President's Budget Advisory Committee

Minutes March 27, 1997

Approved by PBAC, 10 April 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 8:06 AM by asking for a motion to approve the Agenda. Dennis Harris moved to approve the Agenda. A second was obtained from Jose Andrade. Melinda Barnard asked that an item be added to the agenda -- SSU's Policy Regarding Faculty Consultation in Budgetary Matters. The policy document approved by former President David Benson in August, 1991 was distributed by Barnard to the Members. Brief comments were made regarding the policy by various Members including that notion that the policy needed to be updated to reflect present titles and that a Senate action was needed to officially recommend to the President, the expansion of the PBAC which informally took place in 1995-1996. Victor Garlin noted that he felt Section 2.1-B was in conflict with the budget planning parameter that did not permit reallocation among the base budgets of the University. Farish noted that this provision of the Policy could also be viewed as being only applicable to existing campus funds, not new campus resources.

Neil Markley asked that the issue of Early Registration and its budgetary impact be added to the Agenda. With Markley's addition, the Agenda was then approved unanimously.

Distribution of the Minutes of March 20 1997

Farish informed Members that the Minutes of the March 20, 1997 meeting were included with the Agenda Packet (Packet). He indicated that he would seek a motion to approve the Minutes at the PBAC meeting on April 10, 1997.

Early Registration

Farish recognized Markley who raised several concerns regarding SSU's new Early Registration Program (Program). He indicated that he believed having students register for classes based on a schedule built without full knowledge of the campus budget could create serious problems for students if classes originally scheduled were later canceled due to budget reductions. He also noted that the Program seemed to "lock-in" a budget for a certain portion of the budget which he saw as inappropriate. Markley indicated that the concept of the Program was a good one but that the upcoming academic year, given financial challenges, was not the year to launch the Program. He urged that for 97-98, registration take place in July when the budget was formalized.

Barnard concurred with Markley's comments. She questioned how it would be possible to pull back from the schedule if it were necessary given reductions in budget to Academic Affairs. Wilson also concurred citing potential impacts for financial students should they be unable to obtain necessary classes if the course schedule was materially altered. Larry Clark also concurred indicating Markley's issue had been discussed by the Student Advisory Board in the School of Business and Economics. Garlin also concurred indicating that the students' concern was shared by others on campus including faculty who feared classes would be reduced as a result of budget reductions.

Farish explained the rationale for the policy citing improved advising and better retention as being more viable with the new Program. He also indicated that the Program and Course Schedule sent a positive message to students deflecting a potential perception on the part of students that somehow SSU was broken. He also commented that major cuts to the proposed course schedule would undo much of what had been accomplished at SSU over the past years. He indicated that he had told each Dean to expect budget reductions but that he did not anticipate that these cuts would be major or severely curtail the published course offerings.

Markley noted to Garlin that he did not automatically assume cuts to the class schedule would happen but that it was a real possibility that should not be discounted. In response to Farish's comment regarding possible student perception about SSU being broken, Markley suggested that if the Early Registration Program had not been announced, students would not have seen anything out of the ordinary with a Summer registration as had been done over the past years. Markley indicated that the Administration knew there was a serious budget problem facing the campus but proceed with the Program anyway. This action, Markley, noted, was one that he did not understand.

Harris reminded Members that the current schedule of classes (96-97) was built with financing from a one-time interfund loan which was to be replaced with the Partners for Excellence Fee, defeated in Fall, 1996. He noted that the PBAC was aware of this fact when the interfund loan was approved in March, 1996 and that unless financial reallocation took place, classes would clearly be cut in 1997-1998.

Andy Merrifield noted that Academic Affairs was the primary mission of the University and that it was not appropriate to discuss, at this point, cuts to the instructional program. He argued the primary purpose of the PBAC should be to find resources to teach students.

Bill Barnier indicated that he shared many of the concerns raised by the Members but was persuaded by Farish's rationale for proceeding with the Program.

Farish concluded the discussion by indicating that the Program would proceed and that the decision to launch the Program was his. He also reminded Members that he had told the School Deans to be frugal.

Preliminary CSU Allocations to SSU , 1997-1998

Schlereth referenced materials contained in the Agenda packet outlining differences between the campus's financial staff extrapolation of the Governor's Budget implication for SSU and recently received CSU preliminary budget allocations for SSU for the 97-98 fiscal year. He noted that the most material difference was the elimination of funds provided to support technology improvements. He reminded Members that the Legislative Analyst had recommended that this item be removed from the Governor's Budget and that it was an area that the PBAC needed to watch closely in the weeks ahead. Wilson noted that the CSU Preliminary Allocations still were reflecting a 3.4% salary increase pool.

Summary of Funds to Date

Schlereth then directed Members to the revised Summary of Funds to date indicating that changes or modifications should be directed to his office. Garlin asked if the data was prepared by the PBAC staff. Schlereth indicated that it had not but represented his best recollection the key points of the budget presentations made. He indicated that future revisions would be reviewed by the entire PBAC staff.

Farish raised the issue of what funds were outside the purview of the PBAC authority. He recognized the existence of the auxiliary corporation Boards of Directors. but said that he believed the PBAC could make global recommendations to the President on all the funds on campus.

SSU Trust Accounts

Schlereth then turned to the University's Trust Accounts and explained Trust balances at the University-Wide level, the Executive Office, Student Affairs and Administration and Finance. Silvia Barajas did the same for trust accounts in Academic Affairs. Garlin raised a question about the Library Copier account in Academic Affairs which was addressed by Barajas. Several questions were raised regarding the Administration and Finance (AFD) trust balances. Barnard asked whether certain of the physical plant expenditures could be moved to another account, freeing funds in the AFD trust for other purposes. Schlereth noted that if another fund source could be found, that was a possibility. Harris noted that the AFD trust had been utilized for certain physical plant expenses because no other funding source existed for this purpose in 1996-1997. Les Adler questioned whether the current fiscal year was the best time to make the outlined physical plant expenditures given the campus's financial position. Barnier asked what would happen to the balance, should one exist at June 30, 1997. Schlereth indicated that it was his intention to utilize any residual resources to pay down the AFD share of the second Interfund loan created by he and Farish in September, 1996. Merrifield raised the question of reallocation among base budgets and campus policy in this regard. Farish noted that he believed that particular provision applied the general fund bases and not to funds outside the general fund Schlereth reminded Members that Trust accounts were frequently utilized by campus organizational units as a mechanism for general fund roll-forward and that revenue streams flowing through trust accounts often were used to finance the salaries of permanent or probationary employees.

Continuing Education Reserve Accounts

Schlereth referenced the Packet and highlighted various Reserve accounts held in Continuing Education by several organizational units on campus. Barajas assisted in the presentation. Clark indicated that David Walls, Dean of Continuing Education, had asked the Deans not to spend these resources due to potential cash flow difficulties in Continuing Education (CE). Harris questioned whether the CE reserves could be used as bridge financing in 1997-1998. Farish indicated that they could. Schlereth reminded Members of the need for Reserves and indicated that he felt a unit holding a Reserve in CE was doing so as a method to cushion unforeseen events that could impact that unit. Clark concurred with Schlereth.

SSU Academic Foundation

Schlereth called Members' attention to the Packet and explained Foundation Balances available as of March, 1997. He noted that the data presented did not include the University endowment or funds restricted for scholarships. Various questions arose regarding the specific nature of the accounts which were answered by the Cabinet Officers. Garlin questioned which resources could be made available to help with the campus financial problems. Harris noted that various units had worked hard to generate these balances from external resources and noted that he would be concerned if they were utilized for other purposes. Jim Meyer added that it was important to future private fundraising to follow the wishes of the donors. Garlin indicated that he understood these realities but was trying to get a sense of which funds could appropriately be used for help meet the financial challenges faced by the campus.

Merrifield commented that budget processes were, by their very nature political, and that would be a mistake to believe that the PBAC process would be void of political activity.

Barnard reminded the Committee that the campus policy governing PBAC activity required members to take a University view and not simply argue for various special interests including instruction. Garlin noted that he wished to be associated with Barnard's comments but did wish to know what Foundation balances were truly available and which were restricted. Farish and Schlereth indicated that they would be pleased to provide this information regarding specific accounts and asked Members to contact them directly should they have questions regarding a particular account.

GOOD OF THE ORDER

No items were raised for the good of the order.

Adjournment

At 9:52 Farish adjourned the meeting and reminded Members of the next meeting scheduled for April 10, 1997 from 8 AM until 1 PM.

Minutes prepared by Larry Furukawa-Schlereth


PBAC minutes 1996-1997
Updated 2007-12-14
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