President's Budget Advisory Committee

Minutes March 13, 1997

Approved by PBAC March 20, 1997

Members Present:

Staff Present:

Members Absent:

Guests Present:

Meeting Agenda

Materials Distributed with Agenda Packet

Approval of the Agenda

Don Farish convened the meeting at 8:10 AM by asking for a motion to approve the Agenda. Bill Barnier asked that the matter of the Historical Analysis of the Base Budgets be added to the agenda. Farish agreed and assigned this item a time certain of 9:30 AM. Harris asked that today's agenda and each agenda in the future include a "good of the order" with a time certain of 9:40 AM. Farish agreed. With these modifications, the agenda was approved unanimously.

Distribution of the Minutes of March 6, 1997

Farish then asked for a motion to approve the Minutes of March 6, 1997. A motion was made by Victor Garlin. A second was obtained from Bill Barnier. The minutes were approved unanimously.

Continuing Education (CE)

Farish recognized David Walls who, in turn, introduced John Hayes and Beverly Yahn, Business Manager and Registrar respectively for Continuing Education. Walls explained the financial status of the CE unit calling attention to the projected deficit in 96-97 program as well as explaining the material changes to the budget between 96-97 and 97-98. Walls noted that he and Farish were having conversations related to ways CE could increase its financial contribution to the instructional program. During the discussion which ensured, it was clarified that CE had been completely decentralized from the CSU. Barnier asked how the SSU CE program compared to other CE programs in the CSU with respect to contributions to the formal instructional program. Walls noted that experience varied throughout the system ranging between 10% and 20%. He indicated that SSU was around the 10% return mark. Barnier asked if that could be increased. Walls noted that it could but such an action without a corresponding increase in surplus revenue would result in a deficit for the program. Harris noted that CEs contribution to the schools was historically much lower than the present. He urged that the contribution not be decreased since the schools generally relied on CE revenue to augment operating expenses for instruction in the general fund. Garlin questioned the ratio between overhead and direct CE instruction. Walls responded by pointing out that the CE unit was a completely self-sustaining entity and that it was responsible for all overhead expenses including marketing, financial management, registration etc. Barnard called the PBAC's attention to the campus 1996-1997 budget document which provided greater detail related to CE overhead. She indicated that a portion of the overhead was actually operating expense needed to create and then deliver direct instruction. Barnard then asked how the determination is made with respect to CE surplus revenue. Walls commented that this decision was made with the various Deans and the Provost.

Harris informed the PBAC that money provided to the Schools from CE was frequently not spent entirely in the fiscal year in which it was received and, as a result, Schools were able to maintain a small reserve with their CE funds which was needed to cushion school operations. Farish further explained that the Schools had come to rely of CE resources to offset reductions in School operating expense budgets which took place in 1992.

Harris asked Walls if the mandated Cost of Living Adjustment (COLA) was reflected in the 97-98 budget projection. Walls indicated it was but indicated that no projection had been made or included in the 97-98 proposed budget for the CSEA/MSA settlement.

Schlereth asked if the growth of other educational institutions in the Sonoma County area would have an impact of CE operations. Walls noted that competition from Dominican College, St Mary's College, Golden Gate University, the University of San Francisco and recently, the ULCA On-Line Educational program all were competitors of CE making marketing efforts all the more important for the SSU CE program. Farish noted that presently, SSU was not choosing to compete aggressively with institutions who saw the SSU service area as an untapped market. He suggested that the campus needed to evaluate this reality and come to a decision of whether it wished to either simply watch these developments or join in competition for this market. He noted that a Retreat on this topic in Academic Affairs had been planned.

Silvia Barajas asked Walls to comment on the need for retained earnings in the CE program. Walls noted that the retained earnings account actually represented not a true reserve but rather a working capital balance facilitating the program's cash flow needs between the time when registration for courses took place, cash actually received and bills, including salaries actually paid.

Harris questioned if the CE program had any other accounts other than those reflected to the PBAC in the Continuing Education fund. Walls noted that accounts for CE also existed in the Academic Foundation.

Marty Rudell commented that a discussion needed to take place at SSU regarding how best to manage academic programs in CE vis-a-vis their counterparts in the University's regular course of instruction. She expressed particular concern related to marginalization and fragamentation that could take place if the University was not careful.

Student Health Center (SHC)

Farish then asked Schlereth to introduce the Student Health Center which Schlereth did. Schlereth turned to Rand Link who explained the financial operations of the Student Health Center referencing materials contained in the Agenda Packet (Packet). Link then introduced Georgia Schwartz, Director of the Student Health Center who provided an historical perspective for the SHC. A handout on this topic was distributed to the Members.

Barnier commented that he did not see the Health Center as a campus area that could be of financial assistance to the University beyond what it had already done. Tracy Terrill noted that it might be possible to think more broadly about student health and including mental health/counseling services in the Health Center budget thereby aiding the campus general fund.

Harris questioned whether the Student Health Center (SHC) could integrate further the activities of the academic counseling program and the nursing program as a strategy to reduce expense and, at the same time, provide internship and learning opportunities for students enrolled in these programs. He also suggested that the Student Health Advisory Committee become a Sub-Committee of the Fee Advisory Committee and urged the SHC to consider how other components of the health care industry were able to provide high quality care during a time of increased competition and rising costs.

Barnard urged the Members to move on. She indicated that she believed the SHC had already absorbed significant budget reductions referencing Schwartz's historical presentation. Terrill disagreed with Barnard pointing out the current and projected deficit in the SHC. He suggested that at some point, the SHC Reserve would be depleted and once again, students would be asked to pay higher fees. He urged the PBAC to take some action so that this reality would not hit the campus and future students in the years ahead.

Farish noted that discussions regarding the SHC as well as each of the other budget presentations made to date did not illustrate that any unit had significant sums of idle or unneeded cash. He suggested that across-the-board cuts, were therefore, not a viable solution to the campus financial problem. He did indicate that thought should be given to how various areas of the campus could be redesigned to save money.

Spring Meeting Schedule

Farish then moved to Agenda Item IX, a discussion of the Spring meeting schedule for the PBAC. After discussion, Members agreed, by consensus, to expand their meeting schedule to include the following additional meetings:

Farish noted that it was possible that the April 23 meeting would not be needed. He asked Members, however, to hold the date.

Historical Analysis

Farish then recognized Barnier who spoke to the historical analysis of the budget being prepared by the staff to the PBAC. Barnier indicated that he wished to be certain that the staff understood what he wished to see - a simple analysis of what the base budgets for the University and its auxiliary corporations were in 1992-1993 and how these budgets compared with the situation in 1996-1997. He indicated that he anticipated footnotes would be needed to explain organizational changes and other differences that were material. He also requested that an analysis be completed reflecting how many dollars were spent on faculty in 92-93 versus 96-97.

Schlereth noted that the staff was responding to Barnier's request but that it was important that the presentation fully disclose all relevant data, be accurate and be analytically correct. He noted that the presentation being prepared would take Members, year by year, through the budgets, outlining material changes. Because of the complexity of the subject and the many budget changes that took place between 1992-1993 and 1996-1997, utilization of footnotes was not viable. He indicated that financial information regarding faculty between the two years was also being prepared but that historical information for the auxiliaries was not a part of the presentation.

Terrill questioned the rationale for the presentation indicating that he did not wish to add additional burden to the Committee's staff if the information was not going to be useful to the PBAC in the formulation of its budget recommendation. Katharyn Crabbe suggested that the historical information was important.

GOOD OF THE ORDER

Farish then turned to the "Good of the Order" agenda item and recognized Harris. Harris noted that for the good of the order he would defer his comments until the next meeting.

VIII. Adjournement

Due to the lateness of the hour, Farish then adjourned the meeting at 9:50 AM.

Minutes prepared by Larry Furukawa-Schlereth


PBAC minutes 1996-1997
Updated 2007-12-14
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