University of Minnesota Board of Regents – Finance and Operations Committee

– Finance and
Operations Committee. December 14th, 2017. Our first item of business is administrative cost
definition and benchmarking. I’m gonna ask Associate
Vice President Julie Tonneson to come
up and talk to us. And whenever you’re
ready, Brian Burnett. – Yes. Thank you Mr. Chairman and good afternoon
members of the committee. This marks the sixth
year in which we’ve been reporting the results of the administrative
cost benchmarking
analysis to the board. Up until this year and with the
reorganization of the board, it has been presented,
historically, to just the finance committee. Because new members will
be reviewing the results for the first time this
year, the docket summary and some of our comments
today will backtrack a bit, give some background
to explain the purpose and the basic outline
of this analysis, focusing on the results for
fiscal year ’17 while doing so. We will also be commenting on the last three years
of comparable data, so you can see some trends and
touch on some lessons learned and an assessment
of a few outcomes attached to this analysis. This analysis grew
from a desire to benchmark administrative costs, which we will talk
more about, but it has added value beyond
that, in teaching us more about overall expenditures. Associate VP Julie Tonneson
will walk you through the latest version
of the analysis, but before she does I want
to commend her and her team. This is not easy work and it
provides critical information to the university that
isn’t readily available to most other institutions,
so we’re extremely fortunate to have Julie and her team
with this detailed work and with turn it over
to Associate Vice
President Tonneson. – Good afternoon
Mr. chair members. The original goals
of this analysis were actually not that many. There were few. The intent was to create a new
way of viewing expenditures and a shared way of
understanding them and talking about
them on campus. Additionally, we
hoped to uncover ways in which things were
being recorded differently across units, that could be
and should be made consistent and in categorizing
the expenditures, we could track them over time and build benchmarks
that we could manage too. I wanna add just a
few notes for context, about the analysis here. The impetus, as Senior Vice
President Burnett said, for creating this analysis
was really a desire to define administrative costs. You may remember at the time
it was FY10 through FY12. There was some critical
press about the university in the level of
administrative cost here compared to other institutions, but we learned very
quickly that when you ask a group of people, “What
does administration mean”, no one had the same answer. So we decided that in order
to be able to track this and benchmark against it,
we had to first define it. So what you see here and
that we’ll explain today was our attempt to do so and we have maintained
that for six years. A second note, the total
expenditure results you see here will not equal what you see
on the financial statements and that’s primarily
because this analysis does not factor in some
of the accounting entries for accruals and deferrals
and depreciation, that are done at the
very highest level
of the institution. This really reflects
what you could call regular expenditures
occurring in the units. Third, this analysis
cannot be compared to what is or isn’t happening
at other institutions. We know very few places that
delve into it in this way and some are beginning to,
but they will be different, because we do rely on
some of the unique aspects of our system and our data
to pull this together. And finally, you can’t
compare what you see today with the same report that
we delivered last year, due to changes in methodology, so we’ll talk about
that a little bit too. So how is this analysis
best described? When we were developing
it, we met with many different people and
consulted along the way, in order to categorize
our expenditures in ways that people
thought was reasonable and we ended up with the
following three buckets. First, direct mission delivery, for the costs of
those people that actually do the
instruction, research and public service as well as the support costs that
are associated with them. Student aid is not included
in the total mission delivery. It is a pulled out,
separate category here. The second group is mission
support and facilities, for the cost of those
that support the mission, but do not actually
do mission work. This includes
non-supervisory people only and their supply
costs as well as all the facility costs
of the institution are in this category
and some things that people don’t
automatically think of as being associated
with employees. Things like study abroad fees that we pay to
other institutions or royalty payments
that we have to pay to inventors and so forth. Those are included in
this second category. The third category is
leadership and oversight and that’s for those that have leadership or management
roles at the institution, so supervisors, regardless of
where they exist in the units. We use job codes and
expenditure coding in the financial
system by function and by object code,
to get the results. I’m not going to go through
the methodology in detail, but if you have
questions on that I’d be happy to answer
them at another time. And a final note here
is to make the point that mission does not just
happen in academic units and administration does not
just happen in support units and further, all of these
categories are supported by multiple funding sources,
so there is no direct link, in this analysis,
between a category and a type of unit or a
category and type of revenue. There is a detailed
chart on page six of your docket materials
that provides examples of expenditures new
to these categories, but we’ll talk through each
of the three main ones, just in summary form, here. What you see for
direct mission up here are examples of positions that are included
in this category. Not surprisingly,
it includes all of our instructional
staffs, all faculty, clinical professors and
instructors, et cetera, extension educators
doing public service, all the health
science professionals that are directly
providing service; so nurses, physicians,
veterinarians and so forth; scientists and lab techs
that are working in the labs and we have students that are directly delivering
instruction research and public service as part of
their graduate assistant role. In addition, the support
cost or other purchases here that are coded as
instruction research or public service,
in the system. Direct mission delivery,
as defined here, represents close to half the university’s
total expenditures, 47.6% of that total, in FY17. As I mentioned, we don’t
have a separate slide on the student aid component,
but I just want to say really quickly that
the number that you see on the materials
associated with student aid is not only the
institutional financial aid, such as Promise, but it includes
the federal Pell grants, it includes the SEOG grants and the state grant
funding as well. So it’s a large number. We have identified that as
a separate pull out piece, not directly included
in the mission totals. For the second category,
there are a variety of job code families represented in mission support and
facilities and these, again, are
non-supervisory costs, but this is where you’ll find
the basic support functions of finance, H.R.,
technology, clerical. We also have some
interesting titles that are unique to
universities perhaps. We have librarians and coaches. We have the captain of
the ship and so forth. There are also nondescript
positions here, so coordinators. We have analysts,
project specialists and all of the
operations personnel. Quite a mix here for police,
cooks, cashiers, custodians. Those are all in this
category as well. And finally, this year
we have incorporated the spending for temporary
and casual employees. For the first time,
we’ve included them here in this category as well. In the non-personnel grouping there are really three
types to be aware of. In this group there is
the regular support costs that go along with the
people, so that’s things like travel and supplies
and equipment. But second, all of the
facility costs here, related to ongoing
facility operations: utilities, rent, repair
and maintenance spending and so forth. And finally, based
on regent feedback, beginning just
this year we added the university’s contributions
to capital projects. So that’s direct
spending on the projects as well as debt service
in support of them. They are included
in this category. For FY17 the total spending
for all of these activities was 36% of our
overall expenditures. And finally, turning to
leadership and oversight, which was 8.2% of our
total expenditures in FY17, this is where all
the supervisors, managers and leader
expenses fall. So program directors,
departmental chairs, college deans,
campus chancellors, vice presidents and so forth. A summary then of the
dollars and percents for FY17 is shown here. More details are
shown on page nine of your docket materials,
but for FY17 total spending, given the exclusions that
are a part of this analysis, was 3.5 billion dollars,
with roughly 56% of that in direct support of
mission and student aid. 36%, as I mentioned, for
mission support and facilities and 8.2% for leadership
and oversight. In total 60% of the
spending was for personnel, 2.1 billion dollars,
which has been consistent for many years in
that 60 to 65% range. Within that, the single
largest category of spending is for direct
academic personnel, at close to a billion dollars. That would be the instructors,
scientists and researchers. The second largest category
is for student workers, at close to 250 million dollars, which also is in
that mission column. The most significant spending
in non-personnel activities was for supplies, services
and miscellaneous costs, at over 400 million. This has been true in
the past years as well and it is generally for
things like operating supplies and services, scientific
services, travel, lab supplies, really
a wide variety of different purchases are
included in that category. The second largest
non-personnel expense was for debt service and
capital project transfers, at just under 150 million. Nothing in these
results was surprising or represents a significant
shift from prior years. You can see, here on this chart, we put together
and made comparable the last three years
of information. So you can see that there
is really little change in terms of what each
of these represents as a percent of
our total spending. Personnel costs have remained
very stable year to year, mostly remaining flat or
changing by 1/10 of 1%. And even considering that we
know non-personnel spending to be more volatile, there
has been only one shift between years at over 1% and most are
significantly under that. When you roll the data up at
this full university level, things tend to flatten out and really some
messages become clear. We’ve identified five
significant points that we wanna mention
today as learnings from six years of
reviewing this information. First, the shifts of spending
between categories are small, as I just mentioned. It takes a net movement of 3 and 1/2 million dollars
to shift 1/10 of 1%. Within the docket summary,
we did provide examples of changes that can and do
occur from one year to the next, but there are literally
thousands of those occurring each year, throughout
the institution and the ways in which
they offset one another will change and
adjust year to year. For this reason, the second
point here is also relevant. It is not possible to
see the direct impact of the administrative
reallocations we have been implementing
in these charts. Those reallocations
have served to lower the rate of
growth in cost, particularly in mission
support and facilities and leadership and oversight, because that’s how we have
defined administration. But they do not lead to a
reduction in total spending. Reallocations are
expense reductions, but they’re used to pay for
cost increases in other areas, sometimes within the
same column, if you will, as part of this analysis. Third, we’ve learned
that changes in sponsored grant
funding, in the level or in the way those
grants are administered through subcontracts
versus direct spending in the university, for
example, will directly impact this analysis and particularly
the mission category. Fourth, where we have
areas of growth in program, and MnDRIVE is a recent
good example of this, the mission related spending
associated with that comes with additional
support costs and the ratios you see
between the columns, between mission and
mission support, apply even down at that
program or initiative level. There’s mission spending
and support spending associated with it. And then finally, the
non-personnel spending tends to have more
volatility from year to year and we’ve learned
it’s not so much in the general
supplies and equipment, but more in the
large ticket items, things like big equipment
purchases or facility costs, real estate acquisitions,
royalty payments, those kinds of things
that come and go. And finally, overall we
believe that the analysis actually brings us good
outcome information. There are probably a number
of things we could point out, but there are three that I
wanna highlight just quickly. First, our leadership
and oversight remains less than 10% of
our total spending, actually it’s just over 8%. We believe that the consistency
of that is a good thing. We have also increased
cost, increased spending on mission and
support, but that ratio has remained the same, so
the infrastructure costs are not overtaking our
mission spending by any means. And finally, the data at
this level is used by us, but the data at the unit level is used for management
purposes in the unit. It’s helped them to
understand, monitor and plan their spending in ways that
wasn’t available to them before and has helped us as
we really think through all of our reallocation
exercises every year. So with that, Mr.
Chair I will stop and be happy to
answer questions. – Thank you Vice
President Tonneson. Nice report, good to hear. Are there are anybody
that has questions about what we just discussed? Regent Powell. – Thank you Chair
Anderson and thank you Vice President Tonneson for
a very informative report and good work. I guess the questions I
have are first of all, is there any chance … I’m looking for ways
this very good analysis can be used to
support our ongoing productivity and
efficiency initiatives, because I think that’s
probably a key reason for why we would wanna do this. So I guess the first
question is is there any way that we could package data
from other institutions into comparable buckets, so
that we can compare ourselves across, which can always be
eliminating if we could do that. And then I guess the
second question really is how do you see us being
able to use this data to support productivity
initiatives. One of the things you said
is we’ll use it internally, we’ll use it as an
internal set of benchmarks to shape and identify
issues and opportunities, functionally by department. But any chance we could
somehow benchmark this data, I guess is the question. – [Chair Anderson] Vice
President Tonneson. – Chair Anderson, Regent Powell, I would love to say
yes to that question. When we first started
this analysis, I visited with our
Big Ten colleagues on a number of
occasions in asking them if there’s any way that
they had similar plans or similar sets of information and I got zero back from them. I think at the time
when we started, it wasn’t on their consciousness to even start thinking
about spending this way. I think recently there has
been some interest in it, so I will keep pushing for that. I hesitate to just take
information from their websites and try to interpret it in a way that I could confidently
tell you is comparable and I’m not prepared to do
that, but we’ll continue to work with them and see if
there’s ways we can do that. In terms of using
the information for
productivity purposes, I think a couple of things. One is when we do the analysis
and look at the information, we can dig down pretty
deep into the institution and when we see things that
pop out that look different, within, across the units,
we will investigate that to try to understand
what’s going on. Almost always, it
is explainable. In addition to that I will
say that there are differences between the units and
that’s somewhat based on the functions that they have. You can’t, for example,
look at this and say every college should x percent
in leadership and oversight or x percent in support, because their missions
are different. So I guess we have to
look at what’s happening, what the results
are in those units and combine that with what
we know about the unit, to try to find those places where there is
something going on. But beyond that, they
have been using it, so it isn’t unusual now for
one of them to say to us, for example, “You know that
we’re low in administration “and here is why and
here’s what we’ve done”, because they are
tracking it this way. So I think we’re
starting to move that way and we could use it more
for future analysis too. – Thank you. – [Vice President
Tonneson] Sure. – Thank you Regent Powell. Regent Beeson. – My questions and comments are really building
on Regent Powell’s. This does add clarity to
what we had in those years and it does tell
is with, I think, certainty what our
administrative costs are and the fact that we haven’t become more top
heavy since then. But really the question is about we know the data’s being
used for your budget and we know it’s being
used for the reallocation and we know that
it’s being used to contribute to the 90 million in administrative
cost reduction, but the question though is what
else do we do with the data? And I’ve got a couple of
ideas that I hope Mr. Chair and the chair of the
board in administrational really be proactive
about trying to create some projects,
some deliverables to us. One would be give us the
units around the university whose numbers stand out,
either positive or negative and there may be
explanations or stories, but I think we have to
drill down, we have to sort of see what you’re seeing
and not at a micro level, but where are the
outliers for costs and we may just conclude
these are so differentiated and separate and unrelated that we can’t compare
one thing to another. The other project is … And what jumps out is
even though we’ve cut 90 million of
administrative cost, that percent of the
whole university’s budget has remained about even. So that tells me we’re
having to add new costs on and I’m thinking that that’s
more compliance costs, not productive costs
and I’ve asked before, this board to make that
study of compliance. What percentage of these
costs are compliance costs? Compliance costs are required, but they are nonproductive. They don’t add value
the deliverables that we’re trying to produce. Is that becoming and
increasing burden? We can’t answer that question. So there are some projects that
have to come out of the data that we need you to propose and we need to
keep working with. The foundation’s really solid and I applaud the
work you’ve done. – So that’s not
really a question. That’s a comment. I’m gonna go to Regent Hsu. – Thank you Chair Anderson. Vice President Tonneson,
again, exceptional work. It keeps on getting better. I’m not sure if I asked
this question in the past, but I don’t remember the
answer, (chuckles) if I did. Is there a way to understand
the number of employees in each of the categories
or is it hard to count people as half
or three quarters or whatever fractions of people? – [Chair Anderson] –
Vice President Tonneson. – Chair Anderson, Regent
Hsu, in this analysis alone there is no way to count a
headcount, a number of people. It’s totally expenditure based and that’s over an entire year. So you would have to
pick a point in time to pull a headcount and make
some extrapolation from that compared to the yearlong
set of expenditures, but not from this
analysis alone. We don’t do that. – [Regent Hsu] Okay, thank you. – Thank you.
Thank you Regent Hsu. No other questions. I think– – There’s still
Representative Chen. – Oh, Representative Chen,
I did not see you there. – Thank you Chair Anderson. I have a question with
respect to the methodology. First, I think
this is good work. It’s a new lens to
look at the spending, but I wonder if
the methodology … You mentioned you’re
changing the methodology, but when we look at the past
three years of fiscal 15 to 17, there’s little change. Does that mean other years
are calculated retrospectively based on the new methodology? That’s the first question. And second one is that
for this new methodology, should some roles in
the mission support be in the mission delivery,
such as advisors an librarians? I don’t know how you choose
one specific methodology, because it’s a very new work
that other people do not do. – [Vice President
Tonneson] Sure. – Thank you. – Sure. – [Chair Anderson] Vice
President Tonneson. – Mr. Chair, members, first of
all, on your first question, when we changed the
methodology we go back and apply the new methodology
to the prior two years. We don’t go back
the full six years, but we have done that
for the last three years, so they truly are comparable
using the same methodology. To your second question,
in terms of how we chose which jobs fell
in which category, that was part of the year
long consultative process when we developed the
definitions originally. We looked at each job code
and the name of that job code and a short description,
to try to decide where it fell and then had
many many conversations about where some of
these things should fall and really came down to
if you’re doing research, instruction or public
service that’s what drove it versus more of a
support function to allow those things to happen. But you can argue about that. – [Chair Anderson] Thank you. – [Representative
Chen] Thank you. – Senior Vice President Burnett, do you wanna wrap
up the session here. – Well again I wanna
thank Julie and her team for the work that
they do on this. And to Regent
Powell, your question about can we try and get
peers to come with us on this, it’s been my experience since
joining this institution, that our counterparts
are more taken with some outside firms
and are encouraging us to join them to get peer
data and what comes with that is a 30 to 50,000 dollar
annual subscription price. The beauty of this one is
it’s done by our staff, in house so it
makes sense to us. My goal’s gonna be try and sell a couple of other
institutions to come with us and save the money. But at just the
most recent Big Ten business officers meeting
we had dueling pitches from Wisconsin and
Iowa to look at buying these products
to do benchmarking and I guess I’m reluctant
to make that expenditure just to get that data. I think, again, as Associate
Vice President Tonneson put, we’ve got our group
internally understanding these mission versus mission
support versus administration. I think we’ve got a
really good value piece without paying subscriptions
to an outside firm to try and get there, but
we’re going to continue to try and see if
someone wants to take the cost effective
road to peer benchmarking. But again, we’d be after the
land grants in the Big Ten to come with us, the
public land grants that would look more like us, as opposed to some
of the other members. So to your point, we’re
gonna keep trying. – Thank you Senior
Vice President Burnett. I think that wraps
up our presentation on the cost definition
and benchmarking. We’re gonna move in to the
fiscal 19 budget levers and eventually a
resolution related to undergraduate nonresident,
non-reciprocity tuition rate. I’m gonna ask, again, Senior
Vice President Burnett to introduce the panel
and to take it from here. – Thank you Mr. Chairman and
members of the committee. This afternoon we’re going to
very briefly remind everyone of the revenues included with
our primary budget planning for fiscal year 19, which
begins July 1 of next year and within that, to summarize the president’s
recommended change in the undergrad nonresident,
non-reciprocity tuition rate on the Twin Cities campus. At the end, we will
remind everyone about the non-compensation
expenditures included. We’ll talk about that a bit. We have Vice President
Brown here with us, Vice President of
Human Resource, as the committee had asked
to dig a little deeper into the compensation issues, in this presentation this year. We’ll also spend a few minutes
of aspects we didn’t cover in October, outlining
some concepts for how expenditure
changes for the institution interplay with
the annual budget. And this is a
conversation we had with the finance
committee last fall. And in a few minutes
we’ll spend time describing in more detail
factors that go into the annual decision
on compensation. We plan to leave ample time for committee discussion
of these issues. So with that I would ask
Associate Vice President Julie Tonneson and Vice
President Kathy Brown to walk us through the
presentation before you. – [Chair Anderson] Vice
President Tonneson. Vice President Brown. – Okay Mr. chairmembers,
a quick reminder here on what the framework
revenues are. As we’ve discussed on
numerous occasions, budget planning at the
institutional level largely focuses on the
1.5 billion dollars in our large
discretionary funds, our O&M appropriation
and tuition. The revenues depicted here in
red, light green and yellow are incorporated into the budget that the president will
recommend to you in May, but the planning in these funds is largely done
at the unit level. They intersect with the
discretionary budget framework on occasion, as we work
through the process and the university helps units plan in these funds
and monitors them, but the focus of
the decision making is really around the
appropriation and tuition. The projected changes
in these revenues is supplemented in large
part by an annual plan to internally
reallocate resources, reducing plan
recurring expenditures in order to free up
resources to spend on growing costs or higher
priority activities. So in a way it’s another
form of a resource. For an update on our
appropriations and
our reallocations, very briefly, we
know as of today that there will be no increase in our state
appropriation for FY19. So increases in
that revenue source will not be available
to cover cost increases. We will plan to
include some level of internal reallocation in
next year’s budget however. We believe we will need to find at least 11 million dollars in administrative cost reductions
as part of this exercise in order to meet
that final stretch to the 90 million dollar
goal, but it is very likely that the total planned
internal reallocation will need to be higher
than 11 million dollars. It will have to exceed that, in order to cover cost
increases as well as to help address
areas of the budget that are challenged right now
with structural imbalances. We’ve displayed here,
moving to tuition, some general tuition
revenue plan equivalencies for each 1% change
in the various rates. Each of these assumes
stable enrollment, so it assumes the
entering freshman class, for example, is
the same enrollment as the exiting or
graduating cohort. It also assumes the same
overall student credit hours or course taking patterns as
that is occurring this year. One note I wanna mention for the Twin Cities nonresident,
non-reciprocity rate, because of the commitment to
hold all continuing students to no more than a 5.5% increase, any rate increases above that will generate significantly
less in revenue. And I wanna note that we
continually assess and refine our tuition revenue
estimating models and we have done that
again just recently. I believe all of these are sound with the exception of
the little asterisk. I think it’s probably
closer to 300,000, but we’re still in the ballpark,
so we’ll leave it at that. Specifically related
to the recommendation before you today for action,
the president is recommending a 15% increase to the Twin
Cities undergraduate NRNR, nonresident, non-reciprocity
tuition rate, for incoming freshmen only. This would represent
an increase of $3,748 from what the current
year freshmen are paying. For all continuing
cohorts, he is recommending a 5.5% increase,
which varies from an increase of $1,264 for
current juniors and seniors to 1,449 for current freshmen. In total, we are
estimating these changes to generate 8.8 million dollars. These changes are being
recommended for action now, rather than with the
remainder of the budget in May and June, in order
to benefit the communication and recruiting process
for students and families as they choose a
school for next fall. We will, I am confident, talk
more about this recommendation during the discussion period
after the presentation. So I wanna turn next,
quickly, for a few minutes, to focus on a few
other things and first, how to think about reallocations or expenditure reduction plans in the context of
the annual budget. We touched on this
conceptually last fall, as Senior Vice
President Burnett said, with the finance committee,
that’s the fall of 2016, and I didn’t want to
lose it this year, because I think it
might be helpful as you think about
the big picture budget and what you see coming
forward as reallocations. But many of the reports we
produce and the analysis we do as well as many of the
cost levers in the budget are really from the perspective
of object of expenditure. So when we talk about
salaries or equipment or fringe benefits or
utilities that’s this view. It’s important. We need to understand it. We use it for planning. But often, in strategic
planning around the budget, we wanna talk more from a
functional or programmatic view, whether it is expanding program
x or eliminating program y or improving the rank of the
medical school or the library. Those are really
from a functional or programmatic view
of expenditures. We have to do both and
that makes thinking about cost levers just a
bit more complicated, particularly when we
talk about reallocation. Decisions on a larger
strategic level are often not reflected
well in the annual budget, due to the timing of things. We might be able
to talk about plans to invest new dollars over
time, but in our efforts to count reallocations
to balance the budget on an annual basis,
on the cut side it is harder to think about
this in a multiyear framework. I wanna give you
just one example. Let’s say we were going to
eliminate an academic program. The process from decision
to full elimination may reasonably take
a number of years. And the impact of that
decision on expenses is often recognized in
the budget over time. So as an example as
it could play out, in year one if you decide not to enroll
additional students for that particular program, fewer students might mean
less operating costs. The unit submits a reduction
in operating cost expenditures, as part of their
reallocation plan and we count it that year. In year two and/or
year three or four, as the student numbers
drop you might get a faculty retirement
that you don’t replace. You might get a staff
member moving to a new job, you don’t fill that
position, you eliminate it. In the years those
expenditures drop out, we count those savings in that
year to balance that budget. By the time the program is
gone, in year four or beyond, you can finally say,
“We closed program y, “but we can’t count
any more savings, “because we’ve
already counted it.” And that’s why
the strategic cuts often do not flow
nicely or directly as we would hope they would
for communication purposes. We have to take a longer
view and recognize that the specific actions
involved in these decisions help balance the
budget along the way. I don’t wanna leave
the impression that all of our cuts
are strategic in this. Some are clearly not. They’re one time, but to the
extent that they are this way, it has been difficult
for us to communicate it, because the list
of reallocations that get don’t tell
this type of story. We are working on
more systematic ways
to tell the story, so watch for that as a
supplement to the budget in the future. One of the primary costs we
need to address each year, along the way, is compensation and you had specific
questions about that when we talked in October. So Vice President
Brown is here today to walk through some
more detailed information specifically related
to compensation. – [Chair Anderson]
Vice President Brown. – [Vice President Brown]
Thank you Chair Anderson, members of the committee. Compensation is really a part of the employee value proposition. So the slide that you
have in front of you identifies that we have
differentiators as an employer that are not based
on compensation and compensation
is really kind of at the base of the pyramid. This is something
that can be replicated by almost any other competitor, so what our goal is is
to be market competitive. The compensation
alone is hardly ever the only factor that an
individual will decide in either taking a
job at the university or retaining a job
at the university. So what we’re focusing on
in our discussion here today is in the foundational column at the base of the
pyramid, base pay. And then in the performance
based column, merit increases. Obviously there are other things
that go into that pyramid, at the bottom, that we will
not be focusing on today. We have several
different employee groups at the university. Each employee group
looks at compensation a little bit differently,
but largely the same. We have faculty, professional
and administrative staff, civil service staff,
labor represented, graduate assistants and
professionals in training. All of them have
focuses on base pay and they all are merit
driven compensation, with the exception of our
labor represented employees who do not generally
have merit based pay in their contracts,
although we do have a small portion of merit
based pay in our contract for our represented faculty at the Crookston
and Duluth campus. The page indicates just
the number of employees in the P and A and civil
service job family groups. One of the first
steps that we did in helping us understand
our compensation was to take about
40% of our employees; our faculty job descriptions
need little review; but we didn’t always have
good market comparisons for our P and A and
civil service employees, so we broke them
into job families. The number of employees
in each is here. And this helps us both
know what people do and then we have
done market analysis to determine what is a
good market comparison for the people we
employ doing this work versus people in the
greater community or other appropriate
market study group. Then we make a decision
what’s going to be an annual compensation
pool and that’s part of the budgeting process that
comes to you ever year. The first two bullets really
look to what do we need to pay to recruit and retain talent,
relative to external markets, markets in which we may be
competing for employees. The bottom bullet
obviously goes to what is our capacity to
pay and those factors have to be measured
against each other to determine what is a
reasonable compensation pool on an annual basis. The annual compensation
pool is distributed at the local level and the
key for you to understand is that a 2% compensation
pool does not equate with a 2% across the board increase to every employee and
every employee group. So we have a pool of
money that is allocated at the local level,
based on merit, and those ranges may be 0 to 4%. Occasionally it may be higher, if there’s approved
market adjustment where we’ve identified
a group of employees that are substantially
below their market and need some adjustment. We may add a small pool of
money to help that group get to a competitive
market position. Obviously our labor
agreements determine how that compensation
pool is distributed for the labor
represented employees. Again, 2% in the
pool does not equate to a 2% across the
board for all employees. So just to give you
an idea of how we use the job family data to help
us distribute the money, this is a finance job family. On the left side of this
is the titles that we use and current midpoint
in the ranges. What we’ve discovered
and we’re really moving to the next step
in the job family work is if you take a
professional 2 supervisor and professional 2
independent contributor, which are highlighted in gold, the average there is 58,999 or
the midpoint for that range. What we learned is
there’s actually different types
of work being done in a finance professional,
due to job class, and the future state
is down at the bottom, where we would determine
that some people are doing accounts
receivable, some people are doing cost
accounting, some people are doing financial
planning and analysis. All three of those
subspecialties, if you will, in a professional 2 range of
work have different markets and by breaking this
down, we can determine what is the appropriate midpoint
for the work being done. The first cut of
this was a good pass at getting a much
more informed market than we had
previously been using. This is now a second
pass that will not change anybody’s
job description, will not change their
work, will not necessarily result in them
receiving more money, but really helps when you’re
going to hire someone, how much is this position worth, what should we be paying
to be market competitive. And you can see the midpoints
for these subcategories are very different
from the midpoint for the general category,
allowing us to use our resources most effectively to recruit
and retain employees. The final step in a
job family analysis is to really look
at that equity, be sure that people are
being paid similar pay for similar work, so
that’s another future step that we would do to
take this work farther. And before we leave
the presentation to discuss these
issue in more depth, I will end with
just a quick mention of the remaining cost categories that we incorporate into
budget planning every year. In total, in any given
year, we plan for something in the 4 to 7
million dollar range as an incremental increase
for our facilities and operating items,
primarily facilities and technology costs and the
the strategic choice category represents more of
a discretionary, but highly important
set of items that we like to build
into the budget each year, to invest in, in order to
maintain or gain excellence across all of our
units and activities. The president generally tries
to provide an investment pool, hopefully in the 10 to
20 million dollar range if we possibly can,
in order to provide additional allocations to
a wide variety of goals and priorities across
the institution. So with that we are happy
to move to discussion on the issues we’ve
discussed today. – Thank you. I think before we
move to discussion we are in this segment to get
a motion on the NRNR tuition. On page 29 of your docket there is a resolution
related to that. I guess maybe we should
get that on the floor before we start discussing, so at this time I
would entertain– – [Regent Sviggum] I move. – A motion. – Regent Sviggum will move
to put that on the floor. Is there a second? – I’ll second it. – Regent Powell
will second that. It’s been moved and seconded. I will now ask for discussion. Any discussion? Regent Cohen, I’m sorry. – [Regent Cohen] I really
wanted to follow regent Lucas, because I agree with
what she’s going to say, but (laughing). – Do you wanna yield
to regent Lucas. – [Regent Cohen] Sure. – Regent Lucas. I just didn’t see you at first. – Thank you chair. I’d just like to
preface it by saying this is a topic that I spend
a lot of time thinking about and it’s one that I
hope we can get right. As you know the board of
regents adopted a resolution in March of 2016 that reads, “The university will
attempt to raise “NRNR tuition rates to
the middle in the Big Ten. “These increases
will be incremental “with an evaluation of impact “on international and
national students every year.” I think that we
all share the goal that the university
continues on it’s path to become a nationally known
public research university. We’ve made great
strides in that regard, but we have some
things to overcome, including demographic
projections and the fact that so far 46% of our NRNR students come from a single
state, Illinois. Our brand is getting better, but it has much room
for improvement. I think many of us
agree on another thing and that is the
state of Minnesota needs to attract
talent to our state. We have workforce needs
and the university needs to play a
big role in that. So far we have
increased NRNR tuition by 7 and a half percent in 2016 and last year we jumped
to 12 and a half. With that big increase we saw our NRNR applications
go down considerably. We jumped in with more
national recruiting and increased money for waivers. Thankfully we were able
to yield a good class. This year I am told that
at this point in time in comparable NRNR applications were down significantly
again and that’s compared to a year when we were
significantly down. So I think that’s material. I’ve heard that perhaps
we’re down as much as 50%. It is early and
things can change, so it’s not time
really to panic, but we have to face the fact
that we’re gonna have to hire recruiters and
increase waiver amounts if we’re going to
compete on that level. There are no guarantees
that even those efforts will keep up enough to overcome the demographics and
the sticker shock. The question is will an
aggressive 15% increase put us ahead of our skis. For those of us who ski
we know that invariably if you get ahead of your
skis you’ll take a tumble. If we do not meet our
goals in attracting increasing NRNR and
international students, our budget will take a hit
that we are not prepared for. We need to recognize
what a huge role increasing NRNR tuition has
played in the past 10 years and it has increased our ability to keep down tuition
for in state students. I’m gonna vote against
this resolution with the hope that
we can come back and substitute a
slower tuition increase that will be more in keeping
with our 2016 resolution and will lessen the chance that we will get
ahead of our skis. – Thank you Regent Lucas. Regent Cohen. – Thanks Chair Anderson. This morning we had an
interesting discussion about our emphasis on diversity and I think it’s also very
important to the university to have diversity in
many different ways and one of those ways is
a geographic diversity, having both national and
international students. For me, from my perspective,
I really want our university to be a university of
national prominence and I think we’re getting there. We’re number eight as a
public research university. We can attract strong
faculty, strong students and it’s good for the
state of Minnesota. So I believe as a top
tier public institution, we are committed to
excellence and I believe that some of our NRNR students
add to that excellence. One other point is
that I don’t believe that our NRNR students
see a discounted price of admission and attendance
until after they’ve applied and it concerns me
that they may not apply when they see a very
high sticker price before they realize that there
would be a discounted price. So for me, I would much prefer
a more measured approach, perhaps a 10% over
a couple years, rather than jumping
to 15% for this year. So I’m also going
to vote against a 15% increase and
hope that perhaps … I do believe we
need to increase, but perhaps it can be
in a more measured way. – Thank you Regent Cohen. Student Representative Kian. – Thank you Chair Anderson. Also thank you Regent
Lucas and Regent Cohen for supporting students
in this initiative. I’d also like to thank
the president’s office for including our suggestions
to cap tuition at 5.5%. It is this incorporation
of our suggestions that demonstrates the
willingness for this board to work with students on the
topic of the tuition increase. When weighing the
costs and benefits of the tuition increase, we
find that the tuition increase has a significantly
adverse effect on students that want to enter
the University of Minnesota. We’re in a world today in which education’s already
extremely unaffordable. As students we have
so many struggles dealing with housing
insecurities and
food insecurities and even if these costs
could be added to our loans, it’s something that
would impact us immediately after graduation, when we’re still
working to find jobs that will help support us
when paying off those loans. I think what Regent
Cohen was suggesting about potentially lowering
the percentage of increase 10% would be an extremely good
step for this board to consider when we’re talking about
an increase in tuition. Thank you. – Thank you Student
Representative Kian. Regent Beeson. – Thank you Mr. Chair. I wanna thank Regent Lucas for really activating
this discussion and pushing staff and
pushing our colleagues to think about this issue. I remember when it was in
front of us a few years ago. I made the comment, as most
did, we really need to see data. We need to see the numbers
and we have seen numbers. The numbers are that
even after offering more waivers and even after the increased cost
of recruiters, we have yielded more
money to the bottom line. So we’ve reduced money we would
have otherwise had to charge to Minnesota students. So there’s nothing
in the data so far that indicates that
we can’t continue with a fairly
aggressive trajectory and I remember the
comment from Mr. McMaster the first year we did this. He said, I don’t wanna
put words in his mouth, but I’ll paraphrase it,
that we wouldn’t have met that first year’s goals
without the advent of more recruiters and in
reading some of the narrative from the packet, he’s indicating
that we’re still not at par with other schools, in
terms of recruiters. We talked a few hours ago,
the need for recruitment in our system campuses,
the need for recruitment in our urban areas, so I
think we need a whole new plan around recruiting, not
just people who network and event place,
but salespeople, because they can
pay for themselves. You think of a recruiter,
the cost of a recruiter can pay for themselves
in three or four sales, for getting a student who
wouldn’t otherwise be here, will pay for themselves
in a very small number. So I think a call center
doing something really bold around that. That’s what those
other schools … They’ve been way ahead of us. It’s not that organic growth, but they’ve been at
this recruiting side. If we don’t hit it
exactly, we can slow back, but let’s not
underestimate our ability with good recruiting, they
will exceed their midpoint for our of state
tuition, NRNR, that is there. So thanks again. – Thank you Regent Beeson. Next we’ll hear
from Regent Johnson. – Thank you Mr. Chairman. A question Mr. Burnett
or Mrs. Tonneson. If we were to scale
this back and look at over a five year period
that we wanted to get to the middle of the Big
Ten in nonresident tuition, what would the annual increase
have to be, approximately? – Mr. Chairman, Regent
Johnson that’s a tough one, because we don’t know what
our competitors are gonna do. What we’ve seen is 3
to 5% annual increases on their nonresident. You’re probably
something around 8 to 12% would be a range we would
have to think about. It really depends on who
we’re comparing ourselves to and what they intend to
do from their revenue side and what’s going on in
their state government. I could give you a
range, but it’s gonna be built on a whole
lot of assumptions about what the rest of
the Big Ten would do. – Mr. Chairman, there
are many discussions and thanks to my colleagues for their work and
discussion on this issue. Any time you talk
about a 15% increase, today seems quite a bit,
just in layman’s terms. On the other side
of the equation, we know that we’re following
behind in the Big Ten and it just seems to me,
and no one’s lobbied me, that somewhere less than
15, if it’s a 10% increase for this particular budget
cycle then we can review it, see what the applications
are, what the yield rate is and we can go from there. I know we need the money. Regent Beeson you made an
excellent point about recruiters and maybe that needs to
be revisited as well. So there’s all
kinds of arguments, but I think if we can find a
middle ground moving forward I think we’ll move in
the right direction, but not probably 15%. – [Chair Anderson] Thank
you Regent Johnson. President Kaler did
you want to answer? – Thank you Chair Anderson. I’ll just insert a couple
of observations here. I think we do not need to be
concerned about applications. In fact, the application
numbers did drop. The feeling is that
those did drop, because we lost
people who applied simply because it was cheap to go to the University
of Minnesota. We see a general increase that the quality of the
institution is such now that students for whom
it was a big reach simply are not applying. We’re seeing very
strong applications in the ACT/SAT ranges that
we accept, number one. Number two, the actual
applications date to date, this year to last year, from
NRNR students are down 6.6%, so fairly modest drop,
and again timing. This year is odd,
because we’ve changed our application structure, so
the year to year comparisons are a little bit hard to make. We, in general,
have been lagging. And again the current
NRNR rate is 13 out of 14 in the Big Ten, compared to our undergraduate
resident tuition rate, where we’re 7 out of
14 in the Big Ten. So we are dramatically below
the cost of peer institutions. I do not believe that
the value of a degree from the University of Minnesota is any less than the
value of a degree from our peer
institutions for whom out of state NRNR students
pay considerably more. Given where we are, to
Regent Johnson’s comment, I didn’t have time to
run all of the numbers, but if you assume that they
midpoint of the Big Ten increases at roughly 5% a year, well we would have
to increase 5% a year to maintain exactly where
we are now, 13 out of 14. So again, we’re going to have to make the jump to the
middle of the Big Ten. 15% increases in this
year and the next year would get us there if that
midpoint doesn’t move. That probably will move, so we’ll have to
do something again. That’s really a
three year window. If you stretch it to five years I don’t think you’re
gonna dramatically drop the rate of increase
that you’re gonna see. So I think the question
here, for the board, is do you want to be in
the midpoint of the Big Ten and do you believe the
brand is strong enough. In fact, we did
see a sag last year and I’ll finish with this. And you know what,
our recruiting people
had to work harder and when they worked harder
we will filled class. And we did that with a 12
and half percent increase. Do I think we can do that
again with a 15% increase? I absolutely do and I
think we can do it through targeted recruiting and
I think we can do it in a way that
maintains diversity and with waivers
and scholarships, a range of access for
people of all income levels. So I think it’s time to
pull the bandaid and do this and we all know the legislative
perspective on this. And then finally, we’re
talking about students; as Regent Rosha will say
at some point, I suspect; who are not here yet
and we’re protecting the NRNR students who are here, with a five and a
half percent cap on what they would do
with their tuition. I’ll stop there Mr.
Chair, but would perhaps answer other
comments or questions as the discussion proceeds. – Thank you President Kaler. Regent Sviggum. – Mr. Chairman thank you. Mr. Chairman, I do not disagree
with some of the points that previous colleague
speakers said. I think they made a
couple of good points, but I strongly support the President’s recommendation
for the NRNR rate. First of all, I think
the market demands it. Second from the
bottom in the Big Ten. Second from the bottom. 13th out of 14th is the way
the president phrased it. This only puts us
into that mid range, into a competitive game. The market demands it
from the standpoint of the applications that
have come forward and I think most
importantly, members, you’ve gotta put this
perspective on it. Come May we’re gonna
have a budget of x. I don’t know if that x is
3.96 billion or 4.02 billion or whatever it is, we’re
gonna have a market of x. And if we don’t get some
of that 8.8 million, I think is what you
attributed this to, of NRNR, which is justified,
absolutely justified by the market competition,
we will get it from Minnesota students or
from Minnesota taxpayers. One or the other and it
sure seems fitting to me to say that puts us in
a market competitiveness so when we get to May,
this x doesn’t have to be so much from Minnesota students. – Thank you Regent Sviggum. Regent Rosha. – Thank you Mr. Chair. Good discussion and
I’m happy to hear that people are engaged. I sometimes feel
like we’re having the same discussion repeatedly, but I think we’re having
the right conversation. I don’t know if I’m
the only person, but my only
reservation with this is I think we’re taking
too long to get there. I think that this would
be the equivalent … I think about this
in terms of … I don’t know if anybody
around this table has experience with
pricing products and marketing products
internationally, but if you’re gonna
sell toothpaste you don’t look at the price
of your toothpaste and say, “Well gee we don’t wanna go
up too much of a percent.” You say, “What
does the market say “we can sell our
toothpaste for?” Stemming from Regent
Sviggum’s comments, we are still not
where the product is valued by the
market right now. Regent Cohen made the comment
that she would like us to be a university of
national prominence. As an alumnus of the institution and having been involved
with the university now for the overwhelming
majority of my life, I believe we’ve always
been, during my lifetime, a university of national and
international prominence. But I would also say
when you talk about when you look at the
marketplace and you say which schools are the
ones that we hold out as those of the
greatest prominence, it’s certainly not those of us that are looking at a
Walmart pricing scheme. It’s those that are
demanding the price for the value of what
they’re providing. There are two different
considerations. When we talk about
students from Minnesota, and this is the sales pitch
we make to the legislature, we’re talking about access
and keeping it affordable and the value proposition
and what we’ve done of late has not, I don’t think, had
fidelity to that obligation and when we look at
how we price our NRNR, for one we talk
about 46%, I believe, of our nonresidents
are from Illinois. Well when you tell
a Minnesota student that they don’t have a
space here at Minnesota, because an Illinois
student is coming, what is that student
paying even if they’re able to get in at the
University of Illinois? It’s substantially more. Those are considerations that
we have to take into account. One is we’ve got our mission as the state’s land
grant university, but I also think
another major premise is the one that representative
Kian spoke to a minute ago, is that we wanna be
respectful of the students who are already here and that’s a very important
part of this for me is that the increase
for students who came in under a certain expectation
don’t have this kind of a change midstream for them and I
think that the president has done a nice job
of protecting that with the guidance and
input from our students. With respect to that,
looking at this financially, I could go on. There’s many more data
points here, but the data, consistent with what
regent Beeson was saying, all demonstrates that this
is the right direction. I personally think
the right direction is actually to just get
there and then use your funds for recruiting and for
targeted opportunities for reductions for students
that meet certain expectations, but in the absence of being
able to convince the board to move with that level of
boldness, I will support this. – Thank you regent Rosha. Regent McMillan. – Thank you Chair Anderson. I’ll be brief. I like the data and I
like looking at issues like price elasticity, which
is what we’re looking at here and we don’t have
certainty around that. I think we have
better information than we had two years ago. We have indicia that we
can take advantage of some significant
price elasticity here. But I would do so only
with doubling down on regent Beeson’s
observation that we have to double down on the recruiting and the investment in marketing and perhaps some
philanthropy to get there, because I think that is the key. We could probably
go higher than this, to Regent Rosha’s point. We could certainly go lower
and be a little safer, but I think we can get
there if we’re willing, as an organization, to invest
in those added recruiters and marketers and go after this
market with some aggression. And lastly I’d note that we
do well as an organization when we set goals and I
think setting some goals around recruiting and
marketing that reflect a significantly higher price
point, but still not that high, relative to our peers,
would be a good thing. I’ve seen Kaler and
the administration, when we think about our
gold and maroon measures, do very well against
those and there’s room for a measure here,
so I can support 15 if we’re ready to put the
money and effort and resources into recruiting and marketing. – Thank you Regent McMillan. Regent Powell. – Thank you Chair Anderson. The only point
that I want to add is that there are many
schools in our peer set who charge more than we do
now, significantly more, but also have significantly
better outcomes, in terms of the percent of
nonresident students attending. So in the case of the
University of Wisconsin, which charge well
more than we do, a third of their students. So their really performing well. University of Iowa,
even more than that. University of Illinois
sit about where we would, they’re over 25%. So I think the data
would suggest the point that’s already been
made several times, we can get more here, we can continue to
attract students if we supplement that with
a significant increase in recruiting. So I’m supportive of the
president’s proposal. – Regent Hsu. – Thank you Chair Anderson. I too am in support. I do wanna note
that in two years, I believe, using the numbers
that are in the presentation, we’re gonna get to $33,000, which would put us in
8th place for this year. So it would take us,
I think, three years to actually get to the
midpoint of the Big Ten, at 15% per year. So 15% really doesn’t
even get us that far, which is, I think,
on the low side of what I would really
want, but I think 15% is adequate for what we’re doing if we can commit to 2 years. I think there are a lot of
ways to think about this. As someone who came here
from out of state in 1983, the regents that
year, I think you guys have heard me tell this
story, the regents that year raised tuition 25%
between the time that I accepted admission
and then showed up for orientation or enrollment, actually registering
for classes. So I understand everybody
looks at these numbers and they’re just so huge and I wanna point
out that Wisconsin, their in state students
only pay $10,000. The part of this conversation
that I’m uncomfortable with is the fact that we’re having
a one sided discussion. We’re only talking
about the NRNR. We haven’t even had a chance
to talk about the residents. I would love to be able to
freeze the resident tuition in the spring when we get to it, but without having that
part of the discussion available to us today, I
think the 15% is adequate, but I do wanna just
warn people that if after 2 years of that
we’re only get to about 8th place today, so
we’re gonna likely be in the 10th or 11th
position in two years, at 2 increases of 15% per year. So I’ll leave it there. Thank you. – Thank you Regent Hsu. Student Representative Kian,
you wanted to speak again? – Thank you. There are several other
ways in which we can define the value of our institution
and the degree we receive at the University of Minnesota. All these conversations
that you guys have had about the additional
recruitment that we could do to bring up the numbers
of NRNR students that we incorporate into
our school do nothing to talk about how
we can alleviate the stress and financial burdens that it will put on
students that are accepted after the additional
recruitment. I think that if you guys are
gonna have this conversation about increasing tuition there
should also be conversation about we can support
those students so they’re not
gonna be suffering under the financial burden. Thank you. – [Chair Anderson] Thank you. Thank you Student
Representative. Regent Lucas. – [Regent Lucas] Thank you. I just want a point
of clarification. Is the motion for
1 15% increase? We’re not committing to
two years, is that right? – It’s on page 29 I believe. Just this fiscal
year, one fiscal year. Yes mam. I don’t see no more hands
up, but I’m gonna ask Senior Vice President Burnett, we had a question
about recruiting. Can you explain if there’s
money in the budget for that or where
we are on that? – Regent McMillan
and Regent Powell, we are planning to
make those investments, and Regent Beeson as
well, in recruiters. And part of asking you
to make this decision now is we aren’t going to wait
to hire those recruiters. Those recruiters are going
to get added to our cadre here shortly,
because to make sure we bring that class
in, we can’t sit still. So our planning around
this was not just to raise this to bring
in a revenue piece, but was also to bring
it to add revenues to the admissions office,
additional revenue in the budget for scholarships
and for recruiters, so it’s all together
even though we haven’t put the final budget
together for FY19, it is our plan to move
forward quickly on that if this was the
decision of the board. I just wanted to assure you we are making those
investments in recruiting. – Okay. I guess one of the
prerogatives of the board chair is you get to say
something before we vote and I’ll just tell you this is why being on this
board can sometimes be hard. It’s interesting. I’ll just tell you
my perspective. Our last board meeting
we talked about NRNR. It was a Friday. I stayed overnight, because
there was a football game. It happened to be
parent’s weekend. I went to a couple
parent’s weekends events. I didn’t tell anybody that I
was on the board of regents, but I asked people
what they thought about the University of
Minnesota and met so many people who said, “We’re
from Pennsylvania”,
“We’re from Illinois”, “We’re from Missouri”,
“We love it here “and our kids love being here “and thanks for keeping
your tuition low “so we can afford it.” That’s one perspective
and I see that. And it’s hard to make the vote. I also understand that 15%, and I very much
agree with Regent Hsu that we can do this 2 or 3 years and we’re still gonna be 11th,
12th or 13th in the Big Ten. It’s just where we are. I agree with Regent Rosha. It’s the price of a
marketplace can get and I think we have to do that. But I also think we
should do it with care. I’m okay with 15%. It’s taken me a long
long time to get there. I would be okay with 10% too. The biggest point
I have with this is we’re gonna go on to
the other budget variables and even with 15%
we’re gonna ask to raise tuition on
Minnesota students 2%. That’s probably my biggest fear. Another thing that has happened
on many of our colleagues who have a wide spread between nonresident and resident
tuition is it seems that many of them use
nonresident tuition
to raise income and the number of students from
their own states goes down. Michigan 51/49. Iowa’s even 50/49. Wisconsin, where it’s a
really inexpensive, 57/33. But we kind would like to
have 67 to 70% Minnesota kids. So we do have to raise some
tuition to get them in. So anyway that’s my speech. Unless anybody else
wants a minute to talk, we are gonna vote
on the resolution, which is for a 15% rate. It is on the table. At this time I will just ask those all in favor
signify by saying I. – [Several Board Member] I – [Chair Anderson] Opposed. – [Regent Lucas] No. – No. – Duly noted. (gavel striking sound block) Motion passes. Vice President Tonneson or
Senior Vice President Burnett, I left you about 15 minutes
for other budget variables that we’re gonna
talk about today, but not make decisions, correct? – Mr. Chairman and
members of the board we can back up in the
slides to show you what variables we’re
looking at for input, if the board wants to
provide that input today. Obviously we’ll be
putting this together between now and bringing
it back in February for another iteration,
but the idea today was to just educate the board
about one, the framework, two, the more development of it. The decision today
helps us hone in on what the budget would look
like more in February, assuming it’s approved by
the full board tomorrow, the decision that was just made. So each of these
iterations get us closer to putting together what a
framework would look like for next year, but we’re
happy to answer any questions and if there’s none we can certainly pick it
up at the next– – [Chair Anderson] Okay. There’s no slides
or anything on the– – No. – Okay so it’s any questions
on what they’re thinking. I guess, any questions? President Kaler, you would
like to say something? – Chair Anderson
in recognition of that we do have a little bit
of time and I hate to do this, but several members
have asked me and Senior Vice President
Burnett about job families and about benchmarking and
about how we set salaries. And you have that
data in front of you. Vice President Brown talked
about it relatively quickly, so if you would go
back to slide number 10, I think it is, in the deck. This is the answer
to the question that some of the
members have asked. We’ve done very detailed
analysis of the job families, what people do, classified
them across the institution into areas in which
they do like work. The next slide shows
granularity around that, in terms of … Where is it, that slide? Where’s the– – [Woman] It’s 13. – 13, yeah. Slide 14 please. Granularity around this
and these are the midpoints of the classifications and
these are market based. These are what people
get paid to do this work in the United States or
in the state of Minnesota or in the Twin Cities. So perhaps Vice President Brown might take a little bit
of time to talk about how these salaries are
set and a little bit of perspective for the board around what the
external variables are that influence
those salary levels. Sorry to put you on the spot,
but I think you can do this. – Chair Anderson,
members of the committee whenever we look at job market, we look at where do we hire
those individuals from. For example, when
we’re thinking about our labor represented
individuals, most of those people
are hired from the Twin Cities metro
area, so we would look at that Twin Cities market
to determine what would be a market comparison for
that group of employees. When we look at P&A and
civil service salaries, some of those groups are
hired from the metro area and that would be
where we would look. Many are hired from
a regional area. Many are hired from a national
higher education market. So we are looking at the
market that is applicable for the particular job
type and the easiest way to think about it is where
do you hire those people from and then that’s the way you
think about your market. We work with the office
of institutional research to determine what our comparable institutions of higher
education for comparisons, for each of our campuses. That’s not set time to time by the office of human resources,
but we have set comparables that we look at for Morris,
that we look at for Crookston, that we look at for
the Twin Cities, Rochester, Duluth, et cetera. So when we look at the
markets then we are defining what is the range and
when we post this, this is looking at a midpoint. And it’s not saying
that every employee would come in and be
employed at the midpoint. That’s not our goal, because if someone were
an entry level employee with no experience they
would probably come in at an entry level in the market, at the low end of
that market range. If we hire someone that is at a substantial number
of years of experience with their unique skillsets
and particular to the job that we’re looking,
of course that may drive their salary higher. They may be even at the
higher than midpoint range in the market. But as we think of it
overall, we’re trying to look at a midpoint
of the range as a marker, if you will, a way
to center your thinking. So is this an employee that we
think is about in the middle? Is it a new employee? Is it someone that has
been here for a while and we’re looking at performance and they’ve had
meritorious performance and we want to reward
them, we know that they may be having other
employers seek them, so we wanna try to
keep them, so we may move them up a little
bit in the market range. So that’s essentially
how we do it. – Thank you. Regent Sviggum. – Mr. Chairman thank you. If I could follow up on
what you were saying. First of all we have
these 21 job families. Within that about
670 job classes. Is that correct? – Chairman Anderson and
members of the committee, yes I believe it is
about that number. – 670 job classes for
approximately 9,000 persons. – [Vice President Brown]
About 40% of our workforce. – About 9,000 then. It’s probably about 13
persons per jobs class. We’ve divided this so much
that a job responsibility right now, you can’t
find anybody else to put into your class. 670 classes is a little
bit of a large grouping. As we look at the market
competitiveness … And I understand to hire a CEO, a Mr. Burnett, it’s
a nationwide search, it’s a nationwide
competitive market. Many of the other classes,
for instance in HR or in IT or maybe
in communications, our job market might be
the city of Minneapolis or the state of
Minnesota, comparable. In the minimal research
that I’ve done, how do we do the original
range in those job classes or job codes, because in the
minimal research I’ve done the salaries paid here
are significantly greater than maybe the state
of Minnesota pays in IT or in communications or
in your department, HR, or Dakota County pays in
those same job classes, job families. Am I making myself clear, how
the are originally determined, because it seems to
me they’re inflated quite a bit over the– – [Chair Anderson]
Vice President Brown. – Chair Anderson, members of
the committee, Regent Sviggum, there’s a couple things
that worked in this process. One, when we started
this process we used an outside consultant
and they helped us look at market ranges
that would be appropriate for the type of work. And again, we looked to markets into which we were
competing for the jobs. Typically we do not compete with the state of
Minnesota for workers. We don’t have employees
that go back and forth a lot in that sector. So oftentimes we are competing against private
sector in the area. For example, if you
wanna take finance, the talent that we
recruit is often in the private sector and
comes to the university. In my own office just recently,
just as an illustration, we recruited somebody in a
business analyst position from Target, when
they had a layoff. We actually recruited
them in at a lesser salary than they had been
paid at Target. Originally we’re
looking at the markets all of those factors
were considered. The second thing we considered
is what we were paying. And when we went for
a number of years without any market ranges
to determine, they say, “Gosh, we wanna hire Kathy Brown “and she’s been working
someplace in the private sector “in the community and
here’s what she was making.” And Kathy comes in and says, “Gosh, I would like to make
what I had been making.” And we, historically,
didn’t have job families, didn’t have these ranges
that were helping people determine what was
an appropriate thing. So some of our ranges
ended up being very broad, much broader than they
would be if we had just done it from scratch
without considering the salaries of our
current employees. So what we’re doing
now in round two is actually refining
those market ranges. They probably will become
a little bit more narrow, based on the work being done. It has not been my
experience that our pay is in excess of others
in our community, in the public sector, that
is generally competitive. I think that if you look at
the state of Minnesota alone you might have a
different point of view, but when you look more
broadly, we have not found that to be the case and we also
find that many of the people that we are hiring
at the university are coming from
the private sector where we are not as high
as the private sector, in many areas. – Thank you. Got a quick follow up. We’re off the agenda. – Are you giving me time or not? – Give you time. – I understand
what you’re saying and we are in the second
round you said, right now, of comparison or studies? – [Vice President Brown] Yes. – We’re in a second round
that’ll last how long? – [Vice President Brown]
Well we have approximately 20 families to go through
and we will pace it out over a couple or
three years, probably. – Three years. 20 families in 670 job codes. Let me just humbly suggest
that our market competition is Dakota County, is
the state of Minnesota, is Hennepin County. And what I’ve found to be true and maybe I’m completely wrong, but people I’ve talked to, when we recruit from
the private sector those folks who come from
the private sector are looking at two different things. One is the salary, but
the other is the benefits, the pension, the other
benefits that are obtained by working here at public sector that were not in
the private sector. My sense is that the benefits
are rather significant compared to the private sector where the salary is
probably competitive at least if not a little
more than competitive. But I get always whip side when
I talk to different people. One talks about the benefits
and the other talks about the salary and I thinks
it’s unfair to say it’s just competition
is the private sector, because many of
those folks, not all, I’m generically saying,
coming from the private sector probably don’t have
the benefit structure that we do in the
public sector, myself– – [Man] (whispering) We need
to let her take a swing, but then I wanna reply. – [Chair Anderson] Thank you. Regent Hsu. – Thank you Chair Anderson. I just wanted to ask a
clarification question. So the numbers that
we’re looking at here, I don’t know if they’re
real numbers of not, but let’s just say you
just took this page and took off the names
and put in some titles. This is just the salary portion
of the total compensation, is that correct? – [Vice President
Brown] Chair Anderson, members of the committee,
that is correct. – Then we generally
add on, what is it, a third on top of this
or is it more than that? I can’t remember. – Chair Anderson,
members of the committee. We do have a fringe
rate, which I would say would add about a
third, in terms of cost, and that would be an
average, that’s not precise, but it would be
reasonable to think of. – Okay, so follow up. – [Chair Anderson] Regent Hsu. – Thank you Chair Anderson. So then when we do
analysis do we do it on the total comp or do we
do it on just the salary, because there’s
a big difference? You’ll get different answers if you don’t use the total
comp when you compare. – [Chair Anderson]
Vice President Brown. – Yes Chair Anderson and
members of the committee, as I discussed, this
is focusing on base pay and if we look at that
employee value proposition there are other things
that are part of the employee value proposition, which is benefits,
leave and so forth, so there are other factors. For market evaluation
for salaries, we will only look at base pay. If you’re looking at a
total compensation analysis, that’s a different
kind of analysis and one that we don’t
have here today. But we do an analysis
of our benefits. We have benefits comparisons. We’ve provided those to the
board on an annual basis. Usually in the
spring we talk about our health benefits
and so forth. We also have an evaluation
comparison, that we use, of our retirement
programs, to determine how they compare against
other retirement programs from other employers. So we do consider
all of those factors in determining whether,
as a whole package, our pay is competitive
in the marketplace and allows us to recruit
and retain employees. – Thank you. Regent Beeson. – Thank you Mr. Chair. I think Regent
Sviggum had talked, I remember, we
had a conversation about where the
big discrepancies are between the state
and the university. I know that he’s mentioned
at the leadership level, commissioners are paid quite
a bit less than our managers and I think those
are temporary jobs, they’re sometimes political. They’re not career jobs, but
there is a big difference and Regent Sviggum
has made that point, but then as you go down
the line I’m interested in some background
information about what percentage of employees
we get from the private sector. I like hiring from
the private sector. I think they bring
a lot to the table. What percentage we get from
the state or other cities, is that a 2/3 – 1/3 mix? It would just be interesting
to know what that looks like. – Thank you. I think I’ll let Senior
Vice President Burnett wrap this up and
answer some questions and then the agenda has
us for a 10 minute break. – One final comment,
just to echo and add on to what Vice
President Brown has said. Regent Sviggum and Regent Hsu, I think it’s not just where
we attract talent from, it’s where do we lose talent to. I would submit to you we
don’t lose IT professionals to the state of Minnesota. I’ve talked to Vice
President Gulachek. We lose them to 3M. We lose them to Target. We lose them to Medtronic. And when we lose senior
executives, like Danita Brown, to the University of Illinois; Brooks Jackson, to
the University of Iowa to Katrice Albert, to the NCAA; we don’t lose them to
the state of Minnesota. We lose them to their
market comparator. To Regent Beesons point,
I think we need to bring back not just where
do we hire people from, but where do we lose them to. There are different
markets within this 3.8 billion dollar
complex organization, to Vice President Brown’s point, there’s a market for the
trades that’s very different than the market for
senior executives of the universities and colleges
and everything in between. So I think that’s what
we’re trying to parse out is how do we get to the
right compensation package for those and I think more data, just like we brought to you
in the earlier discussion, would help bring
some clarity for you. So I hope that that’s
helpful to you. Thank you Vice
President Burkett. Vice President Brown,
Vice President Tonneson thank you for your time,
thanks for your presentation. We’re gonna take a break and
we’re gonna reconvene at 3:15. (gavel striking sound block) (chattering) (chattering) – You guys obey pretty good. Just hit the gavel
and it gets quite. Okay, we are ready to resume. I’m looking on my agenda here. We’re gonna have a presentation on student housing
across the system. Senior Vice President Burnett I will let you
introduce the speakers. – Thank you Mr. Chairman and
members of the committee. Today we’re going to take,
at the board’s request, in our work plan kind of a view of student housing across
the system campuses. At the October meeting
we gave you detail on the housing on the
Twin Cities campus. So today we’re gonna start up in the northwest corner of the
state with Lisa Samuelson, the interim associate vice
chancellor for Crookston and then we’re just gonna
go in alphabetical or order among the campuses to Duluth,
Morris and then Rochester, to give the board a glimpse
of what’s new or interesting or challenging on our
four system campuses, with respect to student housing. So with that Mrs.
Samuelson, you wanna begin? – Good afternoon Mr. Chair and members of the board. Crookston res life has
undergone tremendous growth and revitalization
in the last 12 years. We’ve been constructing
new facilities while removing outdated
ones and we have well suited ourselves to move
into the upcoming decades. Our current occupancy,
as of 2 weeks ago, was 489 students and
that does not include our 13 community advisors. Of that 489, that actually
is 42% of the students that are taking
on campus classes, because we also have online. So Crookston is experiencing
decreased enrollment, so the 489 students is down
from our high point in 2012 when we had 632 students
living on campus. That leaves our
current occupancy within the
residential facilities at 73% of our maximum
capacity of 672. A silver lining within that
is that we have been able to accommodate the increased
request for and demand of single rooms on campus,
which has been nice, because an increased
number of students want to have single
rooms as a possibility and that also then has
helped us to offset some of the loss of
the capacity as well. We also have maintained
a steady number of our first year
students who have decided to live on campus, as
this year we have 92% of our first year students who are electing
to live on campus. So that is a stable number. So where are these
students living? We have five on campus
residence halls; two traditional;
two apartment style and our most recent
building, Heritage, was built in 2012 and
that is suite style and accommodates predominately
first year students. Slide please. At Crookston we pride ourselves on the high quality facilities
and services that we offer, led by our fantastic
staff upon campus. Although we have
always bragged about how wonderful and beautiful
our residence halls are, we’re starting to get some outside recognition
of that as well. Niche; which is a online
educational resource that rates pretty much all
sorts of things in education, but also beyond that; has
ranked UMC residential life with a A rating for it’s safe,
clean and modern amenities. We are ranked number
four in the category of best college
dorms in Minnesota, even though we don’t use
the word dorm very often. And we are ranked number one in the category of
safety on campus. We also were the first in
Minnesota, in residence life, to offer a LEED
certified building through environmental
efficiency. Slide please. Obviously more important to
us than awards and recognition is the area of academic success
for our students on campus. In residential life
we pride ourselves at creating sound educational
environments for our students. Whether it’s building
or reexamining our
current structures and making sure we’re
creating ample study space to making sure that our
policies are in place to allow for 24
hour respect hours, sleep/study hours
and creating programs to recognize the outstanding
contributions of our students; we make every effort
in making sure that academic
success is number one for our students
who live on campus. This past spring 38% of our
residential life students received a 3.5
GPA or better and, very consistent with
the national trends, our students who live on
campus fare slightly better than our students
who live off campus, in regards to their
academic success. Our on campus students
received, last spring, a GPA of 3.1, whereas the students off
campus were at a 2.87. Similarly our four
year graduation rate for our 2012 cohort was
44.9% compared to 41.7% for the four year
graduation rate. Slide please. So where do we go from here;
what are our future plans? Crookstons top priory,
both in residential life as well as the campus overall, is to increase our
on campus enrollment. If we increase on
campus enrollment then our occupancy rates within our residential life
facilities will also increase. So we are working very closely
with all the campus entities to make sure that our
on campus enrollment is our number one priority. We are working specifically
with admissions. Currently we’re examining
our communication flow with our prospective students. We are also rolling
out a new initiative where perspective students
who are visiting campus can stay in our
Heritage residence hall free of charge and to have
a true student experience while being recruited. We’re also working across campus and increasing the
utilization of our facilities, over the summer,
through introductions of more camps and conferences,
so that the pipeline can be filled a little earlier with awareness of
the Crookston campus. We also are trying to
maintain our costs, making sure that
our facilities are of course still
beautiful, but making sure that our cost through
services and maintenance are being moderated. We’re also closely working
with our dining partner, Sodexo, making sure that the
overall affordability is sound for our campuses
living on campus. And lastly, our
priority is to maintain our overall high quality in
our facilities and services. So although repair and
maintenance is something that must be done every year, our buildings are
in very good shape. Our one project that
we have coming up in the next couple
of years, Skyberg, built in 1970, has
it’s original roof. So that is probably
our biggest improvement that we’ll be needing to
make in the next few years, at a general cost of
approximately $650,000. So with that I’ll turn it
over to Vice Chancellor Erwin. – [Chair Anderson] Thank you. Vice Chancellor Irwin. – Thank you Chair Anderson. Greetings members. Thanks for the opportunity to share a little bit about
the Duluth housing story. We’re gonna start
with an overview. On the left side of
the screen you can see that we house about a third of undergraduate
students at UMD. Our facilities shake
out roughly two thirds in residence halls and
another third in apartments. We have a lot of real estate
at UMD, 725,000 square feet and our buildings range
in age from a toddler at 6 to some other facilities at 61, which I’ll address later
in the presentation. The real pride in UMD
housing residence life is on the right side and
that is our programming. We’re really hitting our stride, in terms of our
four areas of focus that are designed directly
to support academic success and student success, because
we know student success is directly related to
persistence of retention and eventually to graduation. So we’re proud of
our collaborations with our academic
units, in terms of our living-learning communities
and the overall support that we provide our students, in terms of
relationship building, but also in terms
of the resources that we connect them with. Next slide please. The chart on student
profile gives you a sense of who lives with us and I think the most important statistic
is much like Crookston, 92% of our freshman
class live on campus. Again, the first year
is really critical. The student success for our
freshmen I really important, so we’re really glad to house that large a percentage
of our freshman class. I think the most compelling
part of this presentation, for me, is the student
demand, on the right side. We opened at full
capacity this fall. And you can see in the numbers that our requests
for residence halls were larger than the number
of beds we had available, to the tune of almost 250. In contrast, our apartments had less requests
than we had beds. So why is that
happening in Duluth, as freshman live
in the apartments? And that’s not a
great scenario for us. It’s not the same
kind of experience, doesn’t provide the same
quality of connections and resources and support. So our future efforts
are gonna center around creating more
residence hall beds. And finally, the first
two bullets alludes to our desire to expand our
living-learning communities. Our current ones are with the Labovitz School of
Business and Economics. We have the BizDogs, Great community that’s
off the a great start. We have a longer standing
honors college community that’s doing really well. We are steadily maintaining
and upgrading our facilities, in terms of roofs, windows,
fire alarm systems, network. Our students are very
interested in wireless and also in terms of
our building security. Our plans for the
future include a study to figure out our next
directions and our hope is to complete a study
that will give us a plan for the next 10 years. We hope to emerge
with a pre-design for a 250 bed residence hall. And then we want to
look at following phases that can flex with
our enrollment changes at UMD and our enrollment goals. Two of our older halls are
Vermilion and Burntside, they’re the 61 year old halls. We know they need decommissioned
and we are excited to think about what
the future may hold, in terms of a mixed use
facility that might have some academic components, it might have some
residence hall components. It’s great real estate. It’s right across from
the Kirby Student Center, so it provides us a really
exciting opportunity. UMD has enrollment
strategies that would include 1% growth over the
next several years, so we know we’ll need
additional beds for that. We’re working very closely
with Vice President Burnett and Vice President Berthelsen
on our planning process, including our finance
and operations folks on the Duluth campus. So the future is really bright
and very exciting for Duluth. There are a couple
other pressures that
I wanted to mention. The Duluth community, as
Regent McMillan can testify, has an affordable housing issue, so when we’re not able
to house our students and meet our demand, the
Duluth community has issues, in terms of meeting that need. So it’s important
for us to continue to expand our facilities
in a thoughtful way so that we can meet
the student needs and help our Duluth community. The other exciting
pressure that we feel is in our
internationalization efforts. We have a fairly new English
as a second language program, was able to house all
of those students. We have programs that
are short term in length, so if we add 250
residence hall beds we’ll create capacity
on the apartment side to be able to house
our graduate students, house our international students and some of these
short term programs. So the future’s bright. We’re hitting our stride
with our programming and we’re looking forward to
an exciting planning process. And I’ll hand it over the
Vice Chancellor Olson-Loy. (Chair Anderson and Chancellor
Olson-Loy both speaking) – Chancellor Erwin thank you. Regent Anderson and
members of the board, we’re really happy
to have a chance to talk with you about Morris
housing this afternoon. As you know and likely can
see from our materials, the residential life
experience at Morris is a core part of our
student experience and really foundational
to our mission, as the University of Minnesota’s residential public
liberal arts campus. As you can see on the slides, we have about 847 students
living on campus this fall. This includes just over 50% of
our student body and, for us, about 95% of our
first year students typically live on campus and
that is true this year as well. Our students who
don’t live on campus live largely in
apartments and houses in the town of Morris and
about 90 to 95% of our students each year live within
a mile of the campus. So this highly
residential community really supports students’
transitions to college, their deep engagement
in campus life and their academic success
and it’s a hallmark of an undergraduate
liberal arts campus. It also, for us,
supports the vitality of our rural community and
the Morris student population comprises a third of the town
of Morris’ population of 5,000 and about 20% of Steven’s
County’s population of 10,000 residents. On campus, about two thirds
of our campus housing is in traditional
residence hall spaces and the renaming one
third includes our new suite style Green
Prairie Community, which opening opened
in 2013 and was our first new construction
in about 40 years, on the campus, for
residential life and apartments which
were built in the 70s. Overall our occupancy is at
95% of our recommended capacity and that’s up from 742
students a decade ago. Next slide. Our aggregate data shows
that living on campus has a really positive
impact on student success. This shows for students
who’ve lived on campus their first year at Morris,
they earned higher GPAs than students who lived off
campus in their first year and they were more likely to
persist to their second year and to graduate
within four years. Our residential life program,
much like all of our campuses, prioritizes building
students’ connections and sense of
belonging on campus, student learning and success and the provision of quality
facilities and services. We do benchmark our students’
residential life experience each year with an annual
benchmarking survey that’s provided through
the National Association for College Housing Officers,
and Morris students, as we now hear, rank our
sense of safety and security on campus unusually
high and it places us in the top 5% of
universities nationally, that participate in that study. They also give us
especially high ratings now for our facilities and
also that they identify that they have a greater
capacity to impact their actions to live a sustainable
life in the future, more than their peers
in other institutions. Overall our students rate
our housing experience as good and they say
that their likelihood of recommending Morris to
future first year students, for living on
campus is excellent. Core to this work
and we wanted to know according to our student leaders and those who play major
roles on our campus and really bring our positive Morris residential life
student experience to life. Next slide. Our 2007, soon to update,
Morris strategic plan called for us to
create contemporary
student life facilities to support student
recruitment and retention. And aligned with that
plan an also recognizing that perspective
students historically rated our competitors
campus housing above ours, we completed a
series of investments that you see detailed
on this slide, to improve our students’
living environments. I’m happy to report
that Morris students have valued the 2.25
million dollar reinvestment from our student housing dollars directly into their
living environments and as you can see
from the chart, their student ratings of our
facilities have increased to excellent in our
benchmarking report over that time period. Our capital
priorities now move to those slightly less glamorous
infrastructure maintenance such as window
replacement at our two traditional residence halls, which were constructed
in 1965 and 1970. Other res life
priorities for us include a focus on student
retention including addressing students’
interest in single rooms and embedding evidence based mental health and
wellbeing initiatives throughout all of campus
life and especially for first year students in
our residence halls. We’ll continue to monitor
the housing demand that we have on campus for
new and continuing students and also stay abreast
of possibilities for a public/private
partnership related to some near campus
housing development that’s underway in Morris. And finally I wanna
just highlight a little bit about a
collaborative effort that was also initiated
and highlighted in our last strategic plan. In 2008 our residential
life program began collaborating with new
conferences and events office on our campus to look at how
we could increase summer use on campus to grow what
we’re calling the three Rs. So we wanna enhance
student recruitment, our campus reputation
and revenues and each of the programs
that we’re doing don’t have to fit all
three of those areas, but they should
touch on at least one and the more they can touch
on all three the better. So you see from a
baseline of really not utilizing our facilities
in the summer in 2007, where we had 370 summer
residents and guests in our residence halls and only $22,000 in
revenue; we’ve now grown almost 1,200 summer
residents and guests and over over $100,000 in
revenue this past summer. We know that we are
much more likely to enroll prospective
students when they’ve visited the campus
and have had a chance to see our beautiful
and peaceful campus and also meet our faculty, staff and our students
and our community. So events like those
that are highlighted; our own Cougar volleyball
high performance camp for high school
students, our partnership with the University
of Minnesota Extension and their 3 day 4H camp
for statewide youth and also working
with groups like the Irondale marching band
for their summer band camp, which is one of Minnesota’s
premier high school bands connected to the Mounds
View Public Schools; now bring hundreds of the
states’ future college students to our campus each summer. Also we highlighted,
on this slide, our rural arts
and culture summit and programs like it
have brought 350 artists, arts organizations, rural
centric organizations, community and economic
development leaders from across the state and
really across the country to raise our campus profile. And it’s also
helped inform people of the understanding of
the community beauty, big skies and
opportunities to be found in Minnesota’s rural places. Coordinated with our
center for small towns and springboard for the arts, the Minnesota State Arts Board, The McKnight and Bush
Foundations and a number of university partners,
we’re really proud to have hosted this transformative
campus event three different years
in the last six. So this Morris
summer initiatives incremental and
sustained growth, we think, is showing
promising possibilities for us and positive impacts already,
in terms of our recruitment, our growth and revenues and
increasing our reputation and peoples’ connection
with the campus. We often ask people if
they’ve visited campus before, when they come to
these programs, and there are large
numbers of people at each of these events
that raise their hand it’s the first time that
they’ve had a chance to be at our campus. We feel it’s really significant. We also think it
holds great promise for greater system
wide partnerships, as we elevate our
thinking about how to use the unique assets and resources of each of our
campuses going forward. Thank you. – [Chair Anderson] Thank you. Vice Chancellor Sauter. – Chair Anderson and
members of the committee I want to give you
and start out with a short history or UMR housing. That’s because UMR has
currently a short history. (people laughing) So not quite the length and
not quite the same information to provide you, but we
enrolled our first class in fall of 2009 and
all those students lived in various
downtown locations, apartments and some in close
proximity to the downtown port. So UMR was acutely
aware that in recruiting first year students, we
needed to provide for them an on campus housing experience
and certainly parents, as they toured our campus,
were asking for that. Shortly after our
first class enrolled, it was fortuitous that a
private developer approached us about building student
housing for UMR students. However, in 2009
the developer found that the financing for the
project was difficult to obtain, so the city of
Rochester agreed to allocate to the University
5.8 million dollars of city sales tax for the
housing and mixed use project in downtown Rochester. So the university negotiated and signed a 10 year master
lease for the following. Within that building we have
three floors of classrooms, science labs, res life
office space, staff office, faculty space, student life
space and collaborative space. And then floors
three through eight, of this nine story building
was student housing, with a max capacity, at
that time, of 237 students. So 318 Commons opened
then in fall of 2011 with students living throughout
the 3rd and 8th floors, but of course we were not
fully occupied at that time. So 318 Commons management
leased those apartments at market rate and
the revenue was shared with the University, because
we were paying the lease on those rooms, so we
received the revenue from the market rate
and they housed then, like male medical residents,
male clinic medical students and other professionals
that wanted to live in the downtown area. The ninth floor at that
time was not leased by UMR and was dedicated entirely
to market rate occupants. So over the life of
the 10 year lease, the 5.8 million dollars
is being returned to the University of Minnesota
Rochester for other uses and in the past now
that has included supporting housing operations
during the early years, completing additional
space in the building that wasn’t built
out in the beginning and also developing new space
for UMR in downtown Rochester. And you can see, from
the slide, you can see that it’s been truly a
public/private partnership in this lease for housing for the University of
Minnesota Rochester. Our housing status today,
actually we’ve grown in our need for
occupancy in the building and so we occupy fully
all of the apartments on the 3rd to 8th floors and 6 of the 14 apartments
on the 9th floor. Among the student
residents, there are four living learning
communities, currently totaling 71 students. Those are currently
in healthy living, global connections, recovering
on campus and health core, which is the community of
respect and empowerment, so it’s really
underrepresented students that are low
socioeconomic status, students of color and/or first
generation college students. In fall 2018, given the
increase that we are predicting for our first year
student enrollment, UMR is going to add the
remaining 8 apartments on the 9th floor, so
that we will fully occupy all of the apartments
in the that building and have a capacity of 277 beds. It is our goal to house as
many of the first year students that want to have a
student residential life housing experience be
housed in 318 Commons. So we are anticipating the need of some additional housing
for second year students that wanna stay in a
res life opportunity. So we’re currently exploring
additional leased space in a new apartment building
in downtown Rochester. The developer has
expressed an interest in a master lease relationship
and so we are exploring that and the building would be ready
for fall of 2018 occupancy. And then finally, the
future of housing at UMR. As this photo shows, the city of Rochester’s
currently growing and building. None of that
building is from UMR. This is just to show you
what downtown Rochester currently looks like and
you’ll see some of that when you come visit us in March, but as UMR’s enrollment
continues to grow, we anticipate the need
for additional housing in also the years 2019 and 2022. So there are some
local developers that might possibly
compete for the opportunity to provide housing
for the majority of our first and second year
students and we want that to be available to them
to support our goals, like the other campuses
have mentioned, for retention and
success of our students. So we’re looking forward to
some additional partnerships where we might be leasing
additional space, in the future. And thank you. That’s my report from Rochester. – Thank you very much. Thank you, all of you, for
giving us those reports. It was interesting to hear them. We’ve got about 5 minutes for
questions, 5 – 10 minutes. Does anybody here on the
board have questions? Student Representative Kian. – Thank you Chair Anderson. I would like to pass on
the concerns of my peers in the system campuses
with two questions. The first one is why
hasn’t the board extended the first year housing guarantee to first year students
across the system campuses? This is something that
exists exclusively on the Twin Cities campus,
although I do believe that a few of the system
campuses have the infrastructure to support all
first year students, just haven’t made that
guarantee done on paper, but I believe Rochester and
potentially it was Morris, one of them also doesn’t
have the full capacity to meet all first years
that want to have housing. – [Vice Chancellor
Olson-Loy] No, we actually house all
first year students. – We currently are housing
all of the first year students that want to live in housing. We do have some students
that are coming from the Rochester community or
very closely surrounding that and are choosing
to live at home, for financial reasons. – [Chair Anderson] Student
Representative Kian, just so the board can hear you, is the question do they
all provide a guarantee of first year housing
or a guarantee of
second year housing? Specifically for first
year, but wanting to know if that would be something that
could be put down on paper. That’s something that the
students from those campuses have said that they
were concerned about. – So the question is some
of your fellow students are concerned about
that there is not a guarantee of housing? – [Student
Representative Kian] Yes. – I think the panel may
address that possibly in just saying what
you have for capacity and things like that. Any of you have a second
year guarantee of housing? No. First. Morris. – Regent Anderson,
if I could add for Morris we guarantee
housing for any student that applies by July 1st,
so we do provide housing for all first year students. I don’t know that
it is as explicit as it probably could be on
our website, so appreciate– – And I would ask
Crookston I saw … I’ve been to Crookston
several times. I gotta be careful
what I say here, but you do have really
really nice housing. You got some colleagues
there with you so I don’t wanna say any more. (people laughing) But you’ve got 73% occupance,
because the lower enrollment, so I would assume that virtually
anybody that wants housing at Crookston gets it
without a guarantee. – That’s correct. – [Chair Anderson] Does
that answer your question Student Representative. – [Student
Representative Kian] Yes. – [Chair Anderson] Student
Representative Chen. – Thank you Chair Anderson and thank you for
the presentation. I’ve have also questions from my fellow student
from Duluth campus and also Rochester campus. For Duluth campus I
think you’ve mentioned that there’s limited space
for the residential halls and then I think the
specific question’s that there are dorm rooms that are converted
from study rooms. I think this is somewhat
a pressing issue. If you care to comment on that
for this specific question. And then for Rochester
campus, as we know, the housing market
is competitive and in Rochester many
students live off campus. I think for those
who live off campus it’s really critical for
them to have legal services. I know we have legal services located in the
Twin Cities campus, but I don’t know if
everyone in Rochester knows that they have access
to the student legal services and I heard that some
students reach out, but they cannot get
the help they need. And actually the fees
from the Rochester campus pay into the student legal
services located here. So I just wanted to make
sure that the students that live off campus,
they know and have access to the legal services
if they need, in their off campus housing. Those are my two questions. Thank you. – [Chair Anderson] Panelists? – Thank you Chair Anderson
and members of the committee. I worked with that student
that you’re talking about that had some concern
about using legal services on the Twin Cities
campus and unfortunately it is not true that
there are fees paid by the Rochester students
to the Twin Cities campus for legal services,
so they cannot take advantage of
the legal services and that student was turned
away for that reason. So certainly we’re
going to try and see if we can help that student
in the Rochester area somehow, but not through the legal
services for students on the Twin Cities campus. – Thank you. That’s good for us to know. That’s just good for us to know. Was there a second
part to that question or does that answer,
Student Representative Chen. – I think just one
more, the dorms– – [Chair Anderson] Duluth, I heard a question
about Duluth, so okay. – Thank you Chair Anderson. Representative Chen, at the
beginning of the semester we did have 30 students
in study spaces. Those students have all
moved now into rooms. So that’s part of the reason we’re wanting to do a
250 bed residence hall. That’s one of the pressures
that we want to alleviate. – [Student Representative
Chen] Thank you . – [Chair Anderson] Thank you. Regent Lucas. – Thank you. I’m just wondering if
married student housing is any kind of an issue
on any of your campuses. I know on this
campus we have some. I’d love to someday
get an update on the married student
housing on this campus, because I think it’s
kind of something we don’t know too much about
and it’s a little bit– – [Chair Anderson] Do any
of you wanna tackle that? Duluth go ahead. – Chair Anderson, Regent Lucas
thank you for the question. That is one of the capacities
that we think we can meet, if we’re able to build a
250 bed residence hall. We will have apartment
space and we know that there could be demand
from married students. We’d love to create a program for graduate students
and married students. – [Chair Anderson]
Vice Chancellor Loy. – Regent Anderson and Member
Lucas and the committee, we at Morris have
primarily a traditionally age 18 to 22 year
old population, so we don’t have as much demand
for married student housing, but we do have some and also
for some family housing, that if we add a
bit more capacity, we’ve talked about
that would be something that we’d like to try
to address as well. – Thank you. Vice Chancellor. – Chair Anderson,
members of the board Crookston does not
currently offer any married student housing, even though we do have
capacity to accommodate. Due to overall cost of renting
out an entire apartment, we have not been able to
logistically figure out how to make it
financially marketable for our married students. – Thank you. Regent Hsu had a question. – Thank you Chair Anderson. Just a general question
about whether or not we have any housing projects on the six year plan for
Duluth, at this time. – Senior Vice President
Burnett, do have that knowledge? – Thank you Mr.
Chairman, Regent Hsu. No projects at present. We began the planning process when I was on the Duluth
campus a few weeks ago talking about what
that would look like. We are at the formative stages of how we would add
capacity to Duluth, so that’s in the
capital planning process and we’ll be bringing
that forward, but they’ve gotta look
through the financials and that type of
thing and I’m sure Vice Chancellor Erwin
can brief you on where they’re at on that. – [Chair Anderson] Vice
Chancellor Erwin, briefly. – Chair Anderson, I
would like add too that dining is part of that
conversation for us in Duluth. We’re also at capacity
in our dining facilities, so we’re gonna have a
comprehensive conversation and we’ve already
put in a request, through University Services,
to begin that process, or it’s very close to going. – Thank you. Regent Beeson. – I’ll pass. – He’ll pass. – [Regent Hsu] Follow up. – Regent Hsu. – Thank you Chair Anderson. If we built a new dormitory
on the Twin Cities campus that would be charged
to the auxiliary, locally here, the
housing auxiliary? – [Senior Vice
President Burnett] Residence life hall
(indiscernible), yes. – Is that how it would
work in Duluth also or do they have a different … – Senior Vice President Burnett. – Thank you Mr. Chairman. Yes, it would be done
similarly on the Duluth campus and we try and run all
of our auxiliaries, including residential life, so
that they’re self supporting and not taking funds from
the academic mission. That’s the goal. – [Regent Hus] Okay, thank you. – No more questions? Regent Powell. – Thank you Chair Anderson. A number of you commented
on the difference in academic performance
between first years students, primarily, who live on
campus, in campus housing, and those who live
out in the market, in, presumably, homes
and apartment buildings. I think I can maybe guess
for why those reasons exist, but I’m wondering
if you’d comment on what seems to be the
reason for the difference in performance and if there’s
anything that we can do just to strengthen the
experience of students who don’t get access
to on campus housing. I don’t know what it is,
networking, more supervision, I don’t know, but
I’m just wondering if a few of you could maybe
comment on that issue. – [Chair Anderson]
Vice Chancellors,
one of you wanna … Vice Chancellor
Olson-Loy, go ahead. – Thank you Chair Anderson. Regent Powell and
members of the committee, I can give it a shot
to get us started. I think we do a lot in
new student orientation to try to engage students
who aren’t living on campus and to help them
build connections so they have the same
access to peer leaders during those programs and are
encouraged to keep in touch. We see those orientation
group leaders, in some ways, as the sprinters who do
really high intensity work in summer registration and then our orientation
program in the fall. Our community advisors
that are embedded in that residential
life experience are
there to be mentors and support for students through whatever comes up for them,
all the way through the year. So if they talk about not
feeling as connected on campus and having an interest in
a student organization, there’s somebody
right there who knows how to get them linked
in or who can see when they’re struggling and
ask them what’s happening and then refer them to resources if it’s a mental health
issue or something else where a student might feel not
as comfortable going forward, as a new student. They also have a chance
to meet other students and to build that sense
of community and cohort and connection with the campus and then just
proximity to things. It’s much easier for them
to go to the dining hall, to go to the regional
fitness center, to go to the library, to be
connected with their faculty, et cetera, so there
are pieces that we can certainly reach out
more in some institutions that have a higher percentage
of commuter populations, do some more commuter
oriented programs, but it’s hard to
replace what happens and also the
learning that happens and the growth and
development when you live with a group of people and go through that whole first year
transition on your own and as you see with the
data, it has lasting impact, not just in the first
year with the higher GPAs, but also that you’re more likely to be retained and to graduate. – Chair Anderson and
members of the committee I would just like to
tell you a little bit about Rochester and because
it’s a mixed use building where students live,
there’s a quite large area that is student life activities
for the entire campus. A lot of the activities
that all of the students can participate in are
right in that building and now that we’re full with
beds and things like that, we have students that
wanna come back now as juniors and live
in student housing. So that’s very
impressive to us to know that it is meeting a
need, it’s something that they’re finding that
does help them retain them and I think we’ll probably
be starting to look at some of the research that
the other campuses have on the performance
differences, because we know that the general research
shows that students that live in student housing
are much more successful. – Thank you Vice Chancellor Erwin, did you want to end this
discussion right now? – I’d be happy to
Chair Anderson. Regent Powell, another
strategy we’ve used is through our first
year experience course. So regardless of whether you
live on campus or off campus, many students
enroll in that class where they’re gonna get some
of that same information and every instructor
of the course has a TA, a teaching assistant,
who kind of serves in that peer mentor role. So that’s a strategy
that we’ve input. – Thank you very much. Very good and very helpful. I think we all learned a lot. I had to laugh up here, you were raising your hand
and I just thought to myself, I wish my kids would
raise their hands. – [Vice Chancellor Erwin]
Such rule followers. – Rule followers. Thank you very much. We’ll get ready
for the next one, which is we’re gonna have
some action on the amendments to the University of Minnesota
faculty retirement plan. While the speakers are
stepping up to the table, maybe Senior Vice
President Burnett would wanna bring us
up to speed on this. – Members of the board. Thank you Regent Anderson. This was briefed to the
board back in October that we need to
make some changes, complication to our
faculty retirement plan, errors that occurred, in
some cases decades ago, and we need to get these
conformed and get the board to approve these modest
changes to the retirement plan, so we can get this
done in this tax year. And Vice President Brown
and Senior Director Hortsman are here to answer
any questions. – [Chair Anderson]
Vice President Brown, Senior Director Hortsman if you wanna go ahead
and let us know. Certainly. Chair Anderson, members
of the committee the board reserves to
itself the authority to change the retirement plan, so this is really just a
corrective action resolution. As we discovered some
problems, we have a plan to resolve those are we
are simply asking the board to a make a small
modification to the plan to allow us to make
those corrections. – I will ask, and I apologizize, is there a resolution
in our packet? Okay. I don’t have my
packet open right now. Page 83. So I will entertain a
motion to recommend approval of the proposed amendments to
the University of Minnesota faculty retirement time. – [Several Members] Move. – [Regent Hsu] Second. – It’s moved, it’s seconded. Do we wanna have more
discussion on this? We did discuss this when we
learned about the mistakes and things like that
that we’re gonna correct. Is there any more
discussion on this? If not I’ll call for the vote. All those if favor
signify by saying I. – [All Board Members] I. – Opposed? (gavel striking sound block) Motion passes. Senior Director Hortsman,
I guess you can leave. You were very efficient. (people laughing) Well I guess you can stay too. The next one, it does say
that Vice President Brown is taking care of our next item, which is a collective
bargaining agreement with AFSCME Local 3937 and
3801, technical employees. Senior Vice President Burnett do you wanna introduce
Vice President Brown again? – Vice President Brown
will walk you through. We are happy to present an
agreement for your ratification and Patti Dion from the
Department of Human Resources is here as well. – Chair Anderson,
members of the committee, I’m going to allow Senior
Director of Employee Relations to share with you the
details of this contract and explain it to you. – Chair Anderson,
members of the committee we are very pleased today to
bring to you for your approval a labor agreement that
we have negotiated with the technical
employee group, which is represented by AFSCME. And that’s the
American Federation of Sate, County and
Municipal Employees. I’d also like to just
identify for you all that we also have
here in the room today the president of
the technical unit, who works at the university. Mary Austin is right
there in the front row in a green AFSCME
shirt. (chuckling) There are 790
employees in this unit and these employees work
on all of our campuses and in our research
and outreach centers. Some examples of the kind of
work that is found in this unit include library assistants,
lab technicians, information technology
specialists, research plot technicians,
childcare teachers, sign language interpreters
and those are just a few of the many classifications,
so it covers a broad array of work
found in the university. What we are bringing to you
today is a one year contract, which covers the
time period from July 1st 2017 through
June 30th, 2018. This is a mature contract. AFSCME has represented
the technical unit, here at the university
for 25 years, so this settlement is
pretty straightforward. The negotiations focused
primarily on wages and this settlement consists
of a 2% salary pool, which is consistent, as you have heard
earlier in the afternoon, with the salary pool for
our other employee groups. Employees in this technical
unit receive pay in two ways. One way is through a
movement of the pay range. The other is through the
movement or progression of employees through
that pay range. So our settlement is to
move the pay range by 1% and then we have also costed
the progression of employees through the pay range and the cost of that
progression is also 1%. We did have a few agreements
regarding language. We agreed to continue
to meet with the union regarding issues related
to a respectful workplace and we updated our language regarding prohibited
discrimination, to include gender identity
and gender expression to be consistent with our
university wide policies. So with that we ask
for your approval of this labor agreement. – Thank you Senior Director. So this resolution is on
page 88 of your docket. Hopefully you all have
it out and can see it, which I can do this time. At this time I’ll entertain a
motion to recommend approval. Is there a motion? – [Several Members] So moved. – So moved. Is there a second. – [Regent Hsu] Second. – It’s been moved and seconded. For the approval of
resolution related to the proposed labor agreement with AFSCME Locals
3937 and 3801, any discussion on this motion? If not I’ll call for the vote. All those in favor
signify by saying I. – [All Members] I. – Oppose? (gavel striking sound block) Motion carries.
Thank you. – [Patti Dion] Thank you. – [Vice President
Brown] Thank you. – We’ll move ahead to the
next item on the agenda and while the
speakers are coming up I will ask Senior
Vice President Burnett to give us a little
rundown on it. – Thank you Mr. Chairman and
members of the committee. Today we bring forth a
capital budget amendment on a golf practice facility for the Twin Cities
Athletic Department and hopefully Marc Patridge, our interim university
architect’s coming forth. And I believe Athletic Director
Coyle was also coming forth. This is for review today
and for action in February. This facility, as our campus
staff and system staff will lay forth, will be
out on the St. Paul campus near the golf course
and the soccer stadium. And they’ll walk you
through the project that is funded by donations. So with that I turn it over
to Athletic Director Coyle and I don’t think there’s
a PowerPoint for this. I think it’s just in
the docket materials. – [Man] Oh, I see. – We’re gonna get
some technical help. – [Man] Okay. – There is a PowerPoint, yep. (incoherent whispering) – [Man] There it is. – [Senior Vice
President Burnett] So, the interim university
architect sitting in for the Interim Assistant
Vice President Gritters. (people laughing) – [Man] Yes. Thank you very much Mr. Chair and members
of the committee. The purpose of this
project is to construct a new year round golf facility
on the St. Paul campus, both for the men’s and
women’s golf teams. The location is the Les
Bolstad Golf Course, on the site of the Tom
Lehman practice facility, which is right next to the
existing soccer stadium, if you’re familiar
with the area. And this location
is gonna consolidate outdoor and indoor practice,
so that’ll increase the utilization of both the
course and the golf teams. The proposed building
has been sited to minimize impacts
on the golf course, driving range and the
cross country programs that cut through the golf
course and it’s also neutral to any future golf
course development. The scope of this
project is very simple. It’s a 1 story, 5,000
square foot facility. It’ll have enclosed
hitting bays, an indoor chipping
and putting area, locker rooms for the teams,
which they do not have, some team meeting space
and shared coach offices. Scroll through these. It is, again, a
year round facility, which they do not
currently have. Locker rooms, team
meeting space. This is a summary of the
construction cost estimate and the funding source. The reason we’re here for
a capital budget amendment is that we do have the donor
gift that would be used to fund the project
in full, $3,185,000, and the project’s schedule
is quite aggressive. We would start
design immediately with occupancy in
late fall of 2018. At the time of the 2018
annual fiscal capital budget, funding hadn’t been secured,
so that’s why we’re here. Since that time donor
funding has been secured and the project is seeking
a capital budget amendment to allow the project
to proceed with design and construction in advance of the 2019 fiscal capital budget. Happy to have any questions
for either me or Marc. – [Chair Anderson] Okay, so
you’re open for questions. This is a review item. We won’t have
action on it today. – Correct. – [Chair Anderson] Oh, we
do have action on it today. – [Senior Vice President
Burnett] Just review, action in February. – [Chair Anderson]
Yeah, the next meeting. That’s what I thought. Sorry. A couple of my colleagues think
they’re pretty good golfers, so they’re pretty
interested in this project. – [Man] Why are you
looking at me, Mr. Chair? – Truth hurts. Anyway, anybody have
any questions on this? – [Regent Rosha] Mr. Chair. – Regent Rocha. – Thank you Mr. Chair. Just looking at the slide
that’s up right now, the operating costs
about $20,000 year. Am I tracking that right? So the question, how does that
compare to the current space? Is this $20,000 in new expenses or is this currently cost
10,000 to maintain the space as it currently is, so it’s a
marginal increase of about 10? Hypothetically. – So the question’s regarding
the annual operating cost and I’m assuming that is; you
can correct me if I’m wrong; since there isn’t
such a facility today, I’m assuming that’s an estimate based on other
athletic facilities. I’m sure I answered
your question. – What I’m looking at as
we go forward with these, particularly in the
non-revue realm, if we raise the money … And I think this is wonderful. It sounds to me like
it’s a great project. I’m not questioning that at all. It would be wonderful if we knew that it’s about 20 grand a year, what would it cost to endow the cost of the
maintenance of it, so that it’s not
just coming of hide, it’s not coming out
of some other program or eventually coming out of what could be sent back
to the institution. Just wondering if at some
point we can get to the point where when we talk
about adding a facility and it’s gonna have
operational costs above what we’re
currently spending, that we identify an opportunity to keep from pulling it
out of the general budget. That was the basis
of my question. – Sir, if you don’t have an
answer for that question, I think Senior Vice
President Burnett might, on endowing. – Regent Rosha. Thank you Mr. Chairman. It looks to be on a 5,000
square foot building, about 20,000 a
year in operating. It would take about a half
million dollar endowment to make that work. So it’s certainly something
that the athletic department can look at if there’s
a donor to do it, but otherwise they’re gonna
have to budget that 20,000 within next year’s
operating budget and it’s only a partial year,
not opening until November. But it’s certainly
something they can talk with the donors about,
because it doesn’t feel like a big lift to get an endowment to endow the operations
of the building. – [Regent Rosha]
Just so I understand, it would cost about 500,000 to endow the Thomas
Anderson Golf Facility? Is that what you’re telling me? – If he wants light and
heat, yes, absolutely. – [Regent Rosha] Thank you. – [Chair Anderson] Regent Lucas. – [Regent Lucas] Thank you. I’m just wondering where
do they practice now and doesn’t that have a cost? – Chair Anderson
and Regent Lucas, yes, right now they
kind of hodge podge. They go to different
indoor facilities that have practice
during the winter months. There is a cost
associated with that. Also the student athletes
have transportation cost, so obviously this facility
will have a huge impact our men’s and
women’s golf programs being able to be
close to campus, so that will help offset
some of the differences. – [Man] That’s correct. – The question I have,
would we have a chance to rent the facility out to
other high school golf teams, golf leagues or things to
actually bring in revenue to also offset the cost? – Chair Anderson,
that’s something that
we are looking at. Due to NCAA rules we
have to be very cautious about high school golf
teams, but that’s something we’ve been working with
Vice President Burnett and his staff to get the
parameters on the facility to raise some money, but
those are all options that we can look at
as we move forward. – Okay. I’m gonna turn it over
to Vice President Burnett who might wanna turn it
over to President Kaler. There was some misunderstanding. Some people think
it’s for review. Some people think
it’s for action. Where actually are we on this? Is the review item just today
or is it an action item? – Than you Mr. Chairman. If the committee’s comfortable,
it’s a fully funded gift, it’s not gonna have a
huge impact on schedule, but if the committee and
the board is comfortable with moving it review action,
we wanna be very careful about that, it just
gives our staff more time to get the design done. The money’s in hand from donors. The sooner we can
get your approval obviously is better and if
the committee and the board is comfortable doing
review action today we welcome that, yes. – [Chair Anderson] Regent Rosha. – Thank you Mr. Chairman. We’re actually gonna
talk a bit about this in governance and policy,
about review action, but this would be one
of those circumstances where I think unless
there is hesitation on the part of any board member, I would move that we would
approve the proposal today. – [Man] I’ll second it. – Was that a motion
Regent Rosha? – [Regent Rosha] Yes it was. – Moved and regent seconded. Regent Lucas, you were
gonna say something? (indiscernible) So now we have a
motion on the table and I would assume the motion is to go ahead and
build the project. It’s moved and seconded. Is there any discussion
on the motion? – [Man] Let’s give
the money back. – Regent Hsu. – Thank you Chair Anderson. Athletic Director
Coyle, how many to years to the next golf championship? (people laughing) – [Athletic Director
Coyle] Chair Anderson, Regent Hsu we work
hard every day to get that championship,
so very fair. – Is there any more discussion? At this time we’re
gonna take a vote on going ahead with
the new golf facility. All those in favor
signify by saying I. – [Board Members] I. – Opposed? (gavel striking sound block) Motion carries. Thank you gentlemen. – [Man] Thank you. – We’re into the consent report. All right. Senior Vice President Burnett do you wanna take us
into the consent report? – Sure. The consent report
begins and there is a revised consent report
that’s been distributed to the board and
President Kaler’s going to also talk as we get
to a piece of this, but just briefly we brought
in all the purchase of goods and services of a
million dollars. We’re gonna talk
about that tomorrow in the governance committee, so this is kind of how
that comes into play. But the employment
agreements really was originally on page 111 of your docket and the
first employment agreement for the consent agenda was for the dean of the medical school and I think President Kaler was going to talk
about that one. That’s one’s up first. – President Kaler. – Thank you Chair Anderson. I am seeking the
committee’s recommendation for full board approval
for the appointment of Dr. Jakub Tolar as dean
of the medical school and interim vice president
for health sciences at the University of Minnesota. The dean of the medial
school is responsible for advancing the university’s
academic research and outreach mission
in the medial school, including collaboration
between the Twin Cities and the Duluth medical
school campuses for the Academic Health
Center, the broader university and affiliated clinical
education settings
across the state. The dean will also implement strategic
administrative alignment between the medical school and
the University of Minnesota so physicians can
continue to develop the medical discovery teams and ensure high
quality training. The interim vice president
for health sciences is responsible for
leading the university’s health sciences agenda,
working closely with the health sciences
schools and colleges to advance strategic alignment and managing and accounting for critical resources of the AHC. These are big jobs
and we’re reviewing whether one person can
or should do both of them on a continuing basis, in
the climate around healthcare that we now are in. But it is important to take
advantage of this opportunity of the transition to look
at the entire AHC structure and I’m interested
in doing that. If you have ever met Dr. Tolar, he surely has the energy
to do just about anything. Simply put, he’s an
inspirational leader, an exceptional clinician and
internationally recognized for his research around
regenerative medicine. He is now, among
other positions, a distinguished
McKnight professor in the department of
pediatrics bone marrow and transplantation,
and director of the Stem Cell Institute. So without hesitation,
I enthusiastically ask your recommendation,
the full board, for the appointment
of Jakub Tolar as medical school dean
and interim vice president for health sciences. – [Chair Anderson] Thank
you President Kaler. Are you finished? – [President Kaler]
I’m finished, yes sir. – [Chair Anderson] I
didn’t know if you were. I thought you were– – [President Kaler]
No, I’m done. – So the other item
on the consent report that we probably should
have a little information on is the extension of football
coach P.J. Fleck’s contract and I’ll ask Senior
Vice President Burnett to give us some background. – Thank you Mr. Chairman and I’ll ask Athletic Director
Coyle to come to the table. There are two amendments in
the revised consent agenda for the employment agreement
for the head football coach on the Twin Cities campus. There’s two parts to this, an extension and an amendment
to the existing agreement. – Correct. Chair Anderson and
members of the board we felt it was important,
after this first season, to show our commitment
to Coach Fleck, to show a commitment
to our student athletes and our fans that we’re
committed to this program and the direction
we’re moving in, so we offered P.J. a one
year contract extension. There’s no raise
in that extension, so his contract would
be for five more years. It’s based off the same
terms, where the salary would be and so forth,
for the next five years. And we made that decision
based, as I said, we wanted to make sure we
illustrated a commitment to Coach Fleck, our football
program and our fans. And second, if you recall,
when we made this decision to hire Coach Fleck a
year ago, we talked about the impact that he
has athletically, academically and socially
and if you look at what our program did;
obviously athletically we wanna have more wins. Every program wants
to have more wins, but academically,
the first semester he was head of our
program we posted our highest grade
point average ever as a football
program, above a 3.0. I think we were 3.07. We followed that
up in the summer with our highest grade point
average during the summer term. Socially we did several
things in the community, whether it be our
student athletes going to the Masonic Children’s Hospital, whether we do the diaper
drive during fall camp, the turkey drive and
these were all things that were initiated by the
students in that program, so we’re very pleased
with what he’s done and that’s why we
offered that extension, pending this approval. In addition, we wanted to
clarify his current agreement. Coach Fleck, for recruiting,
has the opportunity to utilize private charter
time and we’ve been able to successfully fundraise
dollars earmarked specifically for fundraising,
so just wanted to bring to the
attention of the board that he has up to 60 hours and when we pass
that 60 hour mark of private air time
we would utilize privately fund raised
dollars to offset those costs and those are two amendments we would like to bring
forward to the board. – Thank you. What I’d like to do at this time is get the motion for the
consent to report on the table then we can discuss
any parts of it. – [Committee Member] So moved. – [Committee Member] So moved. – Is there a second? – [Regent Hsu] Second. – Second, Regent Hsu. Okay, we can have a discussion. Anybody wanna discuss
the consent report? Regent Hsu. – Just, first of all, a question
on Dr. Tolar’s contract. If in fact he does
become the vice president of the academic health
center in the future, would there be an increase
associated with that or this kind of the
salary for both positions? – [Chair Anderson] I
guess President Kaler. – Very understood Regent Hsu. As it is today, I would not
anticipate increasing his salary to reflect taking
that job permanently. Frankly I also feel
pretty strongly that it will be a very redefined
job from what it is today. – [Regent Hsu]
Thank you and then– – Regent Hsu, you
wanna follow up on it? – Thank you Chair Anderson. No, I’m good on that one. Athletic Director Coyle,
maybe a question for you. I personally don’t see the need to require fundraising dollars for the additional
airplane time. If he needs additional airplane
time to go out and recruit. If it’s okay with
you and your budget then I don’t know that there
should be a restriction on whether or not we
have the funds coming in from somewhere else. Does anyone else have
a thought on that? – Athletic Director Coyle, do
you wanna try to clarify that? – Chairman Anderson
and Regent Hsu thank you for the question. I think we just wanted to
bring to the board’s attention his contract states that
he has up to 60 hours. We anticipate that he
will go over 60 hours and we just wanted to make
sure, in full transparency, that we all understood that
when he does go over 60 hours we do have fundraised dollars
that could cover that cost. – This is my question. There probably is a
discretionary item on your part if you ever wanted to do
that two frecks mod more. Would that be fair to say? – [Athletic Director
Coyle] Yes sir. – So we already have
what Regent Hsu says. Regent Johnson. – Thank you Mr. Chair. First a comment about Dr. Tolar. I highly support the motion to hire him and his position. The one thing that impressed
me about Dr. Tolar, among many, is I had an
opportunity to see him work over the legislature and
talk about a number of issues and his ability to
communicate very complicated medical, scientific issues
to members of the legislature was absolutely stellar. And that is a huge thing for us at this time and going forward. Second of all I heard him speak about three or four weeks
ago to a full room of folks and again he was
stellar in his comments and he takes very
complicated issues, medical issues, and
makes them understandable to the listening audience. So I highly highly
support that effort. Mr. Chairman I have a
couple of questions, Athletic Director Coyle,
about the second amendment having to do with the aircraft. So I understand,
is under the policy that the head football coach
can use private aircraft up to 60 hours, is that correct? And are those 60 hours, are
they donated by individuals or corporate or do they
come out of the budget? – Chair Anderson, Regent Johnson that’s part of his contract. So in his contract, his
employment agreement with the University of
Minnesota he has up to 60 hours to use private aircraft for recruiting purposes only and that’s part of our budget. – So that’s not, for
instance, a corporation has a private jet, they
couldn’t call you or call him and that he could
use that private jet to fly to Florida or to Texas? I’m trying to understand
how that works. – [Chair Anderson]
Athletic Director Coyle. – Chair Anderson, Regent Johnson yes we do have some donors
who will donate their aircraft to him to go recruiting,
for recruiting purposes and we can take those
opportunities as a well. – So Mr. Chair, that’s
reportable and transparent who does that, which
corporation, what individual? – [Chair Anderson]
Athletic Director Coyle. – Chair Anderson
and Regent Johnson we track every time
our coaches go out on a private aircraft. We track who’s using it,
who provided the aircraft and how it was covered,
so yes we track that. – Mr. Chairman,
and this is outside what we’re talking
about, but I’m curious, do other head coaches
have the same opportunity, in matters of
recruiting, of aircraft? – [Chair Anderson]
Athletic Director Coyle. – Yes sir, Chair
Anderson, Regent Johnson here at the University
of Minnesota or at our peer institutions? Other coaches at Minnesota
have the opportunity– – [Regent Johnson] Mr.
Chairman, here at Minnesota. – Chair Anderson, Regent Johnson so coach Pitino in his
contract has the opportunity to use a private aircraft
and that’s very consistent with our peers across
the Big Ten as well, so other coaches do
have the opportunity to use private aircraft
for recruiting. – One last question
Mr. Chairman. It has to do with taxes. If you’re a corporation
or an individual and you make your
aircraft available, is that a tax deduction
or it depends upon we’re talking about
present tax law or what’s to come in the future? – [Chair Anderson]
I think we could ask Athletic Director Coyle,
but he’s probably not a CPA and qualified to answer that. President Kaler. – Regent Anderson
I’m not a CPA either, but I stayed at a … No. (people laughing) It’s late; I’m jet lagged. This is an interesting
conversation Regent
Hsu and I had with Gayle Klatt, Auditor
Klatt at lunch today and my current understanding
is that a donor who makes that service
available, if it is done in a way in which we can
provide them a receipt for that donation that that
is a acceptable deduction for that individual
or corporation. That’s my current understanding. I would not do that
on your tax return without verifying
it with an expert, but I believe that to be true. – I would just add that in
the cases of recruiting, a coach is not using
it for personal use, it’s for business use, so
there’s a reportable there. Next, Regent Rosha. – Thank you Mr. Chair. A comment, question and comment. The first comment
echoing the sentiments with respect to Dr. Tolar. I’m very excited to see him
moving forward in this capacity. He certainly knows the
medical school very well and I’ve always been
impressed with his capacity and very interested
in his perspective on how to move forward
with creating that position as it relates the
the academic health. The question and I’m
not entirely clear
on this air travel, but the first question
is is 60 hours plus, are we kind of giving
our personnel … I know others have access. Is it access to the same amount
or are some folks with more, because when you look at
the number of recruits, because it’s a huge program
right, 100 some folks, are those enough hours? A one our flight both ways
you get thirty of them. So is that enough for
us to be successful, because we’ve got a pretty
substantial investment in this program. – [Chair Anderson]
Athletic Director Coyle. – Chair Anderson, Regent Rosha are you talking specifically
for the football program? – [Regent Rosha] Yes, correct. – We feel like, and that’s
why we wanted to bring this to the board today, was
to have this conversation; his contract clearly
states us to 60 hours, we will go past that 60 hours. That’s where we
got the fundraised
dollars to cover that. As you know, it’s very
well publicized right now, we have a recruiting class that’s ranked in the
top 25 in the country. We have six four star recruits. It would be, if they all
sign on December 20th, our most highly decorated
recruiting class in program history. So obviously this
is the first year of our early signing
period, due to changes in the NCAA signing
day, so you’re seeing a more aggressive time table,
the private uses of aircraft right now as opposed
to when signing day was the first
Tuesday of February. So we feel comfortable
with the 60 hours, but again we just wanted
to be fully transparent so if you saw reports
that it was over 60 hours, how we were covering that cost. – [Regent Rosha] Mr. Chair. – [Chair Anderson] Regent Rosha – If I could just
follow up on that, because when I hear that
it certainly seems to be legitimate expenditure,
when you consider the way programs run these
days and when I hear you’ve raised philanthropy
dollars I start to think well maybe those retiring some Athlete’s Village
debt or something, unless they’re earmarked
for by the donors, and just simply take
this out of the program. That would seem
reasonable to me, but maybe there’s something that prevents that
from happening. – That brings up another item. You do get donors
that earmark dollars and in this case are we
getting earmarked dollars to offer for recruiting? – Chair Anderson and
Regent Rosha yes sir, these are people who have
made gifts specifically for football recruiting, so
they’re restricted gifts. – Mr. Chair if I may,
just final point. With respect to the extension
of the coach’s contract, when the call came in
inquiring for initial feedback for doing this, my
response is pretty simple. It’s the one thing that
we can’t really have, it seems is turnover and
having that consistency and being able to reflect to
the next generation of Gophers, among other programs, we
need to show that there is that commitment, somebody
who wants to come in knowing that someone
is going to be there through their process,
because they’re really creating a relationship
with the coach as much as they are with
the institution, it seems. So from that standpoint
it seems to be … There’s obviously a
lot of public opinion about these things. There always are, but would
the people be so interested in the dormitories that
our system campuses as they are about these issues, but I would say that
I do wanna just … One point is when we had
the conversation a year ago, a year plus or about a year ago, about making this investment
in this new direction for the program, we
have expectations. I asked some very
specific questions in saying well if we make
this substantial increase in investment in
our leadership staff for the football program, how will that yield
for the institution? At what point are we
gonna turn the corner so that rather than having
to subsidize your department we actually would have
additional resources for the institution. I don’t think we
got there this year. I think when we look at some
of the increases in tickets and so on and so
forth we’re not where I was hoping we would
be at this point, but that by no means suggests that we’re not on
the right track yet. But just bearing in mind
that I think it’s important for this board, as we
ask those questions and make decision based
on those assumptions, that we keep those
in front of us. So my expectation would be that
we continue down this path, certainly as you discussed
the national attention we’re getting for the success
of this class, would hopefully portend success in the future, but there is an
accountability that we make that investment based
on your expertise and wanna make sure that
we’re making progress as we go forward. Thank you. – Thank you. Regent Sviggum. – Mr. Chairman just a 45
second comment if could, because I’m sure like I,
many of you have heard things in the local communities
about the contract extension. Just to enhance what Athletic
Director Coyle has stated, in regards to the
commitment, I think this is a very important commitment, something we need to
do as a university. It’s hard for us
sometimes to relate to citizens, farmers, whoever to
big time football coaching, but this is big time and it’s
somewhat tough for us really, but this guy,
meaning Coach Fleck, does things the right way folks. He does it the right
way, whether it’s out on the football
field with the athletes handing the ball
to the official, whether it’s the
student athletes
sitting in the front row with collared shirts on or
visiting children’s hospitals, as you mentioned, he
does it the right way and we need to make a commitment
and thank you Mr. Coyle. – Thank you. That’s great to hear from a
slow safety from St. Olaf. (people laughing) – [Man] Second short. (people laughing) – Okay, we have a
motion on the table to pass a consent agenda. – [Regent Johnson] Mr. Chairman. – Yes. – That last comment you
made, I can attest to that, because I worked
for St. Olaf College and Regent Sviggum
played real slow. (people laughing) – Thank you. We do have a motion on the table to accept the consent agenda. We’ve talked about it. Consent report, I should say. Any further discussion? If not all those in favor
of the consent report signify by saying I. – [Committee Members] I. – Opposed? (gavel striking sound block) The motion passes. Information items, to
wrap up the meeting, Senior Vice President
Brian Burnett. – We do have one
information item that’s in the form of a report and I invite Executive
Director Darryl Peal to talk about our
annual report on targeted business,
urban community, economic development and
small business programs. We have a presentation
that begins on what I believe was page
137 of your slide deck. Welcome, Executive
Director Peal. – [Chair Anderson] Director
Peal you have the floor. – Thank you very much and thank you very much
to the board of regents. I’m really proud
and just excited to be in front of
you this morning. I wanna preface the
comments about the data with a little information about
the success of the program. We’re really proud
of the relationship that the Office of Business, Community and
Economic Development has forged with CPPM and with
the Office of Procurement and together we’ve
become what I believe is quite the team and
we’re really really proud. The greatest measure
of that is when someone outside of
the organization
recognizes the work. In 2017 we had the great
fortune of being recognized as the corporate
partner of the year by the Women’s Business
Development Center, which is a certifying
agency for Wisconsin, South Dakota, North
Dakota and Minnesota and oversees the supplier
diversity relationships between organizations,
institutions and major corporations,
with women. And we were selected as the
corporate partner of the year, because of our increased
utilization and spend with women business enterprises, which is a huge accomplishment. A couple months later
we had the good fortune of being recognized again. We were selected as the
2017 corporation of the year by the North Central Minority
Supplier Development Council, which serves Iowa,
Wisconsin, Minnesota, North Dakota and South Dakota. The folks we were involved
to win the competition with are 3M and Target and Cargill and all the other
major corporations in these five and
six state areas. So it was a huge honor and
we were very very proud and it would not have happened
without what I believe is an incredible
relationship that is growing and has grown between CPPM
and procurement and between the Office of Business Community
and Economic Development. With that said, I would
like to share with you part of the reason
why we were selected. First, in 2016-17 the
University of Minnesota increased it’s utilization
with targeted businesses, which are women, minorities
and disabled person, by 11.2 million dollars. And that was 11.2 million
dollars over 2015-16, which we thought was
an incredible feat, because in 2015-2016 we had increased by
11.5 million dollars. So over the last two years we’ve increased by
22 million dollars. Actually it’s 22,999,000. Almost 23 million
dollars increase in just the last two years. And third, that’s
a 3.39% increase and in 2016-2017 that
total dollar figure was 82,559,000 and the
year before was 71,000,000. When you look
around the community and look around the
Greater Twin Cities area, our success at the
University of Minnesota, using targeted businesses
is unparalleled. We are truly the
benchmark organization, as it relates to supplier
diversity, among corporations, institutions and universities in the state of Minnesota
and in the region. As we look at the data as well, I’d like to just share
with you a couple things. There are some trends and
the trend data is that we’ve had a huge increase
in the utilization of target businesses and we’ve
had a significant increase in utilization and total
spending with women. Our only challenge has
been with our increase and the utilization of
spend with minorities, which has gone down. But I will share this with you. When you look at the
utilization of women and minority owned
businesses, it ebbs and flows according to the projects
and the opportunities that are available. So some years you will have an incredible amount of
spend and other years you will have what
looks like a deficit and while our
detractors will say all sudden we’ve lost
interest in the utilization of working with minority
businesses, it’s not true. There’s different challenges. For example, in the last year there was a couple
major projects. One of them was a small
700 million dollar project called the State
Capital Project, which pulled a great
number of minority and women owned businesses
into that major project and we just lost
a good number in the U.S. Bank Stadium
project, so we’re competing with what is an ever
shrinking number of minority owned businesses
with capacity and scale to meet the needs
of the university, but even still with that,
which I’m really proud of, we’ve had a 22 million dollar
increase in utilization over the last 2 years, which
means we’ve been methodical and intentional and
very laser focused on trying to grow and expand. As a matter of fact Tim Bray
and I talk regularly and daily on strategy and how we can
continue to increase our spend in a way in which it
helps the university find minority owned and
women owned business who can bring cost savings and innovation to our
supply chain process. With that we’re pretty
excited about the future. And you have the reports, so I won’t read
the reports to you, but what I will say is
that I’m really proud that in this first quarter
already for this year, in construction, we
have a 39% utilization and for the past 10 years
we’ve stayed around 30% in utilization on
construction projects at the University of Minnesota. So we’re really proud of that. Also, in relationship to
some of the ebbs and flows in the utilization of
vendors, one of the things that we look forward to, because
we know that historically, women owned and minority owned and disabled owned businesses, especially in the
construction trades, really have more
activity and we have greater spend with them toward
the end of the projects, because they’re in the final
finishes portion of it. More specifically they do more electrical and those
types of things. And when you think about the
buildings and the projects that we have still on the table, it makes sense when
you analyze the data, that we still have Tate
Lab, Athlete’s Village, the Bell Museum
all who are closing and Pioneer Hall,
which is just starting. So we’re pretty excited. Really excited about
the utilization. The numbers have been fantastic and I don’t wanna
insult your intelligence and I know I’m probably
standing between you and dinner, so if there are any questions
you have about the program or growth or where we
went next I’m here. – I have a brief question and I think Regent
Powell does too. My question is it looks like
you’re doing a wonderful job. When you talk about these
projects that are closing and the minority businesses
and the women businesses, a lot of times we hire people at the closing of
these projects, because they’re
smaller companies. Is that a fair statement? – It’s actually the
types of services and industries that they’re in. A lot of times if you have the
major construction companies, like a Mortensons or
a McGoff or whatever, in the front end of that
process they’re organizing, supervising and
building the building. But the final finishes
are the drywall, the electrical, those
things are where you have a lot more of your women and
minority owned businesses, even have large capacity
and large scale. They’re not necessarily
always small, but they come in and those are where they more specialize in
than the major bricks and– – [Chair Anderson] At
the end of the projects. At the end of the projects. – [Director Peal] Right. – Regent Powell. – [Regent Powell] Thank
you Chair Anderson and Director Peal. So all of the spending is with
Minnesota based contractors or some of it out of state or how does it
break down that way. – Very little is out of state. In our last estimate,
I really wish I’d brought that data with
me, because I’m that guy that always says information
without data I opinion, (chuckle) but we really are
around 90, 93, 94 percent of our utilization and our spend with minority owned
and women owned vendors are from the state of Minnesota. In our office, one
of our philosophies is the state of Minnesota first. – Great. Thank you. – Thank you. Any other questions
for Mr. Peal? Representative Chen. – Thank you Chair Anderson and thank you for
the presentation. This is great work for
these targeted businesses and small business. I wonder if there
is any other groups that we might want to
target to do business with. That’s one question. The other one is that do
we have something similar to a vendor code of
conduct that we advocate doing business with
companies, suppliers, vendors that have high standards
of labor standards or environmental compliance
or other nondiscrimination. Do we have such statement
or things like that? Thank you. – Most certainly so. That’s about three question. (laughing) Let me start with I gotta guess
the first thing I would say is yes we do have aspirations
to grow the numbers and the populations
of targeted businesses that we actually engage. One of the conversations we’ve
been having with the state is we would like to see,
and from my experience really from every supply
diversity program I’ve ever ran, veterans were always a
part of that conversation. So we’ve already
started, me and Mr. Bray, working with collecting data
on the numbers of suppliers who are registered with us who
are veteran owned businesses, so that when the state makes
that move we’re out in front. We’re not waiting or trying
to build an infrastructure to be able to move forward. The other greater
population of individuals we’ve had inquiry about
adding are the LGBT community and again we’ve
built relationships with the national
certification agency and then invited them to our
expo on outreach programs, so that they can have
conversations with individuals who aspire to have
certification with them. However we are pretty
much married to trying to stay
lock step with what the state and the federal
government is doing as it relates to who are
those targeted businesses or protected classes, without
creating lanes of our own, but we’re in
preparation for that. I think the other question … You’re other question was? – [Chair Anderson] Code
of conduct, I thought. It was one about
code of conduct for– – [Student Representative
Chen] Yeah, do we advocate
for doing business with companies higher standers. – I wish I could have
a code of conduct for some of our businesses. (laughing) A majority of the
businesses we do work with. No, but what we do have
are we have expectations, in terms of workforce. So on all of our major
construction projects Sharon Banks, who
works in our office, is engaged in going
and doing site visits to make sure that
we are in lock step with the administrative code
from the state of Minnesota that states that you would
use particular percentages of individuals who are minority, who are women and disable,
on those work sites. And I’m really proud to say
the University of Minnesota has been successful in
meeting those goals. So in terms of code
of conduct I think that’s the most rigid
type of measure we have as it relates to organizational
behavior on a work site, is the measure of
utilization of the workforce. Other than that we are
not really a depository or a ombuds kind of
organization for complaints of difficulties that
women or minorities are having on those sites. And to date since
I’ve been here, I’ve only been here three,
going on four years, I’ve really not had
any brought to us. So in terms of following
up on those types of behavioral it’s not
really a lot of space. – Thank you. Thank you Director Peal. Any more questions
of Director Peal? If not, thank you very much sir. Thank you for being here. Finally, our information items, as we continue in your packet,
you’ll find information on Superbowl planning, quarterly
asset management report, purchasing report, capital
planning project report. Senior Vice President Burnett is here to answer any
question you have on those. If you don’t, I’d entertain
a motion for adjournment. – [Several Committee
Members] So moved. – So moved. – [Committee Member] Second.
– Second. (gavel striking sound block) Adjourned. (chatter)

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