Juy 19, 2003

IFS Report

Oregon University System Board Meeting

7/18/03

Central Oregon Community College

Bend, Oregon

Summary: The Board reviewed and approved an amendment to the Academic Year Fee Book (modified tuition plateaus beyond minimum full-time enrollment), approved several new certificates and majors at several universities, reappointed Philip Conn as President of WOU, and heard reports from the System Strategic Planning Committee.

Two new Board members participated for the first time: Bridget Burns and Rachel Pelliod, both student members, replacing Tim Young and Erin Watari; Roger Bassett announced his retirement and resignation from the Board; and a proposed Board member replacing Bill Williams of Medford has been submitted and is awaiting confirmation by the Governor.

The Board Meeting was spread over two days, the first day of which was dedicated to:

1) a report from T. Rowe Price and Western Asset to the Investment Committee,

2) an executive session for the Chancellor’s performance review, and

3) a Board Renewal Work Session where the Board discussed presidential evaluations, a Board self-evaluation, and progress with the Joint Boards and the K-16 connection.

On the second day (Friday), the Board Executive Committee met early in the morning to hear a progress report from the Internal Audit Division. The Auditors reported generally sound financial operations and procedures, with a few items needing attention. A single significant deviation from normal accounting practices was discovered some two years ago and its resolution is still pending in the courts (misappropriation of funds from a university bookstore).

The full board met for the remainder of the session on Friday:

A. IFS remarks were made by Bill Danley, President of IFS, and OSA remarks by Maddy Melton, the president of Associated Students at U of O. Danley’s remarks centered on the need for a revised state revenue system, and Melton spoke vigorously against changing the tuition plateau system.

B. There was public input from several students representing U of O, OSU, and PSU, all of whom spoke against changing the tuition plateau and gave personal accounts of how this change would affect their situations.

C. The Board accepted quarterly management reports, reviewed operations of fee-charging units within the system (housing, bookstores, etc.), and examined the report of the OSU Intercollegiate Athletics Department, concluding that while OUS athletics was not out of debt, its agreed-upon plan to recover was on track and proceeding satisfactorily.

D. An amendment to the Optional Retirement Plan was reviewed. This amendment was made to clarify the rules and to comply with new treasury regulations.

E. Approved a System Strategic Planning request to permit armed forces personnel to claim Oregon as residence for tax purposes and approved various new certificates and majors at OIT, OSU, UO, and OHSU.

F. Discussed in detail issues regarding student access which had been brought to the Board by the System Strategic Planning Committee. Roger Bassett emphasized that OUS has already adopted a strong position to not sacrifice quality in the face of declining funding, and that core enrollment capacity would be defined by state support in the future. The Board should be prepared to adopt motions in the future regarding autonomy of individual campus decisions on tuition, quality and access; on protecting individual campus missions, and to deal with the dynamics of K-12 pipeline students and advanced placement considerations.

G. Tuition Plateau Amendment - The issue of tuition plateau changes was summarized by Chancellor Jarvis. Briefly, the case for eliminating or reducing plateaus is that (1) it would permit students who take the courses to pay for them, rather than subsidizing courses for others, (2) it would be more fair to part time students who cannot access these tuition breaks, and (3) it permits better management by student and administration of the real costs of attending college. Jarvis advocated a delay in implementing these changes, however, saying that a one-term delay would help students plan their finances, would give institutions time to evaluate their fall enrollment, and would give the system time to accommodate the budget changes required.

Under the proposal to eliminate or change the tuition plateaus, each campus has submitted individual plans ranging from compressing the traditional tuition plateaus at OIT, SOU., and WOU; replacing the plateau with a straight per credit hour tuition at EOU and PSU; and implementing a modified per-credit structure with a lesser per credit hour increment within a specified range of credit hours at OSU and UO (students taking more than the minimum full-time load pay less per credit hour).

The case against changing the plateaus was made by Maddy Melton in her earlier remarks:

(1) Many students can’t afford to pay higher rates for degrees requiring more than the minimum hours, (2) Low income students will take fewer credits and be required to stay in school longer, which may affect other students because of enrollment caps, (3) Since financial aid does not occur on a per credit basis, students will have to pay for more courses with the same financial aid, and (4) Students will be discouraged from taking courses outside of their major and other “courses of interest” which will diminish the quality of their liberal education.

After vigorous and extended discussion, including input from students and university presidents, approval was given to individual campuses to modify the tuition plateau as submitted, and to permit such changes in the future with Board approval.

H. Increases in tuition previously submitted by individual campuses were approved. Director Wurstenburg noted that this is the first time Oregon students are paying more in tuition than the State is providing in support, which she and others felt was lamentable.

I. The Board unanimously passed a motion to support Governor Kulongowski’s Access Scholarship for Education Trust (ASET). This trust would require public and private universities to pay into a fund which would be used to support needy students in the future. Because it represents the Governor’s first and only legislation submitted in this session, it is seen as a promising development and worthy of support by the Board. Because it applies to private universities as well as public (voucher system), and because it will take several years to implement, it is viewed by faculty with reservations and by others with hostility.

J. Legislative Report (Grattan Kerans) - Grattan reported that the legislature is making some progress, but not much. SB 437, the Higher Education Efficiency Act, is now in its 19th version, and in its current language does not permit the much-desired retention of interest earnings by campuses.

K. The EOU presidential search team is now headed by Director Phyllis Wustenberg, replacing Roger Bassett. They will not actively search in the summer.

This is a summary provided by Bill Danley -- OUS Board meetings contain volumes of reading material, frequent and detailed electronic reports, impromptu submissions and discussions, and sometimes boring financial details. Missing or inaccurate information is due to my error, not lack of information from the Board.