BOR Minutes: March 20-21, 2003

APPROVAL OF MINUTES

      Regent Mercer MOVED for APPROVAL of Minutes of the January 16-17, 2003 Regular Meeting in Helena, MT, and the January 27, 2003 Special Meeting in Helena, MT with his recommended amendments

      Regent Hamilton moved that the Board recognize the statute recognizing the Commissioner as an ex officio member of the Board.

     Regent Hamilton's motion was deferred to the May 29-30, 2003 meeting

    The Minutes were APPROVED unanimously as amended on a 7-0 vote.

Chairman Roehm reported on the meeting between the Board and legislative leadership at 5:30 on Wednesday evening.  They were able to pull together many ideas and concerns for the state that they and the MUS could work mutually toward solving.  Chairman Roehm suggested that unless the Board had other preferences, he would have the Commissioner categorize, identify primary responsibility, and collect data on the input.  Regent Jasmin indicated it would be good to see the compiled list before it is published.  He also suggested the Board be able to list their own priorities of the most important items.  Regent Mercer indicated one reason for the meeting was to have interaction between the Board and the civic leadership, and he suggested perhaps the regents could be the ones involved in actually continuing the work with the leadership.  Chairman Roehm noted that he was struck by the number of things the university system already does for the state, about which the leadership was ignorant.  Interim Commissioner Krause indicated they would pull their notes together and get the listing out to the Regents for their feedback on which items they want to work.  It would then be assigned to the campuses.  Regent Jasmin indicated the need to be sure that items that fall into the expertise of higher education and are a good fit with the campuses be placed highest on the list.  He noted as an example that the issue of the economic problems of Eastern Montana would take a very long time, and the effort of many different parties rather than just the MUS.  Regent Hamilton also suggested that with the prioritized list, they send a brief description of what the university system is already doing.  Regent Jasmin indicated he hoped this would not be the last meeting of this group, since many of the leaders indicated they wanted another informal meeting in six or nine months.  Chairman Roehm indicated the future meeting should be included in an outline with the response to the leadership.  Regent Semmens recommended Commissioner Krause circulate to the Board and the campuses the lists of issues that were discussed so that the campuses can provide feedback on the resources and actions that can be taken to further pursue these issues.  Commissioner Krause indicated it would be important to do an inventory a little later, but decide where to move from here at this time.  President Gamble indicated they would have no problem with the outline and that his campus can provide an inventory of where they are on these issues.  Regent Mercer referred to the state computer problem as an example of a problem the MUS could help the state solve.  He indicated that Representative Mood stated if the MUS could save the state some money, he would be willing to split it with them.  Regent Mercer said the list should be put together, then someone needs to go to each of the individuals attending the meeting for refinement and then share it with the Board.  Commissioner Krause indicated they would consolidate all of the discussion issues into one report.

Chairman Roehm reminded all that the country is now at war with heightened security.  He was heartened with the actions of the campuses during the 9-11 attacks and hopes the campuses can maintain again a learning environment without bigotry.  He reminded them there is an implied level of security offered for tuition paid, along with an environment for learning.

  Open Forum for Public Input on MONTANA UNIVERSITY SYSTEM ISSUES

There was no public comment

CONSENT AGENDA

Staff Items:

a.

ITEM 118-1000-R0303 - Staff; The University of Montana Missoula

b.

ITEM 118-1500-R0303 - Staff; Montana Tech of The University of Montana

c.

ITEM 118-1502-R0303 Authorization to Confer the Title of Professor Emeritus of Petroleum Engineering upon Tarek Ahmed; Montana Tech of The University of Montana

d.

ITEM 118-1600-R0303 Staff; The University of Montana-Western

f.

ITEM 118-2300-R0303 Staff; Agricultural Experiment Station

g.

ITEM 118-2400-R0303 Staff; Extension Service

h.

ITEM 118-2700-R0303 - Staff; Montana State University-Billings

i.

ITEM 118-2701-R0303 Authorization to Confer the Title of Professor Emeritus of Management Information Systems upon Professor Ruey-Lin Lin; Montana State University-Billings

j.

ITEM 118-2702-R0303 Authorization to Confer the Title of Professor Emeritus of Management Information Systems upon Professor Janeth Spicer; Montana State University-Billings

k.

l.

ITEM 118-2800-R0303 - Staff; Montana State University-Northern

m.

ITEM 118-2801-R0303 Authorization to Confer the Title of Associate Professor Emeritus of Metals Technology upon Cameron Worstell; Montana State University-Northern

n.

ITEM 118-2802-R0303 Authorization to Confer the Title of Associate Professor Emeritus of Biology and Chemistry on Dr. Duane Klarich; Montana State University-Northern

ITEM 118-2850-R0303 - Staff; Montana State University-Great Falls College of Technology

      Regent Hamilton MOVED for APPROVAL of all Staff Items EXCEPT Item e. which was pulled by Regent Mercer.

    Motion APPROVED UNANIMOUSLY on 7-0 vote.

Questions were asked on various staff items.  The new format confused many of the Regents as well as the campuses.  Regent Mercer requested that benefits be included on the report to give the full picture of the cost of personnel.  Regent Semmens opposed that since benefits are never included in reports on compensation.  Regent Mercer indicated that would be an issue to debate later, but insisted that personnel is the biggest cost to the system and he believes they are not getting an honest representation of that cost.  He suggested that if not in this format, it be done in another manner.

e.

ITEM 118-2000-R0303 - Staff; Montana State University-Bozeman

      Regent Hamilton MOVED for APPROVAL of Item e.

Regent Mercer then indicated he had problems with the pay hike for Ron Sexton.  He noted the year is nearing the end, and they are now getting around to approve retroactively for many, many months.  Further, he stated that last year and this year his increase exceeded 4%, and they are giving higher raises to those with high salaries.

     Regent Mercer moved to freeze Ron Sexton's salary at the level of the previous year.

Regent Mercer indicated when budgets are tight this kind of raise shows poor leadership, and they should be looking at those lower down who work two jobs to support a family since they have a greater need than the top administrators.  Chairman Roehm inquired if this was a personnel matter that needed to be handled in executive session.  Regent Mercer indicated his other concern was that the compensation was going from $119,000 to $126,000 which is a $6400 increase he considers excessive for the average in the state.  He said that when professors and staff get that kind of excessive increase, it is very difficult to tell the people, the legislature and the students the system is short of funds.  He indicated this raise would come from increased tuition.  He indicated he had no question Ron Sexton is entitled to the increase because he is outstanding, but he doesn't see proper leadership when they go marching off with more than the people who work for them.

      Regent Mercer amended his motion to limit Ron Sexton's increase to 4%. 

Regent Hur indicated he would have supported the full increase since Ron Sexton is a fine chancellor who has done a lot for the institution.  President Gamble indicated that the timing of the increase is by agreement with the unions so that salaries of administrators come when the contracts are finalized.  He agreed that the average Montana salary is low, and he would love to see the wealth index move up, but he indicated the average Montanan does not have the responsibilities that Chancellor Sexton does.  If they did, they would receive more than he receives.  CEOs in the Billings area make far more than Chancellor Sexton.  His salary should be similar to the economy.  President Gamble indicated that the 5.3% increase was in a range based on performance, and that some did not receive the 4% and some did, as was agreed to by the Board.  He does not believe they can use the lowest common denominator to set salaries.  Chancellor Sexton indicated his raise was delayed because of the agreement they have struck with faculty because until they know how the enrollments are they won't know if they can give any raises.  Administrators are set last.  Regent Mercer indicated it is the average Montanans who pay the bill, and that if the money is there they will get the pay hike.   But if it wasn't there, they wouldn't get the hike.  He believes the money is not there and that the 5.3% hike comes before other priorities.  Regent Hamilton noted they have discussed before how the salaries compare regionally and nationally.  President Gamble indicated their salaries lag greatly behind the rest of the nation, and contrary to Regent Mercer's statement, they lag behind even Montana CEOs.  The average CEO salary in Gallatin County is $249,000.  He believes it is necessary to change the wealth index, but to change this increase is to be penny wise and pound foolish.

    Motion FAILED on 5-2 vote with Regents Hur and Mercer supporting.

    Original motion APPROVED on 6-1 vote with Regent Mercer dissenting.

Open Forum for Public Input on MONTANA UNIVERSITY SYSTEM ISSUES

Regent Hur indicated that Tom Figarelle from UM wished to comment on the collection and remittance of fees item which would be presented at this meeting.  Mr. Figarelle voiced sentiment that MontPIRG which is covered by this item can monopolize the marketplace of ideas on campus.  They state they are apolitical, but he claims this is not true.  He handed out a report of the position taken by MontPIRG on 49 bills in the 2001 legislative session.  He believes they are left wing and are not providing students with a variety of expressions.  Mr. Figarelle wants to open up the policy to allow other groups to collect and remit fees for student organizations.  He represents Forward Montana made up of young activists.  Chairman Roehm indicated this item could only be discussed with no action taken since the item was only received two days before the meeting.  He indicated further that the format needs to show what text is being changed, and suggested LeRoy Schramm could help with the appropriate format.  Regent Mercer said they should be able to discuss anything.  Chairman Roehm clarified that the ruling was that no action could be taken on the item.  Regent Hamilton indicated that Forward Montana is a registered political action committee and asked if they were incorporated under the terms of the policy, and what in the current policy would prohibit the organization from following the guidelines of the policy.  Mr. Figarelle responded they are not a registered corporation.  Regent Hamilton indicated the policy defines the corporations terms and conditions, and they must be non-profit.  Mr. Figarelle indicated they are a 501c, and that the policy creates too high an expectation for organizations to open up discussions with the requirement of 25% of the student body voting.

END OF PUBLIC COMMENT

Academic/Student Affairs Items:

a.

ITEM 118-201-R0103 - Approval of proposal to implement a two-year Agricultural Power and Machinery A.A.S. degree program as well as a one-year certificate program; Dawson Community College, Glendive, Montana  Attachment

b.

ITEM 118-1501-R0103 - Approval to Establish the Rocky Mountain Agile Virtual Enterprise Technical Development Center; Montana Tech of The University of Montana  Summary

c.

ITEM 118-1502-R0103 Approval to Establish the Economic Development Resource Center; Montana Tech of The University of Montana  Summary   Proposal

d.

ITEM 118-1601-R0103 - Approval of Proposal to Create an Associate of Applied Science in Education Studies Degree; The University of Montana-Western  Summary  Proposal  Budget

e.

ITEM 118-1602-R0103 - Approval of Proposal to Create a Bachelor of Science in Early Childhood Education Degree; The University of Montana-Western  Summary  Proposal  Budget

f.

ITEM 118-2701-R0103 - Approval to Reorganize the Allied Health Programs into the College of Allied Health Professions; Montana State University-Billings  Summary  Proposal  Letter of Support

      Regent Hamilton MOVED for APPROVAL of Items a. through f.

Regent Jasmin noted there were several new programs being presented and although the Board wants to give expanding opportunities, he questioned if this was the right time to do that.  Regent Hamilton agreed that the Board needed to be careful, however in looking at the items they all identify community and statewide needs, and she commended the campuses for this and for the number coming forward at the two year level.  She noted that Item f. should have some discussion.  It is an excellent example of the continued discussion in the Billings community and health care field, but it calls for a shift in the mission of the campus which needs to be made public and which has implications for the Board of Regents and others as they move into high cost programs.  She asked Chancellor Sexton how these changes will affect the accreditation of his campus.  He responded that the proposal reflects about 3 years of concentrated work with the community they serve and further acknowledges the statewide shortage in health care providers.  Previously there were 22 or 23 different programs across the campuses, each doing something different in health care.  This proposal allows them to take what they are doing and broker with other campus programs consolidating everything into one college to make better use of resources.  The result will be a comprehensive grouping that deals with the entire demand for surgical tech, x-ray tech, radiographers, and all the other areas.  He believes that following the last accreditation visit this will make no change in their accreditation status.  Regent Mercer asked about item a. and the enrollment impact on campus.  President Hetrick indicated they have an endowment to fund the program start-up.  After that it will be self sustaining.

  Motion APPROVED UNANIMOUSLY on 7-0 vote.

Administrative/Budget Items:

a.

c.

d.

   Regent Jasmin MOVED for APPROVAL of Items a. through i. 

Regent Semmens inquired about where the extra dollars had come from.  Rod Sundsted explained they were dollars that were accumulated toward these specific projects and not expended until the full amount was available to accomplish the projects.  Regent Semmens asked about the reversions and their sources.  Rod Sundsted indicated they were partly LRBP set-aside dollars, and partly auxiliary funds and dollars collected from students.  These dollars are collected in the O&M Account and when enough have been collected, they proceed with the renovation or maintenance projects.  Regent Mercer asked if the design and administrative costs were included in the figures and Rod Sundsted indicated they were built into the model used through A&E.  Regent Mercer asked if changing from the use of A&E in bidding jobs would result in savings.  Rod Sundsted indicated that A&E takes a percentage off the top of any project.  Any job that is more than $50,000 is now required to go through A&E.  Regent Mercer asked if it would be worth the time for a regent to look into this and see if they could get the requirements freed up, or if it should be left like it is.  President Dennison indicated this is a matter they will be talking about at the May, 2003 meeting.  He noted it would be more efficient and economical, not unlike the Workers Compensation issue which can be done better and more cheaply elsewhere.  Regent Mercer asked if President Dennison believed there was a lot to be gained by going elsewhere than A&E, and he responded there was a lot to be gained.  Chancellor Sexton indicated it would be well worth pursuing as they would have more success with local contractors in getting them to make contributions and matches, and having them bring different resources to the table.  As far as having faculty and students do design work on some of the projects there would be problems with the unions.  Innovation runs into some real issues.  On item i. Chancellor Capdeville indicated that the infrastructure at MSU-Northern is falling apart and he believes that selling these properties will help with the problem.  They were donated, but are not on the campus and are never used.  Regent Hur asked if the dollars could be used directly for students in fee waivers or scholarships.  Chancellor Capdeville indicated that his priority now is deferred maintenance.  The small amount of money won't make any difference to students.  He indicated that MSU-Northern has three properties that might be sold.

  Regent Hur MOVED for AMENDMENT of Item i. so that all proceeds of the sale go to benefit students to offset tuition increases through scholarships and fee waivers.

Regent Jasmin indicated he would vote against the amendment because the maintenance needs to be done.  He recommends leaving it up to the Chancellor to make the decision.

  Item i. was pulled from the original motion

Chief Legal Counsel Schramm indicated that in the case of statutes dealing with construction and maintenance they could argue they do not need to abide by dealing with A&E, however the MUS has chosen for 31 years to work closely with A&E and to go to the legislature for approval when needed.  He believes that announcing the MUS will no longer do this would create a considerable amount of animosity in the legislature and at A&E.  They provide services for the system which could probably be done without the red tape and more cheaply, but there would be real consequences.  He recommended seeking a statutory change if that is what the Board desired, but it was too late this session.

 Motion for items a. through h. APPROVED UNANIMOUSLY on 7-0 vote.

  Regent Jasmin MOVED for APPROVAL of  Item i. as presented

  Regent Hur MOVED for AMENDMENT of Item i. so that all proceeds of the sale go to benefit students to offset tuition increases through scholarships and fee waivers.

Regent Mercer indicated he would support the amendment.  Dan Geelan noted he had dialogue with students on the MSU-Northern campus and they believe this maintenance will give a direct benefit to students.

 AMENDMENT failed on 4-3 vote with Regents Taylor, Hur and Mercer supporting

ORIGINAL Motion unanimously APPROVED on 7-0 vote.

a.

b.

  Regent Hamilton MOVED for APPROVAL of Item a. 

 Motion APPROVED UNANIMOUSLY on 7-0 vote.        

  Regent Hur MOVED to ACCEPT Item b.  with the amendments provided at the meeting.

 Motion APPROVED UNANIMOUSLY on 7-0 vote.        

President Hammon inquired if students were prohibited from using the scholarships at the community colleges by part c.  Arlene Hannawalt indicated both parts b. and c. were not being changed in any way, but are long standing policies.  President Hammon hoped the two year schools would not be excluded for students.  Regent Mercer asked if they could add language in Paragraph c. after campuses"..or Dawson CC, FVCC and Miles CC."  Chief Legal Counsel indicated the Board has no authority to waive tuition for the community colleges.  Their local boards must do that.  This board has not traditionally asserted any authority of waiving fees at the community colleges.

  Regent Mercer MOVED to AMEND Item b. with the added language in Paragraph c. following campuses "or Dawson Community College, Flathead Valley Community College and Miles Community College".

 Amendment APPROVED UNANIMOUSLY on 7-0 vote.

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ACADEMIC/STUDENT AFFAIRS ITEMS

a.

b.

   Regent Jasmin MOVED for APPROVAL to move Item c. to ACTION at the May 29-30, 2003 meeting.

Regent Hamilton asked what costs students would incur to move to on-line courses, and what options would current students have.  President Dennison indicated the cost would only be affected by the delivery charges of on-line, and current students could finish out either way they choose.  Regent Semmens asked what the delivery charge is, and Provost Muir indicated it is slightly higher than the regular resident cost.  Regent Hamilton questioned the need and time frame in Billings, and what advantages cooperative courses had over a cohort program.  Smaller campuses have been encouraged to do these as cohort programs.  President Gamble indicated that since UM intended to have an on-line program it was better for Bozeman to drop its courses in Helena as it was no longer a market for Bozeman.  In looking at the mission of MSU-Billings and the future, he sees public and health administration as very relevant for their location, size of the city, and other criteria.  Chancellor Sexton indicated in their analysis they had looked at the local, state and city agencies over a period of five years, periodically surveying to reaffirm interest.  They expect 20 enrollees on an ongoing basis for the next ten years.  Considering cost of delivery, utilization of local resources, including campus and community expertise, this will be the best of all worlds.  President Dennison asked where the students would be counted for the issuance of a degree.  His understanding is accreditation has to be given by campus, and that no approval has been given by an agency for joint degrees.  Deputy Commissioner Scott indicated she had not checked with the accrediting agency but she will follow up on that and have the information for the Board at the May meeting.  Regent Semmens indicated the Board should have the full picture on this issue by the May meeting.  David Dooley indicated the accrediting agencies are reconsidering their standing on this issue.  The same question arose on programs that come from up to seven campuses.  The Northwest Accrediting Agency indicates there will probably be no problem with the family financial planning program since both institutions are already accredited by the agency.

 Motion APPROVED UNANIMOUSLY on 7-0 vote.

e.

ITEM 118-2004-R0103 - Approval to Create a Joint Masters Degree in Public Administration; Montana State University-Bozeman and Montana State University-Billings.  (Submission Item) Summary  Memorandum of Agreement

  Regent Hamilton MOVED for APPROVAL to move Items d. and e. to ACTION at the May 29-30, 2003 meeting.

Motion APPROVED UNANIMOUSLY on 7-0 vote.

ADMINISTRATIVE/BUDGET ITEMS

Regent Jasmin MOVED for APPROVAL of Item a. 

The added costs in this item will be covered by the ticket price increase, and donations.  The spending authority goes to $3.5 million but if it is not needed, it would not be used.  Jon Swan commented on his own behalf that fans can be fickle and he wanted to know how the payments would be made if they declined to purchase tickets.  President Dennison indicated the revenue from the sold seats will pay off the debt in the allotted time.  Ten years from now it will be paid off so there is no longer term financing to deal with.  Most of the costs are covered by the donor.  Regent Semmens noted the increased costs were $600,000, and at the last meeting the donor was subordinate to the bonds for repayment.  He asked if the increase was coming from the donor or the bonds.  President Dennison answered the donor is still accepting the risk.  Regent Semmens asked if it would be the same bond amount.  Bob Duringer responded that their risk does not change.  They have already sold 3200 seats (80%).  President Dennison added they have commitments in excess of the 80% and that this will be paid off in five years, by 2008.

   Regent Semmens recused himself from the vote on this item since his company will be involved in placement of the bonds. 

Regent Mercer asked what the cost was to issue the bonds and who would receive it.  Rosi Keller said the cost of issuance is $15,000 on a private placement memo rather than public.  DA Davidson is the underwriter and has worked with individuals who want these bonds for portfolios.  For public bonds a rate of 1% to 1.5% is charged which typically is much more money.  Ms. Keller indicated that under indenture their revenues are required to generate 115% of the combined debt service, however they have pushed that internally to 125% to have assurance of sufficient net revenues.  Jon Swan said they are meeting the demands of the ticket holders, but have forgotten the demands of students.  Their fee will increase and they have given more funds to athletics.  Dustin Frost, student member of the Athletic Committee indicated there was lack of student consultation on this issue.  The cost is passed to students even if there is no increase in the athletic fee.  More enrollment gives more money, but there has been no increase in the number of student tickets.  He stated further that the disabled students are concerned about how many seats are being made available to the disabled, and where those seats will be.  Regent Jasmin indicated they were beyond this issue now since the expansion had already been approved and these issues should have been discussed earlier.  Aaron Flint, ASUM Senator supported the stadium and the increase in seats.  He is confident the work will be paid off since 80% of the seats are already sold, and he believes it is good for the students.  Regent Mercer asked for assurance from UM they would enter into discussions with students.  President Dennison indicated they have already talked with the disabled students and they will have some of the best seats, but they are not going to redo construction to put more seats in the lower areas.  They will continue to talk to students about added seats, but there is a cost to it.  Regent Semmens asked if there would be an increase in the athletic fee.  President Dennison indicated there would not.

 Motion APPROVED UNANIMOUSLY on 6-0 vote with Regent Semmens abstaining.

d.

e.

  Regent Jasmin MOVED for APPROVAL of items b., d., e., and f. to extend the sunsets 

President Gamble indicated he wished to modify the proposal.  There has been active discussion with all the student groups, and the students voted in support of the permanent fee.  Bozeman and Northern voted to extend the fee.

President Gamble pulled items b. and e. from the agenda until the May 29-30, 2003 meeting to allow further discussion with the students. 

Regent Semmens encouraged President Gamble, his chancellors and deans to do the same with all of them.  He questioned if the original reasons for the fees were still valid, and why there were such differences.  Chancellor Sexton indicated they have approached the issue thoughtfully, and when the plan was originally made they laid out a detailed plan of costs, established a repair/replacement schedule and have tried everything to cover the costs.  However, they are losing ground since this is a long term program to do a four year recycle without running a deficit.  He indicated the fee approved in 1999 was less than they required, and since then they have patched the system, but cannot continue with the deficit.  Technology drives them, and they have developed a comprehensive ten year plan and won't be back on schedule with a balanced budget until the tenth year.  Regent Mercer indicated they only wanted to get rid of the sunset, and they could still come forward with changes in the fees.  He questioned if these should be rolled into tuition.  Chairman Roehm indicated he opposed these items since they were supposed to be implementation fees, and they are now in the mainstream and upgrading.  It should come out of general operating funds.  Previous student Regents wanted the fees reduced to reach truth in advertising on the true cost of attending.  Now that the systems are in place they become operating costs.  He believes to make these fees permanent adds to the cost of education and slips around the corner from the basic cost of education.  Sara Anderson indicated the students at MSU-Great Falls College of Technology voted to continue the fee with no increase or decrease.  Chairman Roehm asked if the students were willing to submit to a proliferation of fees.  Ms. Anderson indicated the cost should probably go down, and maintenance and upkeep should cost less.  Regent Semmens noted the current fees will remain in effect through the next three years, and on expiration of that time the campuses will come forward with a new fee.  Chairman Roehm commented that the fee would stay there forever.  Regent Hamilton noted she shared Dan Geelan's concern about fees that should be part of the cost of tuition, but when kept separate it provides the students with greater participation in the purchase of IT.  IT is now part of everything on every campus, but if it was made part of tuition, students would not have any input.  However, the Committee did recommend these fees be melded into tuition.  Regent Jasmin indicated that Laurie Neils met with the Committee and looked at a long list of fees.  It was not the intent to eliminate every fee and have only one tuition cost.  Students want and need more internet connection in their rooms and it is something that works well on the campuses.  Chairman Roehm indicated the motion was to establish a permanent technology fee.  Regent Semmens questioned if this should be a fee or part of tuition, and if it was customary for campuses to have separate information technology fees.  President Gamble replied that everywhere he has been, there has been a separate IT fee.  He had suggested these fees be folded into tuition, but the students wanted the flexibility to review the fees.  Regent Semmens indicated that if it is customary to have a separate IT fee, folding it into the tuition would counter truth in advertising.  He asked further why they would consider two campuses at this meeting, and two at the following meeting.  Chairman Roehm stated there would be merit in considering all the campuses together, and would entertain a motion to defer these two until the next meeting also.  Chancellor Sexton noted that if they were not able to assume an ongoing revenue stream, they needed to know that.  The Legislature did not fund IT although it is needed.

Regent Roehm asked the Presidents to comment at the next meeting on what their students think about this item.

Nicole Alley, President of ASMSU-B indicated the students on her campus support the permanent IT fee.  Students go so far as to register into classes held in upgraded classrooms.  Trevor Blyth, President ASMSU-Bozeman indicated they had a discussion on the IT fee and student senate was comfortable with the extension of the IT fee since it is now an integral part of the system.

   Regent Semmens moved to defer all four items to the May 29-30, 2003 meeting

 Motion APPROVED on 6-1 vote with Regent Hamilton dissenting.

c.

  Regent Jasmin MOVED for APPROVAL of Item c.

 Motion APPROVED UNANIMOUSLY on 7-0 vote         

  Regent Jasmin MOVED for APPROVAL to move Item g. to ACTION at the May 29-30, 2003 meeting 

Rod Sundsted explained this idea originated at MSU-Bozeman.  This would expand that idea beyond salary savings for stipends and scholarships.  Regent Mercer asked why they didn't put the savings into deferred maintenance rather than scholarships.  Mr. Sundsted explained it varies by campus, and they can let it revert or set aside for scholarships.  It may be better to set it aside for scholarships than to get it back two years later.  Regent Hamilton asked if it would help with the problem of recruiting and retaining graduate students, and Mr. Sundsted indicated it would.  Regent Jasmin hoped the policy would be permissive during the budget crunch, because a campus may wish to backfill where they don't have money.  Rod Sundsted noted it is permissive, although he believes by the end of the year, there won't be any money left over.  Regent Semmens noted on the Procedures, Item 1 that a department or college needed only to request of the President that a scholarship account be established.  He wasn't sure that was permissive.  Mr. Sundsted indicated there is a difference between establishing an account, and transferring funds.  The transfer is permissive.

Motion APPROVED on 6-1 vote with Regent Taylor dissenting.

Walk on Item from Montana Department of Transportation

Authorization for Montana State University-Bozeman to grant a highway easement to the Montana Department of Transportation on the Eastern Agricultural Experiment Station in Richland County, Montana

Chairman Roehm indicated that Chief Legal Counsel LeRoy Schramm had a request for another item to be added to the Agenda.  Counsel Schramm explained that the Department of Transportation had gone to MSU and requested an easement of 7/10 of an acre in Sidney for highway construction.  They missed the deadline for this Agenda, and when they were told they would have to wait till the May meeting, they implored the campus to see if there was a way to have it heard at this meeting.  Otherwise a $9 million highway project would be delayed many months or indefinitely.  The item is routine, but admittedly was not on the agenda so it would be subject to challenge if someone so desired within 30 days.  A challenge is not anticipated and DOT was willing to take that risk.  This item does not need to go before the Land Board.

  Regent Jasmin MOVED for CONSIDERATION of the walk-on item.

 Motion APPROVED UNANIMOUSLY on 7-0 vote.

  Regent Hamilton MOVED for APPROVAL of the walk-on item.

 Motion APPROVED UNANIMOUSLY on 7-0 vote.

The Board recessed for lunch with student representatives at 11:50

The Board reconvened at 2:10 p.m.

SYSTEM ISSUES

a.

Process for submission and prioritization of agenda items submitted by Board members.  (Discussion Item)  Regent Semmens

Regent Semmens indicated he wanted feedback and guidance on this issue.  As Board members they need to consider and be sensitive to how most effectively to govern the system, and how limited staff resources can be best used.  As an example, currently the Legislature is in session, a Search is being conducted, and issues like tuition, the allocation model, the budget, and two year education need much attention.  He indicated Regent Hur had about a dozen items on this agenda, which was not to be critical but to question how they could be most effective.  He asked if they needed a policy on how to govern themselves to ensure their effectiveness.  If too many things are done at one time, they are done poorly rather than a good job being done on a few things.  If the Board doesn't focus on the important issues and the staffs' time too, they will not be effective.  He suggested perhaps limiting the number of items being submitted at any meeting.  Regent Hur said he thought it was hilarious, because half of those items were carried over from previous meetings.  Some are student items that he brought forward.  Half were not put there by him, but by Chairman Roehm for the students.  He noted it was important for the Board to realize that if they didn't like his items, they could vote against them.  Regent Semmens said it speaks to the fact they are not able to commit the time, resources and attention to all these items.  He said it was an area of concern for him.  Chairman Roehm stated he purposely put those items at the front of the agenda that he knew must be considered and acted upon.  At this meeting, the Tuition Policy, Allocation Model and budget process were extremely important.  He noted he does make value judgments and those that are not quite system issues go to the end.  He reminded them that even that morning it had taken forever to go through the Consent Agenda, and those are items that fit predetermined parameters.  Yet the Board went through them with a fine tooth comb.  He indicated he had a set of tools at his disposal while assuring everyone's items are on the agenda.  First he classifies by information, discussion or action.  Second is the submission/action process at one or two different meetings.  Third is the suspense date for items to be received.  When the Board runs out of time, the items are carried over to the next meeting.  He suggested they could have more meetings.  At one special meeting, they handled the issue of transferability and talked about it for three hours.  That could not have been accomplished at this meeting.  Regent Jasmin indicated he agreed that they needed to pull in some.  Each regent has the responsibility to do research beforehand to warrant having an item on the agenda instead of just throwing things out there.  He noted they used to have priority 1, 2 and 3.  He agreed that they need to find some economy on this agenda.  Chairman Roehm noted that Regent Hur wants all of his items to be action, but with the breadth of the agenda and the number of items, they will run out of time.  Regent Hur stated his items were honored this meeting, but not the last meeting.  The Chair let the Board vote on some of them anyway.  Regent Hur stated that research is a point against him.  The Board has consistently said research can't take up the time of staff, and he wanted to know how he can research if he can't use staff time?  He said his concerns that half the items were not his had not been addressed.  Chairman Roehm indicated he didn't know what Regent Hur was talking about.  Everything that came in for the agenda has the representing Regent.  Regent Semmens noted it may be necessary to have a special meeting, and he was raising this issue so the Board could do their best, rather than being spread too thin.  Regent Mercer commented the Board is making a transition from an oversight Board to one that is taking more responsibility.  He indicated he never liked the submission/action process because it doubles up.  He offered that System Issues might be better placed before the Consent Agenda.  He also indicated the time spent listening to the student reports could be better spent, and that he didn't agree with leaving at noon on Friday.  Chairman Roehm noted that when Margie Thompson was Chair she carried the meeting over on Friday afternoon until 5:00 p.m. and the Board and others were burned out.  It affected the quality of their decisions.  He indicated he would accept written recommendations from any member of the Board on how best to address this issue.

ITEM 118-104-R0303 Workers Compensation Self Insurance; Office of Commissioner of Higher Education (Action Item) Rod Sundsted Program Proposal   RFP   By-Laws

Associate Commissioner Sundsted explained the documents before the Board.  The 1999 Legislature authorized the MUS to proceed with the state fund, self insurance or private insurance.  His office has been working over a number of years on this issue with Rosi Keller and Tom Gibson.  They are convinced it is better to move to self insurance.  He recommends a number of things and the authority to proceed on July 1, 2003.  It will require a considerable commitment to make this work.  He explained they could fund at a level of confidence that would need no reserves, or obtain financing to use as reserves and build in the premium to pay off the debt and keep down reinsurance costs.  The RFP was put out on March 1 for timing reasons, but it can be pulled back if the Board does not approve.  Money could be saved since the renewal cost now is $2.4 million, and long term success would be based on loss control.  He would recommend looking at a full time Risk Manager.  State Fund would be responsible for all claims prior to July 1, 2003 if the Regents approve self funding.  Benefits for employees hurt on the job will remain what they are now.  The plan has been reviewed by the State and Millman USA did the financial work.  Regent Mercer asked if they would want to pass the two policies presented at this time whether or not they approve the self funding, or if they were tied together.  Mr. Sundsted indicated they are good policies either way.

  Regent Mercer MOVED for ADOPTION of the Work Place Safety and Early Return to Work Policies, but not to adopt any part of the self funded program.

Regent Mercer indicated he wanted the Board to bring in some outside people like Jerry Driscol, State Workers Comp, Royal Johnson, Vicki Cocchiarrella for the benefit of their input before making a decision on self insuring.  Regent Semmens asked on the first policy, first paragraph, final sentence if it was helpful or necessary to be included.  Chief Legal Counsel LeRoy Schramm indicated MUS is responsible for work place accidents under the law, even if the worker is careless.  The sentence didn't bother him in the context of workers' compensation insurance but agreed it should probably be omitted.

 Motion APPROVED UNANIMOUSLY on 7-0 vote as amended

Rod Sundsted noted they needed authorization at the current meeting if they were to have it in place by July.  He assured the Board the actuary who reviewed the proposal was either the best, or one of the top two.  He also noted that Royal Johnson was informed of the MUS plans.  They have a bid for $2.35 million and that money could be used elsewhere.

  Regent Hamilton MOVED for AUTHORIZATION to proceed with the establishment of self funded workers' compensation insurance.

Regent Semmens asked if the greater sense of ownership would lead to greater safety and Mr. Sundsted indicated he believed it would and they now need to minimize all costs.  Regent Mercer said MUS is in the higher education business, is trying to get into economic development and now is looking at the insurance business.  He feels this puts tremendous confidence that it will work out right, but he doesn't feel right about the actuarial.  Montana had a program and got into debt.  Regent Jasmin indicated that insurance companies get into trouble with incorrect actuarials, not with the legalese, and when overestimating premiums compared to losses.  Projections are not set in concrete, and there may be a need to increase premiums.  He believes the Board must have some confidence in the expertise of the actuary.  The reserves are funded up front, and if losses climb, then the premiums will be increased.  Interim Commissioner Krause indicated that they also have further protection with reinsurance.  Just as in health insurance, claims over a certain figure are reinsured, putting a limit on what MUS would have to pay.  

 Motion FAILED on 3-3 vote with Regents Hamilton, Jasmin and Roehm supporting and Regent Semmens abstaining.

Following discussion on the value of further consideration it was agreed the Regents would meet with Rod Sundsted immediately following the meeting on Thursday and the matter would be taken up again on Friday.

c.

 Regent Hur MOVED for APPROVAL of Item c. in order to get item on the floor

  Regent Mercer offered SUBSTITUTE MOTION to work with legislative leadership to request an opinion on the legal issues raised by a suit from legislative legal services and thereafter work with involved parties to craft a solution

  Regent Hur withdrew his motion

 Substitute Motion APPROVED on 6-1 vote with Regent Hamilton dissenting   

d.

ITEM 118-105-R0103 - Draft Tuition Policy (Action Item) Regent Hamilton 

  Regent Hamilton MOVED for ADOPTION of the policy statement on tuition 

Regents Semmens, Mercer and Jasmin, President Dennison and Dean Moe offered amendments to the statement.

 Motion APPROVED UNANIMOUSLY on 7-0 vote as amended     

  Regent Jasmin MOVED for APPROVAL of item e.

Following lengthy discussion on the best way to handle summer tuition, the item was deferred to Friday to allow Staff to provide more information to the Board.

Allocation Model (Action Item) Rod Sundsted

  Regent Mercer MOVED for APPROVAL of Strategic Initiative Funding as follows:

MSU Rural Residency for $319,366, Yellow Bay for $98,250, Distance Learning for $100,000 plus Regents' Initiatives for $250,000

 Strategic Initiative Funding APPROVED UNANIMOUSLY on 7-0 vote as amended

Balance of item continued to Friday.

Meeting recessed at 5:10 p.m.

FRIDAY, MARCH 21, 2003

Full Board Reconvened at 8:00 a.m.

STUDENT REPORTS

Please see attached reports

Dan Geelan President of MAS, read into the record a resolution to the Montana State Senate requesting an end to Student Regent Hur's term on July 1, 2003.  (Please see attached resolution)

Jon Swan, President ASUM reported they have begun lobbyist training for students, with 50 participants.  Pat Williams, Dave Wanzenried and Tom Bruggeman were scheduled speakers, however Mr. Bruggeman was unable to attend due to the weather.  A model program has been established for future training.

Regent Mercer requested each of the student presidents to provide him a copy of their budgets indicating the amount requested by the student organizations, and the amount actually provided.

END STUDENT REPORTS

SYSTEM ISSUES continued

Collection and Remittance of Fees for Student, Non-profit and Non-partisan Organization; The University of Montana-Missoula (Action Item) Student Regent Hur

Following discussion this item was tabled till the May 29-30, 2003 meeting.

Following a ten minute break, the Board reconvened at 9:50 a.m.

ITEM 118-104-R0303 Workers Compensation Self Insurance; Office of Commissioner of Higher Education (Action Item) Rod Sundsted Program Proposal   RFP   By-Laws CONTINUED

  Regent Jasmin MOVED for reconsideration of item b.

Regent Mercer noted as a point of order, that the motion needed to be made by someone on the prevailing side of the vote.

  Regent Jasmin WITHDREW his motion.

  Regent Hamilton MOVED to SUSPEND the rules for this issue only.

Regent Mercer noted as a point of order the full Board must approve the suspension, not the majority of the Board.

  Regent Mercer MOVED to WITHDRAW his previous motion and to reconsider the item at a special meeting ten days hence

 Motion APPROVED UNANIMOUSLY on 7-0 vote

  Regent Jasmin MOVED for APPROVAL of a 6% increase in tuition for summer session.

There was a discussion on the pros and cons of continuing the surcharge versus raising tuition for the summer session, and whether or not to continue the tuition differential for the two year schools and the lower levels at MSU-Northern and UM-Western.

Regent Hur offered a substitute MOTION to allow campuses the flexibility to retain tuition levels up to or less than the existing tuition surcharge (Spring semester, 2003) authorized by the Board in July, 2002 in regard to any summer, 2003 tuition levels.

 Substitute Motion APPROVED on 5-2 vote with Regents Hamilton and Jasmin dissenting.

Resolution on Budget 04-05 Guidelines (Action Item) Regent Roehm  Note

  Regent Hamilton MOVED for APPROVAL of item g.

Tuition Waivers (Action Item) Student Regent Hur

Discussion covered the impact of waivers on the budget and students.  There was suggestion to discontinue waivers and use as revenue.  Regent Semmens noted it would be wise to have a detailed presentation by staff at the July 10-11, 2003 meeting.

  Regent Hur MOVED the Board charge staff to come to the next appropriate meeting this year with a series of recommendations and changes the Board may wish to consider to offset potential tuition increases and save money.

 Motion APPROVED unanimously on 7-0 vote

PRESENTATION

Dean Weisenstein presented an overview of two programs being offered out of MSU-Bozeman to address the teacher shortage in Montana and the nation.  One program is Northern Plains Transition to Teaching, and the other Montana and High Plains Troops-to-Teachers Program.  The Transition to Teaching program is funded by the United States Department of Education and operating as a web based teacher licensure program consisting of eighteen credit hours of course work and six credit hours of in-school experience, is designed to get new teachers into the classroom as quickly as possible.  The Troops-to-Teachers program assists qualified military personnel to make the transition from the armed services to service in the classroom.

END PRESENTATION

The Board recessed at 12:15 for lunch and group photo

The Board reconvened at 1:00 p.m.

l.

Commissioner's Evaluation/Presidents' Evaluations (Action Item) Regent Roehm  Attachment

Consensus was reached on item l.

Evaluation of the Regents' Code of Expectations (Action Item) Regent Roehm  Note

  Regent Hamilton MOVED APPROVAL of item m.

Resolution regarding Board of Regents outreach, partnership, and commitment to economic development(Action Item) Regent Semmens  Attachment

  Regent Semmens MOVED APPROVAL of item n.

 Motion APPROVED unanimously on 7-0 vote

Budget Committee Report - Regent Jasmin 

After a brief update, it was decided the next Budget Committee meeting would be on Wednesday, May 28 before the Board meeting in Great Falls.

Allocation Model (Action Item) Rod Sundsted  CONTINUED

 Consensus was reached as follows:

Mandatory Waivers:  Rod Sundsted will prepare models showing a phase-in to 100% funding of mandatory fee waivers.

Tuition Differential:  Differential will be maintained for the 04 budget, with recommendations coming forth for future changes.

Research/Public Service/Athletics: Apply a proportionate reduction to these activities that reflects the overall decrease in available state funding.

Enrollment growth funding:Regents agreed to continue funding enrollment growth.

Consideration of Tuition Revenue When Allocating General Fund/Millage: As a result of budget reductions in FY03 and in planning for FY04, UM-Missoula has developed transfer plans to assist their smaller campuses in dealing with funding issues related to the smaller campuses inability to raise significant revenue through tuition.  The regents could direct each university to develop plans mitigating the impact of budget reductions on the smaller campuses and report on those plans at the May regents meeting.

Fiscal Austerity Measures (Action Item) Student Regent Hur

Proposal on Approved but Non-assessed Fees (Action Item) Student Regent Hur

Two Year Education Task Force Report - (Discussion Item) Deputy Commissioner Scott/ Chancellor Sexton

p.

Workforce Development Projects Update (Informational Item) Arlene Parisot

q.

Two Year Education Proposals (Action Item) Student Regent Hur

ITEM 118-104-R0103 Amend Policy 320.1, Accreditation; Montana University System (Action Item)   Memo  Deputy Commissioner Scott

ITEM 117-102-R1102 - Proposed New Policy re: Prohibition Against Conducting Board Business Via Electronic Mail (Action Item) Regent Mercer  As amended

ITEM 118-106-R0303 Proposed New Board of Regents Policy; Montana University System (Submission Item) Resolution  (Jon Swan/Christian Hur)

u.

Proposed Credit for Participation in Student Government  (Action Item) Student Regent Hur

Regent Communication Proposal (#1)

Attachment  ( Action Item) Student Regent Hur

Regent Hur - Compensation for Postage (Information Item)  Letter   Correspondence

Regent Communication Proposal (#2) Please replace item hh. from the January Agenda with this item.  Re-affirmation of existing practice  Attachment (Action Item) Student Regent Hur

Parking Proposal (#3)

Attachment  (Action Item) Student Regent Hur

Sale of Assets to Assist Montana Students and Offset Tuition Increases (#4)

Attachment  (Action Item) Student Regent Hur

#5  In May we approved a series of revised Information Technology Policies for the Montana University System Attachment  (Action Item) Student Regent Hur

Items i., j., o., p., q., r., s., t., u., w., x., y., z., and aa. were deferred to the April 2, 2003 special meeting.

DISCUSSION WITH CAMPUS CEOs/COMMISSIONER

Please see attached reports

With no further business to come before the Board, the meeting adjourned at 2:55 p.m.

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