Report on 21 June Meeting of the Board
Senators,
I'm appending my report on last Friday's board meeting for your information.
You might want to look at the summaries of the letter from the presidents
to the strategic planning committee and of President Risser's presentation
as these will give you some idea of what's being proposed in the way of
"decentralization" - something we discussed at our June meeting.
If you have comments on these, let me know. I'm not yet sure whether
I'll be able to attend the July 18th retreat on strategic planning but
will try; these ideas will be discussed more fully there and I'd be happy
to present any faculty perspectives on decentralization if you have any.
Since IFS won't meet before then, I can't make a presentation on IFS's
behalf but I can mention things I've heard from individual faculty.
I'm headed north for some sailing in Canada this coming weekend.
Have a pleasant summer.
Elaine
Report on Board Meeting 21 June 2002
The Board met at Portland State for what was to be a half-hour meeting
but which ended up being an hour and half. Previous to the actual board
meeting, both the System Strategic Planning and Budget/Finance Committees
held meetings. I attended the very brief strategic planning committee meeting
where an update on the planning process was given and a July 18 date for
an all-day planning retreat was set. The budget and finance committee meeting
accepted a staff-recommended rewritten policy on FCC licenses within the
system, okayed the 2002-03 nonresident and graduate tuition rate adjustments
and heard a report on the state of the budget at OSU which is apparently
in good shape at this time.
As is the usual order of these meetings, the two committees then met
as the Joint Budget & Finance and System Strategic Planning Committee.
During this meeting, President Frohnmayer presented a letter from all the
institution presidents to the System Strategic Planning Committee. The
presidents asked the Board to consider several specific actions and recommendations
(and I quote from the letter):
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Greater flexibility to increase and use non-state revenues
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The ability to operate more efficiently
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The ability to increase entrepreneurial activity
To achieve these, the presidents requested that changes be made in governance,
financing and regulation of the system, which they listed as:
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institutions will manage enrollment according to the resources available
to them
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institutions should be able to individually set tuition and fees and grant
fee remissions
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access will be ensured by institutionsÕ meeting the full financial
need of its students with financial aid
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limits on expenditures of non-state funds should be eliminated
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bonding restrictions for non-general fund obligation bonds should be eliminated
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institutions should have the ability to expand programs to meet market
demands and academic priorities within available resources
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personal information on donors should be protected
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develop greater flexibility for using private funds
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institutions should retain all interest earnings on funds deposited with
the state
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institutions should have full authority in purchasing, contracting, IT
and telecommunications decisions
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legislative approval for and state regulations on construction projects
should be eliminated when neither construction nor operation of a building
is from state funding
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institutions should be able to buy, hold and sell real and personal property,
purchase insurance above state self-insurance and hire legal counsel
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institutions should have full management responsibility for legal and financial
issues related to contracts and grants, research and technology transfers
and intellectual property rights
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institutions should be allowed to develop employee insurance and retirement
programs that differ from those offer to other state employees and
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each institution should be able to establish its own board of trustees
to meets its needs.
The letter concludes by saying that details must be worked out and that
these suggested changes should be discretionary as not all institutions
may want to embrace all changes.
President Risser also made a presentation on the relationships among
university interests, state government interests and market interests and
the role the system plays in balancing these interests. He offered a set
of system design changes to achieve the best balance that includes university-governing
boards that would oversee each institution and delineates the role of the
Board and the ChancellorÕs office.
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University governing boards would
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appoint the university president with OUS concurrence
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approve university E & G and capital budget requests to OUS
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approve university budgets
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approve academic programs
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set tuition and fees
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identify performance standards
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manage legal, purchasing and contracting processes
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manage research and intellectual property and
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manage financing and construction of capital projects á The Board
and ChancellorÕs office would á codify the disti8nctive university
missions á negotiate E & G and capital budgets with the state
á audit universities á supply requested data, information
and policy analyses á evaluate the performance of each university
and á advocate for higher ed.
The main item of business at the joint meeting was to approve a set of
budget priorities for 2003-05 so that staff in the ChancellorÕs
office can build that budget within the guidelines set by the Board. Interestingly,
the Department of Administrative Services (DAS) requires preparation of
a budget and also preparation of budgets showing 10%, 20% and 30% cuts
from that budget.
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Vice Chancellor Anderes reviewed the BoardÕs priorities set at the
inception of RAM:
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access to qualified Oregonians
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quality educational programs at all campuses
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cost-effective operations and
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employable graduates.
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He summarized the budget priorities for the current biennium:
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preserve the current service level
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quality educational programs
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expand access to all qualified resident undergraduates and
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contribute to the current needs of the state and its communities.
He noted that the institutions also had a set of priorities for this biennium
which he broke into two categories: funding priorities and organizational
priorities.
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Among the former are
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funding at the median of peers
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ensuring adequate regional university funding
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seeking adequate state support for healthcare costs and
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managing enrollments to address market demands but within budgetary limitations.
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Organizational priorities included
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seeking greater autonomy and
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increasing university flexibility in choosing OUS services.
Conditions that challenge OUS and at the same time provide some opportunities,
according to Anderes, involve:
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enrollment demand growing beyond funding capacity
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state funding support per FTE declining
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institutions accommodating growth based on annual budgetary boundaries
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tuition increasing under parameters set by each institution to complement
state funding and
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quality concerns becoming a function of each institutionÕs funding
and growth strategy.
Finally, Vice Chancellor Anderes proposed a set of priorities for 2003-05,
broken broadly into 4 categories:
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meeting existing demand for quality programs
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meeting future demand for quality programs
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responding to state needs and
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mission specific requirements.
He expanded briefly on each. These would be the needs addressed by the
dollar figures submitted to DAS in September.
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Under meeting existing demands
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fund unfunded growth from 2001-2003
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balance funding requirements with campus enrollment strategies
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support operational commitments Cascades Campus, debt service, new building
maintenance, inflation etc.
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Under meeting future demands
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support projected growth for 2003-05
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support faculty and staff salary/benefit adjustments
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support performance funding
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Responding to state needs includes
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continue investing in engineering
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address state economic development initiatives
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Mission-specific requirements involve
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sustaining research
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maintaining public services
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maintaining key partnerships
Costs attaching to these priorities could run up to $200 M which, I think,
no one believes OUS could expect. More careful funding estimates will be
developed before the July Board meeting when the budget will be finalized.
A fair amount of discussion followed among the Board members. Bill Williams
sought an explicit entry showing ÒnegativeÓ funding for expense
management efforts in support of the Òcost-effective operationsÓ
priority as there is no easy way to see where that priority is being addressed.
John Moseley (UO provost) commented that there are no more expense management
efforts to be made at UO that wonÕt cut programs theyÕve
made all the Òaround-the-edgesÓ cuts they can. Director Wustenberg
reiterated what sheÕs said before: budget priorities should be focussed
on studentsÕ education; if funding is tight, then things like meeting
state economic development efforts and funding public services should be
curtailed. Finally, the Board agreed to the proposed priorities with the
caveat that they could change them when they saw actual figures suggested
for each at the July meeting. Informational presentations on the effects
of tuition increases and financial aid in Oregon and on the capital construction
budget followed. The Board wanted the information on tuition and financial
aid to help in determining what tuition increases will be sought; most
institutions have set proposed tuitions for 2002-03 which will be ratified
at the July meeting. Because some of the increases exceed the 3% maximum
set by the legislature, requests will have to go to the E-Board. The capital
construction budget a request separate from the instruction/other priorities
request falls into four categories: projects to support education, auxiliary
projects, student-fee projects and systemwide projects. The request for
2003-05 is about $1,100,000 of which just over 50% would come from the
state and the remainder from the individual institutions, through bonds
and other sources. The OUS is also seeking legislative authority to ask
voters to approve $500 million in bonds to cover deferred maintenance.
The regular Board meeting got underway nearly an hour and a half late (and
ended a few minutes early because of a fire alarm in the building). The
board accepted the nominating committeeÕs slate of officers for
2002-03: Jim Lussier will be the president and Leslie Lehman will be the
vice-president. Roger Bassett will chair the System Strategic Planning
committee and Don VanLuvanee and Bill Williams, the Budget and Finance
Committee. It was announced the Geri Richmond has been reappointed to the
Board and that Ian Ruder, a student at PSU, will replace Tim Young as a
student member. The Board ratified the actions of the earlier Joint Committees
meeting and the actions taken by the Executive Committee in May pro forma
for the Board. Two people offered input during the public input portion
of the meeting the first time since IÕve been attending Board meetings.
Both urged the Board not to delay the implementation of the PASS (Proficiency
Based Admissions) or to make these standards merely added support for admissions.
At its February meeting, the Board decided to delay making PASS a requirement
for admission in 2003-04; meeting those standards would just be an enhancement
to a studentÕs application. The speakers indicated that such standards
are needed to bolster high schoolsÕ demands for higher performance
from students. Moreover, a great deal of time and effort have been invested
in developing the standards and training teachers to assess students against
those standards; that effort shouldnÕt be wasted, the speakers said.