Montana Board of Regents of Higher Education

MINUTES

September 18-19, 1997

Lewis and Clark Room, Student Union Building

Montana State University--Billings

1500 North 30th Street

Billings, Montana

Approved unanimously at the November 20-21, 1997 meeting.

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ACADEMIC/STUDENT AFFAIRS COMMITTEE

ADMINISTRATIVE/BUDGET COMMITTEE

REGENTS PRESENT: Jim Kaze (Chairman), Pat Davison, Paul Boylan, Ed Jasmin, Jason Thielman, and Margie Thompson; Commissioner of Higher Education Richard Crofts

REGENTS ABSENT: Colleen Conroy (Excused)

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THURSDAY, SEPTEMBER 18, 1997

Chairman Jim Kaze called the regular meeting of the Board of Regents to order at 11:00 a.m. Roll call showed a quorum was present.

Chairman Kaze said approval of the minutes from the July 10-11, 1997 meeting would be deferred to the November 20-21, 1997 meeting in Bozeman.

At the request of George Dennison, President of The University of Montana, Chairman Kaze said action on the Consent Agenda would be deferred to the following day's session.

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COMMITTEE REPORTS

ACADEMIC AND STUDENT AFFAIRS COMMITTEE

The Academic and Student Affairs Committee met at 9:00 a.m. in the Ralston Room of the Student Union Building at Montana State University--Billings. Regents present included Pat Davison (Chair), Paul Boylan, Jason Thielman, and Margie Thompson. Chairman Kaze asked Regent Davison to present the committee's report to the full Board.

ANNOUNCEMENTS

The following Level I changes were approved by the Commissioner's Office (September 17, 1997 memorandum from Stuart Knapp, Deputy Commissioner for Academic Affairs, on file):

a. The University of Montana--Missoula

A proposal for a self-support M.Ed. Program, offered off campus, in Education Leadership for students from Taiwan. This program requires no state funding and has the approval of the Dean of the School of Education as well as the Department Chair and faculty members of the Educational Leadership Department.

A proposal to change the name of the "Center for Cooperative Education" to the "Center for Work-Based Learning."

b. Montana State University--Bozeman

A proposal to change the name of the "Department of Sociology" to the "Department of Sociology and Anthropology."

SUBMISSION AGENDA

a. ITEM 18-002-R1077--Admission Requirements: General Policies; Montana University System (REVISED 301)

b. ITEM 27-009-R0680--Transfer of Credits; Montana University System and Community Colleges (REVISED 301.5)

c. ITEM 18-006-R1077--High School Honor Scholarships (REVISED 501.1); ITEM 18-006-R1077--Community College Honor Scholarships (REVISED 501.2); and ITEM 18-005-R1077--Fee Waivers; Montana University System (REVISED 940.13)

Regent Davison briefly reviewed Items a., b., and c., which were submitted as Notices of Intent at the July 10-11, 1997 meeting. He said they were revisions to current Board of Regents' policies that were primarily housekeeping changes reflecting today's environment and change in clientele.

Following brief discussion, the Board concurred with the committee's recommendation to move Submission ITEMS 18-002-R1077, 27-009-R0680, 18-006-R1077, and 18-005-R1077 to the Action Agenda at the November 1997 meeting.

Regent Davison briefly reviewed the following submission items, which were submitted as Notices of Intent at the July 1997 meeting:

a. ITEM 96-1604-R0997--Approval of Proposal to Change the Title of the Bachelor of Liberal Studies (B.L.S.) Degree to a Bachelor of Arts (B.A.) Degree; Western Montana College of The University of Montana

b. ITEM 96-2001-R0997--Authorization to Change the Curriculum of the Medical Laboratory Science Option in the Department of Microbiology to a 3 + 1 Program in an Affiliation Agreement with the University of North Dakota (UND) at Grand Forks, North Dakota; Montana State University--Bozeman

c. ITEM 96-2701-R0997--Authorization to Implement the Performance Option within the Bachelor of Arts Major in Music; Montana State University--Billings

d. ITEM 96-2702-R0997--Authorization to Offer a Bachelor of Science and Bachelor of Arts in Environmental Studies; Montana State University--Billings

e. ITEM 96-2703-R0997--Authorization to Offer a Minor in Environmental Studies; Montana State University--Billings

f. ITEM 96-2704-R0997--Authorization to Offer a Bachelor of Science in Health Promotion; Montana State University--Billings

g. ITEM 96-2705-R0997--Authorization to Establish a Regional Research Center and Cultural Archives entitled "The Center for the Northern Plains"; Montana State University--Billings

Following brief discussion, the Board concurred with the committee's recommendation to move Submission ITEMS 96-1604-R0997, 96-2001-R0997, 96-2701-R0997, 96-2702-R0997, 96-2703-R0997, 96-2704-R0997, and 96-2705-R0997 to the Action Agenda at the November 1997 meeting.

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Regent Davison said Provost Robert Kindrick from The University of Montana--Missoula wanted to make an announcement to the Board.

Provost Kindrick said Dr. Tom Waring was leaving his position as Vice Chancellor at Montana Tech to return to teaching and research. Provost Kindrick asked that the following statement be entered into the record:

As Vice President and Vice Chancellor of Montana Tech of The University of Montana, he [Tom Waring] has served this system with distinction. He has been a forceful representative of the interests of his campus. However, simultaneously he has been a loyal supporter of this system, never compromising his campus' interests but always recognizing the broader needs of the Montana University System. He has forged joint programs and excellent alliances with numerous campuses throughout the state, both those of The University of Montana and Montana State University.

Whereas Dr. Waring is leaving his position as Vice Chancellor to return to a full-time career in teaching and research, I should like to request that this Board recognize his distinguished service to the Montana University System and acknowledge his contributions both at this meeting and in the minutes of the Board of Regents. Thank you for your consideration of this request.

Chairman Kaze said the Regents appreciated Dr. Waring's work and wished him well in his return to a teaching career.

Chairman Kaze thanked Regent Davison for the Academic and Student Affairs Committee report.

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Administrative/Budget Committee

SUBMISSION AGENDA

a. ITEM 18-005-R1077--Fee Waivers; Montana University System (Policy 940.13 REVISED)

Regent Jasmin said the revision to ITEM 18-005-R1077 created a fee waiver for surviving dependents of Montana National Guard members. The change implemented the provisions of Chapter 41, Laws of 1997, which was passed by the legislature with the support of the Montana University System.

b. ITEM 96-002-R0997--Employee Travel; Montana University System (NEW)

Regent Jasmin said ITEM 96-002-R0997 was a new Board policy that outlined the criteria employees must meet in order to be reimbursed for the actual cost of out-of-state (or foreign) lodging.

c. ITEM 96-003-R0997--Use of Interest Earnings in Excess of the Anticipated Level; Montana University System

Regent Jasmin said ITEM 96-003-R0997 was proposed by Regent Thielman to place excess interest earnings in a designated account to be used to fund the Montana Tuition Assistance Program (MTAP) or other student assistance as determined by the Board.

Regent Jasmin said the item would be redrafted before the next meeting by Regent Thielman and the Commissioner's Office to address questions and concerns raised during the committee's discussion.

d. ITEM 96-004-R0997--Repeal of Certain Policies from the Montana University System Policy and Procedures Manual; Montana University System

Regent Jasmin said ITEM 96-004-R0997 would repeal Board policies 920, 940.14, 940.17.2, 950, and 1003.1, which were out-of-date and no longer necessary.

Following brief discussion, the Board concurred with the committee's recommendation to move Submission ITEMS 18-005-R1077, 96-002-R0997, 96-003-R0997, and 96-004-R0997 to the Action Agenda at the November 1997 meeting.

CONSENT AGENDA--ACTION

a. ITEM 96-1901-R0997--Certificate of Completion, Student Union Addition, Series B 1995 Facilities Improvement and Refunding Revenue Bonds; Helena college of Technology of The University of Montana

b. ITEM 96-2005-R0997--Authorization to Expend Student Computer Fees; Montana State University--Bozeman

Regent Jasmin moved that the Board concur with the committee's recommendation to approve ITEMS 96-1901-R0997 and 96-2005-R0997 on the Consent Agenda--Action. The motion passed unanimously.

ACTION AGENDA

a. ITEM 96-1601-R0997--Authorization to Increase the Student Insurance Fee; Western Montana College of The University of Montana

Regent Jasmin said ITEM 96-1601-R0997 would authorize Western Montana College of The UM to increase the student insurance fee from $440 per year to $452. This would be charged at the rate of $166 for fall semester and $286 for spring semester.

Regent Jasmin moved that the Board concur with the committee's recommendation to approve ITEM 96-1601-R0997. The motion passed unanimously.

b. ITEM 96-2003-R0997--Authorization to Adjust the Scope of the Brick Breeden Fieldhouse Renovation; Montana State University--Bozeman

Regent Jasmin said ITEM 96-2003-R0997 would authorize Montana State University--Bozeman to adjust the expenditure of funds from the Series 1996 bond indenture to accommodate an additional $1.6 million needed for the Brick Breeden Fieldhouse Renovation Project. The additional amount would be funded from interest earnings on the original Series 1996 bonds and from any excess proceeds remaining after completion of other bonded projects.

Following brief discussion, Regent Jasmin moved that the Board concur with the committee's recommendation to approve ITEM 96-2003-R0997. The motion passed unanimously.

c. ITEM 96-001-R0997--Operating Budgets 1997-98; Montana University System

Regent Jasmin summarized the committee's discussion of ITEM 96-001-R0997 and reviewed the information included with the item. He then asked Associate Commissioner for Fiscal Affairs Rod Sundsted to review the four graphs (on file) presented to the committee that depicted historical data and a general overview of (a) Program Expenditures-Percentage of Total Budget; (b) Educational Units-Sources of Funding; (c) Expenditures Per Student-Current Unrestricted; and (d) Enrollment History.

Following discussion, Regent Jasmin moved that the Board concur with the committee's recommendation to approve ITEM 96-001-R0997 exclusive of the budget for Flathead Valley Community College. The motion passed unanimously.

Regent Jasmin thanked Rod Sundsted and Laurie Neils, Director of Accounting & Budget, for their work in preparing the operating budgets. Rod Sundsted said he also wanted to thank all the campuses for their efforts in putting the budget book together.

d. ITEM 96-1902-R0997--Purchase of Property, 2300 Poplar Street, Helena, Montana, Sky Supply Building, Owned by the Helena Airport Authority; Helena College of Technology of The University of Montana

Regent Jasmin said ITEM 96-1902-R0997 was an addition to the agenda that would authorize the Helena College of Technology of The UM to take the steps necessary to purchase the property located at 2300 Poplar Street in Helena. The purchase price for the property, including the building and land, was $42,000.

Regent Jasmin moved that the Board concur with the committee's recommendation to approve ITEM 96-1902-R0997, noting this was only approval of authority to proceed. The motion passed unanimously.

The Board recessed at 12:00 noon for a luncheon/meeting with student representatives.

The Board reconvened at 1:40 p.m.

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COMMITTEE REPORTS (continued)

a. Flathead Valley Community College Budget

Commissioner Crofts said there were some ongoing differences of opinion regarding the Flathead Valley Community College's operating budget for the coming year, which was why it was excluded from the action taken that morning on ITEM 96-001-R0997. He said representatives from FVCC and Lincoln County spent most of the morning in discussions, and the issue had been tentatively resolved. That tentative agreement would be presented to the FVCC Board of Trustees September 29, 1997. Commissioner Crofts recommended the Regents approve the FVCC budget as presented in ITEM 96-001-R0997, with the exception of the breakdown of the budget allocation between the FVCC and Lincoln County campuses. He said he was pleased the two parties were able to come to a tentative agreement.

Regent Jasmin moved that the Board approve Flathead Valley Community College's operating budget (excluded from ITEM 96-001-R0997 previously approved) as presented with the exception of the breakdown of the budget allocation between the FVCC and Lincoln County campuses. The motion passed unanimously.

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OLD BUSINESS

a. Senior Administrative Position Descriptions

Commissioner Crofts referred to the committee established at the July 1997 meeting comprised of Regents Jasmin, Thielman, and Thompson. The committee's purpose was to work with the Commissioner's Office to look at the Board's policies, beginning with position descriptions. Commissioner Crofts said he visited with the committee and the university presidents and was presenting a draft position description for the presidents for the Board's review. He said no action was needed at that time but some discussion might be appropriate. He also suggested they consider removing position descriptions from the Board's policy and procedures manual. With the Regents' concurrence, Commissioner Crofts would come back in November with a proposed policy revision that would deal with the presidential position description and position descriptions for other senior administrators in the system. The position descriptions would be maintained in the Commissioner's Office and reviewed and approved periodically by the Regents.

Commissioner Crofts referred to the last "bullet" on page 3, proposing each year a statement of long- and short-term goals and objectives be approved by the Commissioner and reviewed by the Regents. That would be folded into an evaluation process with expectations the presidents and chancellors would follow a similar pattern with the individuals who reported directly to them.

Montana State University President Michael Malone said the document was a good, all-encompassing document that covered the range of new duties the presidents had been asked to assume since the restructuring.

In response to a question from Regent Davison about the relationship with the community colleges, Commissioner Crofts said the bullet at the top of page 2 could be clarified. "Other campuses" could be changed to indicate not only the community colleges but also the tribal and independent colleges and the K-12 community.

Commissioner Crofts said as part of the next stage they would begin to look at position descriptions for the chancellors, which would be similar to those of the presidents with some obvious changes due to restructuring.

In response to a question from Regent Boylan, Chairman Kaze said the position descriptions would serve as an effective way to measure performance when evaluations were conducted.

The University of Montana President George Dennison said he strongly supported the suggestion from Commissioner Crofts that position descriptions not be part of Board policy. The policy should be to have the position descriptions--not put them in as policy.

Chairman Kaze said he heard at least one suggestion for some modification to the position description relative to their educational partners, such as the community colleges, K-12, and others. He asked that the revised document be brought back to the November 1997 meeting for action.

b. Compensation for Service on Outside Governing Boards

Regent Jasmin said he was not on the Board when it made the decision to disallow compensation for service on outside boards. He disagreed with that decision and felt the service on outside boards was a valuable asset to the university system. For that reason, he suggested they revisit the issue. He did not think service on outside boards should be used as a way to receive additional compensation but instead to benefit the university system. Regent Jasmin said several of the Regents had worked toward a compromise position that would allow service on outside boards; he distributed a draft policy (dated 9/15/97). Regent Jasmin said this was an attempt to find some type of middle ground.

Regent Davison said he was comfortable with the draft policy but would like to see the percentage higher than the 10% stated in Section 3. He asked why 10% was chosen.

Regent Thielman said he suggested 10%. He and Regent Jasmin had spent some time looking at and discussing various job descriptions. Regent Thielman said the average top campus administrator in the United States earned $22,000 a year from serving on outside boards, which was 22 percent of the presidents' salaries. He noted, however, the presidents' annual salaries were less than those of many of their peers. He felt 10% was a reasonable figure that would not be looked at as supplemental income, and they could still expect the full attention of their administrators to the university system.

In response to a question from Regent Davison, President Dennison said he did not believe a percentage was an appropriate answer. If he did not give his full attention to the job he was required to do, they ought to release him from that position. President Dennison also said if a conflict of interest occurred, it was his responsibility to remove himself from it, and he took that very seriously. What he thought would be preferable was to require that any income received from outside boards be held in deferment, which would be a reasonable compromise.

President Malone said the main issue was what the service meant to the institution and whether there was a conflict of interest.

Regent Davison suggested they delete the 10% in Section 3 and replace it with "reasonable compensation."

Discussion followed on what might be considered "reasonable."

Regent Davison moved that the Board adopt the draft policy and replace ". . . shall not exceed ten percent of their board approved salary" in Section 3 with " . . . shall be reasonable."

Governor Marc Racicot agreed a percentage was not the issue, and trying to find an acceptable level of compensation did not address the question. He also did not think deferment of the compensation was a solution. Governor Racicot wondered whether their struggle to gain public credibility was worth sacrificing and recommended they not approve the draft policy.

Commissioner Crofts suggested the heading or language in Section 4 be changed to: "The Commissioner shall approve or disapprove the request and so apprise the Board. In the case of the Commissioner, the Board shall approve . . ."

Chairman Kaze said the current policy had only been place for a year and felt they would be short-sighted by not giving it a chance to work.

Regent Davison suggested they work on refining the draft policy based on the discussion and bring it back the following day.

Chairman Kaze said Regent Davison's motion was deferred to the following day's session.

Continuation of Old Business

NEW BUSINESS

a. ITEM 96-011-R0997--Conflicts of Interest; Montana University System (NEW)

Regent Jasmin distributed ITEM 96-011-R0997 (on file; number assigned after meeting) and moved that it be placed on the Submission Agenda for action at the November 1997 meeting. He noted this was separate from the policy on outside boards. Regent Jasmin said he had discussed this policy with Chief Legal Counsel LeRoy Schramm and had reviewed the code of ethics for the State of Montana, the ethics standards for state employees, and a March 6, 1996 letter from Chief Counsel Schramm on the state ethics statute and how it related specifically to the university system. With those documents in mind, a new policy was drafted, which Regent Jasmin reviewed for the Board.

In response to a question from Regent Jasmin, Chief Legal Counsel Schramm said the Department of Administration had directed that departments within the executive branch should have conflict of interest policies.

President Dennison said several federal agencies required the universities and any institutions that participated with them to have conflict of interest statements, which had to be reviewed prior to the awarding of any contracts or grants from those agencies. He said conflict of interest policies were also written into their bargaining agreements, which needed to be looked at carefully.

President Malone said the policies they had at MSU--Bozeman would be very close to this policy, but he felt a systemwide policy was a good idea.

Regent Jasmin's motion to place ITEM 96-011-R0997 on the Submission Agenda for action at the November 1997 meeting passed unanimously.

The Board recessed at 2:50 p.m.

Continuation of New Business

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FRIDAY, SEPTEMBER 19, 1997

The Board reconvened at 9:00 a.m.

Chairman Kaze said they would take action on the Consent Agenda, which had been deferred from the previous day.

CONSENT AGENDA

Staff Items:

a. ITEM 96-100-R0997--Staff; Office of the Commissioner of Higher Education

b. ITEM 96-1000-R0997--Staff; The University of Montana--Missoula

c. ITEM 96-1001-R0997--Resolution Concerning the Retirement of Robert R. Ream, Professor of Wildlife Management, School of Forestry; The University of Montana--Missoula

d. ITEM 96-1002-R0997--Resolution Concerning the Retirement of Joel F. Meier, Professor of Recreation Management, School of Forestry; The University of Montana--Missoula

e. ITEM 96-1003-R0997--Resolution Concerning the Retirement of Thomas J. Nimlos, Professor of Forest Soils, School of Forestry; The University of Montana--Missoula

f. ITEM 96-1500-R0997--Staff; Montana Tech of The University of Montana

g. ITEM 96-1500A-R0997--Staff; Montana Bureau of Mines and Geology

h. ITEM 96-1600-R0997--Staff; Western Montana College of The University of Montana

i. ITEM 96-1603-R0997--Professor Emeritus Status for Professor Lawrence Leith; Western Montana College of The University of Montana

j. ITEM 96-1900-R0997--Staff; Helena College of Technology of The University of Montana

k ITEM 96-2000-R0997--Staff; Montana State University--Bozeman

l. ITEM 96-2300-R0997--Staff; Agricultural Experiment Station

m. ITEM 96-2400-R0997--Staff; Extension Service

n. ITEM 96-2700-R0997--Staff; Montana State University--Billings

o. ITEM 96-2800-R0997--Staff; Montana State University--Northern

p. ITEM 96-2801-R0997--Post-Retirement Employment Contract; Montana State University--Northern

q. ITEM 96-2850-R0997--Staff; Montana State University College of Technology--Great Falls

Capital Construction Items:

a. ITEM 96-1602-R0997--Physical Education Building Remodeling; Western Montana College of The University of Montana

b. ITEM 96-2002-R0997--Replacement of Existing Air-Supported Tennis Structure; Montana State University--Bozeman

Other Items:

a. ITEM 96-2004-R0997--Appointment of Ross Fitzgerald, William Perrin, Gary Mahugh, and Charles Winn to the Fire Services Training Advisory Council; Montana State University--Bozeman

b. ITEM 96-005-R0997--Approval of the 1997-1999 Collective Bargaining Agreement with International Association of Machinists and Aerospace Workers Local 88; Montana University System

c. ITEM 96-006-R0997--Approval of the 1997-1999 Collective Bargaining Agreement with American Federation of State, County and Municipal Employees Local 441; Montana University System

d. ITEM 96-007-R0997--Approval of the 1997-1999 Collective Bargaining Agreement with Montana District Council of Laborers Local 98 and 1334; Montana University System

e. ITEM 96-008-R0997--Approval of the 1997-1999 Collective Bargaining Agreement with Print, Publishing and Media Sector of the Communications Workers of America Local 14740 and Graphic Communications International Union Local 242-C; Montana University System

f. ITEM 96-009-R0997--Approval of the 1997-1999 Collective Bargaining Agreement with Montana Public Employees Association; Montana University System

Amendments to Consent Agenda:

ITEM 96-100-R0997: Proposed salary for Commissioner of Higher Education Richard A. Crofts approved at $113,805, effective October 1, 1997.

ITEM 96-1000-R0997: Pages 6 (beginning with "Vice Presidents & Deans") through 19 withdrawn from agenda; on page 6, proposed salary for President George M. Dennison approved at $113,305, retroactive to October 1, 1997, following approval of faculty salaries.

ITEM 96-1500-R0997: On page 3, proposed salary for Chancellor Lindsay D. Norman approved at $97,100, effective October 1, 1997; on page 3a (addition to agenda item), nonrenewal of Chancellor Norman's contract, effective June 30, 1998.

ITEM 96-1600-R0997: Pages 3 through 5 withdrawn from agenda.

ITEM 96-1900-R0997: Page 2 withdrawn from agenda.

ITEM 96-2000-R0997: On page 4, proposed salary for President Michael P. Malone approved at $113,305, effective October 1, 1997; on page 6, proposed salary for Dorothy Bradley changed to $41,454; on page 9, proposed salary for Rebecca Mahurin changed to $60,303; on page 11, proposed salary for Leslie L. Schmidt changed to $42,695; on page 12, proposed salaries for Robert L. Stark changed to $34,428, Gordon V. Stroh to $63,011, and Annette Trinity-Stevens to $36,550; and on page 13, proposed salaries for Jason M. Watson changed to $15,355 and Warren W. Frost to $80,587.

ITEM 96-009-R0997: Withdrawn from agenda.

Regent Thielman moved that the Board approve all items on the Consent Agenda (Staff, Capital Construction, and Other) as amended. The motion passed unanimously.

Salaries for Presidents and Commissioner

Commissioner Crofts referred to his August 20, 1997 memorandum (on file) regarding presidential compensation. He said in May 1996, the Commissioner's Office did a study of presidential salaries in comparison to those in Idaho, Wyoming, North Dakota, and South Dakota. That comparison was done using the methodology passed by the 1995 Legislature that applied to statewide elected officials. Using that methodology in May 1996 would have suggested that effective July 1, 1997, the presidents' annual salaries, to reach the average of all five states studied including Montana, would be $113,305. The Regents decided to approach that figure in two steps. The salaries were increased as of October 1, 1996, to $106,856. As the second step, Commissioner Crofts recommended that effective October 1, 1997, the annual salaries for Presidents Michael Malone and George Dennison be increased to $113,305. In the case of President Dennison, because the faculty salaries and agreements had not been reached, his salary would be effective October 1, 1997, but paid retroactively once the faculty salaries were set.

Regent Davison suggested they also set the Commissioner's annual salary at that time as $113,805, effective October 1, 1997.

Regent Jasmin moved that the Board approve the annual salaries for Presidents George Dennison and Michael Malone at $113,305, and the annual salary for Commissioner Richard Crofts at $113,805, all effective October 1, 1997. President Dennison's salary would be retroactive to October 1, 1997, following approval of the faculty salaries. The motion passed unanimously. [NOTE: This Board action amends ITEMS 96-100-R0997, 96-1000-R0997, and 96-2000-R0997 as already noted in Consent Agenda.]

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OLD BUSINESS (continued)

a. Compensation for Service on Outside Governing Boards

Regent Jasmin moved that the draft policy on compensation for service on outside governing boards be taken off the table and reconsidered.

Chairman Kaze said if the motion passed, they would reconsider the draft policy. It the motion failed, the chair would be open for another motion.

Regent Jasmin's motion to reconsider the draft policy on service on outside boards passed unanimously.

Regent Jasmin distributed a second version of the draft policy (dated 9/18/97). He said there were two major changes from the previous draft:

Change #1:

Section 3. Reasonable Compensation. Service on outside boards should not be thought of as a means of supplemental income. Any compensation paid to a Montana University System employee shall be reasonable and commensurate with the time and responsibilities required. In no case shall the service on outside boards conflict with the individual's duties and responsibilities to the university system.

Regent Jasmin said Section 3 replaced the section that indicated a 10% cap for compensation received.

Change #2:

Section 4. Prior Approval. Before any Montana University System official described above accepts an offer to participate on an outside governing board of a for-profit corporation, he or she must have prior written approval of the Commissioner. The Commissioner shall be apprised of the details of the board appointment, including any compensation to be awarded and a statement as to how the appointment might benefit the individual and the university system. The commissioner shall then apprise the Board of Regents. In the event the commissioner wants to accept an offer to serve on an outside governing board of a for-profit corporation, prior approval shall be required from the Board of Regents.

Regent Jasmin moved that the revised policy be approved and supersede current Board Policy 750.

Regent Thompson suggested they allow the conflicts of interest policy to work its way through the submission/action process before they did anything with the current policy on outside boards. They could then approve some type of reporting procedure and rescind the current policy.

Regent Thielman moved that Regent Jasmin's motion be amended to incorporate the system's "deans" into Section 1. The motion passed unanimously.

Regent Jasmin's motion to approve the revised policy as amended failed by a tie vote. Regents Boylan, Davison, and Jasmin voted for the motion; Regents Kaze, Thielman, and Thompson voted against the motion.

Regent Davison moved that Board of Regents' Policy 750 be repealed. The motion passed by a 4-to-2 vote; Regents Boylan, Davison, Jasmin, and Thompson voted for the motion; Regents Kaze and Thielman voted against the motion.

Regent Thielman pointed out they now had no policy on outside boards.

Following brief discussion, Regent Thielman moved that the Board reconsider the revised policy on outside boards. The motion passed by a 4-to-2 vote. Regents Boylan, Davison, Jasmin, and Thielman voted for the motion; Regents Kaze and Thompson voted against the motion.

Regent Jasmin moved that the revised policy addressing service on outside governing boards be approved as originally amended.

Regent Thielman said he did not see how they could go forward with no policy at all. Although he did not agree fully with the revised policy, he felt they needed to have something in place.

Regent Thompson reemphasized they needed to adopt some type of reporting procedure and let the conflicts of interest policy make its way through the Board's submission/action process.

Regent Thielman proposed an amendment to Regent Jasmin's motion to state that no compensation as outlined in Section 3 would be allowed until the conflicts of interest policy had been considered by the Board.

Chairman Kaze clarified that Regent Jasmin's motion prior to Regent Thielman's amendment included deans in the list outlined in Section 1 because that amendment had previously passed.

Regent Thielman said he would like to have "deans" stricken from the list in Section 1 as part of his amendment.

Regent Thielman's amendment to Regent Jasmin's motion to strike reference to "deans" in Section 1 and delay implementation of the policy until the Board approved or disapproved the conflicts of interest policy failed by a 1-to-5 vote; Regent Thielman voted for the motion; Regents Boylan, Davison, Jasmin, Kaze, and Thompson voted against the motion.

Regent Jasmin's motion to approve the revised policy on service on outside governing boards as originally amended passed by a 5-to-1 vote; Regents Boylan, Davison, Jasmin, Thielman, and Thompson voted for the motion; Chairman Kaze voted against the motion.

In response to a question from Regent Jasmin, Chairman Kaze noted the policy was effective upon passage.

NEW BUSINESS (continued)

a. Western Governor's University

Commissioner Crofts said Montana had joined the Western Governors' University (WGU). The Governor's Office contributed $10,000, each of the two universities contributed $15,000, and the 1997 Legislature came up with the additional $60,000 for the state's entry-level dues. He said the WGU was a rapidly developing organization. Commissioner Crofts introduced Bob Albrecht, Chief Academic Office of WGU and a former Deputy Commissioner in the Commissioner's Office.

Mr. Albrecht used a series of overheads (copies on file) to provide the following information on the Western Governors' University:

Brief History (background, goals, criteria, participating states and their commitments, and WGU's organizational structure)

The Academic Institution (basic academic services provided, distributed faculty, implementation strategy: initial academic offerings, Associate of Arts degree, competency-based degrees, academic infrastructure, program council responsibilities, assessment council responsibilities, and accreditation)

The Business Enterprise (progress on implementation, issues and considerations, and business partnerships)

Following a question-and-answer period, Chairman Kaze thanked Mr. Albrecht for his presentation.

The Regents reconvened at 10:50 a.m. after a brief break.

COMMISSIONER'S REPORT

a. Montana PRRIME Project

Commissioner Crofts introduced David Ashley from the Department of Administration, who was the project director for the MT PRRIME project. Commissioner Crofts said Mr. Ashley was responsible for making sure the new state information system was up and running effectively by July 1, 1999. He also referred to the brief summary by Laurie Neils the Regents had received with the agenda mailing.

Mr. Ashley said MT PRRIME was an acronym for the Project to Reengineer the Revenue and Information Management Environment. He said 31 state employees had been gathered together full-time from 13 agencies to work with a consultant to implement 14 different modules that were being provided by the PeopleSoft Corporation. In terms of the timeframe, beginning October 1 those 31 individuals plus about 20 consultants would be moving into the Capitol area. They would be working for the first four months on phase 2, which was the project's design component. Beginning April 1998, they would begin the implementation phase. The first module would be a budget development module that would be brought on-line in May 1998. The first financial release in July 1998 would be the accounts receivable and asset management module. In April 1999, they would bring up the full complement of human resource modules, including payroll, time and attendance, benefits administration, etc. Shortly thereafter in July 1999, they would bring up the rest of the financial modules, including the general ledger.

Mr. Ashley said the university system was involved because six of its eight campuses currently used SBAS (Statewide Budgeting & Accounting System) as their primary accounting system. The goals for MT PRRIME relative to the university system were that when SBAS was finally unplugged, they needed to make sure they had a system to take its place at the campuses so they could continue their accounting work. The second goal was to be able to create an environment where information was transmitted easily and efficiently and as cost-effectively as possible between the campuses and the state agencies. As long as the university system's units were tax-assisted, the legislature and the core agencies would expect information from them. Those five core agencies included OCHE, OBPP, the Department of Administration, the Legislative Audit Division, and the Legislative Fiscal Division. Mr. Ashley added that the Helena College of Technology of The UM provided training to state employees on SBAS, and they looked forward to continuing that relationship to provide training on the new system.

Mr. Ashley asked whether the state, The University of Montana, and Montana State University should all use the same software. He said it would be great if two years from now they were all on the same software. He said if they could all start with a clean slate, the community of interest was sufficiently strong they would all end up at the same place. There were quantifiable benefits if all three were sharing the same software system; however, the pros and cons needed to be discussed relative to that decision, and the universities were in the best position to make that call. If either of the two universities decided to choose the PeopleSoft product, Mr. Ashley offered to help them by sending people down to help with contract negotiations, for example.

Laurie Neils, Director of Budget & Accounting in the Commissioner's Office, said when Dave Ashley and the Department of Administration set up the MT PRRIME project, they asked the Commissioner's Office to select someone to represent the university system. Ms. Neils said she had been sitting on the steering committee for MT PRRIME since its inception. In turn, she shared information with the campuses on the project's issues and status. In June 1997, MT PRRIME had vendor demonstrations prior to its selection of PeopleSoft, and the campuses were invited to send representatives to view and evaluate the various systems. Ms. Neils said two people from Montana State University and The University of Montana would be working full-time in Helena on the MT PRRIME project, and she would continue to work with those people to make sure the university system interests were represented.

Commissioner Crofts said they ought to be working on developing a management information system that would meet the needs of the university system and provide the state with its legitimate information needs. He said the primary objective of MT PRRIME was to serve state government. The primary objective for the university system's information systems was to serve students and faculty and meet the information needs of the state. The question should be: What is the most cost-effective and beneficial way to meet the university system's needs and the state's needs for information? He reviewed two alternatives: each university and the campuses would acquire and implement the state's product for finance and human resource information systems, or The University of Montana would continue to implement Banner throughout its campuses and Montana State University would purchase either the Banner or PeopleSoft system.

Following discussion, Commissioner Crofts suggested the Regents authorize a committee to be appointed by the Commissioner, chaired either by the Commissioner or his designee, to collaborate with the centralized state agencies to determine and reach agreement with the MT PRRIME project on the legitimate information needs of those agencies. Both the degree of detail and the frequency of reporting information would have to be agreed upon. In addition, the agreement would have to include the establishment of an appropriate common structure for the data that would be in the system. This would include items such as a chart of accounts and data field definitions. Commissioner Crofts suggested the group also do a cost-benefit analysis of whether it would make sense to move to a single vendor's product in the areas of finance and human resources. He said they needed a credible and convincing statement of what the cost would be regardless of which alternative was pursued. The group also needed to work on an ongoing basis to develop consistent university system policies related to ongoing issues such as information systems and information technology and report back as appropriate to the Regents what the group had done, where they were, and whether the Regents needed to approve any actions or make any decisions.

Chairman Kaze said the Regents had raised this issue at one point and expressed their desire that the entire system be made compatible over some reasonable timeframe. He said he was not sure, however, whether that included providing required information to the state of Montana.

Commissioner Crofts said they wanted to work effectively with the state and reach agreement on the issues. He said they had cooperated with MT PRRIME, and some reasonable progress had been made. It was important, however, to keep their focus on the goal, which was the information system. For an integrated information system, they needed to have common data structures, data definitions, charts of accounts, etc.--rules by which the information system itself operated. Commissioner Crofts said those were the important decisions. Once those were made, they could move to an analysis of what they had to do and the most cost-effective way to get there.

Regent Davison suggested they go ahead with forming the committee and have it report back to the Regents with recommendations. He said they needed the information to make an informed decision. He also emphasized the Board wanted a common system, and he would be hard-pressed to deviate from that.

In response to a question from Regent Davison, Commissioner Crofts said there were different information needs for the university system that the state system would never cover--student records and financial aid, for example.

Regent Thompson said they needed to make sure they looked at what was practical, what worked, and whether they could afford it.

President Malone said within the next six weeks Montana State University would make its recommendation on whether to purchase the Banner or PeopleSoft system. If they chose the Banner system, they would get Banner 2000, which was a later version of the system used by The University of Montana. If they chose the PeopleSoft version, it would not be the same as the state system. He said it was a higher education system, not a state government system and would not have complete compatibility. President Malone said they would be able to report in November on the pros and cons of the Banner and PeopleSoft systems.

President Dennison said The University of Montana's acquisition of the Banner system was not taken lightly. A committee had looked at the issues involved, and the objective was to have a system that would provide management information assistance to the campuses and also meet the state's needs. He said they went with Banner because it was the best system. It was a full suite that allowed everything to be integrated. President Dennison said it also operated on the Oracle database.

Chairman Kaze said he would like them to adopt the attitude that this process was a systemwide effort and not a campus-by-campus or university-by-university effort. He said that would provide what the Regents had wanted for a long time--the ability to have at least a movement toward a student records system that could be used on a systemwide basis. They also had to make sure they could meet the state's information needs.

Following further discussion, Regent Davison moved that the Board accept the Commissioner's recommendation to appoint a committee to collaborate with centralized state agencies to determine their information needs from the university system; collaborate with MT PRRIME on an efficient interface of required data from the campuses; develop a cost/benefit analysis for purchasing a single human resource and financial system; and develop consistent system policies for ongoing information technology issues. The Board would also receive regular progress reports beginning with the November 1997 meeting. The motion passed unanimously.

Regent Davison asked about the status of the Family Education Savings Program that was passed by the 1997 Legislature.

Rod Sundsted, Associate Commissioner for Fiscal Affairs, said they had an RFP ready to be mailed the following week for a financial institution to offer the accounts. Through a contract they already had, they had been working with an accounting firm to help answer some of the questions. Mr. Sundsted said it appeared they could only have one financial institution and one investment option because of federal tax requirements that those investments could not be self-directed.

Regent Davison asked that they make sure people understood why the program was being limited to one financial institution.

STUDENT REPORTS

MAS and ASMSU President Brad Schlepp said they were trying to bring community college representatives into MAS. They had also formed a legislative committee to be chaired by a member of MAS, which would encompass all the other campuses. Mr. Schlepp said they would appreciate any input from the Regents throughout the year.

Kim Cunningham, student body president at MSU--Billings, said the concept of one-stop shopping had been put into place on the Billings campus and met with wide approval of the students. Registration, paying fees, financial aid, etc., could now all be done in one location.

A student from the audience said he had asked a number of students earlier in the day what message they wished to bring to the Regents. The student said the primary problem mentioned was the campus parking situation. He also added the students were appreciative of the Regents' support toward ensuring a quality education.

Chairman Kaze thanked the students for their reports.

CAMPUS REPORTS

a. Update on The University of Montana's Distance-Learning Efforts

President Dennison distributed a report (on file) titled "Distance Learning at The University of Montana, A Study of the Practice on the Four campuses: Butte, Dillon, Helena, Missoula." He then introduced Dr. Sharon Alexander, Dean of Continuing Education and Summer Programs on the Missoula campus.

Dr. Alexander briefly reviewed the report, which included The University of Montana's major contributions to distance-learning, the number of courses and students enrolled during the past few years, how the programs had been offered, the infrastructure to support distance-learning, the challenges facing the university in developing additional distance-learning opportunities, and the university's future plans.

Following brief discussion, Chairman Kaze thanked Dr. Alexander for her report.

b. Helena College of Technology of The University of Montana

Dean Alex Capdeville distributed a campus informational brochure titled "Stepping Stones to Your Future."

c. Montana State University--Bozeman

President Malone distributed two handouts: (1) the FY98 general operating budgets for the Montana State University campuses; and (2) a publication titled "Research and Creative Activities."

President Malone said the initial meeting of the search committee that would recommend a successor to MSU--Northern Chancellor Daehling would be held October 6.

d. Montana State University--Northern

Chancellor Daehling said the Northwest Commission on Colleges would be on the Havre campus for its 10-year evaluation review from October 6 through October 8. He said Regent Jasmin and Chairman Kaze had agreed to be available to meet with the group. Other Regents were also invited to attend a lunch with some of the visitors on October 6 from noon to 1:30 p.m.

e. Miles Community College

President Frank Williams said they were pleased the construction had been completed on new student housing on campus that more than doubled their student housing capabilities. President Williams also noted the college's budget was about 8% smaller this year due to personnel changes in staff, faculty, and administration. He introduced Dale Oberlander as the college's Vice President for Academic and Student Affairs.

f. Dawson Community College

President Don Kettner said the college had a 100% increase in their summer enrollment and about an 18% increase this fall.

g. Flathead Valley Community College

President David Beyer said the college had celebrated its 30th anniversary the previous week.

Chairman Kaze thanked MSU--Billings Chancellor Ron Sexton and his staff for hosting the Regents and for all their help during the meeting.

Chancellor Sexton thanked the Regents, Commissioner, and university representatives for taking time to meet with local legislators and community leaders. He said those gatherings were extremely important for the university system.

With no other business to come before the Board, the meeting adjourned at 12:00 noon.

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