September 27, 2007
Members Present: Altar, Alva, Arnold, Bedell, Bhattacharya, Bruschke, Buck, Bullock, Carroll, Dabirian, Drezner, Fromson, Gass, Gordon, Green, Guerin, Hewitt, Hickok, Jarvis, Junn, Kanel, Kantardjieff, Klassen, Liverpool, McConnell, McMahan, Mead, Nyaggah, Oliver, Palmer, Pasternack, Rhoten, Richter, Sage, Smith, Stang, Stein, Taylor, Walicki, Williams
Absent: Burgtorf, Fidalgo, Grewal, Randall, Shapiro, Spitzer
I. CALL TO ORDER
Chair Guerin called the meeting to order at 11:30 a.m.
II. URGENT BUSINESS
Senator Nyaggah notified the body that the memorial service for Senator Nanjundappa will be held on October 5, 2007, from 3:00 - 5:00 p.m. at the Golleher House. He invited everyone to RSVP if they plan to attend.
Senator Pasternack announced that the draft of the ASCSU Strategic Plan: Access to Excellence, is now posted on the Chancellor’s office Academic Affairs web site. All campuses have been asked to review and submit comments on the draft. Chair Guerin noted that she plans to place this item on the CSUF Academic Senate agenda for discussion.
IV. CONSENT CALENDAR
M/S/P [Fromson/Pasternack] to approve the Consent Calendar. (Approved unanimously)
4.1 Nominees to Standing Committees
Nominees: Ed Trotter (COMM)
Confirmed 9/13: Matthew Jarvis (Soc Sci); Charles Tumlinson (ARTS); Lisa Kirtman (EDUC);
Maijian Qian (CNSM); Sharon Seidman (HHD)
Information Technology Committee
Nominees: Archana McEligot (HHD)
Confirmed 8/23: John Carroll (SOC SCI); Pamela Caldwell (COMM); Cliff Cramp (ARTS); Sean Walker (CNSM); Kristin Stang (EDUC); Teeana Rizkallah (CBE); Susan Tschabrun (Library);
Dimitri Michalopoulos (ECS)
4.2 Nominees to Miscellaneous Committees
TSU FOOD ADVISORY BOARD
Nominees: Jon Bruschke (COMM); Jing Yang (CBE)
UNIVERSITY BOARD ON WRITING PROFICIENCY
Nominee: Susan Shipstead (HHD); Mark Grinyer (CBE)
Continuing: Mildred Donoghue (EDUC)
ATHLETICS ADVISORY COUNCIL
Nominees: Scott Hewitt (CNSM); Lenny Wiersma (HHD); Kristin Beals (SOC SCI)
ATHLETICS: ATHLETICS ACADEMIC STANDARDS
Nominee: Cheryl Cooky (HHD)
ATHLETICS: NCAA COMPLIANCE COMMITTEE
Nominees: Kevin Meehan (SOC SCI); Gayle Brunelle (SOC SCI)
ATHLETICS: GENDER EQUITY COMMITTEE
Nominee: Patti Laguna (HHD)
4.3 Approval of Suggested Changes to ASD 07-85 Proposed UPS on SRI/SOQ [Academic Senate Executive Committee]:
Suggested Change #1:
Change “SRI” in Section C to “SOQ”
Suggested Change #2:
Language Submitted to President for Approval (in ASD 07-85):
“Your evaluation is confidential, so please refrain from talking during the course evaluation or discussing your course evaluation with others. Thank you for your consideration.”
President’s Suggested Language:
“Your course evaluation is confidential; please do not discuss your evaluation with others. For evaluations completed in class, please refrain from talking during the course evaluation period.”
V. TIME CERTAIN
Willie Hagan, VP, Administration and Finance and Chief Financial Officer
As Per Bylaw 07-03, VP Hagan delivered the second
VP Hagan prefaced his discussion by acknowledging members of his team who contributed significantly to the preparation of the information he presented. These individuals included Bill Barrett, Paula Blumberg, Naomi Goodwin, Laleh Graylee, Brian Jenkins, and Sarah Song.
The following was reported:
Overview of University Finances
The University is about a half a billion dollar operation. VP Hagan used the 2006-07 University revenue budget to illustrate, in terms of broad categories, the components that constitute the budget:
· General Fund
· Lottery Education Fund
· Continuing Education Revenue Fund (CERF)
· Health Facilities Fee
· Housing Fund
· Parking Fund
· Student Union
· Parking Fines & Forfeitures
· Auxiliary Funds:
CSUF Auxiliary Services Corporation
CSUF Philanthropic Foundation
Associated Students Inc.
CSUF Housing Authority
VP Hagan noted that this list excludes prior year carry forward, fund balances and reimbursed activities. He also added that a number of these components have reserves. In 2006-07, we had about $18 million reserve in lottery funds.
How did we finish 2006-07?
The 2006-07 Year End (4th Quarter) General Fund Expenditures: Division Summary showed that the divisions have been spending their funds quite well. In response to the budget balances listed in the summary, VP Hagan noted that the budget balances can occur for several reasons. One example is that when divisions hold back on spending in anticipation of impending budget cuts, funds may be left unexpended.
2007-08 Revenue Budget
· We have had General Fund baseline budget reductions from 2001-02 through 2004-05
· There is a history of unfunded mandates, such as negotiated salary increases, benefit increase, CMS, and capital feasibility studies.
· We have dealt with annual baseline and one-time cuts to balance the budget
· At the beginning of 2006-07, the structural deficit was over $5 million
· For several years, the General Fund expenditure budget rolled out to divisions exceeded available GF revenues.
· Lottery funds were held in reserve and only nominal amounts were allocated each fiscal year. (As President Gordon can attest, when we went to the Chancellor’s office and reviewed the lottery sheets, CSUF showed a huge lottery reserve. There were questions about why we had an $18 million lottery reserve, when the campus was looking forward to expenditure for instructional purposes. What was happening was that the amount of General Fund dollars that were given out for budgetary expenditures exceeded the actual General Fund revenue that was present and by default, the lottery fund dollars were being held in reserve. That was not what they were intended for. That surprised everyone. We are now looking to undo these types of things.)
· Reserve was created
· Analysis done over the summer showed that the amount of revenue we expected was significantly less than we had projected. This was taken into consideration for the budget, as well.
2007-08 University Revenue Budget:
· VP Hagan encouraged all divisions to spend lottery funds. It weakens the argument for extra dollars if there is a large lottery fund system-wide.
· Of the $317,175,532 budget, $179,133,570 was allocated by the state. The other larger portion of the revenue ($96,872,700) came from state university fees. Other areas of revenue included non-residential fees; application fees; transcripts, late registration, and bad debt; Federal Perkins; health fees; other receipts; and trust fund interest earning. For this year’s budget, additional one-time resources were factored in and totaled $21, 313,692.
PRBC Budget Recommendations for 2007-08
· Allocate $10.6 million in new baseline revenue to fund various University needs
· Eliminate structural deficit by each division taking baseline budget reductions on a prorated basis: Approximately $5.1 million total
· Use $8.7 million in one-time equipment financing to address one-time needs and develop a three year plan to repay the equipment loan
· Use $8.8 million in lottery fund to partially restore carryforward and fund various one-time University needs. While President has not yet approved the PRBC recommendations, he has approved the $3.1 million in carryforward and it was returned to the divisions.
· PRBC recommendations identified funding for all but $861k in one-time needs identified by the division heads. Recommendation was that we find funds to address these needs or cut back.
2007-08 Proposed Baseline Reductions/Deficit Allocation
(Divisional baseline allocations are to be reduced on a prorated basis to eliminate the University’s structural deficit)
· President’s Office $91, 418
· Academic Affairs $3,506,511
· Administration and Finance $581,384
· Information Technology $299,134
· Student Affairs $473,248
· University Advancement $144,631
· Total proposed baseline reduction/deficit allocation = $5,096,326
2007-08 Proposed Budget Allocations
If the PRBC recommendation to allocate approximately $10.6 million in new baseline revenue to fund various University needs is approved and all of the dollars are allocated as recommended, divisions would receive the following total new 07-08 allocation (net baseline and one-time allocation allocations):
· President’s Office $143,582
· Academic Affairs $9,995,025
· Administration and Finance ($581,384)
· Information Technology ($262,134)
· Student Affairs $35,677
· University Advancement $55,369
· All University/CMS $4,327,821
· After fiscal year 05-06, the budget balance left available was $35.5 million: The University had over-allocated the baseline budget. In reality, there were only $15.8 million in baseline revenues.
· Would this have meant that the University would have gone over a financial cliff? No. The University had sufficient non-General Fund revenues, in particular, lottery funds, to back up a General Fund over-expenditure if it were to occur. By default, the lottery funds were serving as a back up to the General Fund, which was not their intended purpose.
· The bottom line is that you can’t both budget more General Fund expenditures than you have GF revenues to cover and spend lottery funds as intended for instructional purposes if they are in fact back up to the General Fund.
· Steps taken: (1) the General Fund budget was reduced to match the actual $15.8 million in General Fund resources available, (2) a campus Emergency Reserve fund consisting of $7.9 million was established, since there was no true reserve, and (3) the remaining Carryforward funds remained in their respective divisions. [Note: There was the expectation that at some point in time, the emergency reserve would be built using new revenues, thus allowing the Carryforward Funds to be returned to their respective divisions. Unless we consciously set aside new funds during the budget process, the likelihood of returning Carryforward Funds anytime soon is remote. Other strategies are being explored to build the emergency reserve that would allow the Divisions to get their Carryforward Funds returned sooner.]
Budget Challenges for 2008-09
· Prior commitments, expectations, and opportunities:
o Maintain SFR – Approximately $4.5 million in 2007-08
o Continuation of the five year plan to hire 100 new faculty
o Commitment of $9 million of General Fund dollars to equip the new CBE building – Approximately $4 million to be set aside for this in 2008-09
o Acquire the
o CMS- ongoing significant expenses
o Costs to backfill vacated space – Approximately $2 million. [Will make approximately 49,000 square feet available in LH and other places that can be reallocated for campus use. May need renovation.]
o Equipment loan repayment – Approximately $3.2 million
· More unfunded mandates such as compensation
· Recurring items funded with one-time funds, which should be considered for baseline funding, e.g., faculty recruitment, research support, and program support
· Enrollment growth
· Due to reduced fee revenues, will have $3.7 million baseline shortfall in 2008-09
o Believe this can be eliminated without resorting to additional divisional cuts
o New revenue opportunities
o Strategies being investigated – will report back to the President and PRBC
“There is Some Good News”:
· Balance budget fro 2007-08
· Lottery expenditures will be ongoing
· Emergency reserve in place
· Partial restoration of Carryforward
· Budget cuts offset to a degree by revenue related to enrollment growth
· Significant baseline and one-time items will be funded based on PRBC recommendations to the President for his approval
· Increased transparency
· Continue working with University leadership, including division head, PRBC, Deans, Department Heads, and Directors to develop an overarching budget strategy to support institutional goals operational priorities, and initiatives
· Increase communication throughout the University on budget process, how decisions are made, where they are made, and what decisions are
· Develop and implement budget enhancement advocacy strategies with the Chancellor’s Office and other entities as appropriate
· Monitor and report on state and CSU budget forecasts, projections and development at each step in the state budget cycle and develop implication for the University’s overarching budgeting strategy as well as annual budget plans and allocations
· Collaborate with University leadership, institutional research, and Chancellor’s Office staff to develop budget information, including revenue projections necessary for effective budget development and management
· Analyze University, divisional, and departmental budget and operation and recommend budget strategies to maximize institutional resources aligned with University priorities
· Develop and implement models for multi-year budget planning
· Collect, interpret and report key financial management data and assure optimum utilization of financial resources through sound forecasting, analysis and reporting of the University’s financial condition
· Develop, recommend, and implement budget and other strategies to proactively address issue or problems that impact long and short-term plans and operations
· Ensure budget implications of capital and facilities planning are integrated into the University’s over-arching budget strategy
Additional Budget Discussions
· PRBC: Ongoing
· Deans Council: November 21, 2007
· Campus Forum: November 8, 2007 (in Titan Student Union) – Announcement will be sent to campus shortly.
· Senate Executive Committee: To Be Scheduled
· President & Division Heads: Ongoing
· Chancellor’s Office: To Be Scheduled
· Campus Departments: As Requested
The following questions came from the floor during the discussion of the 2006-07 budget:
What does all-university mean?
All-university captures items like utilities, scholarship funds, funds for renovations, and deferred maintenance.
Looking over the changes over the past five years, it appears that the one category that has increased the most in terms of percentages of actual expenses is Administration. Please shed some light on that.
From 2002-03 to 2004-05, there was little change in the Administration division. However, in 2005-06, the PRBC began recommending additional funds for custodial staff. So, a three-year plan was put together to fund maintenance. Also, BFA rolled into the Administration division at that time.
Are the salary increases that were effective in the previous fiscal year reflected in the old data or the 2007-08 budget?
They were applied the year that they were rewarded.
Is it a correct assumption that the $18 million held in reserve from the lottery fund could be used to alleviate some of the programs that academic departments are financially responsible for?
Once we established a reserve and decoupled the lottery fund from serving as a back-up for the General Fund, we began to spend the lottery fund: after the PRBC made recommendations to the President he allocated $5.28 million to divisions last year. The PRBC has recommended that an additional $5.8 million I lottery funds be expended. President Gordon clarified that lottery funds are categorical funds; they can only be used according to the policies and rules governing those funds. They are not a general purpose fund.
Can the lottery funds be used for instructional purposes?
Yes, lottery funds used for instructional purposes are legitimate expenditures.
Could the $1,197,000 in revenue from parking fines and forfeitures be
used to fund the courses at our
No, the parking fines and forfeitures dollars, like the lottery fund, are categorical and can not be used for instructional services. The very specific rules about the usage of these funds say that they can only be used for transportation or parking enforcement. We are also required to hold a portion of these revenues in the reserve. In order to issue bonds to build parking garages, we have to hold money in reserve for that service.
Is it possible to postpone the proposed baseline reduction/deficit allocation by at least one year so that academic departments to prepare for the reductions?
We could always defer it. The University has been addressing the deficit every year by balancing the budget with funds from salary savings and other areas, but has not been taking funds at the baseline level.
Why couldn’t this be done next year?
Certainly, nothing has to be done this year. The decision could be made to apply short-term solutions.
What problems would arise from giving departments enough time to adjust to the cut?
VP Smith responded that we have been working with a structural deficit since approximately 2003-2004. The problem is that we have not been disciplined in our spending to bring spending down so that we can feed the deficit. It will hurt to lower spending, and we have additional expenses coming in that will have to be paid. However, if we do not decrease the deficit, we will continue to carry it and every year, it seems to grow a little because we continue spending. Until we get back on a balance budget, we will have a problem.
President Gordon added that since about 2003, the campus has absorbed about $15 million in reduction. We have been putting off the cut. At one point, the campus will have to eliminate this structural deficit. We are not the only campus in the CSU system that has one, even though we are probably in the better position because of our growth.
Why wouldn’t the
All University funds is not a place were a lot of people are. The
How were the sub-levels (colleges) of the divisions affected by the baseline reductions? More specifically, in the case of Academic Affairs, were the baseline reductions prorated by college?
These reductions are proposed and have not been applied as of yet. However, if/when they are applied, the College Deans will be able to answer these questions.
We are somewhat over target (in enrollment). At what point in time will we see those additional revenues factored into the budget?
They have already been factored in. The bottom line from the previous year is factored into the next year’s budget. VP Smith added that we built into the budget the revenue from over enrollment on YRO. However, once we pay for faculty, there is some money left over, but not a great deal of it. VP Palmer expressed that the pain of having to endure budget reductions is felt across this institution. He explained that he was of the opinion that we should hold off on eliminating the deficit for as long as possible, but after lengthy discussions, it became clear that it was not sound, from a management standpoint, to keep allowing the deficit to roll over.
How much will the proposed $5,096,326 baseline reduction for 2007-08 cancel out in the University structural deficit?
This proposed reduction would cancel out the structural deficits that existed at the time that we did the planning.
What does it mean to say that lottery funds, by default, were used as a back-up to the General Fund, but that it did not occur?
There was no policy or known plan that lottery funds were being held in reserve, it was an “after-the-fact” finding. However, when the funds were discovered in reserve, we questioned why they were not spent, given that there were all these needs on campus for years.
Can the lottery funds be used to address part of the structural deficit?
The lottery funds are categorical and one-time. (We are in an unusual situation of having a huge reserve to spend down.) We will receive $2.5-3 million in lottery on a regular basis. We are spending big “chunks” now because we have it to expend. Lottery funds cannot be used to supplant the General Fund. Lottery funds can be applied in the situation of one-time cuts, but the budget cuts we are addressing are baseline cuts and lottery funds are not baseline.
If funds are allocated to colleges, is there a time limitation they will have to follow for spending the funds?
(1) Money is allocated at the division level.
(2) There is no timeframe; these dollars can rollover. However, it is preferred that the dollars are spent. We should spend 85% of our lottery fund allocation, which would be approximately $250,000. It would not be to our benefit for it to appear that we are not spending what we have.
Are the cuts being distributed equally among colleges?
VP Smith responded that in Academic Affairs, the baseline cuts will be made across the board to the colleges, or else what you are doing is redistributing the SFR. Our one-time money may be a little different. We would look at where some of the funds are available and it might not be exactly across as it would be in a baseline cut.
Budgets reports can be viewed at http://finance.fullerton.edu/Budget/BudgetReport/index.htm
The CERF budget and fourth quarter reports will be posted this afternoon.
The meeting adjourned with discussion of this address on the floor. Chair Guerin encouraged all on the speakers’ list to attend the next meeting. VP Hagan will address their questions at that time.
VI. STATEWIDE ACADEMIC SENATE REPORT
Senator Pasternack reported the following:
· At the last CSU Academic Senate Plenary, we reviewed first-time reading items on budget priorities, textbook affordability, and a resolution in opposition to the “Community College Governance, Funding Stabilization, and Student Fee Reduction Act”
· We distributed a resolution entitled “Call for Consultation on Professional Fee for Graduate Business Degrees”
The Statewide campus Senate chairs will meet next
Thursday, October 4th in
VII. CHAIR’S REPORT
· The Academic Senate Executive Committee continues to finish nominations to committees.
· We are coordinating an orientation meeting for standing committee chairs, Senators serving on standing committees, and Executive Committee liaisons. It is scheduled to take place on October 11th, 11:30 a.m. to 1:00 p.m.
· The Executive Committee and the PAB are currently putting together an agenda for their retreat. Together, these two groups will identify some of the issues facing the campus, brainstorm on solutions, and discuss where we stand on current initiatives. The date of the retreat has not been set.
· The Academic Senate office looks forward to receiving responses the items that have been transmitted to the President’s office for approval.
VIII. NEW BUSINESS
Due to lack of time, items 8.1 and 8.2 were not discussed.
8.1 ASD 07-151 Faculty/Staff Housing Survey Results and Current Status [Dickerson]
8.2 ASD 07-150 ASCSU Consultation on Professional Fee for Graduate Business Degrees (Waiver)
Meeting adjourned 1:03 p.m.