June 2004 Board Meeting
Board Meeting Minutes

Wednesday, June 16, 2004
Wells Fargo Place
St. Paul, Minnesota

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

Absent: Daniel Coborn and Lew Moran

1. Call to Order

   Chair Jim Luoma called the meeting to order at 1:30 p.m.

2. Chair's Report

1. Minutes of Board of Trustees Meeting of May 19, 2004

   As there were no corrections to the minutes, Chair Luoma announced that the minutes stand approved as written.

2. Draft Minutes of Executive Committee Meeting of June 2, 2004

   Chair Luoma reported that the draft minutes of the Executive Committee meeting are included for information in the board packet.

3. Proposed FY 2005 Meeting Calendar (First Reading)

   Chair Luoma reviewed the proposed meeting calendar. He announced that proposed dates for the FY 2006, Capital Budget Hearings and the FY 2006, Operating Budget Including Tuition and Fees would be added to the calendar. The proposed dates for the FY 2006, Capital Budget Hearings are February 23, March 2, and March 9. The proposed dates for the FY 2006, Operating Budget Including Tuition and Fees are June 29, and July 13.

   Chair Luoma asked the Board members if they would prefer the meetings scheduled for December 21-22, 2004, be changed to December 14-15, as December 21-22, is a holiday week. The Board members agreed to revise the meeting dates to December 14-15. In June and July 2005, the Executive Committee meetings are scheduled the week of a holiday. Chair Luoma asked the Board members if they had any conflict with those dates. As the Board members had no schedule conflicts, the Executive Committee meeting dates remain unchanged. The proposed Fiscal Year 2005 meeting calendar will be approved at the July meeting.

   Chair Luoma reminded the Trustees of the deadline on June 18, for declaration of candidacy for officers of the Board. The election of officers shall be conducted at the July meeting. Nominations can be made from the floor at the meeting.

   Chair Luoma announced that the first orientation session for new Trustees is on July 7, following the Executive Committee meeting.

4. Recognition of Outgoing Trustees

   Chair Luoma recognized Trustees Andrew Boss, Mary Choate, Daniel Coborn, Vincent Ijioma and Shaun Williams, whose terms expire on June 30, 2004. Trustee Coborn will be recognized at the September meeting.

   Chair Luoma expressed his appreciation and presented the outgoing Trustees with a State of Minnesota certificate recognizing their service and support to the Minnesota State Colleges and Universities System.

   Vice Chair Robert Hoffman expressed his appreciation to Chair Luoma and thanked him for his dedication to the system. He explained that Chair Luoma's term also will expire if he not reappointed to the Board of Trustees.

3. Trustee Reports

   Vice Chair Hoffman reported that he attended a meeting with the Minnesota Business Partnership leadership and met with the leadership of the Education Committee. He commented on the tightening of State funding and how to be more cost effective while meeting the needs of the students. He added that there would be a significantly greater partnership with private industry in terms of funding. He stated that the 2010 report of the Minnesota Business Partnership reflected three issues of importance: globalization, technology and changing demographics.

4. Chancellor's Comments: James McCormick.

   Chancellor McCormick welcomed the public and friends of the system. He expressed his gratitude and appreciation to the outgoing Trustees for their service and dedication to the system.

   Chancellor congratulated the newly elected leadership of some of the constituency groups and thanked the outgoing leaders.

   Chancellor McCormick stated that new presidential leadership of the Leadership Council will begin at the July meeting. Chancellor welcomed Dr. David Danahar as Co-Chair of Academic and Student Affairs; President Pat Johns as Co-Chair of the Advancement Committee; President Dononvan Schwichtenberg as Co-Chair of the Finance and Administration Committee; President Sharon Grossbach as Co-Chair of the Human Resources Committee; President Wilson Bradshaw as Co-Chair of the Technology Committee; and President Anne Weyandt, Co-Chair, and President Roland Barden, Vice Chair of the Leadership Council. He thanked the departing leadership for their service.

   Chancellor stated that consultant Christine Roberts continues her work on an assessment of system marketing and communications. She has completed interviews with several Trustees and is currently meeting with presidents and faculty union leadership.

   Chancellor McCormick expressed his appreciation to the Board for their vote of confidence. He added that the measure of a performance evaluation is what one learns from it and that in the spirit of continuous improvement he will continue working hard on behalf of the system.

   *Minnesota State Colleges and Universities Annual Work Plan for 2004-2005

   Chancellor McCormick presented the annual Work Plan for 2004-2005, developed in consultation with several constituents. He stated that it reflects a good synthesis of recommendations from the Board regarding the work to be accomplished.

   Chancellor stated that the format departs somewhat from the two previous plans. The format will continue to note a commitment to enhancing education programs and services, contributing to the economic vitality of the State and to strengthen performance. The format notes the responsibilities of the colleges and universities and the Office of the Chancellor for each of the annual goals.

   Chancellor stated that the plan is built upon the foundation of Designing the Future. Five priorities were selected for intense attention: (1) a strengthening of the system's ability to respond to changing needs of the students and communities; (2) an improved alignment of priorities, programs, services and business practices to improve service and manage costs; (3) a strengthening of teacher education and professional development programs, including continued partnerships with the high schools to assure that graduates are prepared to succeed in college; (4) continued movement to fully develop and launch Minnesota Online; and (5) building recognition of and support for the system among key stakeholders.

   Chancellor stated that the Internal Audit's model to measure progress will be utilized and provides greater accountability as a means of evaluation. He added that future reports will be presented on a biannual basis providing a clearer sense of progress made in the course of the year. Chancellor concluded that a report on the 2003-2004 Work Plan will be presented at the July meeting.

   Trustee Shaun Williams moved that the Board of Trustees adopt the Minnesota State Colleges and Universities System Annual Work Plan for 2004-2005. Trustee Vincent Ijioma seconded and the motion carried unanimously.

5. Joint Council of Student Associations
1. Minnesota State College Student Association

   Mr. Justin Paul, President-Elect, and Mr. Brent Glass, Executive Director, Minnesota State College Student Association (MSCSA), addressed the Board of Trustees.

2. Minnesota State University Student Association

   Mr. Brad Krasaway, State Chair-Elect, and Mr. Sam Edmunds, State Chair, Minnesota State University Student Association (MSUSA), addressed the Board of Trustees.

6. Minnesota State Colleges and Universities' Bargaining Units
1. American Federation of State, County and Municipal Employees

   Ms. Karen Foreman, President, Local 638, American Federation of State, County and Municipal Employees (AFSCME), addressed the Board of Trustees.

2. Minnesota Association of Professional Employees

   Mr. Rick Nelson, Business Agent, Minnesota Association of Professional Employees (MAPE), addressed the Board of Trustees.

3. 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.

4. Inter Faculty Organization

   Mr. Jim Pehler, President, and Dr. Nancy Johnson Black, President-Elect, Inter Faculty Organization (IFO), addressed the Board of Trustees.

7. Consent Agenda

   All matters listed under Consent Agenda will be enacted by one motion in the form listed below. Any trustee may request that an item or items be removed from the Consent Agenda for independent consideration.

   Trustee Clarence Hightower requested that agenda item a. Winona State University Foundation Stadium Press Box Project be removed from the Consent Agenda. Chair Luoma stated that the item was removed and placed on the Finance/Facilities Policy Committee agenda.

   1. Winona State University Foundation Stadium Press Box Project
   2. Audit Plan - Fiscal Year 2005
   3. Mission Revision: Northwest Technical College
   
   

   Trustee Andrew Boss moved approval of item b. Audit Plan - Fiscal Year 2005, and c. Mission Revision: Northwest Technical College. Vice Chair Hoffman seconded and the motion carried unanimously.

8. Board Standing Committee Reports
1. Technology Committee, Lew Moran, Chair
1. Information Technology Update

   Committee Vice Chair Vincent Ijioma reported that the committee heard an update from Vice Chancellor Ken Niemi on the current issues and work related to Information Technology.

2. Business Practices Alignment Update

   Committee Vice Chair Ijioma reported that the committee heard an update from President Robert Musgrove on the Business Practices Alignment. There are 107 identified variations in business practices among the institutions that the committee is continuing to analyze.

3. Converged Network Update

   Committee Vice Chair Ijioma reported that the committee heard an update from Information Technology Service Security Director Bev Schuft on converged networking which carries both voice and data information over a shared network infrastructure.

4. Campus Showcase: Ridgewater College Nursing Simulation Center

   Committee Vice Chair Ijioma reported that the committee heard a presentation from staff members of Ridgewater College on the Nursing Simulation Center. The simulation centers provide students with multiple inputs and multi-method approaches to enhance critical thinking skills.

2. Finance/Facilities Policy Committee, Andrew Boss
1. Finance/Facilities Division Update

   Committee Chair Boss reported that the committee heard an update from Vice Chancellor Laura King on the Finance/Facilities Division.

2. *Allocation Framework Implementation (Second Reading)

   Trustee Ivan Dusek moved that the Board of Trustees adopt the following motion:

   The Chancellor will consider reinvestment requirements as part of the FY 2006-FY 2007 biennial operating budget request.

   Full implementation of the allocation framework as contained below effective with the FY 2006 allocations.

   Trustee Tyler Despins seconded and the motion carried unanimously.

3. *FY 2005 Operating Budget Including Tuition and Fees (Second Reading)

   Vice Chair Hoffman moved that the Board of Trustees adopt the following motion.

   Approve the proposed tuition revisions as outlined in revised Attachments A1 to A3 and A4. The percentage impact of resident tuition rates represents the maximum amount that can be applied to other tuition rates charged by the institution not impacted by reciprocity agreements such as nonresident and off campus rates. The tuition increase is effective summer session or fall semester, 2004 at the discretion of the president.

   Approve extension of the non-resident non reciprocity tuition pilot as detailed in the report and authorizes new pilots at Central Lakes College and Minnesota State Community and Technical College through FY2007 (Attachment C).

   Approve Itasca Community College request to charge engineering students a $50 per semester residential learning community fee (Attachment D).

   Trustee Vincent Ijioma seconded and the motion carried with three opposed: (Trustees Will Antell, Tyler Despins and Shaun Williams).

4. FY 2006-2011 Capital Budget Guidelines (First Reading)

   Committee Chair Boss reported that the committee began the process of addressing the FY 2005-2011, Capital Budget Guidelines.

5. *Winona State University Stadium Press Box Project

   Trustee Clarence Hightower expressed concerns regarding the funding of the second phase of the Winona State University Stadium Press Box Project. He suggested that prior to the second phase, President Krueger present a funding plan to the Finance/Facilities Committee. Trustee Ijioma stated that he supports the approval of the Winona State University stadium press box. He added that in the future, he suggests a measurement of the contribution of the role of athletics to students and tuition.

   Trustee Tyler Despins moved to amend the resolution with the following:

   "4. In addition, the University will return to the Board of Trustees with a finance plan for the final build-out prior to the commencement of phase two."

   Trustee Hightower seconded and the amendment carried unanimously.

   Trustee Andrew Boss moved that the Board of Trustees approves the authorizing resolution contained in Attachment A as amended.

   WHEREAS:

   A. Winona State University Foundation (the "Foundation") has proposed to Winona State University ("WSU"), an administrative unit of the Minnesota State Colleges and Universities, that the Foundation construct the shell of a new stadium/press box building ("the Building") on the WSU campus;

   B. It is further proposed that the Building be located on land to be leased to the Foundation by WSU for the duration of the construction period; and

   C. This Board of Trustees has been provided with full information concerning the Building, the physical nature of the project and other relevant matters; and

   D. The Foundation will pay for the costs of construction of the Building up to a "Maximum Cost" of construction of $900,000. If the Foundation receives restricted donations intended for construction of the Building, the Foundation will apply such donations to construction costs it incurs. Additional unrestricted donations to the Foundation may also be used for the construction of the Building; and

   E. If the cost of construction of the Building exceeds the "Maximum Cost," the Foundation will have the option of terminating the lease unless WSU elects to make available the additional funds needed. WSU will not use tuition revenues or state or federal appropriations for the capital cost of the constructing of the Building; and

   F. WSU intends to install improvements to the Building after the Building is completed.

   NOW, THEREFORE, be it resolved by the Board of Trustees of Minnesota State Colleges and Universities, as follows:

   1. This Board hereby makes the following findings with respect to the WSU Stadium/Press Box Building project:

   (a) The Building will be designed, constructed and operated as a stadium/press box building for the benefit of WSU and its students, and, therefore, is a facility of a type listed in Minnesota Statutes, Section 136F.60, subds.2 (b) and (d) (2003).

   (b) Pursuant to Minnesota Statutes, Section 136F.60, subd. 2(c) (2003), this Board is empowered to approve the lease of state property to the WSU Foundation to provide access to land owned by the state for the construction of the Building as a stadium/press box for the benefit of WSU and its students.

   (c) Exhibits A-G hereto sets forth a description of the construction project, its estimated cost, including legal, engineering and financial expenses and other relevant information.

   1. Exhibit A: City of Winona Ordinance 3608, dated April 19, 2004
   2. Exhibit B: Site sketches of WSU campus and proposed property to be leased
   3. Exhibit C: Description of the Building and selected elevations and floor plans
   4. Exhibit D: Legal description of WSU land to be leased to WSU Foundation
   5. Exhibit E: Summary of geotechnical evaluation
   6. Exhibit F: Estimated construction and operating costs
   7. Exhibit G: Summary of donations/sponsorship schedule
   
   

   (d) Pursuant to Minnesota Statutes, Section 136F.60, subd. 2(b), this Board is authorized to receive gifts for capital projects.

   2. Pursuant to the authority granted by Minnesota Statutes, Section 136F.60, subd. 2(c) (2003), the land on which the Building is to be located shall be leased by Minnesota State Colleges and Universities to the Foundation for a term necessary to complete the construction of the Building. This Board further finds that the siting and design of the Project are consistent with the WSU campus master plan and with Minnesota State Colleges and Universities design and construction standards. The lease of the land to the Foundation will terminate upon completion of construction of the Building. The Foundation shall convey all its legal interests in the Building to WSU upon completion of construction.

   3. The Chancellor or his designee are hereby authorized and directed to take all actions necessary or desirable in connection with the lease of the land and construction of the Building and matters related thereto. The Chancellor or his designee is further authorized and directed to execute and deliver on behalf of Minnesota State Colleges and Universities any and all contracts, agreements, instruments, documents or other items related thereto. All actions heretofore taken by the Chancellor, his designee or any authorized employee of Minnesota State Colleges and Universities in connection with the lease of the land and construction of the Building are hereby ratified and approved.

   4. In addition to the adoption of the above resolution, the Board directed Winona State University to return to the Board with a finance plan for the final build-out prior to commencement of phase two.

   Trustee Shaun Williams seconded and the amended motion carried unanimously.

9. Advancement Committee, Cheryl Dickson, Chair
1. Advancement/Leadership Council Update

   Committee Vice Chair Shaun Williams reported that the committee heard an update from Associate Vice Chancellor Linda Kohl and Deputy to the Chancellor John Ostrem on the work of Public Affairs and Government Relations.

2. Advertising Campaign Update

   Committee Vice Chair Williams reported that the committee heard an update from Associate Vice Chancellor Kohl on the Fiscal Year 2003-2004, marketing and public relations plan.

3. State and Federal Legislative Update

   Committee Vice Chair Williams reported that the committee heard an update from Deputy to the Chancellor John Ostrem on the legislative session and how new legislation will affect higher education.

10. Audit Committee, Daniel Coborn, Chair
1. Preliminary Report - Higher Education Services to Traditionally Underrepresented Student Populations

   Committee Vice Chair Clarence Hightower reported that the committee heard a report from Executive Director John Asmussen and Associate Vice Chancellor Dolores Fridge on the preliminary results of higher education services to traditionally underrepresented students. A final report with recommendations will be presented at the July meeting.

2. System-Level Accountability Framework Update

   Committee Vice Chair Hightower reported that the committee heard an update on the system-level accountability framework approved by the Board of Trustees in June 2003.

11. 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 Linda Baer on the activities of the Academic and Student Affairs division.

2. Transfer Report

   Committee Chair Antell reported that the committee heard a report from Senior Vice Chancellor Baer on transfer initiatives within the Minnesota State Colleges and Universities System.

3. *Proposed Amendment to Policy 2.8, Student life (Second Reading)

   Committee Chair Antell moved that the Board of Trustees approves the amendment to Policy 2.8, Student life. Vice Chair Hoffman seconded and the motion carried unanimously.

4. Campus Profile Review Assessment

   Committee Chair Antell reported that the committee heard a report from Senior Vice Chancellor Baer and Associate Vice Chancellor Leslie Mercer on the campus profile presentations from Southwest Minnesota State University and Alexandria Technical College.

12. 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 the Human Resources division.

2. *Chancellor's Assessment

   Trustee Vincent Ijioma moved that the Board of Trustees approves a base salary increase of five percent for Chancellor James H. McCormick, effective July 1, 2004, and authorizes the Board Chair to renegotiate the Employment Agreement with the Chancellor to: (1) Extend his employment agreement for a period of up to 14 months beyond its current term. (2) Effective for the extension period in #1, above, provide a resignation notice period of not less than nine months nor greater than 12 months. The Chancellor shall be eligible for severance benefits in accordance with the current agreement regardless of whether he chooses to extend his employment beyond June 30, 2007. (3) Make modifications needed to implement the authorized changes. Vice Chair Hoffman seconded and the motion carried unanimously.

3. Demographic Report

   Committee Chair Dusek reported that the committee heard a report from Vice Chancellor Tschida on demographic information regarding employees of the Minnesota State Colleges and Universities System workforce.

13. Requests by Individuals to Address the Board

    There were no requests to address the Board.

14. Other Business

    There was no other business to come before the Board.

15. Adjournment

    Chair Luoma adjourned the meeting by consensus at 3:31 p.m.

Recorded by Ingeborg K. Chapin
Board Secretary