MESSAGE FROM THE EXECUTIVE VICE CHANCELLOR

NEWS FROM THE DIRECTORS


 

MESSAGE FROM THE EXECUTIVE VICE CHANCELLOR

MESSAGE FROM THE EXECUTIVE VICE CHANCELLOR Brad Wells has rejoined the CSU as Assistant Vice Chancellor for Financial Services overseeing activities in Financing and Risk Management, Contract Services and Procurement, Accounting and Treasury.

NEWS FROM THE DIRECTORS

BUDGET OFFICE,John Richards, Director

Systemwide Budget Meeting

Campus financial staffs were briefed on the 1999/2000-budget allocation process on May 18th at a Budget Office meeting convened at the request of campuses. Detailed explanations were provided on the methodologies used to determine campus base budget adjustments, budget year expenditure increases, State University Fee and Nonresident Tuition revenue adjustments, and the policy proposal to fund increases in campus mandatory waivers.

Campuses were also advised of several considerations that should be made when submitting Final Budget allocations in August, including compensation adjustments that will be required in the 1999/2000 fiscal year.

The briefing was well attended and participant feedback was very positive.

Final Budget

The Governor signed the Budget Act of 1999 (Final Budget) on June 29, 1999, the first time in six years that the state budget has been enacted before the July 1st deadline. The Final Budget includes $2.25 billion in General Fund support for the California State University and $749.4 million in projected receipts for revenue and reimbursements (after adjusting nonresident tuition revenue and mandatory fee waivers). The increase in CSU's General Fund support is $225.4 million, of which $24.2 million is provided to reduce State University Fee rates by 5% for the academic year. The Final Budget supports the Board of Trustees October request for increased mandatory costs, 3% enrollment growth, and the majority of a 4% compensation pool. It also provides a framework for developing a new higher education budget partnership with the state.

Based on Final Budget appropriations, the CSU budget plan for 1999/2000 provides $213.2 million in new expenditure increases. It funds a 3.8 percent compensation pool ($69.8 million) for all employees and an additional 2 percent compensation supplement ($19.5 million) to address the CPEC-based faculty salary lag with CSU comparison institutions. Funds will be provided from one-time sources to permit a 4% compensation pool for all employees. The budget plan also funds a 3 percent increase in enrollment growth ($52.5 million) and ongoing support for plant maintenance ($12 million). The CSU's technology initiatives received $10 million. The Final Budget also specifies General Fund support totaling $9.3 million for applied agricultural and biotechnology research, Channel Islands campus support, and special legislative requests for campus-based programs. State matching funds of $2.4 million are also provided in the Final Budget for earthquake-related restoration of Verducci Hall at the San Francisco campus.

General Fund support for outreach programs to improve student access to higher education ($14.4 million) is included in the Final Budget. This appropriation will fund student learning assistance, faculty alliances between university professors and high school teachers, and expanded support for CSU equal opportunity grants, precollegiate academic assistance and the California Academic Partnership Program.

The Supplemental Report of the 1999 Budget Act reflects statements of legislative intent that were adopted by the conference committee on the 1999 Budget. A summary of the final requirements follows:

  • CSU Teacher Preparation Enrollment:. By October 15, 1999, the CSU shall report on its classification system for teacher preparation enrollments and its fall 1999 enrollment levels within these classifications. By February 15, 2000, the CSU shall report to the Legislature on its progress toward achieving an increase in FTES enrollments in teacher training programs.

     

  • Telecommunications Infrastructure/Integrated Technology Strategy: The CSU is to prepare Goals and Objectives reports (including benefit/outcome measures) that define quantifiable success measures for the Integrated Technology Strategy. Beginning in November 1999, the CSU shall provide annual reports regarding progress toward achievement of Working Plan Objectives and Master Plan Goals.

     

  • Technology/Integrated Technology Strategy: It is the intent of the Legislature that CSU be provided additional, on-going support funding for technology access, training, and support for students, faculty, and staff. A permanent augmentation of $25 million shall be provided over three budget years. In the 1999/2000 budget, $10 million in permanent funding is provided. The Legislature intends to fund an additional $10 million in 2000/2001 and an additional $5 million in 2001/2002 for a total permanent augmentation of $25 million for technology support. The outcomes to be achieved from this technology funding will be outlined and reported annually through 2008.

     

  • California Minimum Wage: It is the intent of the Legislature that CSU pay its employees at a rate not less than the California minimum wage.

     

  • Year-Round Operations (YRO): It is the intent of the Legislature that the CSU submit feasibility studies on or before April 1, 2000, to examine the advantages and disadvantages of implementing year-round academic programs.

Nonresident Tuition (1999/2000 Budget)

The Governor's January budget reflected an additional $6 million in fee revenue that was to have been derived from an approximate 10 percent increase in nonresident tuition. In the May Revise and Final Budget, the Governor increased the CSU General Fund support to eliminate the need for any increase in nonresident tuition to finance the CSU budget plan. Therefore, there will not be an adjustment to nonresident fees in 1999/2000.

Five Percent Reduction in State University Fee (SUF)

The final 1999/2000 budget includes funding to support a 5 percent reduction in the undergraduate and graduate SUF ($24.2 million). The Board of Trustees passed a resolution adopting a new fee schedule at the July 8, 1999, board meeting. The new annual SUF rate for regular, undergraduate students (6.1 or more units) will be $1,428, and for limited, undergraduate students (0 to 6 units), $828. The new annual SUF for regular, graduate students will be $1,506 and for limited, graduate students, $876. The revised fee schedule is posted on the Budget Office website.

Final Budget Submission and Instructions

Final Budget allocations for 1999/2000 were issued to the campuses on July 15, 1999. As in past years, campuses will receive four amounts via the FTP server:

(1)State University Grants,
(2) EOP Grants,
(3) All other permanent expenditure changes, and
(4) A State University Fee revenue adjustment.

Campuses are requested to submit their budgets for all funds, including auxiliaries, to the Budget Office in the FIRMS format by August 12, 1999. It should be noted that SUG and EOP grants must be posted to the appropriate FIRMS object code while the remaining funds may be spread as deemed appropriate by the local administration. The requirement to budget specifically for EOP Grants, in addition to State University Grants, is a new provision of the Budget Act this year. As in the past, campuses have the flexibility (except as noted) to adjust their budget submissions to reflect their best estimate of the 1999/2000 campus budget plan.

Lottery

The Lottery Review Committee has met twice and made a series of recommendations, which will be included in the final report to the System Budget Advisory Committee (SBAC). The final report is currently in draft. After sign-off by committee members, it will be released to all interested parties. It should be noted that the committee has not recommended any fiscal or programmatic changes in 1999/2000.

CAPITAL PLANNING, DESIGN AND CONSTRUCTION,J. Patrick Drohan, Sr. Director

Capital Outlay Program Status Report

The following is an update of the general status of the ongoing and future CSU capital outlay program:

  • 1998/99 Program

     

    • Projects appropriated under the authority of 6610-302-0574 or 6610-303-0574 for the construction phase only must be bid by December 31, 1999.

     

  • 1999/00 Program

     

    • Major and Minor Capital Outlay allocations have been processed to campuses.

     

  • 2000/01 Program

     

    • July 1, 1999: Final state and non-state programs were due to CPDC.
    • July 15, 1999: Minor capital outlay program submitted to Department of Finance.
    • July 30, 1999: Final state programs submitted to Department of Finance.
    • August-November 1999: Annual scope visits by Department of Finance and the Office of the Legislative Analyst.
    • September 14-15, 1999: Board of Trustees considers the 2000/01 program.

CPDC Due Dates for CPB&G Agenda Items (November 16-17, 1999 Trustees' Meeting)

CPDC Due Dates for CPB&G Agenda Items (November 16-17, 1999 Trustees' Meeting)

Master Plan Revisions:
All Other Items:

September 14, 1999
September 28, 1999

A complete listing of 1999 and 2000 due dates for CPB&G agenda items is located at CPDC website http://www.calstate.edu/PPD/Executive/index.shtml

Capital Projects Training Program

The next scheduled training opportunity will again concentrate on construction contract claim recognition and mitigation. The seminar is scheduled for August 10, 1999, in San Francisco and August 17, 1999, in Pomona and will be facilitated by Mr. Jeff Defeo of Pinnacle One.

This training will include the following:

DELAY ABUSES: REALITY v. RIP-OFF

 

  • Early Completion Schedules
  • Float Sequestration
  • Submittal Reviews
  • Activity Relationships and Logic
  • False RFI and C.O. Delays
  • Inaccurate As-Built Data
  • False Interfaces: OFCI Equipment
  • Coordination with Subs
  • Various Delay Analysis Methods

COST ANALYSIS: SAVING THE SHIP EVEN IF YOU’RE LIABLE

 

  • CSU Audit Provisions
  • Direct Cost Abuses (Labor and Equipment)
  • Overhead and Mark-ups: What is Allowable?
  • Home Office Overhead: The Current Status of the Eichleay Formula
  • Loss of Productivity Claims and “The Measured Mile”
  • The Pitfalls of Total Cost Claims
  • The False Claims Act: An Introduction

Ms. Nancy Garcia is handling registration and coordination. She can be reached at (562) 951-4130 or by fax at (562) 951-4922.

FINANCIAL SERVICES,JBrad Wells, Assistant Vice Chancellor

ACCOUNTING,

The campuses and Chancellor's Office are in the midst of closing out fiscal year 1998/99. The following table provides significant reporting deadlines for legal, FIRMS, GAAP, and IPEDS reporting. Questions related to this reporting should be directed to Ruth Stipp at (562) 951-4615 or by email to rstipp@calstate.edu.

REPORTING DEADLINES

Bill Musselman, Acting Director

CONTRACT SERVICES AND PROCUREMENT (CS&P),

Procurement Training Development Library (PTDL)

On June 30, 1999, CS&P took possession of the first installment of audio-visual and text material for the PTDL. These, and additional materials to be obtained in the future, will serve as a resource for contracts and procurement personnel to augment their skill-sets and pursue their personalized National Association of Procurement Management (NAPM) Focus Assessments career development goals. The currently-available reference materials and the procedure for obtaining them are posted on the department website noted at the end of this section.

PSSO Initiative

The PSSO executive committee is undertaking a multi-part initiative to explore legislative vehicles for updating CSU contracting authority to be consistent with other higher education institutions in California. Aspects of the project include efforts to increase formal bid thresholds for commodities and reviewing the CSU policy manual for contracting and procurement with a view toward updating to current best practice models. This initiative will be monitored to ensure consistency with similar CPDC efforts in the public works arena. Additionally the CSU may benefit directly from current legislation sponsored by DGS to raise existing statutory bid thresholds.

Master Enabling Agreements

Two master enabling agreements have been executed. The first encompasses services with four firms (Charles Abbott and Associates, Esgil Corporation, PC Associates and Willdan Associates) to provide plan check services. Campus and the Chancellor's Office may engage the services of these firms by executing a Service Order in accordance with the provisions of the master agreement. The second Master Enabling Agreement is with The Gordian Group for the development of a fully functional Job Order (unit price) Contracting system.

These agreements, and other information regarding CSU contracting activities, are available online at: www.calstate.edu/csp. Any questions on this subject should be directed to: Haaziq Muhammad at (562) 951-4591, or via e-mail at hmuhammad@calstate.edu.

Pat Dayneko, Director

FINANCING AND RISK MANAGEMEN

Auxiliary Organizations

  • CSU Recognized Auxiliary Organizations

    Campuses are continuing to restructure auxiliary organization functions in the CSU. On June 21, 1999, the California State University Channel Islands Foundation became the 79th recognized auxiliary organization of the California State University. In addition, the San Diego, Pomona, and Hayward campuses are in the process of pursuing CSU recognition for new auxiliary organizations. On July 8, 1999, the Board of Trustees approved the Humboldt State University Center Board of Directors to be the successor auxiliary organization of Lumberjack Enterprises and to receive its net assets upon its scheduled dissolution.

     

  • Operating Agreements

    Responding to an audit recommendation, on July 7, 1999, Executive Vice Chancellor and Chief Financial Officer, Richard West, sent a letter to university presidents asking them to confirm that each of their recognized auxiliary organizations have a current written agreement with the Trustees. A review of system files has also been initiated. The requirement for a written operating agreement is included in Section 42501 of Title 5 of the California Code of Regulation. This section stipulates that a written agreement is required with an auxiliary organization performing the functions listed in Section 42500 of Title 5, except certain student body organization activities.

     

  • Refinancings

    Several auxiliary organizations have been involved in recent refinancing transactions. The
    CSU Policy for Financing Activities, recently approved by the Board of Trustees, requires the Chancellor to present information to the Trustees on most major auxiliary organization financing transactions. However, the Chancellor and other designees are permitted to assist the campuses in completing such transactions without presenting information to the Trustees if the Chancellor determines (1) that the primary purpose for such the refinancing is to produce net debt service savings and, (2) the structure of the refinancing will result in net debt service savings. These requirements may be satisfied by providing a copy of the resolution from the governing board authorizing the sale and showing that its purpose is to generate savings and by providing supporting financial documentation prepared by the underwriter. Executive Order 703 explains these issues in greater detail. Interested parties may consult the FRM website for more information http://www.calstate.edu/FRM www.calstate.edu/FRM by contacting Ben Figueroa at bfigueroa@calstate.edu.

Housing Program

Interest in campus student housing projects has increased in the last few months. Any campus contemplating a new housing project is encouraged to contact the Office of Financing and Risk Management to coordinate the development of a calendar that includes key events and system requirements including a review by the Housing Proposal Review Committee. Coded Memorandum FRM 99-04 provides details about the process and is available on the above mentioned website.

Student Union Program

The budget submissions for the student unions are currently under review. Assuming all operating agreements and leases are current, student union operators are expected to receive their operating funds in August. Should you have any questions, please contact Rosa H. Renaud, at (562) 951-4570 or via email  rrenaud@ca,state

Parking Program

To ensure that parking projects are included in the Non-State Funded Capital Outlay Program, several critical steps must be completed. This process entails the completion and submission of a parking study prepared by an independent consultant for bond-funded projects and a viable financial plan prepared by the campus administration. The Office of Financing and Risk Management can provide assistance in understanding the requirements that are contained in the instructions for the annual capital outlay submission and facilitate the successful sale of parking system bonds, should that be needed. If you have any questions on these parking program issues or need assistance in preparing a financial plan, please contact Rosa H. Renaud at (562) 951-4570 or via email at rrenaud@calstate.edu.

Workers' Compensation Claims Administration Update

In anticipation of replacing the State Compensation Insurance Fund for workers' compensation claim administration services, a request for proposal was released on May 3, 1999. Nine responses were received by the deadline June 11, 1999. An evaluation committee composed of campus and Chancellor’s Office staff reviewed the nine proposals and selected six semi-finalists for site visits and interviews. The interviews will take place on July 26 and 27, 1999.

The CSU and State Compensation Insurance Fund transition teams have continued to meet to make final preparations for the phased withdrawal of CSU claims beginning August 30, 1999. The transition will be completed by September 30, 1999.

Dates for Board of Trustees Items

Agenda items for the September 14th Board of Trustees meeting are due to the Office of Financing and Risk Management by August 6, 1999. November agenda items are due on October 8, 1999.

Richard Leffingwell, Director

GOVERNMENTAL AFFAIR,Karen Yelverton, Senior Director

Copies of CSU Legislative Reports and other legislative information pertaining to the CSU is available on the OGA website at http://www.calstate.edu/oga.

INFORMATION TECHNOLOGY SERVICES,David Ernst, Assistant Vice Chancellor

CMS Status Report

CMS is a CSU wide collaborative project to implement and support PeopleSoft's human resource, financial and student administration system software on the 23 CSU campuses plus the Chancellor's Office. The project will be completed over the next 5 &endash; 7 years.

Much of the CMS project effort to date has occurred in the Human Resources area. Prototyping sessions have been in process for several months, starting with the workforce administration, time and labor, and base benefit processes. In the prototyping sessions, the team members review the PeopleSoft functionality and evaluate whether it will meet the requirements of the CSU. Modifications to the delivered PeopleSoft software are being kept to a minimum; most modifications identified to date are in response to CSU or State policy requirements.

Prototyping for a portion of the student administration system has begun to define aspects of the student campus community processes that integrate with the human resource processes. More detailed project planning for the student administration system implementation is due to begin this summer. We are also working on a document that should help articulate the benefits of the CMS project that are expected to accrue to students, faculty and staff.

Planning is currently underway to begin prototyping for the PeopleSoft financial processes next month. The chart of accounts prototyping will begin in August followed by general ledger, accounts payable and purchasing.

CMS status reports will be made regularly in the B&F Newsletter to record progress of the project.

Hilary Baker, Senior Director

PLANNING AND ANALYSIS,Lenore Rozner, Senior Director

Quality Improvement (QI) Programs

 

  • Frameworks RFP: An RFP was issued to identify and select qualified quality improvement frameworks consultants. The selected firm(s) will provide in-depth functional and technical expertise, technical resources and specific project assistance for individual campuses and the Chancellor's Office. A master enabling agreement will be put in place allowing campuses to contract with one of the selected frameworks consultants. The evaluation process is underway and campuses should be advised of the decision by the end of July.

     

  • Customer Satisfaction Survey: Data from the satisfaction surveys conducted earlier this year have been turned over to the campus survey administrators and functional representatives for evaluation. Results are expected to be released on campuses in late July.

     

  • Mini-Benchmaking Project: Five functional areas (libraries, mail services, university police, career centers and student health services) are in the process of analyzing their data to prepare their functional reports. Function Chairs will present their final reports to the QI Steering and Planning Committees in September.

     

  • Process Mapping: Based on recommendations of the Planning Committee, an RFQ has been issued to four prospective vendors who could provide process mapping training services. A consultant will be selected shortly. Training will then be coordinated for functional areas. Campuses will also have the ability to contract with the consultant for on-campus cross-functional training.

     

  • Newsletter and Website: To promote and celebrate systemwide and campus QI efforts, a newsletter and website debuted on July 1. The first issue of the newsletter focuses on campus efforts of Sacramento, San Luis Obispo, and San Diego. The QI website address is http://www.calstate.edu/qi.

     

  • Annual Fall Symposium: On November 18, the second annual Quality Improvement Symposium will be held at LAX to promote and provide information on QI tools and frameworks. This year's symposium will highlight a campus QI effort and include invited speakers who are experts in the QI field.

Questions concerning the QI programs, frameworks, benchmarking, satisfaction surveys or process mapping, should be directed to Ron Ashcroft at (562) 951-4552 or to  rashcroft@calstate.edu.

CSU Mentor Credit Card

The process of choosing an Internet credit card servicer for the CSUMentor Program is almost complete. Informed Decisions, CyberSource and CyberCash were vendors that provided information regarding the services they could provide to handle the Internet credit card process.

All three vendors reviewed were found to have creative solutions. Vendor processes and the campus costs associated with each vendor's process are currently under review. It is anticipated that the vendor will be selected and the credit card application process re-activated by the end of July.

Y2K - Embedded Systems Evaluation

Seven campuses participated in a follow-on to the embedded systems pilot project conducted on the Long Beach campus. The campuses developed inventories of physical-plant-related embedded system which were provided to Parsec Automation Corporation. The contractor then performed a compliance assessment using its equipment database, vendor websites and other sources. Participating campuses were provided with summary reports in June documenting the compliance status of known equipment and highlighting those pieces of equipment for which additional inventory documentation is required. Campuses also received vendor contact information to continue their own equipment evaluations.

The Business and Finance Newsletter is accessible from the Chancellor's Office website http://www.calstate.edu/BF/. Questions related to receiving the B&F newsletter or changes in e-mail addresses should be directed to James Francel at (562) 951-4547 or jfrancel@calstate.edu.