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June 18-19, 2002 Meeting Minutes
In attendance (for part or all of the meeting): D. Belt, T. Bennett, S. Brady, D. Bowers, K. Cline, J. D'Aleo, L. Davis, N. Fawcett, A. Ferrara, K. Gifford, K. Kain Gray, L. Hartmark,
J. Homburger, R. Hume, E. Kumar, J. Lambert, K. Lowery, G. LaRosa, K. Levison, M. Lewis,
I. Lisnitzer, W. Long, N. Lyons, D. Mann, D. Melucci, G. Mitchell, L. Neveu, J. Nolan,
S. Richards, R. Schenk, K. Seitz, W. Shaut, C. Smith, J. Van Voorst, C. Webb, B. Weigman, and C. Young. Guests: J. Campbell, K. Dupuis, D. DeMarco, G. Drahos, F. Gabriel, C. Lloyd,
R. Haelen, K. Schweigard, B. Stenson, and M. Trunzo.
Copies of some referenced handouts are not included with these minutes. Anyone needing copies is welcome to contact John Lambert (607 / 255-4425 or jal3@cornell.edu).
The Night Before
The opening dinner honored recent retirees: Ed Kumar, Harry Snoreck, and Bob Wagner. Ed and Harry were unable to attend. Judy Wagner accompanied Bob. Other guests included Bill Anslow, Chuck Goolden, John Hartigan, Dick Miller, Lew Rosenthal, Len Snyder, Brian Stenson, Joyce Villa and Pat Wiater. Several spoke in tribute to Bob. Dick Mann presented a rain slicker in light-hearted recognition for UB's continued "hosing" of Stony Brook. Ivan Lisnitzer presented a plaque to Bob reading:
The State University Business Officers Association
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Presented To
Bob Wagner
Vice President for Administration
State University Of New York at Buffalo
In Grateful Recognition Of Thirty-Five Years
Of Dedicated Service To The
State University Of New York
And The Business Officers.
You Have Provided Leadership, Mentoring,
And Energy To Us.
Thank You For Your Dedication
And Friendship.
---
Ivan M. Lisnitzer, President
June 18, 2002
Bob reflected on his service and -- using the comprehensive procurement program, dorm devolution, flexibility legislation, Rethinking SUNY, and the Quality Initiative (with roots in the Hartigan Report) for context -- lessons he learned about cooperation, shared values, cultivating the common good, and general camaraderie. The evening was a fitting tribute to everyone who has and will serve their campus, the State University, and SUBOA.
Good Morning
Ivan Lisnitzer noted the resignation of Cheryl Groeneveld, and welcomed Greig Mitchell from Brockport, Judy Nolan from Purchase, and Bill Shaut from Cortland.
Sector Meetings
Tony Ferrara reported the University Centers / Health Science Centers / Specialized and Statutory Colleges. Most time was spent on the budget. The group discussed how campuses were managing within existing constraints on appropriations and tuition / fees. Campuses seek clarification on the retirement incentive, and monitoring against the financial plan.
Tracy Bennett reported for the University Colleges and University Technology Colleges. The group discussed campus strategies (retrenchment, OTPS reductions, increased class size) for coping with the 2002-03 budget, and beyond. They discussed M/C raises, and American Express (most everyone has closed accounts). Campuses seek clarification on the retirement incentive, TAP, the status of guidelines for campus-related entities, and the status of the auxiliary services contract. In general, campuses favor not changing the BAP formula.
Government Relations Update - Michael Trunzo with Jim Campbell
Senate adjourns tomorrow. The Assembly will adjourn early next week. Government Affairs is "playing defense" on some proposed legislation, e.g. disclosure by bookstores, and the tracking of / reporting on foreign students. Hospital flexibility has been stripped of everything but procurement; no capital. (Dick Mann suggested Government Affairs propose to the legislature to use some of the excess bond cap as an alternative source. Beyond that, capital might have to be addressed through the next five-year plan.) WTC scholarships will be provided through the HESC (Higher Education Services Corporation); language is being finalized. Legislation providing full-year credit for 10-month academic employees is likely to pass. There is some discussion (not real lively) about folding bias crime (similar to campus safety and sexual assault) into existing public safety policy and procedure. Expect a 3 to 5 year extender on DA ability to build civil facilities. We are not exempt from additional charges for bonding.
Wayne Diesel, Dick Miller and Michael Trunzo met with the Dormitory Authority to explain why campuses shy away from the DA's predisposition to build "100 year dormitories," and hope to bring the DA in front of campus presidents.
Government Affairs people meet on July 24 in Albany. Among topics will be how to improve advocacy with a broader / more global scope.
Anticipate earlier solicitation of Program Bills (in July?), timed more appropriately to feed into budget cycles.
To manage cash, the HESC will delay TAP payments beyond April 1, but before July 1.
Michael reported on campus specific bills for Farmingdale and Stony Brook.
SUCF Update - Bob Haelen and Ken Schweigard
Good news: the budget provides $20 million in '384' money, and provides the "green light" to issue bonds in September at $224 million for core programs, plus $28 million for NYSTAR. There is enough room to accommodate GRI capital.
The MOU / pilot program for campus-based responsibility for individual construction projects is undergoing review by senior management. In general, campus lets (20 percent of total dollar volume) are undergoing review to ensure proper procedures and appropriate management of risk. Some campus-based projects are not to specification; some have followed design / build for which SUNY has no authority.
The Board is very interested in the process for centrally-managed projects, to ensure that the right tools are in place to anticipate and deal with the things that will go wrong.
We have to rebuild confidence before flexibility legislation is likely to move forward.
The RFP on procurement has progressed to the interview stage; expect recommendations to the Board at their meeting in July. Procurement is an example of a positive outcome from the risk assessment commissioned by SUP.
Brian Stenson described a new bonding structure that should provide a more favorable credit rating. The change will not affect campus operations.
Research Foundation Update - Frank Gabriel and Gerry Drahos
(Copies of the May 2002 Operations Report and Resource Development News at May 2002 were distributed to those present.)
From the Operations Report, Frank Gabriel highlighted the UAlbany Election Update (regardless of results in Albany, it is a matter of time before the movement spews over to other campuses), the Entrepreneurship Institute (be very sensitive to disallowances for program administration), the RF credit rating ("superior"), key indicators, and the investment portfolio (equity investments have not done very well). From Resource Development News, Frank commented on the chancellor initiatives to increase funding for research, and philanthropy.
The Foundation is on track for movement to their new facility in August. Information Services will remain on the plaza.
The financial plan (normally approved in May) is on hold until July or August. There are no changes to assessments, other than the formula for Stony Brook.
Gerry Drahos (Vice President for Information Services) joined the Foundation about 6 weeks ago. He worked with the RF while at KPMG, and has kept in touch with what is going on. Stabilization is the number one priority for OASIS, followed by performance. Enhancements will be addressed once an appropriate foundation is in place. They are working on an overall process to resolve issues (now understanding the problems instead of just the symptoms), prioritizing new issues (involving campus teams / groups), developing tools to communicate priorities and their status, and timeframes, keeping those timeframes in front of presidents (monthly) for when they can expect to see results. RF is reallocating existing resources to match priorities. Oracle is working gratis. Outside help will be called in only as a last resort. The initial plan calls for major improvements within 6 months, i.e. by end of CY02. Gerry invited contact at 518 / 434-7205 or gerald.drahos@rfsuny.org.
Vice Chancellor's Report - Brian Stenson with Dave DeMarco
Tied loosely to the early retirement incentive, state funds allocated to SUNY will be reduced for 2002-03 by $11.4 million. This contains an element of good news because the State Division of Budget (DOB) had assigned all State agencies and SUNY a 1 percent permanent reduction to close a gap in the recently enacted state budget, which assigned a preliminary number of $18.5 million to SUNY, based on its total $1.8 billion budget (tax dollar and tuition support). DOB settled for the lower amount, supporting System Administration's argument that the reduction should be discounted because campuses have a disproportionate share of their employees participating in the Optional Retirement Program (ORP) and must absorb the cost of that incentive.
The $11.4 million reduction will be distributed through the BAP, pro-rated to campuses on the basis of state and other support, excluding campus retained revenue. This will distribute a disproportionate share of the reduction to those campuses that have a higher ratio of state hard (tax) dollars to campus-retained revenue. SUNY's Finance Committee will review this approach tomorrow (June 20).
If the SUNY Board acts (as expected) on the proposal on Tuesday, June 25, campuses can expect to receive revised allocations within the following day or two. Financial Plans would be expected to be in place by late July / early August, with certificates processed (in groups of 10 or 12) upon receipt / approval. Campuses were encouraged to reduce reliance on reserves to balance this year's budget. Go for real cuts. SUNY will carefully review plans for dealing with this year's shortfall.
The early retirement incentive is one tool for helping cope with reduced budgets. Participation in Part B (55/25) is up to individual employees unless the campus can exclude them from participation on the basis of health and safety, with a narrow view of what constitutes health and safety. Campuses have the option of targeting positions and titles for inclusion or exclusion from Part A of the retirement incentive program. Open period periods will be left to the discretion of campuses, but must end by December 31.
DOB understands we will, in some situations, need to replace faculty who choose to retire. While it is up to campuses to decide which positions to hold vacant, there is a clear intention that the retirement incentive is to reduce the size of the workforce. Although no specific goals have been set, DOB is likely to have an expectation for SUNY in the range of 1,200 to 1,500 of the 5,000 jobs targeted by the Governor. They will be watching us, monitoring based on the total number of lines.
Looking forward, no one knows with certainty whether there will be further reductions mid-year (right after elections, around December) during 2002-03. Through June, tax collections are falling significantly short ($1 billion) of the estimate just done in April. Most expect mid-year action of some sorts. In 1990-91 (the last big "hit"), legislative action (as opposed by the current "haircut" administered by DOB), reduced state support to SUNY by $56-59 million, offset slightly (to the tune of about $15 million) by a modest increase in tuition. IF (a big "if") a tuition increase is authorized, it is most likely to offset, perhaps only partially, a state reduction.
The prognosis for 2003-04 is "pretty grim," based on the general softness of the economy coupled with reliance on soft sources, e.g. casino income and federal support to balance the budget for 2002-03. The state must find $500 million just to continue the TAP program, which was restructured on non-recurring revenues.
For SUNY, expect no state funding for inflation, to incent sponsored research, or for increased enrollment. Expect next year's appropriation to equal this year's minus $18.5 million, i.e. the $11.4 million expectation for 2002-03 is discounted only because campuses must, in this first year, absorb the cost of the ORP retirement incentive.
One glimmer of hope: Because employers do not have discretion (beyond health and safety) to limit those retiring under Part B, the State will pay the cost of the ORP / TRS retirement incentive if the positions are kept vacant through 2003-04. There were no details on how this would be monitored. Mechanically, it would be handled subsequent to filing the Financial Plan, as a rebate on the $11.4 million reduction that is being distributed to campuses.
A "bottom line" is a better and bigger State University - in terms of program and enrollment - at a time when there is little or no appetite for additional state support or increased tuition. Sooner rather than later, we have to take a serious look at the BAP for 2003-04 and beyond - somehow balancing current incentives (e.g. enrollment) with other drivers relating somehow to quality, at least in some hold-harmless manner. Brian will be drawing together an expanded BAP advisory committee, perhaps this summer.
Several expressed concern that the dim economic outlook has not registered with presidents / provosts. They do not seem to be getting a consistent message.
Other business covered by Brian: (1) travel cards will not be done in the system office; and (2) a revised draft on campus entities will be circulated next week for review and comment by presidents and business officers; the report is planned to go to trustees this fall.
Executive Committee
The group will "retreat" in August to plan the agenda for FY03. Sub-committee membership will be among topics discussed at the retreat. Among topics for the coming year: the Dormitory Authority, the EPA Audit and its overlap with NYS DEC and sometimes local monitoring, and guidelines for campus-related entities, including auxiliaries.
Tentative meeting dates are posted on the SUBOA Website: September 25-26, November 20-21, January 22-24, April 16-17, and June 18.
SUBOA's annual meeting is coupled with EACUBO -- October 6-8. Tracy Bennett may seek help from others, lining up sponsorship. Ken Levison is arranging for the Monday evening banquet. John Lambert will poll SUBOA to see how many are likely to attend. Generally, the group would like to increase our organizational presence at EACUBO and NACUBO. Kim Cline will investigate and report on opportunities to participate on organizing and other committees.
John Lambert will update the SUBOA website, listserv, and paper directory, as soon as possible.
Auxiliary Service Contract - Bill Long
The major issue is perceived / potential loss of flexibility. Ivan Lisnitzer encouraged the SASA group to work on a "white paper" with Mike Lewis's taskforce. We may need a special meeting in July to discuss concerns and next steps.
President's Report
Ivan Lisnitzer highlighted the Quality Initiative, thanking those involved, and encouraging continuation of the effort.
Trustees reviewed accomplishments under the Quality Initiative. They focused attention on the BAP and specific issues like property control. Importantly, however, the session was successful in their recognizing what has been accomplished and what is on the agenda. They urged us to move forward (and expand) the quality initiative. It was a very strong validation of SUBOA leadership, individual efforts, and collaboration with system administration.
Ken Levison previewed arrangements for SUBOA's annual meeting in Philadelphia, October 6-8. Further detail should be going out about the first of July.
Business
The minutes from the April meeting of SUBOA were approved. John Homburger reported $52.07 in the checking account, and $18,221.54 in the savings account. He will formalize the report as the treasurer's responsibilities pass to Brice Weigman.
ABB
Becky Schenk commented on work with Dave DeMarco and Barb Owad on financial plan reporting. Following discussion, the group agreed we do want continued representation, from SUBOA and ABB, on ITECH. Ivan thanked Becky for her leadership, and encouraged campus participation in ABB.
The June meeting adjourned and the annual meeting was called to order.
Annual Meeting
Ivan Lisnitzer thanked David Bowers for his backup and support. "He is ready for the presidency." Ivan thanked Leif Hartmark for legacy advice, helping Ivan through his presidency. He thanked the Executive Committee for their help and support. Ivan concluded that "It has been an honor and a privilege to serve as President."
Leif presented the Proposed Slate of Nominees for the 2002-04 Officers and Directors, comprising the SUBOA Executive Committee. (Attached.) He thanked Ivan for his leadership for nearly two full terms, reflecting that Ivan had filled in behind Carl Carlucci, who left early. Leif commented on successes during Ivan's presidency, and noted that David inherits "a first rate past president."
Nominations were moved and seconded, and nominees were voted into their positions.
David thanked everyone for their vote of confidence, and reflected on following a distinguished list of predecessors: Chuck Goolden, Bob Wagner, Ken Levison, Glenn Watts, Leif Hartmark, Carl Carlucci, and Ivan Lisnitzer. David presented Ivan a display clock with plaque inscribed:
The State University Business Officers Association
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Presented To Ivan Lisnitzer
In Recognition Of Your Dedication
And Dedicated Service
As
President of SUBOA
From April 1999 to June 2002
Respectfully submitted,
John A. Lambert,
Secretary
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