Report of the 

 Board of Regents 



Secretary Heyman and the Regents' committees contributed 

 substantially to the Board of Regents' accomplishments at its 

 three meetings on January 26, May II, and September 14, 

 1998. At the September meeting, the board voted to designate 

 Esteban E. Torres as a Regent Emeritus, with all the rights 

 and responsibilities thereof, effective upon his retirement from 

 the U.S. House of Representatives. 



The Regents continued their practice of meeting as a 

 Committee of the Whole on the afternoons preceding each 

 meeting. In these sessions, they reviewed selected museum 

 operations and advisory board activities, consulting with the 

 directors and board representatives of the Freer and Sackler 

 Galleries, the National Museum of the American Indian, and 

 the National Museum of American History. In addition, the 

 Regents discussed in depth such issues as Smithsonian 

 capital campaign planning, Smithsonian business 

 initiatives, and strategies for fulfilling facilities needs. Out 

 of these discussions, the Regents authorized undertaking a 

 national fund-raising campaign, establishing a special business 

 organization within the Smithsonian, and appointing an ad 

 hoc Committee on Facilities. 



The Audit and Review Committee met three times during 

 the year and continued to exercise its primary responsibility 

 for oversight of the Smithsonian's financial operations. The 

 committee discussed KPMG Peat Marwick's report on fiscal 

 year 1997 transactions and considered the Smithsonian 

 Inspector General's semiannual reports to Congress. The 

 committee also considered a study on enhancing business 

 activities, reviewed cash management and pledge collection 

 policies and procedures, and discussed both Year 2000 

 computer problems and the Regents' policy on the rotation 

 of independent auditors. 



The Investment Policy Committee also met thtee times. 

 The committee monitored rhe investment managers' 

 development of the Institution's endowment, rebalanced the 

 portfolio, and evaluated the managers' performance. In 

 addition, the committee recommended a rotal-rerurn payout 

 rare for fiscal year 1999 and proposed a plan for meeting the 

 financial needs of the first two years of the Smithsonian's 

 capital campaign out of endowment funds. The Regents 

 appointed Smithsonian National Board vice-chair Frank A. 

 Weil to the Investment Policy Commirtee, and the committee 

 was saddened by the passing of its member Thomas Keresey. 



Ar each of their meetings, the Regents considered 

 comprehensive financial reports. They approved the trust and 

 federal expenditures for fiscal year 1999 and the request to the 

 Office of Management and Budget for fiscal year 2000 

 appropriations. 



The Regents also discussed how exhibition topics are 

 selected and developed at the Smithsonian and were briefed 

 on the Institution's highly respected security operations that 

 safeguard collections and people. 



Through the Secretary's reports at theit meetings, the 

 Regents were informed abour the design and implementation 

 of a uniform visual identity for the Smithsonian. In 

 accordance with the new institutional logo, the Regents 

 adopted a new seal effective August 10, 1998. The Secretary's 

 reports also informed the Regents about the Star-Spangled 

 Banner Preservation Project and the difficulties emanating 

 from the contract for architectural services for the National 

 Museum of the American Indian. Under the Secretary's 

 initiative, congressional members of the board supported 

 legislation to gain coverage for the Institution under Title VII 

 of the Gvil Rights Act, the Rehabilitation Act, and the Age 



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