BOR Minutes: January 27, 2003
Montana Board of Regents of Higher Education
Minutes
Special Meeting
January 27, 2003
Montana Higher Education Complex
2500 Broadway
Helena, MT 59620
These minutes were approved unanimously as amended at the March 20-21, 2003 Meeting
in Helena, MT
MONDAY, JANUARY 27, 2003
ROLL CALL
The Full Board Convened at 10:00 a.m. - Roll Call indicated a Quorum Present
Regents Present: Richard Roehm Chairman, Lynn Morrison-Hamilton Vice-Chair, Christian Hur, Ed Jasmin, John Mercer, Mark Semmens, Margie Thompson, and also present was Commissioner Richard Crofts
Regents Absent: Governor Judy Martz ex officio, and Superintendent of Public Instruction Linda McCulloch ex officio
a. ITEM 118-100-S0103 Staff; Office of Commissioner of Higher Education
Regent Jasmin moved APPROVAL of Item a.
Regent Mercer requested clarification on the exact amount of money involved in terms of double salaries for two on the payroll, including benefits, and specifically where the money to cover the salary would be found. Rod Sundsted indicated the exact amount was $9000 per month for the overlap, so for 5 five weeks it would be about $11,000 plus 12% for benefits or $1320. There was discussion of the various charges that would be implemented to cover the shortfall, among which would be $10,000 to the Family Education Savings Plan for time and effort expended, $9500 to the Montana Rural Physicians Incentive Program for time and effort expended, and $25,000 to the Gear Up program for time and effort. Part of the severance package for Richard Crofts is being charged to GSL for time and effort, and there will be unused WWAMI funds of $111,000. This is approximately $160,000. The dollars being charged to these programs have normally been left in even though it was appropriate to charge for time and effort expended. The money from GSL is from reserves and not operational funds. Regent Mercer asked about funding the $50,000 for a search firm. Rod Sundsted indicated the only other potential sources would impact the campuses. Distance learning funds of $100,000 which have not be distributed could be held back. Regent Mercer indicated he would continue to argue it was irresponsible to have two commissioners at a cost of $12,300, but Regent Semmens noted that there would be a savings over the six months of $3000 per month and indicated it was not fair to focus on a one month period. The only exception would be the $45,000 in sick and annual leave which is a contractual matter with all employees. He believes it would be good to have the ability to set up a reserve for that, but it is not permitted.
The Motion CARRIED on a 5-2 vote with Regents Mercer and Hur dissenting.
b. Discussion of Role and Duties of Commissioner and evaluation of various management models
Regent Mercer questioned why this item was on the agenda again when the Board has looked at many times, and continues to vote to affirm it. He indicated there is no will by this board to make any changes in the role of the Commissioner. Chairman Roehm indicated it was on this agenda because Regent Mercer had requested it be discussed. He agreed it had been beaten to death in a hundred different ways. There followed debate over the affirmed role description, and Regent Roehm indicated that policy 204.3 is the official position description unless the Board wanted to change it. Regent Jasmin asked why anyone would want to apply for the position if it was unstable. Regent Semmens encouraged further discussion on what the Board is looking for in a commissioner beyond management and administration. Regent Thompson indicated the Board had spent a lot of time amending the position description. Regent Hur said the Board had the opportunity to look and see if they wanted to revise, modify or reaffirm the position description.
Regent Hur MOVED that the Chair of the Board of Regents create a committee that
would be tasked with discussing and suggesting additional and/or modified roles and
duties for Montana's Commissioner of Higher Education.
Regent Hamilton appreciated Regent Hur's concern about input into the description but asked the Board to consider the time they spent in public meetings and the annual review of the commissioner and presidents. The Board is charged in statute and the constitution to describe the duties. The Board has reviewed them numerous times and reaffirmed those duties at the last meeting, and she indicated it is now time to move forward to the attributes and characteristics of the individual. Commissioner Crofts commented that the two consultants who would be making presentations to the Board would say it is important at the start to discuss the position, role, job and other attributes and characteristics of the individual. The official position description has to be established, but the leadership roles and priorities are other important considerations. The firms would suggest ongoing discussion, but he reminded the Board they had set themselves an aggressive time frame and if they intended to accomplish it they needed to proceed to get it done with ample time to discuss it along the way. If the Board delayed for another two months, their goal of a new commissioner in six months would be unattainable. He suggested the majority had confirmed in general terms where they want to go, and there would be room to make changes as they work through the process. Regent Semmens indicated he supported Regent Hur's concept, but noted it doesn't have to be done sequentially but could be done concurrently. Regent Jasmin stated that no one would put in an application until they knew for sure what the job was going to be, and for the search firm to get on they needed to know what job description they are trying to fill. Carrol Krause noted that the Board needs a strong CEO, whatever they might call him. He mentioned a few of the other systems in the country and the best ones are those with a CEO. He stated it would be impossible for the two presidents to do the job from either their point of view, or that of the Board. There is nothing magic about the job description, but the Board needs to look for a good strong CEO with both a good management and scholastic background.
Regent Jasmin called for the question
Motion FAILED on 4-3 vote with Regents Hur, Mercer and Semmens supporting
c. Process for Selection and Recruitment of Permanent Commissioner
Presentation by Elaine Hairston
Ms. Hairston of Academic Search Consultants gave the background of her company and herself, indicating she has served Boards for 19 years. Theirs is a non-profit group which began in 1976 before the commercial firms started. She indicated that Alan Ostar would assist her with the search, and reminded the Board that their firm had conducted the search for President Gamble. They would start by asking key individuals, starting with the Board what they perceive to be the opportunities and challenges for the next commissioner. She would spend two days either in person or by phone speaking with important constituents, after which she would prepare a draft profile of no more than 4 to 6 pages and then would discuss it with the Board. They would then answer the question "what kind of person can take us through this?" After developing the key characteristics, she would draft an ad and write to leaders of national organizations for suggested candidates. After developing a pool, they would screen the applicants, do reference checks and then suggest 4 to 6 people for interviews. The entire process takes about six months. She indicated this is a very difficult position to fill since there are tremendous competing forces pulling at this kind of leader. She recommended the Board serve as its own search committee. The firm will continue through to the completion of the employment contract. They have a flat fee of $50,000 for the search. The only other costs will be for travel for her or the candidates. They would provide the clerical help for an additional $10,000, and she figures it will take about 1/3 to 1/2 position for six months in-house to do the work at an actual cost of about $40,000. Travel will probably run about $15,000. She indicated that Montana is at the lowest end of the national range for salary on this position and it is something the Board will have to wrestle with. She indicated the Board will need to help her identify potential candidates in Montana that might be able to advocate for the system.
Presentation by Jim Mingle
Mr. Mingle of AT Kearney indicated that the processes of his firm and that of Elaine Hairston are very similar. He explained using a search firm provides an expanded pool of candidates, is the most cost effective way to manage the process which is a substantial effort, and the Board would be assured of a thorough review of the candidates and reference checking. A firm also assists the Board in reaching consensus on the type of individual they are looking for and the role that person will play. He suggested the Board needed to be unified for any candidate to be successful. He stated he knew all of the former Commissioners in Montana, and as head of SHEEO he found the most successful systems and heads had unified boards. Successful heads have vision, and demonstrate leadership they carry out with courage. Their firm will recruit by referrals and personal contacts, and will select 10 or 12 candidates for brief interviews at an out of state site. He suggested the Board ask the firm to play a more significant role in the first cut of candidates. The selection process is last so there likely needs to be two visits by his firm. He recommended not adding people to the search committee with decision making powers, but for input only. However, when it comes to going over the final candidates, he recommended it not extend beyond the Board. Negotiation of the employment contract would be included in their proposal. The cost is based on 1/3 of the cash compensation offered the individual, or a minimum of $55,000, plus 15% administrative costs and the cost of travel for both the consultants and candidates.
END PRESENTATIONS
Regent Semmens asked for comments from senior staff on the benefits of a firm. Commissioner Crofts noted first is the significantly increased speed of the process, second is the assistance this Board would receive from objective, independent professional experts. Third, the firm is also able to make reference checks in ways that go beyond an internally driven process. He noted that in addition to hiring the firm, one also hires the consultant. Chairman Roehm asked if the search should remain in-state and not use a firm at all, presuming that someone qualified would want the position. Commissioner Crofts indicated there may be those interested in the position, but the Board must have confidence in the person selected. It would be best to have Montana candidates measured against candidates from outside the state.
Regent Jasmin MOVED APPROVAL to hire a search firm for the process.
Regent Mercer questioned the need for a firm and wondered if they could even get someone from out of state at the salary offered. The commissioner has not always been hired from a national search. Commissioner Crofts indicated the Board makes it own decision each time. He was appointed to the position from Deputy Commissioner, but a national search had been conducted to hire him into the original position. The salary will be a problem, as it was when they hired Geoff Gamble. But he was pleased and surprised to have three very strong candidates. As they worked on that search, they used the firm for communication on compensation. That issue should be resolved before the final candidates are presented to the Board. Chancellor Capdeville indicated he was on the screening committee when Carrol Krause left. Deputy Commissioner Hutchinson had not applied and had no intention of applying. When the pool was narrowed to two people, the Board could not agree. One candidate quit and the other was unsatisfactory. The firm will bring focus to the search and minimize this possibility. Chancellor Gilmore indicated about six months ago they did a national search for an executive director of Sigma Xi. Although he opposed the use of a firm because of the cost, he was over ruled and the search was very successful in hiring a phenomenal candidate. President Dennison said they used a consulting firm for the president of the Foundation. The process works very well. He felt the Board would be well advised to search inside Montana because of the timing, and there are people in Montana capable of doing the job, and it would be less costly. Chancellor Hulbert reflected on his experience in leaving the position of Commissioner, when the Board used a firm to identify his successor. An appointment was made for political purposes. It cost $30,000 and that person stayed for three years, and in a period of six years they went through three commissioners. He recommended going to SHEEO because they have any number of resources available and they can get the word to a wide audience. Regent Semmens asked Deputy Commissioner Scott to give an estimate of the amount of her time spent on the search for President Gamble. She indicated she chaired the committee and the staff work was done in Bozeman. She spent about 25% to 30% of her time on the search process. The firm generated candidates, talked to them and did the feedback, but she wrote to them and did the follow-up. She indicated the search firm will walk candidates through doubts and generally do more hand holding. The firm was proactive in recruiting and generated about 130 interested individuals, with 90 completed applications. The committee did the work of weeding the pool. In this search, the firm will do the weeding for the Board.
The Motion CARRIED on 5-2 vote with Regents Hur and Mercer dissenting
Regent Semmens MOVED to hire Academic Search Services.
The Motion CARRIED on 5-2 vote with Regents Hur and Mercer dissenting
Ms. Hairston explained that her office would send a suggested contract for MUS legal counsel to review. After that is done, she would develop a schedule for the search. Her plan was to return as soon as possible to Montana for two days of appointments. She asked that OCHE set up the schedule of in-person and phone call interviews. She will work up the draft profile and then meet with the Board to discuss it. She would then develop the ad and move forward.
With no further business to come before the Board, the meeting adjourned at 4:11 p.m.