President's Budget Advisory Committee

Minutes October 22, 1999

Members Present

Staff Present

Members Absent

Staff Absent

Guests Present

Meeting Agenda

APPROVAL OF THE AGENDA

Bernie Goldstein brought the meeting to order at 8:11AM and asked for a motion to approve the Agenda. A motion was made by Dennis Harris. A second was obtained by Andy Merrifield. The Agenda was approved unanimously.

APPROVAL OF THE MINUTES

Goldstein asked for a motion to approve the minutes of the September 17, 1999 meeting. A motion was made by Steve Wilson. A second was obtained by Bill Barnier. No changes were made to the minutes. The minutes passed with no dissenting votes. Merrifield abstained.

ROLES OF THE CAO AND CFO

Larry Schlereth noted that these roles had already been distributed to the Members and gave a brief presentation. Merrifield noted that "Compact 2" may have an impact on these job descriptions.

CAMPUS FINANCIAL POLICIES AND PRACTICES

At the request of Victor Garlin and the Students, Schlereth presented this item:

CAMPUS FINANCIAL POLICIES AND PRACTICES

Crystal Shrouf expressed her concern regarding the CABO practice. Schlereth responded that this is embodied in the Educational Code and noted if business officers choose not to follow it , they will need to change the Education Code. Barnier asked how the list became policies and practices. Schlereth responded that we have generally been following these and we could discuss them if the Members wish. Joe Latulippe asked if this list consisted of laws and asked why we were getting this list. Schlereth responded, we don’t need this list, however many auxiliaries are not following them, so they are broken down into salient points. Merrifield asked if all campuses are following this or just us. Schlereth said Dr. Arminana is choosing to follow this, which is consistent with the Education Code. Merrifield expressed his belief that the CSU lawyers interpret the Education Code consistent to what the CSU would like and is not always black and white. Shrouf agrees. Schlereth noted that many of the Education Codes are very clear without interpretation. Further, we could delete the CABO bullet, because if we follow the Education Code, this is already covered. Barnier argued that there was no policy recommendation at the PBAC level regarding utilization of the marginal cost formula for distribution of both new discretionary revenue and new University-Wide expense, but only the latter. Harris noted that the President’s action followed a formal recommendation by PBAC to accept the marginal cost formula for both and that the marginal cost formula accounted for the additional cost of both direct instruction and other expenditures added with each new FTES, which is why we are able to use the FRMS database to determine the percentage of these new revenues which should accrue to each of the five divisions as a result of enrollment growth. He continued, although University-Wide items seldom result from a decline in enrollment, the marginal cost formula has already been utilized for distributing these costs to the five divisions, since their ability to contribute is, to a significant extent, related to the funds they receive under the formula. Barnier responded that his recollection of the discussion and outcome of the PBAC’s deliberations on the marginal cost formula differed from that of Harris; however, he was not proposing that PBAC revisit the issue. Phyllis Fernlund noted if unit money is scooped in the division, the units may not be motivated to save. Schlereth said that is a VPBAC and CRC issue. Merrifield indicated that items such as the scoop, which may cause an issue, may be more of a PBAC issue to discuss. Schlereth responded that the CFO and PBAC should not get into telling the divisions how to operate.

CAMPUS FINANCIAL AFFAIRS

As requested by Garlin, Schlereth presented this topic.

COUNSEL PROVIDED TO THE PRESIDENT FROM THE PBAC/VPBAC/CRC AND PROVOST SEARCH COMMITTEE
Late Spring, 1999

THE MARGINAL COST FORMULA

ITEMS FOR THE GOOD OF THE ORDER


PBAC minutes 1999-2000
Updated 2007-12-14
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