Board hears campus budget reports

May 2, 2016

All proposed tuition increases within legislative allowances

The State Board of Higher Education employed technology this month to meet from five locations - Bismarck, Fargo, Grand Forks, Minot and Williston.

The State Board of Higher Education employed technology this month to meet from five locations – Bismarck, Fargo, Grand Forks, Minot and Williston.

Technology and budgets were the talk of the day when the State Board of Higher Education met this week to move business forward.

The regular meeting was held at Bismarck State College, with satellite locations dialing in via Skype for the first time. The multi-location meeting allows for more flexibility and less travel on behalf of board members and campus representatives, who used video teleconferencing to meet from Minot State University, North Dakota State University, University of North Dakota and Williston State College.

Board Chair Kathleen Neset noted that the technology offered a new opportunity for the Board and university system to conduct business in a more efficient manner.

Chancellor Mark Hagerott’s report brought forward discussion on budgets, presidential evaluations, and initiatives to include Bakken U and Nexus ND, and the upcoming educational summit titled Envision 2030.

 

Budget allotments

Chief Financial Officer Tammy Dolan said the governor would be announcing budget guidelines next week for the 2017-19 biennium. For this biennium, she noted that guidance had been offered to the campuses on how to meet the 4.05 percent allotment including the examination of travel policies/practices, accelerating ongoing efficiency efforts in administrative processes, considering shared service agreements, examining academic course delivery methods, and evaluating faculty course loads, among others. No matter what, Dolan said, guidance allowed for the discretion of respective campus leadership.

Board member Nick Hacker said this was one of the most important things the Board and the system could do, asking that further details be provided during the meeting. Dolan offered to create copies of the guidelines for those present. Hagerott noted that the guidelines were created through collaboration to identify needs and wants, always under the framework of keeping students as the highest priority. Most of the colleges and universities achieved some savings by reducing travel and offering early retirements.

Details on the individual budgets began with a presentation from MiSU.

Dr. Steven Shirley said the $2 million decrease at MiSU would come through freezing nine positions, reducing extraordinary repair expenditures, eliminating two staff positions, and putting a seven-percent across-the-board cut in place for operating budgets. The university reduced Fiscal Year 2017 salary increases for all positions that were above the MiSU median salary.

Dr. Ray Nadolny said the $531,331 decrease at WSC would come from deferred salary increases, reducing the workforce by adding responsibilities to each position, and some layoffs.

Dr. Larry Skogen said $1.5 million decrease at BSC would include savings from early retirements and some positions not being filled, one vice president position being eliminated and two divisions being consolidated. Travel and repair budgets had also been reduced.

Dr. Thomas Mitzel noted that the $1.1 million decrease at Dickinson State University would come through eliminating some positions and postponing certain searches, and reducing travel and non-essential maintenance.

Dr. Tisa Mason stated that the $1.6 million decrease at Valley City State University would come from engineering changes to the upgraded heating plant, reducing deferred maintenance expenditures, decreased tuition waivers, reducing or eliminating salary increases, and reducing travel.

Dr. John Richman said the $2.3 million decrease at NDSCS was in reducing administrative positions, identifying local funding for some deferred maintenance projects, and eliminating vacant positions.

Dr. Dean Bresciani said the $6.402 million decrease at NDSU would come through reduced research budgets, postponing job searches and combining some job responsibilities.

Dr. Gary Hagan said the $685,676 decrease at Mayville State University would translate to reducing extraordinary repair expenditures, eliminating some positions and reducing salaries in other positions.

Ed Schafer said the $12.6 million decrease at UND would come from eliminating 138 positions, and terminating some academic and athletic programs.

Dr. Jerry Migler said the $399,594 reduction at Dakota College at Bottineau would be achieved through the reduction in a capital project at the Nelson Science Center, and in delaying the hiring of two positions. Permanent changes in FTE positions would allow salary savings, and salary increases would be reduced.

Dr. Doug Darling said the $678,568 reduction at Lake Region State College would come through reducing capital projects for the biennium, reduced maintenance and travel, and reduced salary increases.

All colleges and universities that spoke about a tuition increase for next year were within the boundaries set by legislative mandate in the last session and were previously approved by the Board.

Some discussion was held during the budget talks by Board members interested in having more details presented on any financial decisions, especially if those decisions affected academic programs. Board members found consensus in having such program cuts brought before the Academic Affairs Committee, which was typically where program or department changes were deliberated. Due to the limited timeframe from the announcement of allotments to the final budget approval, Board members said they understood that this was an exceptional case.

Hagerott said preparation of the draft guidelines for the allotment began in the fall when commodity prices decreased.

Board member Kari Reichert said she was pleased to hear conversation regarding reorganization and consolidation of senior administrative staff duties. She noted that she would have liked to hear more details on subjects such as shared services or consolidation of functions that were duplicated across multiple campuses. She reiterated that things like program eliminations should be brought before the full committee to meet the responsibilities of those committees.

Hacker said the reports given by the presidents weren’t long, although they were precise and to the point. He said he would like more time in the future to review additional details of respective budgets, as he felt it was in the best interest of the Board and system.

“We are in a unique situation here, and a difficult one,” Neset said. “The timeline is short and the hurdles are huge. We don’t just want to see final proposals. I believe we want to see the work product rather than the final product, brought to the Board. That way we can have some input and do our fiduciary responsibility to the state and to the students of North Dakota.”

Board Vice Chair Don Morton said he liked the decision-making to be closer to the campus because that was where the impacts would be felt.

“What’s best for students at one institution is not what’s best for students at another,” Morton said. “It sounds like we’re moving toward a position where we want the board to make these decisions and if we do that why don’t we just eliminate the presidents and have the board run the campuses?”

Stemen said the Board hired presidents to make tough decisions, which included the shaping of the respective campus budgets.

Neset said that working forward, perhaps presidents could provide more summary information prior to board meetings, to allow for more informational and efficient board meetings on the budget. She asked Hagerott to look into it.

 

Master planning

Rick Tonder, NDUS director of facilities planning, spoke to the Board on institutional master plan summaries, which included space utilization data and recommendations. He noted that the systemwide master plan had been put in place a few years ago, with an update last year. Much of the discussion surrounded space utilization and program needs.

The master plan was to help guide strategic planning and to detail needs for space, deferred maintenance, and safety, as well as potential future programmatic changes. Tonder offered details of the current plan, which included how certain locations in NDUS facility inventory were aging and weren’t optimal for classrooms, how centralized scheduling was not in place across all institutions, and how an excess of classrooms and labs existed.

Recommendations from the plan were to require central scheduling of a minimum of 95 percent of classrooms and labs, to prioritize deferred maintenance projects to improve classrooms and labs currently underused due to existing conditions, and to remove facilities in lieu of repair where the estimated deferred maintenance cost was greater than 65 percent of the replacement value unless a significant value – historical or otherwise – existed in the building.

Hagerott said that with billions of dollars in infrastructure master plans were vital. The plan itself offered a “fidelity of data.” After brief discussion, Neset stated that in the future she would like to see the institutional master plans brought to the Chancellor. When brought to a vote, the Board unanimously approved the institutional master plans, including the three recommendations to improve space utilization rates and reduce deferred maintenance.

 

Other business

Valley City State University President Tisa Mason presented on the VCSU heating plant. Her presentation detailed how the carbon plant/steam plant integration would be beneficial to the campus, the community and feature work from UND students and the Energy and Environmental Research Center.

Morton discussed the Budget and Finance Committee recommendations, including authorization for a renovation at Dakota College at Bottineau’s Nelson Science Center, and renovations at UND’s O’Kelly Hall classrooms and Merrifield Hall IT CORE upgrade.

Reichert brought forward recommendations from the SBHE Academic and Student Affairs Committee, including organizational changes. Those approved by the Board included the renaming of a division, renaming a department, approval of new programs and termination of programs, and tenure recommendations.

In other business the Board approved State Board of Agricultural Research & Education nominations. Neset and Hacker both thanked them for their service. It also held the first reading of HR policy 18 (rest periods), and the second readings of policies 402 (delegation of admission authority), 402.11 (admission policies standardized test scores), 402.1.2 (admission policies placement into college courses), HR policy 6 (annual leave), and HR policy 7 (sick leave board business).

Before closing out the meeting the Board confirmed its upcoming meeting dates, which will be May 23 and 24 at the Bismarck State Capitol, and June 16 and 17 at in Washburn at the Lewis and Clark Interpretive Center.