October 14, 2004
TO: Sheila Stearns
FROM: Rod Sundsted
Associate Commissioner for Fiscal Affairs
SUBJECT: Board Retreat – Issues for Consideration
You asked that I prepare a list of the primary issues for which guidance is needed by the Board to make planning responsive to their direction and vision. The issues below are provided in response to your request.
Lump Sum Funding – Allocation to the Campuses
The current model used to allocate the lump sum appropriated to the Regents was developed in 1994 in response to the financial plan envisioned during restructuring. However, much has changed since 1994. While the model has been adjusted regularly it is not directly linked to Board priorities for the MSU. The consensus seems to be that the allocation model needs to be significantly revamped. Direction is needed from the Board to begin planning for the development of a new or significantly changed system of allocating funds. Examples of questions that need to be answered include:
· What are the fundamental objectives to be achieved by the allocation?
· Should funds be directly tied to enrollment resulting in short-term volatility but immediate rewards or is funding stability an objective?
· The current allocation model is driven by institutional characteristics and resident enrollment. Non-resident students and non-resident tuition are a significant factor in the financial health of a campus. Should tuition, resident and/or non-resident be a consideration in the allocation?
· What is the Board’s desire regarding tuition differential? Is there an expectation that students pay a different percentage of the cost of their education based on the institution they are attending? If so, this needs to be a factor in the allocation.
· Should a base funding level be established for each campus that insures they can provide a quality education, maintain their facilities, and provide adequate support for students?
System-wide Data Management
The student records data warehouse is the only system-wide data management system available to the Board. Due to limited resources and funding the student data warehouse has never been utilized to it’s potential and the original plan to expand the data warehouse to include system-wide finance, financial aid, and human resource data has not taken place. As a result, most requests for system-wide data are collected on a manual ad hoc basis. As a result, this data is more susceptible to errors and inconsistencies in the data generated. In addition, other states are now expanding data management to include employment data and social services data to better measure the effectiveness of programs.
· Is the Board satisfied with the data available when making decisions and governing the MUS?
· What data that is not readily available would be most helpful to the Board?
· Each university develops internal data systems based upon their priorities, needs, and resources available. Does the Board wish OCHE to take a more prominent role to assure all data systems must be developed and implemented system-wide?
Human Resource Management
Human resource issues are generally managed at the campus level within broad policies established by the Board. This frequently results in inconsistencies among campuses in the application of various personnel policies and practices. The lack of consistency can create the potential for future liability in some instances. For example:
· An administrative/professional position on one campus may be paid significantly more than an individual who hold a position similar or identical to that individual on another campus.
· Positions that are classified on one campus may be a Regents contract professional on another campus raising concerns of equity and fairness.
· Employment instruments, such as Letters of Appointment, are utilized for varying purposes and for different types of employees depending on the campus. This raises the potential for salary inequity among similar positions and may also circumvent recruitment and selection procedures.
Campus management autonomy conflicts at times with a system-wide perspective on equity and personnel decisions. While the MUS is considered one employer, campuses desire maximum flexibility in issues of personnel management.
· What is the Board’s desire regarding the role of OCHE in human resource issues?
· Does the need for campus flexibility outweigh the risks and inequities resulting from varying campus practices?