BUSINESS AND FINANCE NEWS
June 18, 1996
The California State University
Business and Finance Division
Richard P. West, Vice Chancellor
MESSAGE FROM THE VICE CHANCELLOR'S DESK
THE VICE CHANCELLOR'S DESK....................
On May 15, 1996, the Board of Trustees approved a new California State University student fee policy. There are a number of significant changes in policies and procedures that will be required to implement the fee policy. We are scheduled to review the implementation plan for the new fee policy at the June 25-26, 1996 Executive Council meeting. Following is a brief summary of the topics that we will address in more depth once the formal implementation plan has been approved.
Establish a campus fee advisory committee. The fee policy requires each campus to establish a fee advisory committee to provide advice to the campus president regarding charging fees and allocating fee revenue. The fee advisory committee provides advice to the president on proposed fee actions for mandatory, user, and penalty fees.
Develop student fee referendum procedures. Prior to increasing campus mandatory fees or requesting the Chancellor to establish a new campus mandatory fee, the new fee policy envisions that a student referendum will be conducted. The policy does permit alternative consultation mechanisms if they can be demonstrated to be more effective. The fee referendum may be conducted either by the campus associated students' organization or by the fee advisory committee. If the referendum is conducted by the fee advisory committee, the campus is required to fund the cost of the referendum.
Establish local financial aid programs. The fee policy requires the campus to develop local financial aid grant, work study, and waiver programs to offer financial aid adequate to meet additional student need resulting from increases in campus mandatory fees or the establishment of new campus mandatory fees. Local financial aid programs need to be designed and implemented to accomplish this policy objective.
Review existing fees to determine if fees can be eliminated or consolidated. The Trustees encouraged campus presidents to evaluate existing fees to determine if fees can be consolidated or eliminated to simplify the administration of fees and to enhance the ability of students and their families to plan for the costs of higher education without impairing the ability of the campus to provide access to a high quality program. Consolidating existing fees can create additional funding flexibility for the campus by creating a general revenue source from which a variety of services can be funded, including those funded in the past through specific fees. Examples of the types of fees that might be consolidated into a single service fees are graduation and diploma fees, miscellaneous course fees, and health facilities fees.
Revise Standing Orders of the Board of Trustees to incorporate the new fee framework and delegate authority to establish and adjust fees. Existing standing orders related to specific fees will be eliminated. New Standing Orders will be proposed in July for information and in September for action.
Establish an ad hoc systemwide committee comprised of representatives from the California State Student Association, the Academic Senate, and the campuses to develop student fee referendum guidelines for publication in Title 5. The Board's fee policy requires the Chancellor to develop guidelines applicable to the student fee referendum process designed to ensure that the referendum is open, fair, and objective.
Distribute draft outline of fee accountability report for review and comment. The fee policy requires that an annual report be provided to the Board. We plan to provide the report to the board in conjunction with the 1998/99 budget presentation in September 1997. A fee report information request will be sent to campuses in March 1997, to gather information for the report to the Board of Trustees.
Richard West, Vice Chancellor, Business and Finance
Audited Financial Statements
In March 1996, the Chancellor's Office issued a Request For Proposal (RFP) for the purpose of selecting a certified public accounting firm to serve as the independent auditor. In May 1996, the Board of Trustees' Committee on Audit chose to reject all bids from the March 1996 RFP process and requested that the RFP be revised and rebid incorporating a presentation and interview phase with the BOT Committee on Audit and to incorporate cost in the final evaluation criteria. A revised RFP was released on May 31, 1996, with a response due on June 21. The final selection of the firm will be made by the BOT Committee on Audit at their meeting on July 9, 1996. The scope of work in the RFP requires the selected firm to:
1) Conduct an audit of the consolidated financial statements of the California State University for the express purpose of rendering an opinion on the CSU's general purpose financial statements;
2) Conduct an independent audit of the federal funds received by the CSU. The audit will be performed in accordance with OMB Circular A-133; and
3) Conduct an audit of the CSU Revenue Bond programs encompassing all CSU bonds sold for Housing, Student Unions, and the Headquarters Building Authority.
The audit contract awarded will be for a three year period beginning with fiscal year 1995/96. A review committee has been established to screen the responses to the RFP and forward the top candidates to the Committee on Audit. The review committee includes representatives from five campuses and Chancellor's Office staff.
Direct Vendor Pay
The Assembly approved AB 2613 by a vote of 62 to 2. It is scheduled to be heard by the Senate Education Policy Committee on June 19. This committee is probably the most important we have during this entire process. There is only one Republican on the committee, Ray Haynes. The Democratic members are Leroy Greene, Ralph Dills, Tom Hayden, Teresa Hughes, Jack O'Connell, Byron Sher, and Diane Watson, plus Independent Lucy Killea. If you are aware of any vendor relationship with any of those members, it would be beneficial to have support letters. Governmental Affairs is requesting each campus legislative liaison to initiate contact with the Committee member as soon as possible. Contact by the campus president or vice president would be very helpful to stress the importance of this legislation to the CSU.
George Pardon, Director
On April 16 and April 18, Auxiliaries, Planning and Bonds held a workshop to provide campus and student union administrators an opportunity to discuss key student union budget and planning issues. The workshop was well attended and appeared to be viewed by the participants as providing valuable information. Over 40 persons attended, including all of the student union directors. We view this conference activity as an important aspect of understanding problems of student union operations and welcome the opportunity to meet campus and student union staff and discussing issues that affect the program.
Environmental Resources (ER) has issued an open invitation to visit their Home Page. Many new "click-on" sites have been added to the Resource List. In the Documents section, documents are available to help in the areas of workers'compensation, chemical storage, diving safety, and many more. The new Announcements section serves to preview upcoming workshops, training, and other items of interest to all the campuses. The Newsletters section has copies of past newsletters, including "The Environmental Resource" and "Connections." The ER Home Page can be accessed at: http://www.co.calstate.edu/ppd/er/ or through the Chancellor's Office Home Page.
On July 30 and 31, Environmental Resources (ER) will hold a systemwide air quality workshop at CSU, Humboldt. In addition to an overview of federal and state air quality compliance issues, several special agenda items will be presented. These include a synopsis of specific air quality district rules and regulations regarding campus stationary sources (five major air districts will be highlighted), the latest Title V information, and self-inspection checklists. Written material will be available. For more information, please contact Monique Theriault at firstname.lastname@example.org or by phone at 310-985-9013.
Environmental Resources (ER) has released the first round of Treatment, Storage, and Disposal Facilities (TSDF) audit reports prepared in partnership with UC, Lawrence Berkeley National Laboratory, and Lawrence Livermore National Laboratory. The facilities in this round include: Laidlaw (AZ), Salesco (AZ), Bethlehem Apparatus (PA), Romic (both AZ and CA), S.D. Myers (AZ), and Rollins OPC (CA). For more information, please contact Lincoln Castro at email@example.com or by phone at 310-985-9014.
Environmental Resources (ER) will conduct a "Lead Related Construction Supervision and Project Monitoring" course on September 30 through October 4, 1996. The course fee of $599 may be waived for all qualifying CSU employees. Upon successful completion of this accredited course, students may apply for state certification. For more information, please contact Susan McCormick at firstname.lastname@example.org or by phone at 310-985-9011.
Environmental Resources (ER) hosted the thirteenth in a series of live satellite video teleconferences, "Ergonomics - Fitting the Job to You" on May 14th. Videotapes of this campus-oriented training session may be purchased for only $100. For more information, please contact Diane Leduc at email@example.com or by phone at 310-985-9015.
Richard Leffingwell, Director
The 1996/97 Governor's Budget was submitted to the legislature on January 10, 1996. It included a $114.4 million increase in General Fund support to CSU. Of this increase, $80.2 million was provided in accordance with the Governor's compact for higher education established in the 1995/96 fiscal year, and the remaining $30.2 million was provided to eliminate the need for an increase in the State University Fee. The Governor's Budget proposal fully funded the budget plan adopted by the Board of Trustees at its November meeting which included a priority focus on physical plant funding needs.
In the analysis of the 1996/97 Budget Bill published by the Legislative Analyst's Office (LAO) on February 21, 1996, three areas of budgetary concern affecting CSU were emphasized: the state's funding approach to deferred maintenance; faculty workload; and, the use of carryover funds. The LAO recommended that the legislature increase funding for ongoing maintenance, prohibit the addition of any new projects to the existing deferred maintenance backlog, and start a process to eliminate the existing backlogs. The LAO further recommended that the legislature adopt supplemental report language to the Budget Bill to ensure CSU's contract agreement with the California Faculty Association does not result in a decrease in faculty teaching workload, and language that specifies the legislature's priorities regarding how CSU generates and uses carryover funds in 1996/97.
Both the Assembly and the Senate adopted supplemental report language stating legislative intent that there be no reduction in the average faculty teaching load. The Assembly also adopted budget bill language stating CSU shall not restrict student access nor expend state funds for faculty hiring on the basis of racial, ethnic, or gender characteristics or students or faculty candidates. The Senate increased funding for CSU ongoing maintenance by adding $7.5 million to the $9.6 million included in the CSU budget plan for physical plant support. The Senate also adopted budget bill language specifying total expenditure level expected for facility maintenance and repairs, and supplemental report language stating the legislature's intent to augment the CSU facility maintenance and repair budget by additional $7.5 million increments in 1997/98 and 1998/99, which would be matched by funds available to CSU through the Governor's compact. Supplemental report language adopted by the Senate also states that CSU not defer maintenance in the future and that any projects not included in the current backlog shall be the fiscal responsibility of the university, not of the state. The Senate also augmented funding to CSU by $5 million for technological and instructional equipment support and $2.6 million for intersegmental outreach programs that increase access to CSU. The Governor's May Revise had no significant impact on 1996/97 CSU funding proposals included in the Governor's Budget.
A conference committee has been formed to resolve differences between the Assembly and Senate funding proposals for CSU. Chancellor Munitz has sent a letter to each member of the conference committee supporting the Senate augmentations.
John Richards, Director
A new agreement has been executed for Procurement credit cards for State agencies including the CSU. This new agreement provides a thirty-six month contract for credit card services with Rocky Mountain Bank with the possibility of two additional one-year extensions. The new agreement has a number of new or enhanced features including:
CSU campuses continue to sign up for the State of California sponsored procurement card program. Currently 15 CSU campuses are in varying stages of implementation/or utilization. Recently both CSU, Bakersfield and San Diego State University have begun to implement a procurement card program. Welcome Aboard!!
June means CS&P is busy meeting year-end Chancellor's Office acquisition needs in addition to supporting and facilitating the following programs. Here's a quick update of status for projects identified in the April newsletter:
Pat Dayneko, Director
The Legislative hearings for the CSU Capital Outlay budget are complete leaving the Governor's Budget intact. We have Supplemental Report Language on long-range enrollment projections, telecommunication projects, and the future water supply at CSU, Monterey Bay. We also have Supplemental` Report Language on the deferred maintenance issue and an augmentation for annual maintenance on the Senate's side with an agreement, in principle, to eliminate deferred maintenance with capital outlay renovation dollars over the next 20 years.
Local legislative support was essential in gaining approval for the two growth projects at CSU, San Marcos and CSU, Stanislaus. The same assistance was also required to assure support for the telecommunication projects and infrastructure proposals for 14 campus projects. I hope that everyone thanked their local legislators!
Recognizing and Mitigating Construction Contract Claims PP&D has sponsored two claims mitigation seminars for the Executive Deans and Contract Management staffs. One was given on May 7, 1996, at the offices of PP&D in Los Alamitos, and the other one was given on May 14, 1996, at CSU, Sacramento. Mr. Jeffrey DeFeo, Esq. of High-Point Rendel was the instructor. This course was customized to the CSU Contract General Conditions and should be quite helpful to those campuses that have been delegated major capital outlay projects. Interest in the seminar was so great that PP&D is considering a third session later this year, also to be given in Southern California. Interested parties can contact the Construction Management Unit in PP&D.
The Computing and Communications Technology in Design and Construction pilot project is intended to advance the use of computing and communications technology in the design and construction of CSU's facilities by providing project managers, campus staff, consultants, and contractors with real time access to all information. It is intended to better support timely decisions, maximize communications, and help control the cost of administering capital projects.
The project will utilize widely available computing hardware and software in conjunction with CSU's existing computer network to more effectively execute our capital projects. The targeted technology components include secure communications, complete digital environment, and Internet-based access. Further refinements of the project criteria and the selection of an appropriate project for the pilot are ongoing. Kickoff is expected in late 1996 or early 1997.
PPD Due Dates for CPB&G Agenda Items (September 10-11, 1996 Trustees' Meeting)
Master Plan Revisions: July 9, 1996
Jon H. Regnier, Senior Director
A task force has recently been created to develop one of the Integrated Technology Strategies Projects priority projects - the One-Card Initiative - into reality. "One- Card" (also commonly referred to as universal, all-campus and multi-purpose school ID cards) supports a wide variety of services for students, faculty, and staff which can be activated through the use of a single plastic card with a magnetic stripe or embedded microchip. (The One-Card uses the same technology used by debit/credit cards). Major services to be examined in the CSU One-Card Initiative include: user identification; banking services, including debit and credit card transactions; long-distance telecommunication; and university services such as student information, dormitory, and library resources.
Fourteen campuses and the Chancellor's Office have volunteered to become active participants in the One-Card Task Force, chaired by CSULB's Bill Griffith to:
During the 1995/96 cycle, the Productivity and Investment Program (PIP) Committee awarded $879,500 to 7 proposals from multi-campus consortia. The PIP Committee has disbursed the initial allocation of PIP funds to the awarded campuses upon receipt of their project plans with the remaining funds to be allocated based on the submission of project reports detailing their progress. Status reports on all of the awarded projects (including past cycles) are available on the Chancellor's Office web page under the Business and Finance section. Updates will be made every 6 months. Lawrence Lin (310-985-2705, e-mail: firstname.lastname@example.org) is providing staff support on this program.
The committee met May 6 at CSU, Hayward with the consultants Sedgwick James and Directors of the State Compensation Insurance Fund (SCIF) to discuss several areas of concern regarding SCIF's performance and the impact on CSU's processes. SCIF agreed to review several policies and procedures that were of concern. Sedgwick reported that the project is proceeding on schedule and will be completed by mid-July. The consultants are scheduled to meet with the CSU Benchmarking Task Force on June 20 and will present a draft final report at that time.
The CSU post data collection workshops were held June 3-5 in Ontario with approximately 200 participants in attendance over the three-day period. The CSU and NACUBO data was further analyzed at the workshops and work was begun on the development of recommendations and the final report. The project is on schedule and completion of the final report is expected by mid-August. Final reports will be issued on a functional basis with each participating campus receiving a complete report.
The NACUBO post data collection workshops were held June 12-14 in Orlando, Florida. Contact Ron Ashcroft 310-985-2706 for more information on Benchmarking or Process Mapping.
Lenore Rozner, Senior Director
The Business and Finance Newsletter is now accessible from the Chancellor's Office