By Dane Huffman – Managing Editor, Triangle Business Journal

Managing Editor Dane Huffman with Triangle Business Journal talks with Chancellor Lee Roberts of UNC-Chapel Hill. Roberts took the helm as interim chancellor in early 2024 after Kevin Guskiewicz left to lead Michigan State University. The interim tag was officially dropped in August, and Roberts is now tasked with leading the prominent university in an era when the dynamics of higher education are changing fast and the future of key funding sources remains unclear.

Q&A excerpt

Dane Huffman: So you said once that one of the things about finance and one of the things that you loved about budgets in particular is that budgets really help you set priorities, right? And how has that sort of helped you think about your role there at Carolina?

Lee Roberts: You’re right. You know, I was honored to serve as state budget director under Gov. (Pat) McCrory. And then I taught for the last few years before stepping into this role, a class in public budgeting to graduate students in public policy over at Duke.

And so I think that experience has certainly served me well here. We’ve got a $4.2 billion budget here at Carolina. We’re spending a lot of taxpayer money and a lot of other people’s money as well — our tuition dollars, our grant dollars. And we want to be good stewards of that money.

Resources are always finite. We want to make sure we’re using our inherently scarce resources as effectively as we possibly can. So having strong budgeting expertise and understanding to me is crucial.

Dane Huffman: So you’ve talked about expanding the student body at Carolina. How do you handle that. How do you provide classes?

Lee Roberts: Everyone who lives in North Carolina knows how quickly our state is growing.

And Carolina hasn’t grown very much, as you say. So every year we enroll a decreasing percentage of North Carolina’s high school graduates. We used to be around 5 percent. Now we’re closer to 3 percent. And if we stay flat as the state continues to grow very rapidly, that that percentage will continue to go down.

And it’s worth asking the question as the University of North Carolina, as a school that was founded to serve the people of this state — that’s our core mission — don’t we have an obligation to grow at least somewhat to reflect the state’s explosive growth?And so we set up a working group to look at this last year — trustees, faculty, staff, alumni students — and they recommended that growth of 5,000 students. So its material growth, an increase of 25 percent in the undergraduate student body, but over a 10-year period, which is about as fast as we can do it given the inherent constraints. There are challenges for our facilities, as you say, for faculty workload for our infrastructure for the town of Chapel Hill, and we’ll continue to work through those were jump starting the growth plan by admitting 500. More students in the freshman class that we’re admitting right now.

And we’ll continue to work towards that overall growth of 5,000 students over the next 10 years.

Dane Huffman: Franklin Street is the historic heart of Chapel Hill. It was far more say vibrant decades ago than it has been. Tell me about Carolina’s plans for that area.

Lee Roberts: So it’s a complex challenge, and it’s driven by some factors that apply much more broadly than just to to Chapel Hill.

Obviously, the use of retail real estate is changing pretty fundamentally for college students. The way in which they consume and access goods and services have changed dramatically. My wife and I have two kids in college now and one who just graduated. They’re as likely to have food delivered or have most things delivered, for that matter, as they are to go out to eat. That’s a significant change from earlier generations that impact of those changes on Franklin Street.

We’ve built, I think, a really good partnership with the mayor, Jess Anderson, who’s been terrific to work with, and the Chamber of the Town of Chapel Hill, Aaron Nelson, and his team. We really want to work together to make sure that the Chapel Hill generally and Franklin Street in particular are as vibrant as possible, which is obviously in everyone’s interest, in particular around Porthole Alley. The university actually owns the frontage on both sides of Porthole Alley there, and what we’d like to do is expand the Ackland Art Museum, giving them much needed additional exhibition space while creating an entrance to the museum on Franklin Street, which will be great for the Ackland, great for the university, and I think great for Franklin Street and the town of Chapel Hill, because that would be a really important demand driver, a really important and attractive use there on Franklin Street, which should bring significantly more street traffic.

Dane Huffman: So would you still put the undergraduate admissions office there?

Lee Roberts: Our thought for undergraduate admissions, which is currently in Jackson Hall, is to put that into a renovated alumni center, the George Watts Hill Alumni Center over by the football stadium. Our thought is to move the admissions office over there where we have plenty of parking and plenty of space.

And so we’re on the early stages now of designing that project.

Dane Huffman: So when I’m on Franklin Street, there are lots of Bill Belichick shirts, lots of interest in the football program. Tell us about why this is important to the school.

Lee Roberts: Football drives the bus. So North Carolina makes more money from basketball than most schools do — really more than almost any other school does. So men’s basketball remains very important as a revenue driver for us, as well as all of our legacy and tradition.

We don’t have a more important sport here, of course, than basketball. But when you look at the growth of viewership and the concomitant growth in revenue, football is really in the driver’s seat. That makes a huge difference to the rest of our, what we’re able to do across the athletic department, across all 28 of our intercollegiate sports.

Dane Huffman: With basketball, you’re evaluating the Smith Center’s future. What’s the timeline for that?

Lee Roberts: One thing I always stress when this topic comes up is that the status quo is not an option. Sometimes people ask me, ‘Why are you even talking about this? What’s wrong with the Smith Center?’ The answer is that the Smith Center at a minimum needs a new roof, which costs $80 million to a $100 million to not improve any of the other challenges with the Smith Center. …

That’s true with any building, but as we come up on some really significant capital investment for the Smith Center, you have to ask the question of whether this is the right long-term home if you look out the next 50 years for a basketball program, and that requires stepping back and saying, ‘How much would it cost not just to fix the roofs, but to address some of the other things that are a little more outdated?’

Dane Huffman: Could you see a scenario where you’d move it to where the Friday Center is or somewhere off campus? Or do you want to keep it on campus?

Lee Roberts: If we were to move the basketball arena to a location away from the central core of campus, we wouldn’t put it in the middle of surface parking lots with nothing else around. It would be part of a broader mixed-use development program, as you’ve seen in several other venues across the country with multiple uses, including lodging, retail, entertainment and dining.

And I’ll tell you that would be a significant improvement on the Smith Center location. So it is walkable for a lot of the students, but there’s nowhere to get a bite to eat before the game, there’s nowhere to grab a beer after the game. And as, as you’ll remember when the location was first identified, people thought moving to the Smith Center was the back of beyond. And then we’re moving out of the central core where Carmichael and Woollen Gym are, where basketball had been played for decades.

So these things evolve and change, but we want, wherever we play, we want it to be a, a vibrant location with a lot going on.

Dane Huffman: In that Smith Center area, can you make what you’re talking about work in that space?

Lee Roberts: It’s more challenging in that space than in some of the other locations that have been talked about. So everyone knows how tough it is to get out after a game and the challenges we have with parking. And part of that’s inherent to the site. Part of it’s the proximity to the hospital, which limits what we can do with traffic and with parking.

And if you look out over the next 50 years, one eternal principle of real estate is that hospitals only grow up and they always need more land and they always want more of the land around them. And if you think about the proximity of our hospital to the Smith Center and you think about taking a long-term perspective, that’s an important factor to be considered.

Dane Huffman: Then if you had to move the Smith Center somewhere that was still accessible for students in some way, does the Friday Center make the most sense for the type of complex you’re talking about?

Lee Roberts: There are a couple of locations that have been identified and that’s one that’s been talked about.

In addition to the Friday Center is the old airport site — Carolina North. Half of our students live off campus and a lot of them live up MLK (Martin Luther King Jr. Boulevard) towards that location. And it’s only 1.6 miles from that intersection to Columbia and Franklin. It’s 1.3 miles from Columbia and Franklin to the Smith Center, which isn’t maybe as commonly perceived, but the distances are broadly similar or maybe more similar than people might realize. And the town just got federal funding to run bus rapid transit down MLK from that airport site back down to Franklin Street.

And obviously the access to Interstate 40 from that location is much better than what we have right now. So that’s another site worth considering.

Dane Huffman: Chancellor, is there anything I didn’t ask you that you wanted to address?

Lee Roberts: One thing that we’re spending a lot of time on is artificial intelligence. So it’s arguably the most important technological development of our careers. We’re a leading global research university. We have a responsibility to develop a really robust strategy around AI research. We can’t be all things to all people. So we need to place our again, inherently finite research dollars in areas where we’re already doing things that are differentiated, that are cutting edge and importantly, where we have teams who are going to be able to execute. So we’re working on that now. And we also believe AI holds tremendous promise internally.

We have a large, complex, decentralized organization and AI should, at least on paper, help our enterprise run more effectively, more efficiently. So we’re spending a lot of time, energy and resources on it. We look forward to being able to say more about how we’re going to undertake cutting edge AI research, as well as deploy it internally here as we have future conversations.

Listen to the entire interview here.

The preceding article originally appeared on February 20, 2025 on the Triangle Business Journal’s website and is made available here for educational purposes only. This constitutes a ‘fair use’ of any such copyrighted material as provided for in Title 17 U.S.C. section 106A-117 of the U.S. Copyright Law. Any views or opinions expressed here are those of the authors and do not necessarily reflect the official policy or position of the Carolina Leadership Coalition. Photo of Chancellor Lee Roberts by Jon Gardiner, University Communications at UNC Chapel Hill.