BOR Minutes: May 19-21, 2004

The Full Board convened at 7:30 a.m.

ROLL CALL

Roll Call indicated a quorum present.

Regents Present:  Mike Foster, Lynn Morrison-Hamilton, Christian Hur Vice-Chair, John Mercer Chair, Richard Roehm, Mark Semmens, Lila Taylor.  Also present was Commissioner Sheila M. Stearns

Regents Absent: Governor Judy Martz ex officio, excused, and Superintendent of Public Instruction Linda McCulloch ex officio, excused

APPROVAL OF MINUTES

      Regent Hamilton MOVED for APPROVAL of the Minutes of the March 25-26, 2004 Regular Meeting in Dillon, MT and the Minutes of the April 14, 2004 Conference Call Meeting

      The Minutes were APPROVED unanimously on a 7-0 vote.

ACADEMIC/STUDENT AFFAIRS ITEMS

a.

Joint Nursing Approval Process ITEM 123-102-R0504 - Establish a Review and Approval Process for Some Nursing Program Proposals, in Order to Coordinate That Review with the State Board of Nursing   Attachment

Deputy Commissioner Roger Barber gave a brief overview of the history of this item.

   Regent Hamilton MOVED for APPROVAL of item a. 

   Item a. was APPROVED unanimously on a 7-0 vote.  

b.

Update from Nursing Coordinating Group Regent Roehm and Regent Hamilton

1.   Helena Clinical Capacity Study

Regent Roehm expressed disappointment with the lack of recommendations from the outside consultant.  Regent Hamilton indicated the study was paid for the by the State Board of Nursing, and they were charting new territory.  It was necessary to find someone from the outside who was qualified to participate.  The Nursing Coordinating Group will discuss the possibilities of the study at the June meeting.  Regent Foster noted that the study on the clinical capacity focused on Helena, which is only one portion of the state.  He stated the other areas of the state will be different, and although the capacity may be tight in Helena, there is a lot of potential in Billings.  Regent Hamilton explained the study was intended to be only in Helena, but they were hoping for recommendations for the whole state.  Deputy Commissioner Barber attended two conference call meetings of the State Board of Nursing with the consultant.  He reported that Dr. Vance used the same phrases repeatedly, such as "inexact science, think out of the box, be flexible, be innovative, and take a risk."  She did suggest rural settings, especially for those who would find themselves in rural areas.  Dr. Vance is from NY City, and their programs are growing so quickly they also are looking for other appropriate clinical settings.  She indicated there is no literature available on what makes an appropriate clinical setting.  Dean Jean Ballantyne said there were some serious limitations to the study, but there also were some suggestions.  However, no clarity was given for either Helena or the State of Montana.  Some possible sites were listed, but no standards on the difficulty of the exposure, and what constitutes quality clinical education.  Dean Ballantyne added that there is an acute shortage of faculty, and that needs to be addressed quickly.  Regent Semmens noted the reference in the report to no articulation program between the Helena College of Technology and Carroll College, but the recommendation was to support the HCoT proposal for the LPN and the ASN.  Regent Roehm indicated the problem was to ensure a quality clinical experience.  He suggested the Veterans Hospital might work.  Deputy Commissioner Barber noted that the State Board of Nursing had moved the Helena College of Technology proposal forward under the old process, before the new one was approved that morning.  When it comes before the Board for approval they will have to consider the use of non-traditional clinical settings.  Regent Semmens inquired about the articulation agreements between the Helena College of Technology and Carroll College, as well as others in general.  Roger Barber responded there are agreements in place for some campuses in the system already.  However, it appears it may be difficult to work out an agreement with Carroll College. The State Board of Nursing asked Carroll if they would be willing to work out an agreement, and Carroll indicated they would be willing to talk, but did not say they would come to an agreement.  Regent Roehm indicated there is a benefit with the Nursing Coordinating Group in that Carroll College has a seat at the table, and there is discussion of the issues.  Regent Mercer inquired as to the plain answer to the nursing shortage.  He asked if the system was educating enough students, or if they leave the state because of low wages, and if there was a plan to get the answers.  Regent Roehm indicated the system is educating enough, but there is the question of the kind needed and how many of each.  There is also an aging workforce, along with the need for adequate faculty.  The Montana Hospital Association is conducting a survey of the entire state covering the needs for number and type of nurses.  Chair Mercer asked if this would get the answer to whether or not MUS was educating enough nurses.  Regent Roehm said he suspected there is a greater need than there is capacity in the MUS.  Roger Barber noted there are several barriers to filling the needs, such as some will not pass the licensure, and some will leave for better pay.  Because of many factors, the answers will be complicated.  President Gamble indicated the last survey showed that 68% stayed in state.  Regent Foster indicated that St. Vincent' Healthcare stepped up with a scholarship program to keep the graduates at their facility.  He said this is where the public and private entities need to join efforts.

2.   Montana Hospital Association Survey  

Roger Barber reported the survey has been completed, the data has been put together, and the Montana Hospital Association will release an informal report next week.  The Department of Labor has been involved in the survey because they must make projections on nursing needs in Montana.   The survey was designed to capture the need for all kinds of health care workers.  Most hospitals did not break the RNs into two and four year credentials.  They are not sure if this means they don't need one or the other, but just RNs.  The survey was sent to 120 clinical settings, with a response rate of just under 50%, and 75% from the hospitals.  The Hospital Association intends to do a follow-up survey every year to obtain trend information.  During the survey, there were 160 RN vacancies in Montana.  The hospitals are paying a lot of money to cover those vacancies with overtime, part time, and traveling nurses.  The Deputy Commissioner said one issue is the aging workforce in the healthcare arena, with the average age of RNs in Montana being 45.

3.   LPN Consultant

Regent Roehm indicated the Nursing Coordinating Group had agreed at its February 26 meeting to hire a facilitator for this issue.  Roger Barber said they will fine-tune the charge, and suggested the time line is August but is open to change.  The State Board of Nursing is trying to find a consultant, but is having difficulty doing so.

c.

Shelby Nursing Program Regent Roehm   Informational Item

Regent Roehm explained that the program offered in Shelby was an idea generated by President Gamble to use a SWAT team approach, which would put a group in an area temporarily, to train a cohort, or relieve a problem.   A letter was handed out by Rolf Groseth on the background of this item.  He briefly explained the history, the decision to form a cohort in Shelby, and also indicated the community was very interested in working on this project.  They believed they had residents committed to the community, who either could not or would not leave Shelby, but would be interested in pursuing a nursing education program.  Mr. Groseth indicated they formed a pilot project, which required a lot of work over a number of months with health care providers.  He said it was not their intention that this program would be permanent, but they would evaluate it to see what had been done right or wrong so they would be in a position to say if they would continue the program in Shelby, or put it another community with the same needs.  Senator Black reported that Shelby had operated a very successful program.  He and they feel the program should be retained for continuity and integrity.  He stated it would damage the credibility of those in the program if it were cancelled.  Mark Cross, CEO of the Medical Center in Shelby stated that the program was never presented to them as a SWAT program, but as a long-term program.  They were surprised at the great response of those interested in the program.  Quality was the main component, and they believed it could be maintained in Shelby.  Across Montana, health care facilities are bringing in Philippine nurses, whose training is lacking.  The cost is approximately $10,000 to bring these nurses into the community, as well as providing room and board, training, and help to bridge the culture gaps.  Mr. Cross said there were at least six of these nurses in Glendive, one in Shelby, and two or three in Conrad.  The need for training is long term, and the homegrown idea is to maintain people in their own communities because they will most likely stay there because they are tied by marriage, family or other long-term ties.  If their residents go to Bozeman, Carroll College or Havre, they will probably stay in those larger cities because that is where the dollars are.  Mr. Cross said that quality does not mean a four-year degree in a large community, but is based on the people driving the program.  They are short of X-ray technicians, but in the past they used to send them to Weber State.  Allan Underdal, Toole County Commissioner indicated he also did not remember this was an effort that was going to have an end and then be studied.  It was going to be continued if successful.  He stated that stopping a program is a disincentive to restart it.  He urged the Board of Regents to look at the concept, and not stop the program for a review.  In rural settings, there is a nursing shortage, and even Shelby prison has trouble finding RNs.  Shelby uses satellite and interactive TV and urged the Board to continue to use these, and to expand their use.  These graduates will be able to go from a $7 or $8 an hour job to a $20 an hour job, which is an incentive.  Dean Ballantyne indicated she did not disagree with either of these gentlemen about the need for nurses, and that the program is helping to meet the need.  She added on the quality issue, that nurses in any town need to be well prepared, and that is the system's responsibility.  This program cannot be separated from MSU-Bozeman's or MSU-Northern's accreditation process.  She indicated it also was necessary to consider the resources needed, and the cost of the program, as well as the faculty shortage that impacts the program.  Although it should be done, there is the question of whether they can do it.  Susan Raft gave a brief overview of the data on progress to degree and retention of the students in this cohort.  Mr. Cross noted that although the students knew from the beginning that there would be only eight slots for the clinical training, they were willing to compete for two years for those slots.  President Gamble explained his model was one he had seen work elsewhere, supplying the current need in an area to saturate the marketplace, and then move the program to another community where it is needed.  It was always possible to return to the original community at a later time.  He explained that nursing education is their most expensive program, and although they are committed to solve the nursing shortage problem, they need to see how it is working, and where it is working.  There were different comments on the initial intent of the program.  Whether this was to be a SWAT program, or a permanent program needs to be cleared up.  Regent Roehm indicated this is a resource issue.  He asked how much the system could spend before it becomes disproportionate to the balance of programs.  This program is way over the norm for nursing costs.   He said the bottom line is an economic issue, and a continuing presence in Shelby would be an economic boon for that city, but the MUS cannot be all things to all people.  Regent Taylor stated that if Shelby put resources into the program thinking it was long term, then the system needs to be up front when going in.  Mr. Cross indicated resources were utilized.  They committed the facilities and equipment, and $10,000 to MSU to support the program, and Chester and Conrad each provided $3000.  He stated all of these communities are financially strapped, but were committed to bringing in the program.  He said he is an auditor and CPA, and he wanted to see the details behind the budget that had been presented.  They are still committed to keeping the program.   Regent Semmens asked if the Shelby hospital had a need for more than ten nurses at the present time.  Mr. Cross indicated it would probably be enough for them, but would do nothing for Conrad, Chester and the surrounding area.  Regent Semmens said he would agree to hit the area that needs the help and to saturate it, then move on.  Mr. Cross offered that they could still do electronic training on the core courses and save some resources.  He believes they should be kept in the loop on the financing, and thinks there are alternative resources.  Regent Semmens asked Mr. Cross if he had the understanding this program would be permanent, to which he replied yes.  Regent Semmens asked President Gamble what his plans were, assuming favorable pass rates, to either move to another rural area or stay in Shelby.  President Gamble said that with limited resources, he has no intent to grow more sites.  The idea was to satisfy the current need, and then to move to another area and fill their need.  Regent Hamilton wished to clear up the issue of the intent of the program.  She believed the program came to the Board for approval as a cooperative program between three campuses, but it was a pilot project.  That means it may not be continued.  She said they also touched on distance education as another initiative from the Shared Leadership group and the Nursing Coordinating group to establish a common core, and investigate how it can be delivered.  They all agreed it was necessary to train those who are place bound, and acknowledge there is an increased cost in delivery away from campus.  The Board needs to decide what commitment it will make.  Chair Mercer asked what the express understanding of the program was, and he wants to see it in writing.  He asked President Gamble to bring rationale to the Board for their participation, before discontinuing the program.  He believes that if this experimental program meets the necessary quality, the MUS has a classic lab experience on how to improve the Montana economy.  He recommended looking at the proposal for the next session to try this in several areas.  MUS cannot fix this program alone.  The taxpayers will have to pay for it. 

The Board took a ten-minute break and reconvened at 9:30 a.m.

DISCUSSION WITH CAMPUS CEOs  

       (President Gamble, President Dennison, Chancellor Capdeville, Dean Hoyle)

Over the course of several meetings, all of the CEOs, on a rotating basis, will have an opportunity to talk with the Board about important higher education issues, trends and directions, and concerns related to their campuses.  The Commissioner will determine the rotation.

Please see attached reports

President Gamble said he would provide a document of their five-year plan.  He indicated planning over the past year has been fruitful, and the campuses responded positively.  He indicated the plan is generally fashioned after the Mission Statement because it doesn't appear to have specific strategic priorities.  He said they needed to do strategic visioning, deciding how the campuses will look in five years.  He encouraged the Board to do a complete strategic plan for the entire system since it would make the jobs of the campuses much easier with those guidelines.  He thanked the Board for providing creative approaches for the campuses, and believe the flexibility is good for them.  He referenced creative acquisition, summer salary policy, refinancing for lower rates, and indicated he wanted to press a little further.  He requested discussion of the degree that individual campuses could deviate from system processes.

President Dennison said he wanted to focus on the national issue in education.  The new bill HR 8243 (the Higher Education Act) was introduced early this month, and hearings will continue through the summer.  The House will have its final version by the end of summer, and the Senate will have its own version.  Although education does not want federal control of education, this bill has some elements of it in it.  It is important to adopt a position, and then communicate that to the delegation.  President Dennison said the bill has some good changes to loans, but it doesn't do much about the entire loan limit problem.  It does have an option for students to consolidate their loans, but it forces them to take variable rather than fixed rates.  He indicated there are several other items of concern, one being quality indicators and student learning outcomes.  He asked the Board if they wanted to continue the way they are going, or if they want to have something imposed on them by the Federal bureaucracy.  He said distance education is a big part of this, and it will open federal loans and grants for distance education, but asked what is the cost, and how would campuses deal with provisions that the accrediting agencies already do.  President Dennison indicated this bill goes a bit too far.  It even deals with a transfer of credits.  There is already a survey being conducted on all the Montana campuses, which must publish the criteria of why they would or would not accept certain credits.  There is a whole range of issues that must be reported in new formats and different ways, and it will require more people to accomplish the reporting.  This mandate is unfunded.

Chancellor Capdeville reported they had just held commencement, and that Commissioner Stearns was their speaker.  She was in Havre for a couple days before that, talking at Rotary, touring tribal campuses, and doing other outreach.  They celebrated the first four-year graduating class 50-year reunion.  He indicated that Northern is unique, offering teacher education, technical education, and workforce development.  He said the Board would have the opportunity to look at the IT infrastructure which the campus accomplished with the fees approved by the Board.  They sometimes have trouble recruiting and retaining faculty, partly due to geography, but also due to low salaries.  They are also faced with some enrollment decline in teacher education.  He believes they have hit the line on teacher education, since there is not much salary differential to justify getting the Masters.  Chancellor Capdeville reported they were able to raise over $2,000,000 for the new Applied Technology Center.  Groundbreaking for the new facility took place the following day.   They struggle to maintain state of the art equipment, and if it were not for the relationships they have developed over the years, they would not have the equipment.  Nonetheless, when students leave MSU-Northern, they do very well.  Companies from out of state love to recruit their students, but most of them want to return to Montana.  He indicated that collaboration with the main campus, and sharing of resources has helped Northern immensely.

Dean Hoyle passed out a folder of items, and pointed out the sheet with the bulleted items which lists their successes and progress over the past year.  It then shows the constraints they face, potential opportunities, and finally their needs.  Dean Hoyle noted the growth of the college, and that the placement rate was 96%, with virtually all of those in Montana.  He said almost all their nurses stay in Helena and/or Montana.  Employers are beginning to act differently toward two-year education, and there is a campaign to improve the image, as a professional service of higher education skills.  UM-Missoula provided the Helena College of Technology with a grant this year, which was used to hire a marketing person.  They also contracted out some services rather than filling vacancies to cut back on expenditures.  An expanded access center including advising and testing has been completed on campus, and they now serve twice as many students in half the time.  The Helena campus received one of ten $10,000 grants for women in non-traditional jobs, and with the help of Senator Burns a $200,000 grant for their training site.  Dean Hoyle said they are working with the City of Helena to expand their revenue streams.  He would like to have more flexibility in management, and to function more as a business than a state institution.

Regent Roehm urged the Commissioner and Board to address the five-year planning process for the MUS.  He believes planning should be ongoing, with regular reassessment.  Some areas of concern to him are distance education which should be led through the Commissioners office, the undercurrent on the structure of two-year education, compensation issues, and the mandated functions of budget and planning as the Board of Education.  Regent Hamilton agreed, and asked for copies of the reports presented by President Gamble and President Dennison.  She indicated the HEA item has been on the Agenda a couple times, and they still need to meet as a Board on that issue, and then communicate to the delegation.  Regent Hamilton also believes the issue of flexibility will be very important, and it is be touched on by the Shared Leadership Group and the Budget Committee.  Regent Taylor agreed that a planning process is needed at this time, as the targets are moving.  Regent Semmens said the Budget Committee had opted to defer on the salary issue until they have more information.  He asked Dean Hoyle to provide the source of data he referred to, which was in conflict with the data he knows himself.  Regent Foster reinforced the need for flexibility, indicating they need to prepare, and then prepare to change.  The focus on workforce development will be beneficial to all of Montana, and it puts the Board in the position of making sure they are addressing the differences between the two- and four-year campuses, and how to make it work smoothly.  Regent Mercer noted that with the changes in the Board, and the problems in getting together, it would probably be a good idea to meet this fall to work on strategic planning, with input from the campuses.  He would like to address the latitude of campuses to differ within the system, as well as within their own side of the system.  He suggested the CEOs let the Commissioner know if they like this suggestion.

END DISCUSSION WITH CEOs

ACADEMIC/STUDENT AFFAIRS ITEMS continued

d.

Military Studies - ITEM 122-2014-R0104 - Authorization to Establish a Minor in Military Studies; Montana State University-Bozeman (Revised)   Summary   Proposal

   Regent Hur MOVED for APPROVAL of item d.

Regent Roehm asked if this item was authorized under Policy 303.1 which states that a minor must be taken along with the major.  He said there appears nothing new is being offered, but only the courses they already have.  He believes the proposal would be the same as giving a minor in university studies for taking core courses.  Regent Roehm indicated the excellent opportunity this is to use history courses, which would be in the area of the major.  He would not support the item.  Chair Mercer asked if this item complied with the Regents Policy.  Sr. Vice Provost Joe Fedock indicated it was their belief this does satisfy the requirements of the policy.  He indicated one would take the courses along with the major, and this is fairly typical in the other 33 non-teaching minors.  It represents a range of courses that complement the major.  Deputy Commissioner Barber indicated a true minor is for the student's own interest.  Some have breadth, and others are concentrated or specialized, and tend to reflect the culture of the campus.  They could differ between MSU and UM.  He believes the proposal meets the letter of the policy, and it has been through the internal review process, and approved by the appropriate administrators.  Regent Semmens inquired if the proposal was for 18 credits, and if more than ROTC students were required to take these now, and if they could be used for other than a minor.  Joe Fedock replied the requirements are for 24-29 credits, and they would be taken in addition to the major.  The proposal is not limited to Cadets, but is open to all students.  Regent Hamilton asked if there is articulation of this program with other campuses and if they had considered delivering the program to other communities, or the armed services.  Joe Fedock replied the answer was no, but the comments were well taken.  Chairman Mercer indicated it would not be fair to vote the proposal down based on the policy.  However, the policies should be reviewed and updated with clearer language.  Regent Roehm suggested a process for Roger Barber to obtain feedback from the CAOs as to whether or not the policy definitions describe what the Board wants, and if the proper rigor is required.  Roger Barber and Commissioner Sheila Stearns agreed to handle this assignment.

   Item d. was APPROVED on a 6-1 vote with Regent Roehm dissenting.

e.

Admissions Policies ITEM 123-103-R0504 Amend Admissions Policies; MUS

   Regent Semmens MOVED for APPROVAL of item e.

Deputy Commissioner Barber gave a brief history of his efforts with this item, wherein he tried to bring all the policies for resident students into one policy and all the policies for non-resident students into another policy.  He explained that currently the policies indicate they do not apply to the two-year campuses, but they do want to be covered under them.  He looked for those policies that related to all campuses, those for the four-year campuses, and those for the two-year campuses.  He noted that UM directs some of its students to the College of Technology when they are admitted.  Regent Roehm indicated he has often been confused on the accounting between UM-Missoula and their College of Technology.  He said the total campus population including the College of Technology are listed as attending UM, but none of the others report that way.  He asked that this information be broken out.  President Dennison responded that students are reported attending the campus they are on, either UM or the College of Technology, and the same is true at Montana Tech and its College of Technology.  Regent Hamilton referred to attrition rates and how they are tracked, and indicated she would like the Board to discuss methods of dealing with retention, progression and other issues related to these.  She noted the large campuses have done a good job of tracking, but there is a need for better data on where the graduates go, and other indications of success.  Regent Hamilton said that Native American students do a better job at the system campuses when they first graduate from the tribal colleges.  She stated the Board needs to look at policy development as they make progress in P-20 to raise the bar.  Regent Semmens suggested it may be necessary to impose more rigorous requirements, with the possibility the students may need to attend the CoTs first.  Chairman Mercer asked if these proposed policy changes had been distributed to every high school counselor.  Roger Barber replied he had not yet done so.  

Chairman Mercer then asked the Board to wait on this item until the high schools have had a chance to see the proposed changes.  

Commissioner Stearns advised she will be calling a meeting of the leaders in the system for mid-June.  She suggested that these very issues be evaluated at that time, and suspected they could use more staff advice before returning with a refined proposal.  Regent Semmens asked if there was any reason this item could not wait until the July meeting.  The Deputy Commissioner indicated that would be best since the Board has not yet passed the new writing standards.  He also reminded the Board that there is nothing new in the item before them, because all he did was attempt to consolidate several policies into two.  Chair Mercer indicated that no matter what is done, everyone needs to see the changes in advance.  He also feels it could be revised for simplicity, and a fresh look at it might make the difference.

 Regent Roehm MOVED to TABLE Item e. until the above considerations have been handled. 

  Motion to TABLE was APPROVED on a 6-1 vote with Regent Hamilton dissenting.

f.

Letter to Congressional Delegation Action Item Student Regent Hur

  Regent Hur MOVED to APPROVE Item f.

Regent Hur explained this letter is an opportunity for students to urge the Congressional Delegation to reconsider certain proposals in the Reauthorization Act.  Regent Roehm asked that the letter be rewritten since it lacks supporting data.  Regent Semmens agreed that a letter needs to go to the Delegation, but suggested the letter be substantive, and include several issues that are problems with specific recommendations and statistics.  Chair Mercer stated the Board needs to write a letter.  The students did it when no one else did.  He recommended the students be involved in the drafting process, and follow the recommendations given here.  Regent Hamilton agreed the letter needs supporting documentation, but reminded the Board that each of them can write a letter to the delegation in addition to the position taken by the Board.  Commissioner Stearns agreed to work with the CEOs to create a letter with related data and good focus.  A draft will be sent to the Board in the next few days.  Regent Hur agreed to take the letter to the Commissioner and senior staff to work with the Board and students to get it modified and sent out.

 It was UNANIMOUSLY AGREED that the student letter should be revised, plus a letter is to be written on behalf of the Board to the Congressional Delegation covering the same issue. 

g.

Military Sciences Minor Process at University of Montana-Missoula Regent Mercer  Attachment 1    Attachment 2   Attachment 3   Attachment 4   Attachment 5   Attachment 6

Chair Mercer referred to Attachment 3-Rationale of the documents provided by the campus, which states that many members of the committee were worried about Pentagon policy, and other things related to war.  This is not the information that was provided to the Board in the beginning, and he stated that judging programs based on political beliefs is wrong.   President Dennison agreed completely, and reminded faculty that when people raise these issues, the rest need to say they are not relevant and move ahead.  Some faculty argued for the freedom of expression because it stimulates thoughts, and ideas.  They expressed concern over limitations on political comments they believe they should be able to make.  Chair Mercer exhorted them not to cover their political beliefs when judging programs.

END ACADEMIC/STUDENT AFFAIRS ITEMS

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CONSENT AGENDA

Staff Items:

a.

ITEM 123-100-R0504 Staff; Office Commissioner of Higher Education

b.

ITEM 123-1000-R0504 Staff; The University of Montana-Missoula

c.

ITEM 123-1002-R0504 Authorization to Confer the Title of Professor Emeritus of Sociology upon William M. McBroom; The University of Montana-Missoula

d.

ITEM 123-1003-R0504 Authorization to Confer the title of Professor Emeritus of Political Science upon Forest Grieves; The University of Montana-Missoula

e.

ITEM 123-1004-R0504 Authorization to Confer the Title of Professor Emeritus of English upon Bruce Bigley; The University of Montana-Missoula

f.

ITEM 123-1005-R0504 Authorization to Confer the Title of Professor Emeritus of Biological Science and Zoology upon Delbert L. Kilgore, The University of Montana-Missoula

g.

ITEM 123-1006-R0504 Authorization to Confer the title of Professor Emeritus of Geology upon Donald W. Hyndman; The University of Montana-Missoula

h.

ITEM 123-1007-R0504 Authorization to Confer the Title of Professor Emeritus of Geology upon Don Winston; The University of Montana-Missoula

i.

ITEM 123-1500-R0504 Staff; Montana Tech of The University of Montana

j.

ITEM 123-1500A-R0504 Staff; Montana Bureau of Mines and Geology

k.

ITEM 123-1600-R0504 Staff; The University of Montana-Western

l.

ITEM 123-1601-R0504 Authorization to confer the Title of Professor Emeritus of Mathematics upon E. Otis Thompson; The University of Montana-Western

m.

ITEM 123-1602-R0504 Authorization to Confer the Title of Assistant Professor Emeritus of Business upon Glenda Elser; The University of Montana-Western

n.

ITEM 123-1900-R0504 Staff; The University of Montana - Helena College of Technology

o.

ITEM 123-2000-R0504 Staff; Montana State University-Bozeman

p.

ITEM 123-2001-R0504 Authorization to Confer the Title of Professor Emeritus of Microbiology upon John William Costerton; Montana State University-Bozeman

q.

ITEM 123-2300-R0504 Staff; Agricultural Experiment Station

r.

ITEM 123-2400-R0504 Staff; Cooperative Extension Service

s.

ITEM 123-2700-R0504 Staff; Montana State University-Billings

t.

ITEM 123-2800-R0504 Staff; Montana State University-Northern

u.

ITEM 123-2850-R0504 Staff; Montana State University - Great Falls College of Technology

   Regent Roehm MOVED for APPROVAL of all staff items.

   Motion was APPROVED unanimously on a 7-0 vote. 

Labor Agreements/Other

a.

Local Executive Boards - ITEM 123-106-R0504 Confirmation of Governor Martz' appointments to Local Executive Boards; Montana University System

b.

Rural Physicians Incentives - ITEM 123-105-R0504 Montana Rural Physicians Incentive Program; Montana University System

Regent Roehm asked if the placement of a physician in Polson met the requirements of the Rural Physicians Incentive Program.  Commissioner Stearns indicated the committee had reviewed that issue thoroughly, and it was within the requirements of the program.

   Regent Roehm MOVED for APPROVAL of items a. and b. 

   Motion was APPROVED unanimously on a 7-0 vote. 

Academic Items

a.

LEVEL II MEMO (Presented to the CAOs at this meeting)

1. University College - ITEM 123-2005-R0504 - Authorization to Reorganize Five University-wide Programs into an Administrative Structure entitled University College; Montana State University-Bozeman

2. Childhood Trauma - ITEM 123-1010-R0504 The Montana Center for the Investigation and Treatment of Childhood Trauma at the Division of Educational Research and Service; The University of Montana-Missoula

3. Radiologic Technology (AAS) ITEM 123-1001-R0504 - Radiologic Technology; The University of Montana-Missoula College of Technology and Montana Tech of The University of Montana College of Technology

4. Preservation Technology - ITEM 123-1502-R0504 Historic Preservation Technology; Montana Tech of The University of Montana

5. Networking Technology - ITEM 123-1501-R0504 Networking Technology; Montana Tech of The University of Montana

b.

Level I Memo

c.

MSU-Great Falls Academic Programming in Bozeman Information Only Dean Moe

Regent Roehm MOVED for ACCEPTANCE of items a., b., and c. 

Motion was APPROVED unanimously on a 7-0 vote with Item a. to move to the full Board for Action at the July 7-9, 2004 meeting. 

Administrative/Budget Items

a.

Expend Student Computer Fees - ITEM 123-1503-R0504 Authorization to Expend Student Computer Fees; Montana Tech of The University of Montana

b.

Expend Computer Fee - ITEM 123-2801-R0504 Authorization to Expend Student Computer Fee Allocation; Montana State University-Northern

c.

Allocate Computer Fee - ITEM 123-1008-R0504 Student Computer Fee Equipment Allocation; The University of Montana-Missoula

d.

Expend Computer & Equipment Fees - ITEM 123-1901-R0504 Authorization to Expend Student Computer & Equipment Fees; The University of Montana-Helena College of Technology

e.

Status of Regent Approved Projects - ITEM 123-2006-R0504 Annual Status Report on Regents Approved Projects; Montana State University - Bozeman    Attachment

f.

Status of Regent Approved Projects - ITEM 123-1012-R0504 - Annual Status Report on Regents Approved Projects; The University of Montana - Missoula    Attachment

   Regent Roehm MOVED for APPROVAL of items a. through f.

   Motion was APPROVED unanimously on a 7-0 vote. 

END CONSENT AGENDA

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At 12:00 noon the Board recessed for lunch with student leaders, followed by a meeting with Faculty Senate Representatives

The Board reconvened at 1:30 p.m.

SPECIAL REPORT - Report from the Special Panel on the UM Athletics Deficit Judge Dianne Barz    Cover Letter from Judge Barz     Executive Summary   Report    Reduction Plan

Judge Barz requested Laurie Neils explain the layout of the Athletic Report which had been distributed to the Board.  She indicated further they had 100 copies printed at a cost of $15 each, and portions of the report would be posted on the web site.  Judge Barz introduced the members of the panel who were present, those being Pam Joehler, Mark Bruno, Jim Salisbury, Laurie Neils, and Trudy Collins.  She thanked the members who had spent countless hours to conclude the review in a period of six weeks.  She explained they had not conducted a full audit, nor did they review all the ProCard transactions.  Among the findings and recommendations of the panel she reported:

Auditing and Accounting:

          The UM President should re-assess the risk inherent in the financial operations of the athletic department.  Therefore, he should communicate clearly his expectations of enhanced involvement and scrutiny over the financial activity of UM Athletics.

          The level of risk in athletics necessitates a closer review of special purpose audit reports and action plans.

          The Board of Regents should review the relationship of the GSA and UM.

          The President should provide written guidelines as to what is acceptable for campus personnel to seek reimbursement or pay for out of UM Foundation accounts.

          The UM Administration should monitor and control both the revenue and expenditure portions of the athletic operating budget throughout the fiscal year.  The President should provide a realistic funding package for athletics that includes adequate institutional support.

          The Regents should review the revenues and expenses related to concessions, royalties, and collegiate licensing at UM to determine if adequate profits are being realized and subsequently allocated to the athletics budgets.

          The UM should establish and monitor a receivable from GSA for the amount of pledged scholarships donations for the fiscal year.  GSA should establish a corresponding payable.  These two entities should communicate with each other to make certain they are in agreement on the amount outstanding.  

          The Panel recommends that the Board of Regents ask the Legislative Auditor to review the structure, functions, and staffing of the internal audit departments.  The Board of Regents may want to consider establishing an audit oversight committee.

          The special purpose audit (NCAA) of athletics should be completed by December of each year and submitted to the Office of the Commissioner of Higher Education.

          The new athletics fiscal officer should develop a standard reporting format for athletics and develop automated systems that monitors revenue and expenses from all sources, including GSA and Foundation funds.

          All game guarantees should be contractually documented and recorded on the University's accounting records.

          The Board of Regents and UM should analyze the costs incurred versus the value received for trade-outs, comp tickets, and courtesy cars.  Although the amounts seemed excessive to Panel members, we are not experts and do not have a reasonable basis for comparison.

          The new athletics fiscal officer should report to the athletic director as soon as is practicable.  The Office of Administration and Finance should provide increased level of monitoring and oversight of athletics finances.

          Once the Board of Regents has approved a deficit reduction plan for UM, the University should review actual variances from the plan at least semi-annually.

          The UM should ensure that Athletic Department employees comply with policies and procedures regarding ProCard use and ensure that only appropriate travel and university related expenses are charged to the ProCard.

          The University should re-evaluate the number of ProCards issued in the Athletic Department.

          We recommend that the Regents require a thorough audit of UM Athletic Department ProCard charges for FY02 through FY04.

Budget:

          The athletics fiscal officer should develop an operating budget plan in sufficient detail to evaluate the reasonableness of its assumptions.  Input from coaches and other athletics department staff should be solicited and used in developing the budget.  The budget should include all funding sources.

          The athletics fiscal officer should provide timely and meaningful budget status reports to athletic department management and head coaches on a regular basis.  The budget status report should incorporate all funding sources.

          The athletics fiscal officer should not be responsible for advance travel for games.

          The athletic director should ensure that the operating budget is prepared in sufficient detail, with input from coaches and staff, and that includes all funding sources.  The athletic director needs to be attentive to budget variances, provide appropriate oversight over the athletics fiscal officer, and communicate frequently with the President and the Office of Administration and Finance.

          Even though budget responsibilities are decentralized, given the history of athletics deficits, the Office of Planning, Budgeting, and Analysis (OPBA) should provide more thorough analysis of athletics budgets.  The President and VP must develop comprehensive analysis tools that allows for better monitoring of the athletics fiscal operations for Administration and Finance.

          The President should have required the athletic director to be more accountable for presenting an operating plan in sufficient detail for OPBA to analyze and should have investigated when the athletic director and fiscal manager did not respond to OPBA's requests for information regarding the athletics budget.  The President should have required the athletic director not only to raise revenues, but also to control costs.

          The Board of Regents should engage in public discussion and feedback on the athletic reports in November each year.  The policy on negative fund balance should be re-evaluated to determine if the current policy provides disincentive to acknowledge deficits and problem areas.

          The University should evaluate the number of courtesy cars that are provided to the athletic department.

          Head coaches should be more involved in the budget development process and should receive monthly-standardized budget assessment reports.

Chair Mercer thanked the panel for their dedication to this incredible task, and is amazed at the number of suggested items the panel put forth.  He expressed how important it was that such a good cross section of Montana joined with the Montana University System to solve this problem.  Chair Mercer assured the panel that the Board would use the report to be sure their actions reflect the advice of the panel.  Regent Roehm asked the panel if there had been any influence from anyone that would hinder or affect the work of the panel.  Judge Barz responded no, they had excellent cooperation from President Dennison, Robert Duringer, and the athletic department.  Regent Roehm then asked if there was a climate established in the athletic department that being a championship team was more important than the budget, and if it influenced management reporting.  Jim Salisbury indicated there was probably a culture to be national champions, and they needed to be on that track, and this probably was a case of the culture driving the train, not the fiscal issues.  Regent Semmens commented on noncompliance with the policies on ProCards, and asked if there were any other areas where this was the case.  Pam Joehler explained that on the budget side, the Office of Planning Budget and Analysis initiated a new budgeting process a couple years ago which incorporated processes that all were supposed to follow, but in the course of developing the budget and monitoring the assessment process, the athletic department failed to respond.  It was very difficult to get information from athletics.  The panel had a subcommittee look at a portion of the ProCard purchases, and although they have a well-developed policy and procedures manual, the procedures were not built in.  They did not get into more than just the ProCards.  Laurie Neils indicated they had been provided with a copy of the policy and procedures manual which covered many issues, and had a well developed list of actions.  In many cases they weren't following them.  Trudy Collins said they looked specifically at the personal use of cell phones, and the courtesy cars.  In response to a question from Regent Semmens, Judge Barz referred to Finding 11, and said that Chuck Maes who did a line-by-line review, and tried to provide accounting for the past three years, could not do so.  Jim Salisbury also noted that the fiscal officer left in September, and the athletic director in February, so that key people were missing when they were asking questions.  Several members of the panel met with one person and they were disappointed there was no knowledge of the sudden increase in expenditures.  Regent Hamilton referred to the same auditor finding problems in FY04 that should have been reported in FY02, and asked if there was a problem with the structure of the audits.  Judge Barz replied they only wanted to point out that even the professional auditors from outside did not find the errors.  Jim Salisbury said that one issue underscores the accounting in athletics, where money goes back and forth between GSA, athletics and the Foundation.   Regent Hamilton then referred to the recommendation for a legislative audit, and asked if the system was not already audited by the state, and if so, why hadn't they caught it.  Laurie Neils replied that the fiscal auditor attests to the fairness of the audits.  There was reliance on NCAA auditors which is an external group.  However, they look more at NCAA requirements than the big picture.  She suggested the legislative auditor may want to look at which kind of audits to perform at UM, MSU and their peers.  Regent Hamilton asked if the negative fund balance policy could have been a disincentive to report accurately.  Trudy Collins replied there is a disincentive to report negative fund balances, and there is a real scramble at fiscal year end to make ends meet, without looking at what caused the deficits.  Realizing the negative fund accounts need to be reported, she recommended the policy be reconstructed with better ideas.  Ms. Neils also suggested adding to the report a section showing the funds transferred to make a negative fund whole.  Regent Foster asked if the risk in athletics had to do with the financial aspect of donated funds.  Judge Barz replied that was true, that the private sector is expected to provide 2/3 or more of the funds they need, and it is very unpredictable.  Mens' basketball is an example of not living up to expectations, with lack of attendance.  Regent Roehm expressed concern that under GASB 39 transfers from affiliated foundations be accounted properly.  Laurie Neils explained when funds are transferred to UM for athletics, they are deposited into the UM account and shown as restricted funding.  The part that is difficult are the funds spent at the foundation for the benefit of athletics or others.  The foundation report was requested for the evaluation, and it was difficult to get the information.  Laurie Neils indicated she understands someone at the university is approving those expenditures.  Regent Hur asked how the athletic deficit was able to recur after the CEOs had the charge to take care of the deficit.  Laurie Neils replied that President Dennison took the charge seriously, and gave clear orders to have it cleared.  Both Rob Edwards and Wayne Hogan knew it was the expectation to clear by FY03.  Some funds had to be transferred to help fix it.  There was reliance on other funds to cover up a problem.  MSU let their deficit stand alone with no transfers.  Regent Semmens asked if quarterly reviews of expenditures and revenues were not in place.  Pam Joehler explained that once the budget office at UM implemented the new procedure they sat down quarterly to review the budget, but the problem was the difficulty in getting explanations from athletics to explain the problems.  There were no consequences for not providing an explanation.  Trudy Collins said the quarterly process looks only at the designated funds, but to get the true picture there is a need to combine all the funds together.  Commissioner Stearns asked if the revenues were being checked off as they came in after July 1, 2003.  Ms. Neils replied some came in after June 30, but were for FY02.  Some were advertising revenues, but most came before June 30.  The Commissioner commented that she thought Ms. Neils had told her at the end of the fiscal year that those in charge were celebratory for having solved the problem.  Laurie Neils stated everyone on the panel thought the people involved had it balanced out at the end of the year.  No one intentionally cooked the books.  Rob Edwards told the panel that when the books closed positive, he knew of no errors, and if there were any they were done unknowingly, but he didn't think he had made any errors.  Judge Barz said the panel was looking at credibility and all were totally surprised at the deficit, and the panel found it incredible they could be so stupid.  Commissioner Stearns asked if the errors in athletic accounting were not so much traditional errors, as not adjusting to the changes in procedures.   Jim Salisbury said it was not adapting to the changes in accounting procedures.  Rob Edwards was on the payroll at GSA in 2002, and someone should have known they had a problem.  They should have adjusted by $200,000 as owed back to GSA.  There was poor communication, misunderstanding, and there should have been exit conferences and audits.  Commissioner Stearns said that confirmed her own suspicions.  Mr. Salisbury said the main error was when Rob Edwards thought the GSA owed him more money.  In response to a question from the Commissioner, Ms. Neils indicated that other accounts across the UM campus had been cleared of negative balances, and have remained in that condition.  She also reported they had put together spread sheets to show by sport and category where the losses were, and they were looking for the overall reason behind the sudden increases, but the panel had run out of time.  She and Judge Barz recommended it be delved into from FY00 through FY04.

President Dennison reported they have hired a fiscal officer who is qualified and had been in another athletic program.  There will be rigorous collaboration on the budget in the future, on a weekly basis for some time, and then monthly if appropriate, and then quarterly.  He said they will do a review of the ProCard and provide a report to the Board.  President Dennison indicated he did not know for some time the Rob Edwards was not just fiscal, but was traveling with the teams.  Although this was the same practice of the previous fiscal officer, Mr. Edwards was not giving appropriate attention to his duties.  In response to the remark made that he had picked Mr. Edwards for the position, he noted he never knew him before and received a report from the department manager telling him this was the right person.  President Dennison is further surprised about spending from the foundation.  It is his understanding that foundation funds are transferred to the university and then expended.  Exceptions would be any funds donated to work on the stadium which is according to statute.  Also excepted is the acquisition of championship rings.  He stated the foundation does not spend the money, but are shown the records of how spent by the university.  President Dennison indicated they will be following all the recommendations in the report from the panel, and noted that the elements of the deficit reduction plan were on page 39.  In addition to increased ticket prices, they will be using funds from the Coke contract and collegiate licensing.  To address the structural deficit, they have proposed a $15 athletic fee for students who enroll for less than seven credits.  If the plan goes off track, President Dennison committed a portion of the contingency fund to prevent another deficit.

Following a ten-minute break, the Board reconvened at 3:25 p.m.

Questions were addressed to President Dennison by the Regents and the Panel on a variety of points in the budget, on both revenues and expenditures.  In response to a request for an explanation of the dramatic increase in expenditures from FY01 to FY02 President Dennison gave some of the major elements, but promised a detailed explanation at the next meeting.  Chair Mercer referred to his phone conversation with President Dennison in the fall of 2003, in which he advised President Dennison the media had told him there were some serious problems in athletics, and after checking President Dennison had told him there was a problem with the cell phones.  He asked what inquiry he had made on the issue.  President Dennison replied he made inquiries with his people and learned there was a current audit on the cell phones, which he believed to be an immaterial amount.  Chair Mercer asked President Dennison precisely who had told him this, to which he replied it was Robert Duringer.  Chair Mercer recommended a system be established to protect the president in the future from poor recommendations by search panels, such as the one that hired Rob Edwards.

 There was consensus of the Board to provide the members of the Panel with certificates of appreciation, and to keep them informed as this matter develops

Chair Mercer told the Board the report asked the Regents to do certain things.  He requested a vote to do the audit of the ProCard charges right away, using some internal people, or a group approved by the panel which would be acceptable to the legislature and the governor.  

 Regent Hur MOVED ADOPTION of the recommendation for an audit of the ProCard usage as soon as possible

Chair Mercer asked the panel if they would be agreeable to work with the audit group.  Regent Hamilton indicated she was unclear on whether the motion was for an internal or external audit.  She believed it should be done externally.  Chair Mercer indicated it might take up to six months for an external audit to be done, and Laurie Neils agreed saying it would have to go out to bid.  Regent Semmens recommended the customary procedure when financial or management audit recommendations are made, which is for management to evaluate and develop written responses on whether they disagree with the recommendations or prefer to proceed in another fashion.  He noted there were six or seven recommendations directed to the Board, with the balance to the campus or departments.  He suggested the process be undertaken on the campus, and asked that the Commissioner provide guidance on the six or seven Board items, while possibly endorsing the ProCard audit today.  Commissioner Stearns agreed that she would like her staff to analyze the recommendations, using the customary procedure and bring a response to the Board at the July 8-9, 2004 meeting.  

 Regent Hur WITHDREW his Motion

 Regent Semmens MOVED for APPROVAL to pursue the recommendations as stated by the panel.

Motion was APPROVED unanimously on 7-0 vote

Chair Mercer stated it was necessary to get the audit done, and internally with the concurrence of quality by the panel.  He again asked the panel if they would be willing to do this.  Judge Barz replied there was a quorum of the panel present, and they gave their approval.  

 Regent Hur MOVED Approval of an internal audit of the ProCard usage, with the best personnel being chosen by the Commissioner, and that it move expeditiously.

Motion was APPROVED unanimously on 7-0 vote

END SPECIAL REPORT

DEFICIT REDUCTION PLAN

Deficit Reduction Plan

Chair Mercer indicated he would like to take up the deficit reduction plan, and do the balance of fees tomorrow.  President Dennison noted a $15 athletic fee for students enrolled for fewer than 7 credits, and a $2 athletic fee increase for full time students.  He requested the Board approve both fees and the overall plan.

 Regent Hur MOVED to TABLE the plan until President Dennison could return with a plan describing what would happen if there were no increases.

 Regent Hamilton MOVED to ACCEPT the report and APPROVE the proposed deficit reduction plan

 Motion to ACCEPT the report was APPROVED unanimously on 7-0 vote

 Regent Hur MOVED to TABLE the proposed plan

 Motion to TABLE APPROVED on a 4-3 vote with Regents Mercer, Semmens and Hamilton dissenting

Fees

 Regent Hur MOVED APPROVAL of the balance of fees with the exception of the UM athletic fees, and reiterated his request for President Dennison to provide a plan showing the results expected if there were no increases.

Regent Semmens then MOVED ADOPTION of all the fees, and if approved, that FY05 athletic fees be covered by the $40,000 from the Regents' discretionary fund, with no increase this year to the students.  Additionally, the balance would not take effect unless the plan remains on track.

Regent Hur said in recognizing the compromise made and that others are putting their money in to help, he would agree to do it this time.  Regent Hamilton asked if there was still $40,000 available to the Board.  Rod Sundsted stated there was still a balance of $102,000.

  Regent Hamilton ACCEPTED the amendments to her motion

Regent Foster indicated he was confused but would support the motion since it at least gives the students a glimmer of hope.  He agreed with Regent Roehm's issues and that the students had no responsibility for this problem.  Regent Taylor indicated she would not support the motion since it is not the students' problem, and increasing their rates to fix a problem will set a precedent for other campuses.  Regent Roehm wanted assurance on the internal checks and balances, and that UM has accepted and will implement fully the suggestions of the panel so the Board could know this won't happen again.  Regent Hamilton indicated she was concerned about waiting until July, and she believes the Board does share in what happened.  She believes the Board needs to be made aware of the athletic issues over time, but if the Board takes a negative action today, it will be perceived as punitive for something that is the responsibility of a handful of people.  The additional restrictions would assure accountability, and Regent Hamilton stated the Board had an obligation to take action.

 Student Athletic fees were DENIED on a roll call vote of 4-3 with Regents Hamilton, Mercer and Semmens supporting.

 Regent Roehm MOVED approval for the Board to reconsider at the July 8-9, 2004 meeting.

Chair Mercer stated when people get together to solve a problem, and it is shot down, then the Board takes the responsibility on their own shoulders.  He stated that those who had voted no must come up with alternatives.  He indicated he would not vote to reconsider because the Board either makes a decision or not.  Regent Roehm indicated he had been advised by Chief Legal Counsel LeRoy Schramm that he did not need a motion, but only a statement he would bring it up in July.

 Regent Roehm withdrew his motion.

President Dennison stated he appreciated the difficulty of the issues and of finding a solution, but he believed the solution should be found at this meeting.  He indicated the plan could not be put together if there were no firm numbers.

The Board recessed at 5:05 p.m.

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FRIDAY, May 21, 2004

The Full Board reconvened at 8:35 a.m.

STUDENT REPORTS

Please see attached reports

END STUDENT REPORTS

ADMINISTRATIVE/BUDGET ITEMS

a.

Validation of Fees - ITEM 123-101-R0504 Inventory and Validation of Fees; Montana University System   Community Colleges

  Regent Hur MOVED approval of Item a. with the exception of the UM Athletic Fees

Regent Semmens asked if there was any feedback on the nursing fee at Montana Tech.  Regent Hamilton indicated she would support the motion except for a graduation fee at MSU, and the building fees at UM and MT Tech.

Chair Mercer divided the UM Building Fee, the Montana Tech Building Fee, the Graduation Fee at MSU, the $150 nursing fee, and the e-fee for separate consideration.

Chair Mercer began with the building fee increases, reminding the Board they had denied a small athletic fee the previous day.  Rod Sundsted indicated UM was increasing from $2.25 to $5.00 and Montana Tech from $3.75 to $5.00.  He reminded the Board that Dawson Community College is not on the same schedule, and that he had given them a memo the previous day detailing the progress.  The Board of Trustees approved a $1 student activity fee, and a $1 Computer Fee, and the student building fee increased to $7, with a special fee of $7 to be used to service the debt.  Chair Mercer stated that in respect to the Trustees, they should include the amended fees.  President Dennison reminded the Board that Gale Price had told them about the compromise to reduce the building fee at UM to $4, and Regent Semmens also noted that the student government had endorsed that fee level.  Chancellor Gilmore explained they had not reduced their building fee presented at the March meeting, since it was exactly the amount required to meet the bond payments.  The fee requested in 1997 and 1998 was totally inadequate, and Montana Tech has needed a transfer from UM every year to make the payments.  Student Senate endorsed the increase unanimously, but the full student body did not approve it.  The vote was 52-48.  Regent Hur indicated the Board had been given no alternative policy, and he didn't believe they had all the facts.  He stated they could not just trust the managers that these increases are necessary.  Regent Semmens indicated they are committed to a quality system, and they spend less than any other institution.  He did not believe this was a case of spending gone amok.  He stated the Board had charged the campuses with coming back with a collaborative process to figure out how best to preserve quality.  Regent Semmens said that fees need scrutiny, which is what they were doing, but wholesale rejection is not good.  In response to a question on the e-fee, Rod Sundsted indicated there are costs incurred for accepting credit cards.  He believes there should be a common e-fee across the system.  Regent Hamilton said it is important to remember that the students and the campuses pay fees on credit cards, and there is another fee for using PayPal.  Resources must be provided to do business.  However, since these are ongoing, and related to doing business they would be better included in the tuition across the system.  

The e-pay fee at MSU was APPROVED on a 4-3 vote with Regents Hur, Mercer and Foster dissenting

The building fee at UM was DEFEATED on 3-4 vote with Regents Taylor, Hur, Mercer, and Foster dissenting

The building fee at Montana Tech was DEFEATED on a 3-4 vote with Regents Foster, Taylor, Hur and Mercer dissenting

The $150 nursing fee was DEFEATED on a 3-4 vote with Regents Semmens, Hur, Taylor and Foster dissenting

The increased graduation fee from $30 to $45 at MSU was DEFEATED on  a 2-5 vote with Regents Hamilton and Semmens supporting

Regent Roehm MOVED for reconsideration of the UM athletic deficit reduction plan

Motion was APPROVED on 5-2 vote with Regents Hur and Taylor dissenting

Regent Roehm indicated he had extensive conversation with Gale Price, Regent Semmens and President Dennison, and he wanted to offer a motion that might please most of his colleagues.

Regent Roehm MOVED for approval of the athletic deficit reduction plan as presented with the following modifications

1.   The student athletic fee increases will begin in FY06 at $4 per (term) and increase by $2 per term during FY07 and FY08, provided that:

a.     the quarterly monitoring demonstrates essential elements of the reduction plan are meeting expectations.  Should revenue exceed budget projections, a corresponding reduction in student fees will be recommended to the Regents;

b.     that  UM student leadership be fully involved in planning and review of the athletic budget at a strategic budget planning committee.

2.   For FY05, $40,000 is allocated from the Regents' reserve to the Athletic Reduction Plan which is designed to replace the student fee increase for FY05.

3.   President Dennison publicly commits to comply with all the findings and recommendations in the Barz Report and submits written responses to each of the findings and recommendations to the Board of Regents at the July 8-9, 2004 meeting.

4.   A formal annual review of the progress of the athletic deficit reduction plan be presented at each March Board meeting until the plan is completed.

5.   Every associated athletic fee increase will be tentative and must be reapproved each year by the Board of Regents.

6.   Repayment of the standing deficit portion of the plan will be extended one extra year (to FY10) and the extra funds generated each year will be applied toward either decreasing the institutional support, or decreasing the student fee increase.

Regent Foster asked what was different about this plan from that offered by Chair Mercer.  Chair Mercer replied it had some better things in it.  He would not support tentative approval with the need to revoke, nor the sunset because of the structural deficit.  Chair Mercer indicated he was interested in the automatic self-enforcing element if the plan is not on target, with the fee coming off with no positive action.  He also wished to see this on a two-year cycle rather than every time they meet.  He asked Regent Roehm if he would consider the automatic self enforcing element, as well as removing the sunset.  Regent Foster asked ASUM President Gale Price about the availability of seating for students at the games.  She indicated that at most typical games, they don't sell all the student tickets.  Those games that are short of seats are homecoming, Cat-Griz or other big games.   She indicated she thought the changes would be good, but without the sunset which would be detrimental to the prevention of future deficits.  

Regent Hur asked to divide the question by each amendment.

Regent Roehm WITHDREW number five with the understanding there is an automatic self enforcing element in the plan

Amendment # 1 APPROVED on 5-2 vote with Regents Hur and Taylor dissenting

Amendment # 2 APPROVED on 5-2 vote with Regents Hur and Taylor dissenting

Amendment # 3 APPROVED unanimously on 7-0 vote, which President Dennison complied with at that time

Amendment # 4 APPROVED unanimously on 7-0 vote

Amendment # 6 APPROVED unanimously on 7-0 vote

Following a 10-minute break, the Board reconvened at 10:25

PUBLIC COMMENT

Doug Kaercher, Hill County Commissioner requested the Boards assistance to provide full ride scholarships for the Boys and Girls Clubs across Montana.  He will contact the Commissioner. 

END PUBLIC INPUT

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ADMINISTRATIVE/BUDGET ITEMS continued

b.

Guaranteed Tuition Rates - ITEM 123-107-R0504 Adoption of a Guaranteed Tuition Rate for Two Years Regent Roehm Submission

Regent Roehm asked for additional consideration of both access and image when setting tuition rates.  He proposed consideration of an approach to provide predictability through guaranteed tuition rates.  Following the legislative session, he thinks the Board should be able to guarantee a tuition rate with some sort of COLA for a period of at least two years.  Regent Semmens commented the Board has already agreed to set tuition and fees on a two year cycle, but he is concerned with the term guaranteed.  He also wanted to clarify that the dramatic increase in tuition is tied to the amount of state support, not to the expenditures which are lower than any of the peer states.  He agreed the Board should continue to look at the predictability of tuition on a periodic basis.  Chair Mercer indicated Commissioner Stearns would develop ideas in this area.

c.

LRBP Report Informational item Rod Sundsted

Rod Sundsted indicated this report shows the top twenty projects in priority submitted by the campuses, and the report includes cash and the bonded portions.  They are required to submit the report to the A&E by July.  Mr. Sundsted has not yet prioritized the items himself, but will do so following consultation with the campuses.  He asked the Board to provide him with questions or concerns about the list.  Regent Foster asked if it would be possible to have a single sheet with all the projects listed, and Mr. Sundsted replied it would be in his e-mail early the following week.  Regent Foster asked if the sprinkler systems had been addressed.  Chancellor Sexton indicated that all those at MSU-Billings would be completed by the time school starts up in fall.  Regent Hamilton noted that the Board needs a presentation on safety and security issues since the 9/11 attack, with a system-wide approach.  It was agreed that a report would be presented to the Board at the September 22-24, 2004 meeting.

d.

Enhancement Project - ITEM 123-2002-R0504 Authorization to Construct a Student Facilities Enhancement Project; Montana State University-Bozeman   Attachment

   Regent Hur MOVED for approval of Item d.

President of ASMSU, Scott McCarthy reported they had found support in the student senate for this item, and after developing resolutions, it was then presented to the student body.  This building belongs to the students, and it is their responsibility to maintain it.  Plans are for a "black box", refurbished Strand Union Building and a fitness center.  Due to concerns in the community regarding competition there will be no climbing wall included.  The increased fee of $55 per semester will begin in fall of 2005.  Craig Roloff indicated that if the item is approved, management will form a finance committee to plan all the details.  Chair Mercer stressed the mixed message the students are sending when they state they are maxed out, and can't pay any more, but they are giving themselves a $55 fee for recreation.  The students cannot afford a $2 fee but want to apply a $55 fee on themselves.  Regent Hamilton indicated this was difficult and she could not support the item.  She acknowledged it would improve recruitment and student lifestyle, but she believes the Board has the responsibility to watch the bottom line.  Times are tough and middle- and low-income students are being priced out.  Regent Semmens indicated he would support the item because quality of the campuses has been a key factor in touring with his own college-bound children.  However, he did request a detailed presentation on the full costs including O&M.  Regent Foster indicated he has two children who would have voted on this item, and he had no knowledge of it but he is paying the bill.  He recommended communication with the parents.  Chair Mercer said he wanted to see Montana move ahead in every way, but he would remember this $110 fee and he will bring it up in the future when the students say they cannot afford something.

   Item d. APPROVED on a 5-2 vote with Regents Hamilton and Taylor dissenting

e.

Deferred Maintenance - ITEM 123-1009-R0504 Deferred Maintenance Projects; The University of Montana-Missoula    Attachment 1     Attachment 2

   Regent Semmens MOVED for approval of Item e.

President Dennison indicated that although only the items at the top of the list needed the Board's approval, he wanted them to see all the items.

  Item e. APPROVED unanimously on 7-0 vote

f.

Easement to Norma Jean Hawbaker - ITEM 123-1011-R0504 - Grant of Easement to Norma Jean Hawbaker to permit access to and from Hawbaker residential property across The University of Montana Biological Station at Yellow Bay on Flathead Lake, Lake County; The University of Montana-Missoula.   AgreementMapPictures

Item f. was pulled from the Agenda

g.

Student Health Insurance ITEM 123-112-R0504 Student Health Insurance as recommended by the Consortium Glen Leavitt

   Regent Semmens MOVED for approval of Item g.

Commissioner Stearns indicated this item normally would not go before the Board, but it has a public policy issue and there are concerns among graduate students at UM.  Glen Leavitt reported that few students use the option for spouses or dependents, which drives the costs up for all students.  Following many negotiations and proposals, the consortium recommended dropping the dependent/spouse coverage to keep the premium increase at 4.5%.  Regent Semmens commented that the $603 rate per semester is a great rate.  Blue Cross offers a conversion plan for any student being affected by the change, and will accept previous conditions.  Regent Taylor asked if they had told the 150 individuals affected about the change, and Mr. Mitchell from the consortium replied they did not believe it was appropriate until approved by the Board.  However, they did discuss it on campus.  Regent Taylor had many concerns about the item, and would not support it.  Regent Foster said one in five Montanans are uninsured which affects access to health care.  If uninsured, a person will not seek attention in the early stages, and then the cost becomes much worse.  This can end up as bad debt which drives up the cost of health care.  He would not support the item.  Chair Mercer asked if it was possible to refuse to accept any new dependents, while continuing those who are already covered.  Glen Leavitt indicated he did not know the answer, but couldn't think of any particular reason against it.  Chair Mercer also asked if they could require all dependents and spouses to be covered in order to keep the costs down.  Mr. Mitchell indicated he would find out tomorrow from Blue Cross.  Regent Hamilton said the system is a family and there is an obligation as a family to offer a level of support to all members.  She was concerned about the possible costs for those who are uninsurable under other programs, and would not support the item.  Chair Mercer expressed his appreciation to the consortium for the work they had done on this, but his sense was it would have to wait until the following year, and he hoped they would work on the issues presented by the Board before that time.

   Item g. DEFEATED on 6-1 vote with Regent Semmens supporting

h.

Naming Science Complex - ITEM 123-1013-R0504 - Naming the Science Complex the "Charles H. Clapp Building"; The University of Montana-Missoula

   Regent Hur MOVED for approval of Item h.

   Item h. APPROVED unanimously on 7-0 vote

i.

Naming Lewis and Clark Village Community Center - ITEM 123-1014-R0504 - Naming the Lewis and Clark Village Community center the "Barbara Hollmann Community Center";  The University of Montana-Missoula

   Regent Hur MOVED for approval of Item j.

   Item j. APPROVED unanimously on 7-0 vote 

j.

Affiliated Foundations Policy - ITEM 122-109-R0304 Amend Policy 901.9 Campus Affiliated Foundations

k.

Foundation Operating Agreement - ITEM 123-2007-R0504 Foundation Operating Agreement; Montana State University-Bozeman

l.

Foundation Operating Agreement - ITEM 123-2703-R0504 Foundation Operating Agreement; Montana State University Billings

m.

Joint Venture Format ITEM 123-111-R0504 Format to be used with Policy 407 - University System/Employee Joint Ventures; Montana University System   Attachment    Form

n.

Update on FY03 Reported Negative Fund Balances Laurie Neils

Items j., k., l., m. and n. were delayed to the July 7-9, 2004 meeting

END ADMINISTRATIVE/BUDGET ITEMS

SYSTEM ISSUES

a.

Committee and Meeting Structure ITEM 123-110-R0504 Amend Policy 201.7 By-Laws ART VII. Committees.  (Committee and Meeting Structure for the Board) Regent Mercer

b.

Trust Lands ITEM 123-109-R0504 - Administrative Assessments on University Land Grant Income:  Board Options LeRoy Schramm (Evaluation by Greg Petesch)   Attachment 1   Attachment 2   Attachment 3

Items a. and b. were delayed to the July 7-9, 2004 meeting

END SYSTEM ISSUES

ELECTION OF OFFICERS

   Regent Taylor NOMINATED Regent Mercer as the new Chair

   Motion approved on 6-0 vote with Regent Hamilton abstaining

   Regent Taylor NOMINATED Regent Foster as the new Vice Chair

   Motion approved on 6-0 vote with Regent Hamilton abstaining

Chair Mercer presented Regent Hur with a certificate of appreciation as he leaves the Board.  He then announced the Board would go into Executive Session for personnel evaluations of Presidents Dennison and Gamble.  Regent Taylor was excused from the meeting at that time.

The Board recessed to Executive Session at 12:10

EXECUTIVE SESSION

a.

Personnel Review President Gamble

b.

Personnel Review President Dennison

With no further business to come before the Board, the meeting adjourned at 2:00 p.m.

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