December 2003 Board Meeting Minutes

Wednesday, December 17, 2003
Wells Fargo Place
St. Paul, Minnesota

Trustees Present: Jim Luoma, Chair, Will Antell, Andrew Boss, Mary Choate, Daniel Coborn, Tyler Despins, Cheryl Dickson, Ivan Dusek, Clarence Hightower, Robert Hoffman, Vincent Ijioma, Lew Moran, David Paskach and Shaun Williams

Absent: Ann Curme Shaw


  1. Call to Order
    Chair Jim Luoma called the meeting to order at 1:03 p.m. and reported that a quorum was present. Chair Luoma announced that the Educational Policy Committee would be the first committee report heard on the agenda.

  2. Chair's Report
    a. Minutes of Board of Trustees Meeting of October 22, 2003
    Chair Luoma announced that a corrected page 4 of the minutes was distributed, and that the minutes stand approved as written.

    b. Minutes of Board of Trustees Emergency Meeting of November 21, 2003
    As there were no corrections to the minutes, Chair Luoma announced that the minutes stand approved as written.

    c. Draft Minutes of Executive Committee Meeting of December 3, 2003
    Chair Luoma reported that the draft minutes of the Executive Committee meeting are included for information in the Board packet.

  3. Trustee Reports
    Trustee Will Antell reported that he attended the commencement at Minnesota State University, Mankato, on December 13, 2003. Trustee Antell commented that he was pleased that Chancellor McCormick and staff visited with the superintendent and staff of the Minneapolis Public Schools. Trustee Antell also attended the inauguration of President Don Day of Fond du Lac Tribal and Community College in Cloquet, on November 21.

    Trustee Tyler Despins reported that he attended the Minnesota State University Student Association (MSUSA) Board of Directors meeting at St. Cloud State University, December 5-7, 2003.


    Trustee Ivan Dusek reported that he attended the Academic Quality Improvement Program (AQIP) Strategy Forum with Ridgewater College, November 12-15, 2003, in Lisle, Illinois.

    Trustee Mary Choate announced that the Association of Community College Trustees (ACCT) appointed Trustee Dusek as a member of its Diversity Committee.

  4. Chancellor's Comments
    Chancellor McCormick welcomed the public and the constituency leaders to the meeting. He commended the staff at the campuses and in the Office of the Chancellor for the noteworthy audit results. He expressed the importance to inform the people of Minnesota of how well the System is managed.

    Chancellor McCormick congratulated Minnesota Online for the preliminary positive report given by the Higher Learning Commission. Through Minnesota Online, the Minnesota State Colleges and Universities will be the provider of high quality online learning opportunities. He added that a key recommendation by the Higher Learning Commission was the importance of adequate funding of Minnesota Online efforts. He added that he fully supports the efforts of building a strong foundation of programs and services for the online students.

    Chancellor McCormick commented that the business and campus visits have gone very well and that the meetings have brought a realization that the higher education opportunities are important to the local community and business leaders.

    Chancellor McCormick discussed his membership in the St. Paul Rotary Club and that he had an opportunity to hear Governor Pawlenty at a recent meeting along with Matt Kramer, Commissioner of the Department of Employment and Economic Development. Commissioner Kramer also met with the Leadership Council and discussed his interest in increased collaboration to serve the people of Minnesota.

    Chancellor McCormick commented that in January a joint meeting of the Audit and Finance/Facilities committees will review the Sarbanes Oxley Act of 2002. Although Sarbanes Oxley does not yet apply to nonprofits, including the higher education institutions, it does set new standards for accountability.

    Chancellor McCormick stated that the Board of Trustees' annual "Foundation Thank You Luncheon" in honor of the private support to the colleges and universities will be held on January 22, prior to the Board of Trustees meeting.

    Chancellor McCormick requested that the Leadership Council consider utilizing the lunch hour at the Leadership Council meetings to feature individual institutions as the presidents do not often have the opportunity to visit other campuses.
    The Chancellor further commented this is the time that legislators and others will review their investment in higher education and to gain their support is to welcome the opportunity to be accountable and open to scrutiny. He added that we not forget that the colleges and universities belong to the people of Minnesota.

    Chancellor McCormick stated that there are a number of students in rural communities to be served and although the costs may be higher, as are many other services provided to the smaller communities, it is a need that is important to present to the legislature. He added to support and advocate as a whole system is important in presenting to the legislature.

  5. Joint Council of Student Associations
    a. Minnesota State College Student Association
    Ms. Missi McLaren, President, Minnesota State College Student Association (MSCSA), addressed the Board of Trustees.

    b. Minnesota State University Student Association
    Mr. Sam Edmunds, State Chair, Minnesota State University Student Association (MSUSA), addressed the Board of Trustees.
  6. Minnesota State Colleges and Universities' Bargaining Units
    a. American Federation of State, County and Municipal Employees

    Ms. Karen Foreman, President, and Mr. Carroll Partridge, Vice President, American Federation of State, County and Municipal Employees (AFSCME), addressed the Board of Trustees.

    b. Minnesota State University Association of Administrative and Service Faculty
    Ms. Jeanne Cornish, President, Minnesota State University Association of Administrative and Service Faculty (MSUAASF), addressed the Board of Trustees.
  7. Consent Agenda
    a. Fiscal Year 2003 and Fiscal Year 2002 Audited Financial Statements

    Trustee Daniel Coborn moved approval of the Consent Agenda. Trustee Tyler Despins
    seconded, and the Consent Agenda was approved unanimously.

  8. Board Standing Committee Reports
    a. Finance/Facilities Policy Committee, Andrew Boss, Chair
    1. Finance/Facilities Division Update
      Committee Chair Andrew Boss reported that the committee heard an update from Vice Chancellor Laura King on the Finance/Facilities Division. The acquisition of the Billy Graham property has been completed and will make a significant difference in the services offered by Minneapolis Community and Technical College and Metropolitan State University. Chair Boss commended the staff for the challenging transaction.
    2. Proposed Amendment to Board Policy 6.4, Facilities Planning (First Reading)
      Committee Chair Boss reported that the committee reviewed the proposal to present college or university strategic profiles to the Board on a periodic basis which was also discussed at the Educational Policy Committee meeting. This will be an action item at the January meeting.
    3. FY 2004 HEAPR Capital Allocation Plan
      Committee Chair Boss reported that the committee heard a presentation on the FY 2004 HEAPR Capital Allocation Plan. The committee reviewed and had a discussion on the plan. Chair Boss noted that there will be further discussion as the budget is brought before the 2004 legislature.

    b. Advancement Committee, Cheryl Dickson, Chair
    1. Advancement Update
      Committee Chair Cheryl Dickson reported that the committee heard an update on government issues from Deputy to the Chancellor John Ostrem, Vice Chancellor Linda Kohl and President Joe Sertich. The update included discussions on strategy sessions; business meetings; publications and advertising. Mr. Lee Hanson, Chair of the Minnesota State Colleges and Universities Foundation, reported on a plan for staffing the new fundraising effort as a result of the recommendations from a consultant.
    2. *Proposed Amendment to Board Policy 8.3, College or University Related Foundations (Second Reading)
      Committee Chair Dickson moved that the Board of Trustees approves the proposed amendment to Policy 8.3, College and University Related Foundations. Trustee Mary Choate seconded and the motion carried unanimously.
    3. 2004 State Legislative Session
      Committee Chair Dickson reported that the committee heard a report from Deputy to the Chancellor John Ostrem on issues related to the 2004 State legislative session.
    4. 2004 Federal Legislative Proposals
      Committee Chair Dickson reported that the committee heard a report from Deputy to the Chancellor John Ostrem and Mary Jacquart, Federal Government Relations Director, on progress related to improved Federal relations.

    c. Audit Committee, Daniel Coborn, Chair
    1. *Plan to Contract with Certified Public Accounting Firms and the Legislative Auditor for Fiscal Year 2004 Audits
      Committee Chair Daniel Coborn moved that the Board of Trustees authorizes the Executive Director of Internal Auditing and the Vice Chancellor - Chief Financial Officer to take the following steps to implement the fiscal year 2004 external audit plan:
      Evaluate the strategy objectives, capacity and cost effectiveness of conducting
      additional institutional financial statement audits. Report the results of this evaluation and recommendations for future institutional audits to the Audit Committee in December 2004.
      Initiate a competitive bidding process to contract with an external auditor to serve as the principal auditor for fiscal years 2004 to 2006.
      Contract with the Legislative Auditor to test internal controls and finance-related legal compliance at eight two-year colleges, perform selected information technology audits, and conduct the assurance work on state systems that is necessary to support the external auditors responsible for the fiscal year 2004 financial statement audits.

      Trustee Andrew Boss seconded and the motion carried unanimously.

    2. System-Level Accountability Framework Update
      Chair Coborn reported that committee heard an update on the System-Level Accountability Framework. Due to time constraints, it will be presented again at the January meeting.

    d. Technology Committee, Lew Moran, Chair
    1. Information Technology Update
      Committee Chair Lew Moran reported that the committee heard an update from Vice Chancellor Ken Niemi on the current issues related to Information Technology.
    2. FY 2004 Information Technology Priorities
      Committee Chair Moran reported that the committee heard a brief update from Vice Chancellor Niemi on the divisional priorities for the current fiscal year.
    3. Instructional Management Systems Implementation Plan Update
      Committee Chair Moran reported that the committee heard an update from Associate Vice Chancellor John O'Brien and System Director Dick Johnson on the implementation of Desire2Learn, (the instructional management system product selected in the recent request for proposals process).
    4. ISEEK Overview and Update
      Committee Chair Moran reported that the committee heard an update from Associate Vice Chancellor Gary Langer on ISEEK (Internet System for Education and Employment Knowledge). ISEEK is one of the Web portals for Minnesota citizens managed by ISEEK Solutions which is currently used in high schools, colleges, workforce career centers, and business and industry.

    e. Educational Policy Committee, Will Antell, Chair
    1. Academic and Student Affairs Update
      Committee Chair Will Antell reported that the committee heard an update from Senior Vice Chancellor Baer on the activities of the Academic and Student Affairs Division. Chair Antell acknowledged Dr. Gary Langer, Ms. Lynette Olson, Ms. Shelly Heller and the campus faculty, students and administrators and Office of the Chancellor staff that have participated in the development of Minnesota Online. He noted an observation on Minnesota Online from Senior Vice Chancellor Baer: "There are challenges ahead, which we will meet with renewed strength and vision, so that we can continue the strategic direction of access and integration."
    2. *Proposed Amendment to Policy 3.10 Academic Program Improvement; Deletion of Policy 3.11 Academic Program Accountability; and Deletion of Community College Policy III.02.06 Academic Standards: Section Titled Review and Evaluation of Academic Programs (Second Reading)
      Committee Chair Antell moved that the Board of Trustees approves the proposed amendment to Policy 3.10 Academic Program Improvement; Deletion of Policy 3.11 Academic Program Accountability; and Deletion of Community College Policy III.02.06 Academic Standards: Section Titled Review and Evaluation of Academic Programs. Trustee Tyler Despins seconded and the motion carried unanimously.
    3. *Proposed Amendment to Board Policy 2.6, Intercollegiate Athletics (Second Reading)
      Committee Chair Antell moved that the Board of Trustees approves the proposed amendment to Board Policy 2.6, Intercollegiate Athletics. Trustee Shaun Williams seconded and the motion carried unanimously.
    4. Alexandria Technical College - Advanced Manufacturing Prototype
      Committee Chair Antell reported that the committee heard a presentation from Alexandria Technical College on the Advanced Manufacturing Prototype. The prototype provides a model that is integrated and responsive to the needs of industries and students competing in an increasingly competitive global environment.
    5. Bold Ideas Update
      Committee Chair Antell reported that the committee heard an update from Senior Vice Chancellor Baer on the "Bold Ideas Initiative." He added that there are four such ideas to strengthen K-12 education and prepare the skilled employees necessary to accelerate the growth of advanced manufacturing, health care, biosciences and other targeted Minnesota industries. The ideas are: create the nation's top public online university by 2006; Operation JOBZ; create a world-class teacher center; and increase the number of nurses in the state.
    6. DARS Progress Report
      Committee Chair Antell reported that the committee heard a progress report on the Degree Audit Reporting System (DARS) implementation. Many campuses have made great progress and more will be implemented by spring of 2004.
    7. College/University Strategic Profiles Presentations to the Board of Trustees
      Committee Chair Antell reported that the committee heard an update on the college/university strategic profiles. The strategic profiles will replace the presentations of the facilities master plans and will focus on key directions and plans of the institutions. The strategic profiles will showcase each institution's unique role, as well as its contribution to the system; replace the facilities master plan presentation with a more comprehensive view; and provide an opportunity for dialogue with the Trustees.
    8. *Higher Education Funding and Financial Aid (Second Reading)
      Trustee Tyler Despins moved to amend the recommended motion that was approved by the committee earlier in the day. Following line 32, by adding four options:
      1. The Pell Pass-Through - a student's state grant is not reduced by the amount of the Pell Grant.
      2. Splitting up the state grant program by sector.
      3. The Tuition Model - maximum state grant is based on public college tuition; eligibility based solely on family contribution from need analysis.

        4. The Doermann Medium Cost Plan - maximum grant amount the same for public and private students; multiplier applied to parent contribution, student share lowered.

      Trustee Shaun Williams seconded.

      During discussion, Trustee Despins stated that one criteria of the mission of Minnesota State Colleges and Universities is access. He added that there is a need to provide access in times when resources are not available. Trustee Hoffman responded that he agrees and feels that the resolution as it stands now addresses the need. He stressed that it is important to allow flexibility for Chancellor McCormick as he presents to the legislature. Trustee Despins stated that the options are in addition to the language of the resolution and gives the Chancellor flexibility as he advocates for the System. Trustee Cheryl Dickson stated that she supports the resolution as it stands, adding that she is concerned about segmenting the state grant program. Trustee Shaun Williams agreed with Trustee Dickson but added that the low-income students' needs should be addressed and believes it is a battle he feels is being lost. Chair Luoma stated that he trusts staff to closely monitor the bills being presented to the legislature and that there are few resolutions that come before legislature.

      Trustee Will Antell called the question. The amendment failed with four in favor (Trustees Tyler Despins, Vincent Ijioma, David Paskach and Shaun Williams) and nine opposed (Trustees Will Antell, Andrew Boss, Mary Choate, Daniel Coborn, Cheryl Dickson, Ivan Dusek, Clarence Hightower, Robert Hoffman and Lew Moran).

      Trustee Antell moved that the Board of Trustees adopts the following resolution:

      The Board of Trustees of the Minnesota State Colleges and Universities System supports revising the state financial aid program to provide access to affordable, high quality public higher education for all Minnesotans and to reduce the financial burden for lower-income and part-time students. The formula currently used to calculate state grant eligibility places an extra burden on independent students and part-time students.

      The Board of Trustees believes that state financial aid grants should be directed to students with least financial means. The system supports changes to the current Minnesota state grant program that would provide better targeting of scarce funds toward the lowest income students.

      The Board of Trustees believes that maintaining affordable tuition is the best approach to improving access to higher education for low income students.

      The Board of Trustees believes the system's primary legislative objective is to preserve the base level of legislative appropriations, to secure additional enhancements based on the Board-approved budget request, and to promote changes to the state grant formula to increase access to higher education to lower income, independent and part time students.

      Trustee Andrew Boss seconded. The motion carried with ten in favor (Trustees Will Antell, Andrew Boss, Mary Choate, Daniel Coborn, Cheryl Dickson, Ivan Dusek, Clarence Hightower, Robert Hoffman, Lew Moran and David Paskach) two opposed (Trustees Tyler Despins and Shaun Williams) and one abstention (Trustee Vincent Ijioma).


    f. Human Resources Policy Committee, Ivan Dusek, Chair
    1. Human Resources Update
      Committee Chair Ivan Dusek reported that the committee heard an update from Vice Chancellor Bill Tschida on presidential searches; director of development search; presidents' contracts; and a new hire in the Office of General Counsel.
    2. *Personnel Plan for Minnesota State Colleges and Universities Administrators
      Committee Chair Dusek moved that the Board of Trustees approves the Personnel Plan for Minnesota State Colleges and Universities Administrators for fiscal years 2004-2005, with the exception of the proposed salary ranges, and authorizes the Chancellor and his designees to take appropriate measures to secure legislative approval to implement the plan. Upon approval by the Board chair and chair of the Human Resources Policy Committee, the salary range changes presented to the Board may be proposed to the legislature or one of its committees before or during the 2004 legislative session. Trustee Vincent Ijioma seconded and the motion carried unanimously.
    3. *Proposed Amendment to Board Policy 4.8, Emeritus Status (First Reading)
      Committee Chair Dusek moved that the Board of Trustees approves the suspension of the rules to consider an item that was not on the current Board agenda as an action item. Trustee Vincent Ijioma seconded and the motion carried unanimously.

      Committee Chair Dusek moved that the Board of Trustees approves the suspension of the rules to allow adoption of proposed amendments without a second reading. Trustee Daniel Coborn seconded and the motion carried unanimously.

      Committee Chair Dusek moved that the Board of Trustee approves the proposed amendments to Policy 4.8, Emeritus Status. Trustee Vincent Ijioma seconded and the motion carried unanimously.

    4. *Chancellor's Recommendation for Distinguished Senior Fellow for Academic Affairs
      Committee Chair Dusek moved that the Board of Trustees approves the recommendation for Chancellor McCormick to appoint Dr. Anthony Kuznik as distinguished senior fellow for academic affairs, effective January 5, 2004, through February 27, 2004. Trustee Vincent Ijioma seconded and the motion carried unanimously.

    5. *Appointment of Interim President of Alexandria Technical College
      Committee Chair Dusek moved that the Board of Trustees approves the recommendation of Chancellor McCormick to appoint Janet Mahoney as interim president of Alexandria Technical College, effective December 18, 2003, and authorizes the Chancellor to negotiate an employment contract to that effect, under the terms and conditions of the Personnel Plan for MnSCU Administrators. Trustee Vincent Ijioma seconded and the motion carried unanimously.

  9. Requests by Individuals to Address the Board
    There were no requests to address the Board.
  10. Other Business
    There was no other business to come before the Board of Trustees.
  11. Adjournment
    Chair Luoma adjourned the meeting by consensus at 2:46 p.m.

Recorded by Ingeborg K. Chapin
Board Secretary