to be used
to make necessary repairs on the fraternity house.

Your Committee reluctantly and regretfully declined the application of Francis L.
Berkeley, Jr., a Professor at the University. Professor Berkeley requested a loan of $14,000.00
to complete the construction of a residence he had been building at 1927 Thomson Road, at an estimated
cost of $20,375.00. Your Committee felt that Professor Berkeley's equity in the property
was not sufficient and that his earning power and probable ability to amortize the loan over a
reasonable period of time had not been sufficiently shown, to warrant the making of a loan to him
in the amount requested.