We are in the midst of the 1997/98 legislative budget discussions. The report of the Legislative Analyst, described below, presented several challenges to our budget that we have, thus far, been able to deflect. Several critical issues remain, including funding for our integrated technology strategy and the Stockton Center. Budget hearings will likely continue through next month which would lead to a final decision on our budget in June. We will keep you informed as the discussions continue.
Richard West, Senior Vice Chancellor, Business and Finance
NEWS FROM THE DIRECTORS
KPMG Peat Marwick is conducting audit entrance conferences with each campus to discuss the audit program in further detail. The next milestone in the audit is that each campus is to have a draft June 30, 1996, beginning balance sheet in a GAAP format submitted to the Chancellor's Office by April 30, 1997. The final beginning balance sheet is due May 30, 1997. It is critical that we maintain this timeline in order to meet the audit schedule.
Effective with fiscal year 1997/98 financial information, campuses will report to the Chancellor's Office in the new FIRMS (Financial Information Records Management System) data structure. One of the items that require immediate attention is use of the new budget function codes that will be used to feed payroll data into a GAAP based financial expenditure program. Budget function codes will be used by campus payroll departments during May as payroll headers for the 1997/98 fiscal year are submitted to the State Controller's Payroll Services Office.
A significant change that will occur with the implementation of FIRMS is the frequency of data submissions required. Currently, campuses submit summarized financial information to the Chancellor's Office on a monthly basis. Effective with fiscal year 1997/98, campuses will submit financial information on a quarterly basis.
Tax Seminar on Information Reporting (1099) and Sales/Use Tax
As campuses move to procurement cards and direct vendor pay, questions are arising related to what is reportable and when should we pay sales and use tax. On May 15-16, 1997, a tax seminar is being offered to address Information Reporting and Sales/Use Tax. The seminar will address the employee vs. independent contractor issue, what payments qualify as 1099 income, and when is sales and use tax paid. This is a seminar that will be beneficial to staff in accounting, accounts payable, procurement, and auxiliary organizations. KPMG Peat Marwick will provide the instruction for the seminar. Participants will receive 8 CPE credits for each seminar day attended. The cost for the seminar is $300 per person for both days. If someone only wants to attend one day, the cost is $175.
The seminar will be held in the auditorium at the Chancellor's Office. The deadline for registration is May 1. A memo was mailed and faxed to each CABO member on April 8. The memo included the complete seminar agenda and registration information. Joni Shimotsu in Accounting is coordinating the registration for this seminar. Joni can be reached by telephone at 562-985-2900 or e-mail firstname.lastname@example.org.
George Pardon, Director
AUXILIARIES PLANNING AND BONDS
Student Union Program
On April 1, 1997, Auxiliaries Planning and Bonds sent to campuses the annual budget request for student unions to submit their 1997/98 operating budgets for review and approval. Requirements of coded memo APB 97-02 are designed to assure compliance with covenants made by the Trustees for bonds issued to construct student union facilities. Campuses are requested to submit the completed budget packages to Auxiliaries Planning and Bonds by June 6, 1997. Budget submissions received by June 6, 1997 will assure prompt processing and prevent delays in receiving operating funds. Questions pertaining to the student union program may be directed to Rosa H. Renaud, Financial Manager, at 562-985-2790.
Delegation of Leasing Authority
Efforts are underway to delegate authority to campuses to execute leases without receiving approval from the Chancellor's Office. The executive order delegating this authority will apply when the campus acts as either the lessee or lessor. The exceptions to this delegation relate to capital leases with financing issues, leases involving public/private (or public/public) development activities, leases where the annual rental value is greater than $1 million, and leases with a term of twenty or more years. Apart from the executive order delegating this authority, campuses should expect to receive additional information on procedures for processing leases still requiring Chancellor's Office approval. This information will include notice that the review and approval of the non-delegated leases will be reassigned from the Office of Contracts and Procurement to the Office of Auxiliaries Planning and Bonds.
Richard Leffingwell, Director
Governor's Budget Allocations (B 97-02)
Campus allocations based on the 1997/98 Governor's Budget have been distributed to campus chief fiscal officers. Coded memorandum B 97-02 is also available for general viewing at the Budget Office site on the CSU Internet Server (access as a guest through Chooser, Appleshare, Appletalk Zone CSU Services).
Campus budget officers have been asked to advise the Budget Office on the need for a North/South briefing to discuss the allocations. As of this date, no campus has indicated the need for a briefing. Campuses are also encouraged to meet individually at the Chancellor's Office if one-on-one discussions are needed.
Legislative Analyst's Report on the 1997/98 Governor's Budget (B 97-02)
The Legislative Analyst has made 10 recommendations concerning support budget requests included in the Governor's Budget for CSU. The Analyst recommended an $18.1 million increase in General Fund support for deferred maintenance. The Analyst also recommended a $ -52.2 million cut in the Governor's Budget request for a net budget change of $ -34.1 million. The most significant reductions recommended by the Analyst included the elimination of $13.5 million for the Integrated Technology Strategy, $5 million provided for K-12 education initiatives, and $850,000 for the development of the Stockton Center. The Analyst also recommended that CSU make $32.8 million in unidentified budget cuts as a result of productivity savings and higher than budgeted revenue collections.
CSU has issued a response to all of the Analyst's recommendations and has clarified the misconceptions made in the assumptions regarding productivity savings and revenue. These misconceptions occurred as a result of how productivity savings and revenue are treated and displayed in the state budget process. Issues remaining before the legislature for discussion include funding for technology, deferred maintenance, K-12 education and teacher preparation initiatives, and the Stockton Center.
Campus 1997/98 Final Budget Submissions
In an effort to streamline campus final budget reporting, the Budget Office is working with Accounting and FIRMS staff to reduce the level of detail required in the budget submission. These changes will not affect the FIRMS structure and are designed to reduce the workload required by campuses.
Based on discussions with campus representatives, there will be a change in the FIRMS reporting structure to accommodate Reimbursed Activity as a separate budget program. As in the past, Reimbursed Activity expenditures will be completely offset by Revenue from Reimbursable Activities in the Receipts program.
Campus chief fiscal officers will be advised of these changes via coded memorandum, and the Budget Office will arrange to discuss these changes in detail with campus budget officers at the April FOA conference or elsewhere as requested.
John Richards, Director
CONTRACT SERVICES AND PROCUREMENT
Policy Manual Release
The new California State University Policy Manual for Contracting & Procurement was formally released for distribution to campuses the second week in April. The full text of the manual will be available on the internet in the near future and will include a feature allowing the user to quick-reference codes and regulations pertinent to the policy sections as well as a Contracts Reference Library, consisting of forms, models, exhibits and other helpful information. Questions may be directed to Cliff Johnson at 562-985-9177 or Pat Dayneko at 562-985-9157.
The State Department of General Services (DGS) has recently established five separate Master Agreements with four credit card transaction processors. These agreements may be utilized by any state agency including campuses of the CSU. The existing CSU Master Enabling Agreement with Mellon Bank will expire on November 20, 1997. Any campuses currently employing that Agreement for its credit card transactions should soon begin thinking about establishing a link-up to one or more of the State's Agreements or to another entity of the campus' choosing. Transaction rates under the State's Agreements may be the lowest that can be competitively obtained without the sacrifice of key service elements such as monthly reports and equipment repairs. For additional information, refer to the memorandum dated March 10, 1997, from Richard West to campus Vice Presidents for Administration. The direct contact for extending services similar to those on the current CSU/Mellon Agreement is Joyce Peters, Executive Vice President of American Heritage BankCard, 818-734-2989. For assistance with establishing a contract with one of the other three providers (American Express, First USA Paymentech, and Novus Services/Discovery), contact Gloria Anderson from DGS at 916-327-2076. Questions regarding the current Mellon contract may be addressed to Cliff Johnson at 562-985-9177.
Public Works Delegated Authority
An Executive Order is being prepared for issuance that will formally raise the level of campus delegation for the execution of public works contracts (excluding professional service agreements related to public works) to the $250,000 limit permitted in statute. The current policy and statutory limit is $100,000. This increase in delegation will mean that such contracts will not be required to be submitted to the Chancellor's Office for review nor to the Office of General Counsel for endorsement. Questions may be directed to Cliff Johnson at 562-985-9177. All service agreements related to a public works project will continue to require General Counsel approval.
Unified Information Access System Vendor Negotiations
The CSU is currently negotiating with Ameritech Library Services to develop a Unified Information Access System (UIAS) which will allow CSU library patrons access to both traditional print-based library material which is primarily held in the collections of the 23 CSU libraries, or other libraries with which CSU or its campuses have cooperative arrangements. The proposed UIAS will also provide for digital information resources available in electronic databases hosted on commercial and other servers located on the Internet. The target for contract award is May 30, 1997.
California State University, Long Beach Opportunities '97
The CS&P Department recently participated in a campus-sponsored workshop for vendors and contractors who are interested in doing business with the CSU system. The CS&P department provided keynote speakers for the "How to do Business With the University System," and "Workshop Moderators" for the breakout sessions. This year's CSULB Opportunities '97 marks the third consecutive year that the CSULB campus has collaborated with the Chancellor's Office CS&P department to help coordinate this affair.
Procurement Modeling Project
The Procurement Training Project Team chaired by Patricia Farris, Vice President for Administrative Affairs at CSPU, Pomona, is currently requesting quotes for a consultant to assist the CSU in the development of a comprehensive professional development and training plan for a Contract and Procurement Specialist. The plan will be a tool which will be deployed by the campuses at their discretion and in conjunction with current training programs/schedules. The target for the delivery of the plan is August 8, 1997.
Pat Dayneko, Director
PHYSICAL PLANNING AND DEVELOPMENT
Energy Supplier-Request For Qualifications
Physical Planning and Development staff are working with Contract Services and Procurement, the CABO Energy Advisory Committee, outside consultants, representatives from the University of California, and energy managers from both university systems to prepare a joint RFQ to seek firms most qualified to provide electric power and related services following the beginning of the deregulated market for power generation on January 1, 1998. It is anticipated that the RFQ will be released in late April as the first step in a multiple-step procurement process for these services. These efforts follow many meetings of the CABO committee, workshops for campus personnel, and almost three years of monitoring and involvement by PP&D in the restructuring of the electrical industry in California and nationwide.
New Trustee Policy on Professional Appointments (EO 666 dated3/7/97)
The new trustee policy on professional appointments requires campuses to notify PP&D of their selections on all major capital outlay projects. The first report on campus appointments will be presented at the May 1997 Trustees' meeting and, to date, includes selections for three major capital outlay projects and Fiscal Year 1997/98 Campus Consulting Architects. Thank you for your careful attention to this important new streamlining measure.
1997 CSU/UC Joint Facilities Conference : "A Partnership for the 21st Century"
On March 2-5, 1997, the California State University and the University of California hosted its second joint facilities conference held in Newport Beach. Over 400 people attended representing the 22 CSU and 9 UC campuses, Stanford University, and the University of Southern California. Host campuses were CSU, Fullerton and UC, Irvine.
Jon Regnier, CSU Senior Director of Physical Planning and Development and Ron Hicks, UC Director of Facilities Management and Construction officiated at the opening general session. There was a full agenda of concurrent afternoon sessions on a wide variety of topics, many focusing on new and innovative methods of managing capital facilities, design and construction; environmental health and safety; public/private partnerships; procurement; and community relations. This conference was considered by many as our most successful to date. Thanks to all of you who contributed to making this event such a success.
PPD Due Dates for CPB&G Agenda Items (July 15-16, 1997 Trustees' Meeting)
Jon H. Regnier, Senior Director
PLANNING AND ANALYSIS
Productivity and Investment Program (PIP)
The two PIP Fairs held in March 1997 were attended by approximately 250 employees; 110 attendees at CSU, Fullerton and 140 at CSU, Sacramento. Based on evaluations received, the Fairs were successful in meeting our goal of providing an effective method of information transfer on the many exciting projects that have been sponsored by the Productivity and Investment Program. We would like to thank all of the presenters, attendees, and the campuses that hosted the Fairs for the time, effort, and support they contributed to make these events successful.
Status reports on all awarded projects are available on the Chancellor's Office web site under the Business and Finance section. Contact Lawrence Lin (562-985-2705, e-mail: email@example.com) for more information. firstname.lastname@example.org), Phone: 562-985-2706, Fax: 562-985-2710).
CSU One-Card Initiative
Contract negotiations with AT&T for a CSU master agreement on campus One- Cards have been completed and the contract was signed on 4/14/97. This master enabling contract covers identification carding, a long distance calling card option, and campus long distance service. Several campuses will be moving forward this Spring to use this contract to replace their currently obsolete carding operations. Bill Griffith of Long Beach chaired this task force, guiding the collaborative development and implementation of the first of the ITS initiatives.
Pursuit of a one-card banking option was discontinued at the request of the Technology Steering Committee to enable further evaluation of a potential linkage between CSU financial services and a one-card option. The evaluation is currently underway via a contract with IBM Consulting. The study should be completed by April 30, 1997.
Collaborative Management Systems (CMS) Project
The task force issued an RFQ on April 15 to generate industry responses as to how their software packages will fulfill the CSU vision for integrated campus financial, student, and human resource systems. Function representatives (previously nominated by campus presidents) convened on March 11 to review the preliminary results of an industry scan by the Gartner Group. The vendor responses are due on June 13, and following the initial qualifying evaluation, software demonstrations by the qualified vendors will be arranged.
Thirteen campuses to date have committed to active involvement in the 1997/98 Benchmarking Project. Data collection is expected to occur in October and November 1997, with the data being turned into the national organization in early January 1998. Data analysis and summary reports will be available by summer 1998.
A contract was awarded to KH Consulting Group for development of customer satisfaction surveys related to the benchmarking effort. Focus groups of faculty, staff, and students have been conducted at the Pomona and Northridge campuses to develop the preliminary survey instrument. Additional focus groups will be conducted at other campuses to finalize the survey, which will be available for campus use next fall in conjunction with the Benchmarking Project.
If have any questions concerning benchmarking, please contact Ron Ashcroft (e-mail email@example.com, phone 562-985-2706, fax 562-985-2710).
Process Mapping Project
The Human Resources process mapping project is underway and a contract was signed with Sedgwick James to conduct the study. Five campuses - Long Beach, Monterey Bay, Northridge (lead campus), San Diego, and Stanislaus - are the primary participants, and representatives from both administrative and academic human resource areas are on the project team. Completion of the project is planned for December 1997.
If have any questions concerning process mapping, please contact Ron Ashcroft at the numbers noted above.
Lenore Rozner, Senior Director