NEWS FROM THE DIRECTORS
NEWS FROM THE DIRECTORS
1999/2000 Trustees' Budget
On October 29, 1998, the CSU Trustees approved a budget request and expenditure plan for 1999/2000 of $264.7 million. The state general fund would support $252 million of the expenditure increase with the remainder funded by student fee revenue associated with enrollment growth. The general fund request represents an 11.65% increase over total general fund support received in 1998/99. After adjustments for one-time funding received in 1998/99, the 1999/2000 CSU budget request represents an 8.1% increase over CSU's 1998/99 state-funded budget level.
The CSU budget request for 1999/2000 includes increases for enrollment growth ($57.2 million, including $5 million for expansion of summer session teacher preparation); compensation ($93 million, including a 2% compensation differential for faculty); technology support ($25 million); and mandatory costs including lease bond payments ($30.4 million). It also includes funding for campus initiatives, teacher recruitment, and structural budget deficiencies in deferred maintenance, instructional equipment, and CSU libraries.
The budget will now be reviewed by the Governor for inclusion in his budget proposal to be submitted for legislative review in January 1999. The legislature will hold hearings and modify the Governor's Budget as appropriate for final passage before July 1, 1999, the beginning of the new fiscal year. Based on the Governor's Budget proposal, preliminary campus allocations will be made by March 1, 1999. Final budget allocations will be made once the 1999/2000 budget has been enacted and chaptered.
In keeping with state fee policy adopted last year, the Board of Trustees also approved the 1999/2000 academic fee schedule with rates remaining the same as the 1998/99 academic year. State General Fund support has been requested to cover the anticipated revenue loss associated with this policy.
The Board of Trustees also approved the 1999/2000 Lottery Budget at its October 1998 budget meeting. The Lottery Budget allocations are the same as those implemented for the 1998/99 fiscal year. A systemwide review of lottery programs and funding is currently underway, but that review is not expected to affect the 1999/2000 campus or systemwide funding allocations.
A FIRMS Advisory Committee comprised of representatives from Business and Finance has been formed to address various issues relating to FIRMS. The group, chaired by Laleh Graylee of IRT, will:
- Analyze FIRMS related issues in detail and make policy recommendations for implementation;
- Provide on-going analysis and documentation of internal and external reporting requirements; negotiate with external agencies regarding reporting requirements;
- Recommend changes to the FIRMS Manual; and
- Develop on going FIRMS training plans for the Chancellor's Office and campuses.
Campuses are advised to contact Ms. Graylee regarding issues to be considered by the Advisory Committee. She can be reached by telephone at (562) 985-9559 or e-mail: firstname.lastname@example.org.
For FIRMS issues specifically related to the budget, you are encouraged to contact either Don Brown (e-mail: email@example.com) or Mark Lopez (e- mail: firstname.lastname@example.org.) or call (562) 985-2712.
On November 10, 1998, the annual report of student fees was presented to the Board of Trustees. Included in the presentation were: an annual fee report brief, the 1998/99 public institutions fee survey comparison, CSU campus mandatory fee adjustments, campus fees eliminated and consolidated in 1998, and CSU resident, undergraduate student fees by campus.
Fees at the California State University are among the lowest fees for a four-year university in the nation. The undergraduate State University Fee was reduced by 5 percent effective in the 1998/99 academic year to $1,506. Beginning in 1999/00, resident, graduate student fees may be reduced by 5 percent if the legislature appropriates offsetting funding to fully reimburse public universities (AB 1896).
John Richards, Director
CONTRACT SERVICES AND PROCUREMENT
California Higher Education Consortium (CHEC)
The CSU and University of California system have signed an MOU relating to joint contracting efforts to maximize volume discounts and provide professional development opportunities. To date, the two systems have jointly participated in contracts for electrical power, scientific laboratory equipment, furniture, and a variety of library database subscription agreements. An ad hoc task force is currently investigating the feasibility of developing a custom institute for professional development of procurement and contracting professionals.
CS&P has released bulletins announcing systemwide master agreements for the following goods and services:
98-22 - Master Enabling Agreement for Consulting Services (PeopleSoft)
Targets of Procurement
Procurement and Support Services Officers (PSSO) are currently pursuing collaborative purchasing initiatives in the following areas:
Projects that have been completed by the PSSO group in the last year include: systemwide master agreements for office supplies, courier services, and hazardous waste disposal services.
Copies of all Bulletins, active solicitations, and further information regarding CSU contracting activities may be accessed at http://www.calstate.edu/csp/
Pat Dayneko, Director
FINANCING AND RISK MANAGEMENT
Tax-Exempt Equipment Financing Processes
Within the next few months the Financing and Risk Management group will be updating the instructions related to tax-exempt equipment financings and modifying the process to address several issues that have arisen over the past year and a half. If you have any specific areas of concern or would like to ensure that certain matters are addressed, please forward your comments to Benjamin Figueroa at email@example.com
Energy Related Projects and ENRON
As ENRON identifies cost effective energy projects, through the campus specific strategic energy plan development, there are two basic questions to consider: 1) Who will provide the design service; and 2) how will the project be financed?
Due to recent additional flexibility in contracting for services, a list of qualified contractors does not necessarily have to be obtained by general advertising, but can be selected from an established list (based on qualifications) of such contractors. As an example: ENRON, as a result of the RPQ/RFP process leading up to the Enron Direct Access Service Agreement with the CSU, is a pre-qualified contractor for energy professional services. ENRON's status as a pre-qualified vendor does not require that they automatically obtain the contract, but that their services may be compared with other qualified vendors without need for advertising. For all other energy construction related services, including design build projects, traditional competitive selection process shall apply. This includes any construction contract that ENRON might be interested in bidding.
As in the past, campuses can pursue funding for energy related projects through the Energy Efficiency Revenue Bond Program administered by the State Department of General Services, Energy Assessments Office. Alternatively, campuses may consider third-party tax exempt equipment financing for such projects from a number of pre-approved firms that have accepted the CSU terms and conditions. ENRON can also provide the third party financing if they are willing to accept the CSU standard terms and conditions.
CSURMA has received its second annual financial audit report for the period ending June 30, 1998 from the accounting firm, KPMG. The opinion was unqualified and marks the second year of operations. Copies of the report are available from Financing and Risk Management.
CSURMA Conference Results
The second Risk Management conference, "Fitting the Pieces Together" was held November 4-6, 1998. High points of the conference were the keynote by Richard West, and discussion topics such as student travel, special events, terrorism, workers' compensation, student field trips, litigation management, and violence in the workplace. Rich Pimentel's general and breakout sessions on the topics of return to work, and working with the medical community were especially well received.
Rich also assisted in launching a new program for the CSU, Disability Case Management, (often referred to as Return to Work). Rich's firm, Milt Wright and Associates, was awarded a three year contract in October to design, implement and train campuses in a flexible return to work program with the campus selecting its coverage level (basic, intermediate and comprehensive). By now, each campus should have received a survey relating to current practices, policies, and procedures. Campuses are requested to return it as soon as possible. In addition, five campuses were selected for the initial on-site review by Milt Wright and Associates. Those campuses are San Francisco State, San Marcos, San Diego State, San Luis Obispo and Northridge. For further information, please contact Charlene Minnick via e-mail at firstname.lastname@example.org
Student Union Financial Audit Statements
The 1997/98 audited student union financial statements were recently issued and were distributed to campuses. The audits provided information to complete the review process for releasing operating funds to certain student unions. Please contact Ms. Rosa H. Renaud, Financing and Risk Management, at (562) 985-2790, should you have any questions.
Parking Program Bonds
On November 30, 1998, the Board of Trustees successfully sold bonds to finance a parking structure at the San Diego campus. The parking revenue bonds for $13,100,000 were awarded to Piper Jaffrey as the low bidder in a competitive sale. The total interest cost on the sale for the bonds was 4.82%. Proceeds of the bonds will be used to construct a multi-story parking structure providing approximately 1,500 parking spaces and related improvements on the San Diego campus. A replacement athletic track and soccer field will be located on the top deck. Questions on the issuance of revenue bonds should be directed to Ms. Rosa H. Renaud, Financing and Risk Management, at (562) 985-2790.
Financing Policies Approved by the Board of Trustees
At the November 1998 Board of Trustees meeting, the Trustees' approved a CSU Policy for Financing Activities and reviewed a related change in Title 5 (RFIN 11-98- 18). The goal of these actions is to form the nucleus of a comprehensive financing policy that can be reviewed and changed by the Trustees as needed. The Trustees will be asked to approve the proposed Title 5 change at the January 1999 meeting. Additional information will be provided to the campuses when the Title 5 change is finalized. If you have questions, please contact Richard Leffingwell via e-mail at email@example.com.
Richard K. Leffingwell, Director
Copies of CSU Legislative Reports and other legislative information pertaining to the CSU, can be accessed at the Governmental Affairs website, http://www.calstate.edu/oga/
Karen Yelverton, Chief Professional Officer
CAPITAL PLANNING DESIGN AND CONSTRUCTION
Internet Enabled Design & Construction Management Pilot Projects
Several desktop applications solutions are now available to facilitate the distribution of massive flows of project correspondence and information via the Internet through a simple web browser interface. As part of the normal process of preparing RFI's, responses, submittals, etc., all project information is automatically compiled into a shared database of project correspondence that is then available to all the project participants. Four major product/service vendors have agreed to support pilot projects with the CSU to measure the effectiveness of their products in our project environment. Currently, one provider has been assigned to the CSU, Chico Bell Memorial Union Project. The other three will be assigned to appropriate new projects later this month.
California Building Code for New Project Starts
The 1998 California Building Code (CBC) was formally adopted by the California Building Standards Commission for all affected state agencies, including the CSU. While other agencies may defer adoption of the CBC until as late as April 1999, at the request of the CSU Seismic Review Board (SRB), the CSU adopted the 1998 CBC, effective December 1, 1998. The SRB has been requesting project designers to use the structural components of the code for some time because they adhere more closely to the Trustees' Seismic Safety Standards.
Projects that have already initiated the design process may continue to proceed under the 1995 CBC. All new project starts in 1998/99 that have not initiated design prior to December 1st are required to use the 1998 CBC. The new code also applies to all projects that have been shelved for some reason, and restarted after December 1, 1998.
It should be noted that the CSU is statutorily required to assure compliance with the CBC on all improvements or alterations to facilities and grounds; this includes all minor projects, special repairs, and nonstate-funded projects. The only exceptions would be nonstate-funded projects not located on trustee-owned property that is under the plan check authority of the local jurisdiction, i.e., the city plan check department.
Possible Delay in Loan Approval for the 1998/99 Capital Outlay Program
With the passage of Proposition 1A, CPDC has submitted a request to the State Treasurer's Office for approval of a loan from the Pooled Money Investment Account. The Pooled Money Investment Board is scheduled to meet on December 16, 1998. While such loan requests are typically approved, the Treasurer's Office has indicated that the results of the vote must be certified prior to the loan approval. As a result of this possible delay in the loan approval, allocation orders being processed to the campuses indicate that the campuses are authorized to enter into a contract, but that funding to pay the invoices may not be available until late January 1999.
CPDC prepared the cash flow projections used in the loan request. The campuses will be asked to provide revised cash flow projections for newly funded projects (including Minor Capital Outlay) per the standard procedure.
CPDC Due Dates for CPB&G Agenda Items (March 16-17, 1999 Trustees' Meeting)
J. Patrick Drohan, Senior Director
PLANNING AND ANALYSIS
Collaborative Management Systems (CMS) Initiative
Ten campuses have formally declared their participation in the "first-wave" implementation of CMS. The participating campuses include: Fresno, Hayward, Long Beach, Los Angeles, Maritime Academy, Northridge, Pomona, San Jose, San Luis Obispo, and Sonoma. CMS Board members from these campuses comprise the CMS Implementation Steering Committee, which held its kickoff meeting on December 1. A communication strategy is being developed to keep all CMS Board members informed during the CSU baseline software development process.
CMS Board subcommittees have also been working on two separate Requests For Proposals (RFPs) to provide shared services center(s) for the CMS project and for consulting services to assist the CMS implementation effort. The RFPs are scheduled for issuance during December and January with vendor selections targeted for early Spring 1999.
On November 20, 1998, Chancellor Charles Reed and Senior Vice Chancellor Richard West joined several external speakers at the CSU Quality Improvement Symposium in encouraging CSU administrators to use available assessment tools in their quest for process improvements. The symposium, attended by over 170 senior management personnel, focused on quality improvement frameworks for campus use. The Malcolm Baldrige criteria and the Balanced Scorecard were two of the conceptual frameworks covered by presenters.
The mini-benchmarking project covering Mail Services, Health Centers, Career Centers, Libraries, and Public Safety is in progress. The number of participating campuses per function range from 8 to 14. All functions have held their pre-data collection workshops in which common data definitions were documented. The data collection efforts are scheduled to conclude by January 27, 1999.
Customer Satisfaction Survey
A revised draft of the benchmarking customer satisfaction survey was tested with a focus group at CSU, Long Beach in November. The resulting comments and suggestions were very helpful and are an important part of the survey development process. Administration of the survey is targeted for the spring of 1999.
If you have any questions concerning benchmarking or the customer satisfaction survey, contact Ron Ashcroft via e-mail at firstname.lastname@example.org. or (562) 985-2706.
The Human Resources process mapping project has been completed and the final report is being distributed. Six copies of the report are being sent to each campus for the president, vice presidents of academic affairs, student affairs and administration, as well as two copies to each human resources department.
The Delivery/Distribution Services Process mapping activities are nearing completion. KPMG, the project consultant, has visited all four participating campuses (Chico, San Jose, Pomona, and Long Beach). Preliminary process maps and Activity Based Costing (ABC) models have been completed for each campus. The project is scheduled for completion in early 1999. If you have questions regarding this project, contact Glenn Ducat at (562) 985-2721 or by e-mail at email@example.com.
Year 2000 Compliance Activities
During 1999, campuses will be required to report their campus-wide progress to become Year 2000 compliant on a quarterly basis. Following a discussion at Executive Council, it was decided that campus Presidents would designate a senior campus official to coordinate, verify and sign-off on those quarterly Y2K compliance reports.
Additionally, a jointly sponsored pilot project to evaluate Y2K compliance issues related to embedded microprocessors in plant facilities on the Long Beach campus is nearing completion. Parsec Automation Corporation, in conjunction with campus facilities personnel, have completed the physical inventory of embedded microprocessor systems and vendor contacts to determine Year 2000 compliance status. More than 80% of the identified items were found to be "compliant" or not have a date processing function. Three percent have been identified as "non-compliant" and the remaining 17% are "to be determined." These results and the inventory methodology were shared with the Plant Directors at their systemwide meeting in November, with CABO, and with the Executive Council. The final project report is currently under review by campus and Chancellor's Office personnel. If you have questions regarding this project, contact Glenn Ducat at (562) 985-2721 or by e-mail at firstname.lastname@example.org.
Lenore Rozner, Senior Director
The Business and Finance Newsletter is now accessible from the Chancellor's Office