At UT System, Plan to Expand KUT Moves Forward

University of Texas Chancellor Francisco G. Cigarroa during Joint Committee on Oversight of Higher Education Governance, Excellence & Tansparency on September 21st, 2011
University of Texas Chancellor Francisco G. Cigarroa during Joint Committee on Oversight of Higher Education Governance, Excellence & Tansparency on September 21st, 2011

Updated, 8/23: The full board of regents approved the revised plan, so KUT will be getting its second station.

Updated, 8/22: A revised version of the proposal to purchase a station that will allow for the expansion of KUT, a public radio station housed in the the University of Texas at Austin's College of Communication, was approved by the academic affairs committee of the University of Texas System Board of Regents on Wednesday.

If everything goes as planned, newly purchased KXBT-FM is expected to become KUTX, which will become the hub of KUT's music offerings and the current station will expand its news presence.

While the purchase of the station will still cost $6 million, the university will now only have to put in a $4 million internal loan, because $2 million in gift funds that have been raised for the project. The new proposal only calls for a 10-year internal loan from the university, as opposed to the 20-year loan originally called for in the plan that was tabled by the regents in July. The plan that is moving forward provides that if KUT fails to repay the loan, the UT System will sell the new station.

Regent Steve Hicks, who has extensive experience in the radio industry, said he had previously been concerned about the price and the length of the loan, but the reduction in both had made him feel better about the plan. Though some regents still had clear reservations.

"I struggle with how this really moves the needle in terms of students," said Regent Wallace Hall, who questioned why UT was not putting money directly into the education of students rather than auxiliary activities like the public radio station.

UT President Bill Powers responded that the university expected all of the money they put into this project to come back. "We’re not spending $4 million dollars of UT money on this," he said. "We’re loaning money to KUT." Powers also emphasized the internship opportunities at the station.

In the final vote, Hall was the sole member of the committee to oppose the proposal.

The full board is expected to approve the committee's recommendations on Thursday.

Original story:

During a Wednesday meeting, the University of Texas System Board of Regents tabled an agenda item that would allow for the expansion of KUT, a public radio station housed in the University of Texas at Austin’s College of Communication.

UT System Chancellor Francisco Cigarroa made the request to table the matter, noting that his office had received a number of unspecified questions about the proposal.

If the regents had approved the plan as laid out, UT would have been authorized to pay $6 million to acquire KXBT-FM radio from Border Media Business Trust with the intention of turning it into a public radio station with a focus on music. This would allow KUT to expand its news programming on its current station.

The plan does not call for the use of any student tuition or fees. The payment would come from reserves in the university’s unrestricted funds. The money would be repaid by KUT over 20 years with a 4 percent interest rate. If KUT were unable to raise the necessary funds, the College of Communication had agreed to repay the balance.

KUT has a strong track record of fundraising, so the university considered it a safe investment.

Following the unexpected development, which delays the decision but does not necessarily indicate that it won't ultimately be approved, UT President Bill Powers indicated that he would be happy to answer any questions that Cigarroa may have.

Cigarroa was not immediately available for comment.

We will update this story with more details as they become available.

Texas Tribune donors or members may be quoted or mentioned in our stories, or may be the subject of them. For a complete list of contributors, click here.