These minutes reflect
discussion and debate at a meeting of a committee of the
Minutes
Senate Committee on Finance and Planning
Tuesday, March 29, 2005
2:30 – 4:15
238A Morrill Hall
Present:
Charles Campbell (chair), Kendal Beer, Rose Blixt, David
Chapman, Arthur Erdman, Steve Fitzgerald, Lincoln Kallsen, Joseph Konstan,
Michael Korth, Richard Pfutzenreuter, Terry Roe, Charles Speaks, Alfred
Sullivan, Kate VandenBosch, Michael Volna
Absent:
Calvin Alexander, Daniel Feeney, Scott Fine, Thomas
Klein, Ian McMillan, Kathleen O'Brien, Diane Parker, Thomas Stinson, Susan Van
Voorhis, Warren Warwick
Guests:
none
[In these minutes: (1) financial issues; (2) stadium
agreement with TCF and stadium funding; (3) salary instructions]
1. Financial Issues
Professor
Campbell convened the meeting at 2:30 and asked for a motion to close the
meeting in order to discuss some financial issues. The motion was made, seconded, and adopted
unanimously. The Committee spent about
half an hour discussing various matters with Vice President Pfutzenreuter.
2. Stadium Agreement with TCF
The
meeting remained closed; Vice President Pfutzenreuter provided information on
the negotiations and details of the contracts with TCF Bank regarding the
proposed new football stadium.
Professor
Speaks then raised a question about the use of student fees in support of the
stadium. It was brought to his attention
by a graduate student that one possible plan for student fees is to make the
fee part of the University Fee rather than part of the student services fee
process. This will mean that graduate
students without assistantships will pay the fee out of their own pocket; for
those with assistantships, it means that departments/colleges or PI's will pay
the fee as part of the fringe benefit package they pay for assistantships.
Mr.
Pfutzenreuter said there was no decision about how the student fee would be
administered. As a backing for bonds
issued by the University, the student services fee process is not sufficiently
reliable, so it may need to be part of the University Fee. It is proposed to be $50 per semester (fall
and spring only) for both undergraduates and graduate/professional students.
Professor
Speaks also raised a question about the consultation process that was used in
developing the proposal. Mr.
Pfutzenreuter said there was considerable consultation with students, but all
at the conceptual level. The student
leadership has been involved for over a year.
They have not gotten to the point of consulting with faculty and
deans. Professor Speaks said that
talking with students was entirely appropriate, but if the charge is attached
to the University Fee, it will also hit PI's, departments, and so on. This Committee needs to talk about the
issue.
Is it
still the plan not to collect the fee until the stadium is open, Professor
Konstan asked? Mr. Pfutzenreuter said he
has modeled a plan that starts collecting the fee from freshmen in fall, 2006
and in 2008 or 2009 from graduate/professional students. Professor Konstan said he understood that MSA
supported the fee but that the Council of Graduate Students opposed it (he did
not know the views of professional students).
It seems odd, given the closeness of undergraduates to athletics and the
distance of graduate and professional students from athletics, that the
University would use a one-size-fits-all approach. Mr. Pfutzenreuter said he understands that
graduate and professional students go to the games as well. The fact is that some groups favor the fee
and others don't, Professor Konstan said.
The President will need to make a decision, Mr. Pfutzenreuter concluded.
There
will be no fee imposed before the legislature appropriates the money, Professor
Speaks asked? That is correct, Mr.
Pfutzenreuter affirmed. University rules
require that for any capital project, 80% of the money must be in hand and a
plan in place to obtain the remaining 20%.
The state funds must be approved.
Mr.
Pfutzenreuter said the question of funds from departments or PI's for students
on assistantships would have to be worked out.
Mr. Kallsen said there are a lot of ways the fee could be modeled, each
of which would have pluses and minuses.
If no decision has been made, Professor Speaks maintained, and if the
financial implications of the fee include taking money from departments and
PI's, this Committee should discuss the plan before it is adopted. Professor Konstan added that if those are
sources for the fee, that would appear to violate the President's commitment
that the stadium would be paid for with private funds and not taken from the
academic side of the institution. If
funds come from the University Fee, that violates the President's
assertion.
Professor Speaks added that the issue
needs to be aired. Some students want to
organize a petition to object to imposing the fee through the University Fee;
so do some faculty. In the absence of
information, perverse things could happen, which is why he would like to see
the issue resolved. Mr. Pfutzenreuter
said the issue needs to be resolved this spring, even if the fee is not to be
implemented in fall, 2006, if the goal of having a fall 2008 stadium opening is
to be met. The $50 million that will
come from student fees has to be agreed on or he would not be comfortable
counting it toward the required 80%.
What would the size of the fee be if it
were limited to undergraduates, Professor Konstan asked? Mr. Pfutzenreuter said he had not calculated
that number.
Professor Van den Bosch asked if
students would receive discounted tickets.
The athletic department is working on that element of the plan, Mr.
Pfutzenreuter said; there would be something given back to students. The two student populations could be treated
differently, Professor Van den Bosch said:
those who pay the fee receive the benefit, those who do not do not.
Mr. Pfutzenreuter affirmed that this is
a fee for students on the Twin Cities campus only.
Professor Speaks asked about the
estimate that an on-campus stadium would increase athletic revenues by $3.5
million per year. That amount was in the
original feasibility study, Mr. Pfutzenreuter said; he said he would be happy
to review the numbers with the Committee and noted that the costs of the
stadium in that study included depreciation and operation. It also included high attendance figures,
Professor Campbell added. Professor Speaks
said the revenues also included parking income; Mr. Pfutzenreuter said parking
was counted at $900,000 per year (from game-day parking), which supports $13-15
million in debt to support financing.
What is the duration of the student
fee, Professor Konstan asked? 25 years,
and it is flat, Mr. Pfutzenreuter said, which supports level principal and
interest payments. He agreed that over
the life of the fee, it would become a smaller percentage of the total cost of
attendance for the student.
The issue will come back to the
Committee this spring, Mr. Pfutzenreuter promised; he needs to have this
resolved because they will need to start spending money on the project
(assuming the state approves its portion of the cost). Professor Campbell thanked Mr. Pfutzenreuter
for his reports.
3. Salary Instructions
Professor
Campbell said that in his memory, this Committee and the Senate Committee on
Faculty Affairs, and sometimes the Faculty Consultative Committee, are
consulted about salary instructions annually.
He said he has learned that the salary memo is already on the web; he
did not know if it has already gone to the deans. If it is already posted, it may be chiseled
in stone. This raises questions of
process. He said he also has a number of
questions about the document itself.
Professor
Konstan said it would help to know which elements of the memo represent a
change and which do not. It is not too
late to react if some elements of the document represent a policy change. Professor Campbell said he did not know if it
was too late to have an effect; the salary instructions usually go to the
Regents in June for review and action later, but historically salary
instructions have gone out to units before final regental approval because the
work must be done; all is then subject to the approval of the Board. It is not clear the Committee can make any
recommendations.
Professor
Roe noted that the memo calls for a minimum of 3%, and more where units can
fund larger increases, but those greater increases are in perpetuity and a
claim on the University's funds. Are
there discussions of these increases and plans laid out? Professor Campbell said he did not know; it
is only clear that all the funds must come from the units. But tenure is in the University, Professor
Roe pointed out, so the claims are on the entire University. Mr. Kallsen reported that deans must submit
salary plans to the Provost and a letter to that effect is being prepared—and
that is no change from the past. Someone
must sign off on the plans. So if the
dean must submit a salary plan, and has the option to fund 3.5% or 3.75%
increases, that can be done if the Provost approves, Professor Speak observed.
Mr.
Kallsen affirmed that a retention offer has always required chancellor or provostal
approval. Professor Konstan noted that
the deans may hold back part of the 3% for use later in the year; does that
mean the dean must have paid out the full 3% by the end of the year? Could the dean award the 3% on June 30 and
use the money for other purposes the rest of the year? That would need to be part of the salary
plan, Ms. Blixt said. The only cases she
knows of where salary funds have been held back is when there is a pending
promotion or retention case. Professor
Konstan said he could imagine good reasons to hold back some of the funds, but
that would not excuse holding the funds so the dean can use them for other
purposes.
The
Committee also found that the language concerning promotions to be
unclear. In the past, it has been understood
that the promotion increase came on top of the merit increase; the salary memo
does not make that clear.
Professor
Konstan also noted that last year the instructions called for taking into
account earlier performance (since there was no salary increase the year
before). The instructions should require
that units not look at a narrow window and it should be proper to evaluate
merit over time. Some colleges and
departments have that approach in their policies. Professor Speaks said he was not sure he
agreed; the promotion increase should clearly be in addition to merit, but the
window that should be used to evaluate merit will vary over time. There should be strong deans telling
department heads what they should consider.
Professor Konstan said any such instructions need not be specific but
allow departments to say they evaluated merit and fairness over time. Professor Speaks said that will vary by unit,
and departments recommendations are reviewed by deans and the deans'
recommendations by the Provost. He said
he would rather see feedback between the deans and the Provost about what
occurred. The Provost won't have the
information he needs, Professor Konstan said; Professor Speaks said the Provost
can inquire of the deans what instructions the department heads were given.
Professor
Campbell said he had other questions.
When the biennial request was submitted, it referred to 4% increases; is
the salary instruction different or is the difference the cost of benefits? One part of the biennial request called for
funding for competitive salaries ($15 million), and the Governor supported that
request; it is not clear how that increase will be dealt with. Mr. Kallsen reported that the 4% in the
biennial request was for compensation, not just salaries. He did not have an answer for the second
question. Professor Speaks said that if
4% is used in the biennial request, it should say total compensation; faculty
will read that figure as a salary increase.
Mr. Kallsen said he was quite sure the request was for total
compensation and promised to check.
Professor
Campbell distributed copies of a resolution:
The
Senate Committee on Finance and Planning respectfully requests
the Senior Vice President for Academic Affairs and Provost to consult with
it and with the Senate Committee on Faculty Affairs about the salary
instructions for 2005-06 before they are presented for final action to
the Board of Regents.
The Committee approved the
resolution unanimously.
Professor Campbell urged Committee members to review the
budget model deliberations and information.
He adjourned the meeting at 4:25.
--
Gary Engstrand