Transcript General Faculty Meeting
March 8, 2016

Larry Teeter chair:  Welcome to the Spring General Faculty Meeting. I am Larry Teeter, chair of the Faculty Senate. If you’d like to speak about an issue, or ask a question please go to a microphone, wait ‘til you are recognized and state your name and your academic unit so we can get that in the minutes.
The agenda for today’s meeting was set by the Senate Steering Committee. It was sent out in advance and now you see it on the screen.
The first item of business is approval of the minutes of the October 6, 2015 General Faculty Meeting. The minutes were previously posted on the Senate’s Web site. Are there any changes, additions, or deletions to these minutes? If there are no corrections, the minutes stand as approved.

Our next agenda item will be comments from Dr. Jay Gogue, our President.

Dr. Gogue, President: Thank you. I appreciate you being here today. Probably in higher ed circles the most important metric that’s used is graduation rate numbers. If you looked at the way institutions are evaluated nearly always is that is given disproportionate weight to other academic values or factors, and when you see things in the paper that talk about many of the for profit universities that have under 10% graduation rates. I just want to say thank you to the faculty, our numbers show increases every year, for a number of years, we have gone from the low 60% graduation rates to almost the mid-70s. So some really nice improvement. I say that to you because it’s probably the things that you do everyday that nobody is even aware of that has a tremendous impact on graduation rates at the university and I appreciate that.

Second thing that I delight in hearing and reading about is the number of post-graduate fellowships and scholarships that Auburn undergraduate students are winning. I noticed a few years back, 3 and 4 were the numbers that we actually produced, today those numbers are between 30 and 40 students each year that win those. Again those are things that faculty members do that are quietly done that prepare students for very special recognition. I get an opportunity to talk with most of those students and it is through those discussions that they actually call your name and share thoughts about things that made a difference in why they applied. Or why they looked at this particular one. So I appreciate it.

For the seventh year in a row the Arbor Society of America has recognized Auburn for it’s beautiful trees. I want to make sure you are aware of that, we have something like 8,000 trees on a campus of about 600 acres. Again, it is all part of the entire picture that when you look at Auburn that makes a difference. We often hear from parents, and we often hear from those that come to our campus, the beauty and appearance of the campus.

We take a lot of in 3 of our colleges are ranked, usually in the top 10, some evaluations will put us in the to tier of electronic online courses at the graduate level. So the College of Education, College of Engineering and the College of Business are often listed in those particular rankings and I think the most recent one was the Harbert College of Business in a top tier with one of the evaluations. [3:33]

The new program that started this term is the Share-a-Bike Program. A lot of activity by students, but also I noticed some faculty and staff are using the bikes. Apparently you can pick them up at various locations, ride them to other locations, deposit the bike, do business and ride it back. If it is successful, we are going to look to expanding that.

The things that I mentioned plus a whole lot of others lead to Auburn in the last month being listed in the Forbes list as the top university in the state of Alabama. I am proud of that. I realize that when rankings are not good we devalue those and when they are good we talk a lot about them. It was interesting, there were 14 schools in the Southeast Conference, only 3 of them were the best within their state, University of Florida, Auburn, and Vanderbilt. Two of those schools, Vanderbilt and Florida are AAU universities, so really top universities and great company to be in.

Legislature is in session. Many years when we come to visit with you we talk about the level of cuts. Then we went through a period in which we said that there was flat funding and the last couple of years we’ve seen one and two percent. We anticipate some stability in that one or two percent. Operating increases probably one percent or so. So certainly not the levels of 2007 or 8, but at least excitement that there’s not cuts. And compared to some of our sister institutions, that’s a good situation to be in.

Search and screen committees for new positions, we have several that are out and open at this time. The General Council position is receiving a lot of attention. Mr. Armstrong will be stepping down as General Council at some point in the future, so we are underway in terms of a search for a new General Council. Vice President for Business and Finance is underway. A search is underway for a Chief Information Officer. We concluded a Dean search; Dean of the College of Agriculture and also the Director of the Agriculture Experiment Station, we selected Paul Patterson for that position. Then Auburn University Montgomery, the Chancellor search is down to 2 individuals and we are involved in the final review of those 2 individuals. Hopefully we will make a decision prior to the Board Meeting April 7. [6:07]

A couple of items on that April 7 Board Meeting; number one, this is the one where tuition fees come us so there will be discussion of that. The interdisciplinary science building is also on the agenda, and one that we’ve waited a long time on this campus, the Performing Arts Center is on that agenda. So we are excited about several of those new facilities.

A lot of positive things going on on campus, but I would call our attention certainly to the diversity, the inclusion, and the equity issues that are almost in the news everyday as we look at American higher education. It’s clear that we all need to pay more attention in this particular area of our institution. I don’t know if you read the newspapers today, one of our sister institutions in Missouri, they will loose about 1,500 students this fall versus last fall. And they will see about an 8% budget cut because of the issues that have occurred there over the past few months.

Last fall I sent a note out to campus to try to say, hey there’s a lot of things going on relative to this topic that we need to pay attention to. There’s a lot of realities of life in colleges and universities that we need to be perhaps more sensitive to. I’ve asked that we renew our discussion of our core values at Auburn and ensure that our campus fosters learning, safety and helpfulness and respect and sport. We’ve taken several steps in the last couple of months; one, I’ve committed to go out and I’ve always spent time with student groups, but in a systematic way to try to go and sit and listen, informally, recognize that the information I get will be very anecdotal compared to what the Provost is doing which I will mention later. But you learn a lot by sitting with student groups and just listening to the things that they have to say about the university. I will have to share with you what I learned from the black engineering group. The student raised the question and said: I realize that the number of black engineers is not tremendous in what is produced each year in terms of PhDs that go to work for universities. The numbers are quite small, I looked up the data on how many were produced, how many got into higher ed and how many go to other walks of life. And he said, wouldn’t it be possible for us to have a little diversity in some of our courses. And I said, what do you mean? And he said, well, couldn’t we get some adjunct faculty that maybe came in for a week occasionally, couldn’t we invite people on sabbaticals to come and stay for a period of time? Couldn’t we share some faculty perhaps with other institutions? So a lot of interesting ideas that really came out of students.

So far the complaints I have heard the most about were food in the residence halls, and parking on campus. Not a great deal of insightfulness there.

We’ve strengthened the Office of Diversity and Multicultural Affairs and more changes will occur in that area. The Provost has formed a steering committee to look at campus climate and that is the formal listening that is going on around the campus. I know that they have held a number of meetings to seek input. They have developed a survey and it is my understanding that you have until March 16 to complete that survey and give additional information. The pledge we’ve made is that we will report the findings of the survey and the listening that has gone on and also share actions that we expect to take before the end of the semester.

I’ve tried to say it before and I guess I’d say it again, if anybody at Auburn is threatened, or disrespected then really we all are. We need to pay attention to that. So I hope you will help us as we move forward in that particular area.

I do want to mention shared governance briefly. I always do at this session. About half the faculty at the university are involved in various committees that deal with leadership types of questions that the institution faces. So I appreciate each of you taking time to serve on those committees.

I’d report once again that all resolutions that have come to the University Senate have been approved by the Board of Trustees. That’s a track record that we want to keep consistent, so I feel good about that. And I would just conclude by saying that I appreciate the work that each of you do. Thank you. [10:59]

Larry Teeter, chair: Thank you Dr. Gogue. Next we will have comments from Dr. Boosinger, our Provost.

Dr. Boosinger, Provost: Thank you Larry, I appreciate the opportunity to spend a few minutes with you and update you on a few things that are going on in my office. First a few comments about the Strategic Planning process.

In June we will have completed 3 years of the 5 year plan that we are working on right now. We have, in that period of time, achieved about 75% of the goals that we set out to accomplish, so I think we have a lot to be proud of. I will mention or highlight a few things. The process includes of course the Strategic Plan but also an active implementation committee that makes a report to the President twice a year, so that meeting is coming up in just a few weeks where all the different strategic priorities and goals will be discussed in detail and we will look to see where we are achieving our goals and where we are not hitting marks or where we may need to reinforce some of our efforts.

Dr. Gogue mentioned the Climate Study, all I would add is that is a study; it’s much more than just a survey. I heard people say, oh, you are doing a campus climate survey. I think we have now had 40 listening sessions and another 30–40 private interviews for people that wanted to be interviewed and we are going to continue to work on that for the next few weeks, but the goal is to have a report put together to present to the administration and the faculty well before the end of the spring semester. We don’t have an exact date, but we are working on that.

A couple of things under student success that I wanted to mention are relatively new in the scheme of 3 years. The student success collaborative from the educational advisory board, that’s a platform in a way to help advisors identify students that maybe are not on a path to success. It analyzes their performance as they move through the university curriculum and identifies some indicators that maybe the advisor should sit down and meet with that student because it doesn’t look like they are going to be successful. If they want to be an engineer and they are failing all of their math courses, then we always knew that, but this looks at more, subtle indicators. It is really an enrichment opportunity for advisors to sit down with those students and talk about what changes they might make to enhance their success at Auburn. [14:02]

When we started this process 3 years ago we had a student to academic advisor ratio in the 600s, now through careful planning of this cooperation of colleges and schools we brought that down to 480. Best practice nationally is in the 300s so we still have a little way to go, but we can say with some confidence that that change along with other things we are doing and the many things that all of you contribute is helping us with retention rates and our graduation rates. As Dr. Gogue was saying, we increased our 6 year graduation rate by a full 10 points over the last 8 years. So I think that’s a lot to be proud of.

The Student Government Association, SGA, leadership commissioned a task force to look mental health of our students and asked the question, are we providing the support that we need to provide for students at Auburn University that have mental health challenges. Of course the ultimate tragedy is to have a suicide, but along the way we have students the wrestle with mental health problems for a variety of reasons and that causes some of them to leave. So we want to do everything we can. That task force worked for a number of weeks and has now made a presentation to the President, Dr. Large, and myself asking us to look at allocating resources to support the goals and objectives they are recommending. So we will be looking closely at that in the future.

I hope that all of you have heard about the Green Dot Program, that’s a national program, not really an organization, but it’s a process that’s been accepted now at a number of institutions to do 2 things; help raise everybody’s level of awareness about sexual assaults and how to prevent sexual assaults on our campuses. There is more to it than this, but in the simplest of terms it encourages everybody to be more involved. It encourages bystanders to become engaged and help prevent these things from happening when they see something happening. The training that some of you have been through is all about how to recognize those early signs of possible incident. I think that has been good for us. We have set a goal of providing training for 6,000 faculty, students, and staff; I think to date we have done 2,000 or 3,000. I thank all of you for helping with that. [17:00]

We have looked carefully at Enrollment Management at the absolute number and the percentage of students at Auburn University that are Pell Grant eligible. I think I’ve mentioned that before. Pell Grant eligibility is a reflection of financial need. So Enrollment Management has made some recommendations to enhance what we were already doing for Pell grant eligible students with need based scholarships by adding up to $5,000 of support, trying to get the students in that category to basically an in-state scholarship kind of level. So we will continue to work on that. That’s complimented by scholarship programs like Plus, that you probably heard about. Plus is specifically targeted for first generation kids, which are very frequently have significant financial need.

We continue to work on 3 distance, or online degree programs. Those are going well. One is in the RN to BSN, another is Bachelor of Science in Business Administration, and a Bachelor’s in Computer Science.

The Biggio Center has announced the search for faculty fellow for transformational leadership to focus on ways to strengthen our ability to help faculty be better teachers, to help heads and chairs be better administrators. I am excited about that, there are 2 faculty finalists and there will be presentations April 4 and April 5.

We had a number of questions about spousal hires. I think I’ve mentioned this before We accommodate spousal hires currently on a case by case basis and do the best we can to line up spouses that come as part of a hiring package with positions at Auburn University. We’re working on a memo explaining what we’re currently doing and what we’d like to do to make that even more effective. We are working with HR so I hope by the end of the month we can send something out to the academic community for you to see and better understand what we are doing now and what we might do in the future.

Finally, the last thing, and I’ve talked about this about 3 or 4 times, is to remind you about the cluster hiring and where we are. We haven’t said much recently, but we’re now at the point where positions are being advertised, faculty candidates are being invited to campus for interviews and we will be able to bring some of those people on board in the next few months. That will be a big plus for our research programs in different areas at the university.  There are 5 cluster hire areas and many of you are a part of this through your departments and I appreciate your support.

Does anybody have any questions or comments for me? Thank you. [20:31]

Larry Teeter, chair: Thank you Dr. Boosinger. I just have a few remarks this afternoon. This is the spring meeting of the General Facutly. There are 2 General Faculty meetings each year, one in the fall and one in the spring. In addition there are 10 meetings of the University Senate, one every month except for December and July. Everyone is welcome to attend the Senate meetings and you don’t have to be a senator to attend and speak at the meetings. The Faculty meetings and the Senate meetings are important aspects of Auburn’s shared governance.

As I do at every Senate meeting I also like to introduce the Executive Committee because the Faculty officers also serve as Senate officers. Dr. Laura Plexico is our secretary, Dr. Xing Ping Hu is our secretary-elect, Dr. James Goldstein is our chair-elect and will assume the role of chair July 1. Dr. Patricia Duffy is our immediate past chair and serves as our representative on the Board of Trustees. Dr. Bob Locy, who is not here, is our Parliamentarian, and I want to thank Bob for overseeing the slate committee that helped put together the slate for the candidates for our new officers.

I’d like to remind you that all participation in shared governance is an important opportunity for faculty at Auburn. There are 21 Senate Committees and 34 (actually 37, 2 new and one split into 2) University Committees, and all need faculty volunteers to do their work. Last week we opened the Web site for volunteers and encountered some initial difficulties, we’ve heard about it and it’s been fixed. So please take time to view the Senate’s need for volunteers and volunteer for an activity that you are interested in.

I’d also like to take a moment to thank all 4 of our nominees for Senate Officer positions and to the committee that helped identify faculty for this slate. All of the nominees have a rich history of service to Auburn in its shared governance needs. Two of you will not be elected, but I hope this will not dissuade you from working with the Senate in other capacities and possibly running for an officer position at a future point in time. Thank you for all you do for Auburn University.

Are there any remarks or questions for me?

If not, our agenda today we have 3 information items and first Amanda Malone will provide us with a general status update on implementation of the new budget model. [23:11]

Amanda Malone, special assistant to the Provost for budget management: Thank you Dr. Teeter. Thank you everyone for the opportunity to come and give you an update on where we are in the strategic budgeting initiative. As Dr. Boosinger mentioned we are 3 years into the current Strategic Planning Process. Priority of that Strategic Plan actually deals directly with our resource allocation methodologies on campus. Work has been ongoing over the last 3 years. Today I want to give you an update on where we are as we continue to explore and test methodologies that may be available to us as we move forward in future years.

This past fall a working group was established to start looking at the practices, the business processes around budget development; the software systems that we use the flow of information, to start looking at that information, seeing what opportunities there are for improvement under a new resource allocation methodology. We also conducted an in-depth training with both the business officers in colleges and schools as well as central administration offices. Those were conducted this past fall. This spring we have moved into what I’m considering an education phase where opportunities to go and have these types of discussions with various constituent groups across campus including, Dr. Boosinger and I have had our annual budget meetings with each dean and business officer, so in those budget meetings among other things we have looked at the proposed strategic budget model and what impact that will have on each college, been able to answer questions and continue to explore and test different areas within that proposed model.

We also discussed in those meetings with the dean’s what the next steps are as we move into budget development season in the next few months. Just to give you a high level view of what that may look like: in April, as Dr. Gogue mentioned, that is when Board discussion around tuition is going to occur. So we will have some additional information after that meeting and certainly begin to share and evaluate the impact of those discussions on the resource allocation model. Then as we move into what has traditionally been the budget development season, May, June, and July; the salary guidelines that the Board may entertain in its June meeting this year, certainly that will have an impact and we will share that information. Then the traditional September Board of Trustees meeting is when the Board will actually receive the proposed budget that will start on October 1. [26:20]

I’ve got my contact information up here as well as contact information for Bryan Elmore, who’s the director of Budget Services. I can answer today any questions that you’ve got, other questions I may need to discuss with Bryan, but I am willing to entertain those.

Mike Stern, department of economics: Thank you Amanda. Our question for you: since October 1 you’ve been running this new budget model in parallel to the existing one. Is that my understanding?

Amanda Malone, special assistant to the Provost for budget management: We are continuing to test different avenues, different scenarios in that, yes since October.

Mike Stern, department of economics: Have the colleges received the results of these budget simulations? The hard numbers of what the outcome of what this parallel model is producing?

Amanda Malone, special assistant to the Provost for budget management: Each dean does have access to information for both actual years, these are historical numbers, actuals from FY 13–14 and then budget information for FY 14, 15, and 16.

Mike Stern, department of economics: So the parallel runs that are occurring right now, those results have been distributed to the colleges?

Amanda Malone, special assistant to the Provost for budget management: Not in the year that we are in right now. Budget Services is actually taking a lot of time to evaluate the method by which we communicate that information, they are also spending a lot of time in data integrity. Making sure that we’ve got the right information and that the output is what we expected. Where we’re seeing a lot of variation we are spending some time to investigate those.

Mike Stern, department of economics: Had you intended to distribute that information by now?

Amanda Malone, special assistant to the Provost for budget management: Not necessarily.

Mike Stern, department of economics: I am just interested because I had been told to expect that for my college in the middle of January and at every meetin since then they’re telling me they haven’t received anything and were sitting there with little information and I have people asking me questions. There was a belief, I think, that we would get quarter one numbers on the settled model that was running in parallel after the close of the first quarter at some point. It’s now approaching the middle of March so maybe those expectations were wrong. They should not have been set that way, but we were certainly given that expectation and we’re just wondering if there is a delay, what the delay is for.

Amanda Malone, special assistant to the Provost for budget management: Sure. You are absolutely right, there is a delay, and when we expected that information to come out and it has not yet come out. And the delay is because we are insuring that the data is intact, that it’s good data, and where there are variants that we have an answer for those. We are going through a very extensive vetting process before we make that information available.

Mike Stern, Dept. of Economics: Do you know when you expect to have that information distributed?

Amanda Malone, special assistant to the Provost for budget management: I don’t have a hard date.

Mike Stern, Dept. of Economics: Thank you.

Amanda Malone, special assistant to the Provost for budget management: You’re welcome. Anything else? Thank you very much. [29:56]

Larry Teeter, chair: Thank you very much Amanda.

At a previous Senate meeting we discussed 3 new committees that will be required to support this new budget model and Drew Clark is going to explain a little bit about how those committees will work and how they will be constituted.

Drew Clark, Dir., Office of Institutional Research: Thank you Larry and thanks for the opportunity to be here. Auburn has a long standing tradition of shared governance. For the university budget it has historically been enacted through what’s called the University Budget Advisory Committee. I am going to talk a little bit about how that committee will function under a new model and about two additional committees that are probably needed under the terms of a new budget model.

Let me start with the University Budget Advisory Committee which continues to exist. I think it would be a fair statement to say that most of its deliberations in recent years has revolved around incremental changes to the base budget; that is how the university plans to invest new dollars that it may receive. That’s an important activity, but the kind of budget model we’re adopting will require a little bit more than that so the committee as it begins to function in a new way will have a couple of additional things where its advice and consultation will be really, really helpful and needed. First of all the committee in keeping with the budget approach that’s being taken will look not just at increments, not just at what’s changing over the last year, but at the total budget picture, all revenues, all sources, all expenditures, so that we can get a more widely shared understanding of the economic reality of the university.

The second thing that the committee will need to do, has the opportunity to do will be to provide advise and consultation over how dollars from the so called Mission Enhancement Fund might be invested. As a reminder to those of you who may be a little out of touch with the most recent update. We create a Mission Enhancement Fund by applying participation rate to revenues of the schools and colleges which are much larger under this model than they’ve ever been because basically all revenue goes to the schools and colleges. The purpose of that fund is first of all to make sure we’ve got enough resources to take into account structural differences in cost of programs amongst the various schools and colleges. So each school or college will literally have an investment in the ongoing viability and success of each of the other schools and colleges. That’s the first purpose of that fund.

The second purpose, however, is to create for the first time actually, a pool of recurring dollars for investment and strategic initiatives under the ultimate control of the President upon recommendation from the Provost and Executive Vice President, who will co-chair this committee. But a major function of the University Budget Advisory Committee going forward would be to provide consultation and advise on exactly how those strategic investment dollars should be invested.

Then the third function of this committee, again brand new because it represents a change in approach, it is represented on the slide with an abbreviated phrase ‘budget model performance.’ One of the principle duties of this committee will be periodically to evaluate how well the budget model itself is performing. We don’t want to make those changes, weekly, daily, monthly, there has to be a level of stability so the proposal is to follow a practice that’s long been in place at Indiana University, which is to lock down the description or the specification of the budget model for a period of 5 years and every 5 years unlock it for a thorough review and adjustment. Here’s an example. I mentioned that the Mission Enhancement Fund is created by applying a participation rate to certain colleges, most college revenues but not all. Right now my own view is that the rate that we have to begin with to accomplish the other things is higher than we would like it to be. One possible adjustment to the model and a sign that the model’s working as designed would be at the next review of model overseen by a group called together by this committee, we would be able to lower that participation rate.

So that’s the University Budget Advisory Committee, and existing committee with some new duties. There are 2 features of the model that call for good consultation and advise around topics that we haven’t been consulting and advising on in the past. We know the committees are needed because we know the kinds of discussions that the model will discuss. The first of the 2 is called the Central Unit Allocations Committee. As a reminder, Auburn does now and will in the future have to spend a fair amount of money to simply run itself and provide administrative services, student support services, institutional support. Here’s a ballpark figure for you, I just checked it today, the average land-grant public university in fiscal year 2014 spent about 70 million dollars on operation and maintenance of the physical plant. Auburn’s value is very close to that, we are pretty much an average land-grant university and that’s just one example of what it takes. Physical Plant, Registrar’s Office, University Library, Student Support Services, President’s Office, all of the things that it takes. Those expenses are real and exist now they don’t go away because we switch to another budget model, but the way that the budget model is designed the revenues that are needed to pay for those administrative services now flow through the schools and colleges and are funded by the schools and colleges using a series of allocations. Because those will actually show up on your school and college income statements you will see for the first time in specific detail what your college is contributing to the Library, to IT and so on. We know that that will create a wholesome opportunity for exchange and dialogue about the university’s level and amount of administrative spending over what we need to add to those units, what might need to be subtracted. And the purpose of this committee, to get back to the committee, is to give structure to that dialogue. We don’t want a world in which every unit is engaging with every admin unit all the time around its level of expenditures. So this committee is called together to do a couple of things; first of all, coordinate that dialogue and give it some structure. For example: they will probably want to rotate through the administrative cost pools, one at a time, to examine in some detail what the university is spending on that, how that benchmarks against good benchmark practices, what we might need to do in the future is simply the case that expenditure across all range of functions is liable to go up. We need to make it go up in a coordinated and planned way. This committee can advise on setting spending levels for central support units. It also raises conversations (we know this is coming) and can be wholesome if we commit to it, about levels of service from those units. If your unit is paying for share of IT, a share of the Library, a share of whatever the administrative service is you have a right to know what kind of purchase is that. What is an add on to that, what kind of service can you expect and this committee can help coordinate the preparation of service level agreements. So that’s the second of the two. We don’t do this now because our budgeting practice hereto fore has simply set those budgets off the top, set different budgets for the academic schools and colleges and not created any dynamism between the two, this will change that.

The third committee, the Space Management and Repair and Renovations Committee, again necessitated in part by a feature of the model that was originally titled ‘Space Management and Differed Maintenance’, I prefer differed maintenance. This committee again has a couple of functions implied by the model, the first would be to serve as a panel of advise and consultation around setting priorities for repair and renovation projects across campus. That one’s not strictly caused by the model but is a good practice of shared governance, but the other function is one that is called into existence by the model. Because schools and colleges will pay some of their allocations for central support on the basis of the square footage that is maintained for them by the Division of Facilities, this creates an incentive for schools and colleges to vacate square footage in order to hold down their share of the facilities budget. For the university to function appropriately we can’t have abandoned buildings on campus, so one of the things we know we’ll have to create is essentially a brokerage function that allows if the unit wishes to vacate space, as a seller, we need to have a buyer. This committee can provide good advice on that phenomenon. [40:10]

So Larry, that’s in essence what I would like to describe, again the bottom line is we have a broad university participation already in the establishment of the university’s budget. What we are proposing to go forward with deepens that in a substantial and meaningful way and if you wish to participate you will have greater occasion than you ever had before to provide input, advice, and consultation around a wider range of the university’s budget topics. I’d be happy to field any questions about this.

Mike Stern, Dept. of Economics: In regards to the brokerage exchange space management and your pricing in this model. Am I to understand that you are going to apportion the costs of facilities based on utilization of square footage in the budget model? So you will be billed according to the square footage you consume on campus?

Drew Clark, Dir., Office of Institutional Research: The square footage is a driver of the allocation of the Division of Facilities budget, yes.

Mike Stern, Dept. of Economics: So square footage?

Drew Clark, Dir., Office of Institutional Research: Yes.

Mike Stern, Dept. of Economics: Is there anything else that you use?

Drew Clark, Dir., Office of Institutional Research: No. I don’t know why you keep saying you.

Mike Stern, Dept. of Economics: You, speaking on behalf of the model. So what marketplace do we draw this statistic from to price real estate? What is the basis for using square footage to price real estate?

Drew Clark, Dir., Office of Institutional Research: Square footage is like all the allocation variables in an attempt to allocate to each of the schools and colleges an approximate fair share of the service being provided.

Mike Stern, Dept. of Economics: Fair?

Drew Clark, Dir., Office of Institutional Research: Approximate fair share.

Mike Stern, Dept. of Economics: So the fairness was the basis for it? As opposed to using, there are many real estate markets all over the place, I’ve never heard anyone say square footage is a primary driver. Real estate usually adages location, location, location; quality matters, what it’s used for and so forth. So you would not need to restrict the withdrawal from space if the prices you charge are reflective of the value, in a market sense, of that space. So when you use average cost pricing of a particular asset there will be excess demand for things that are worth a lot more than that and no demand for things less than that so that you’re right…because you are not using proper pricing there will be a withdrawal from all inferior space. For instance, if we were allowed to if you charged us average (? can’t identify the word used) pricing for our square footage all of our faculty would immediately vote to vacate all of their offices and work from home. Okay, immediately. So you have to use force to make us pay the tax and transfer to those who are being vastly undercharged for the luxurious facilities that they get to consume on campus. So there is nothing fair about that, nor is there anything market based about it, okay. It is a tax and transfer from the have-nots to to the haves on campus and an extraordinary one. [43:31] I don’t know the fairness metric and I don’t know the market metric, but it certainly generates a particular political (? can’t identify the word used). And you wouldn’t need to restrict the exchange base if you were using the proper pricing. There are many mechanisms by which organizations allocate scarce resources among the competing divisions. Standard one is you put them up for auction, therefore the price will reflect the highest value use within that the institution places on it. [43:59] But then can those units that generate a lot of revenue would have a tremendous amount of buying power then might fit facilities that people who don’t make particular much money on campus would not be able to afford. Right, therefore we cannot put the facilities out for open auction, right?

Drew Clark, Dir., Office of Institutional Research: Are you asking a question?

Mike Stern, Dept. of Economics: Yes. Did you consider since you are giving us all our revenue that we simply bid for the facilities. We’re using facilities that nobody wants, nobody places any value on it’s worth very little then why should we have to pay much for them?

Drew Clark, Dir., Office of Institutional Research: I have 2 observations to make. The first is probably the more important. I said at the beginning that the creation of these 3 committees… the reformation of one university committee and the creation of 2 more provides and opportunity for robust input into the process. My first suggestion Michael, is provide that input to the appropriate committee once they are constituted. If the model needs to be revisited after 5 years, provide this kind of input, let them look at it. An auction process was not used this time around for the allocation of space. I said I had 2 answers, I think that is the only answer.

Mike Stern, Dept. of Economics: I am aware that is wasn’t used because it isn’t being used, so it’s not an answer. The answer is, why was the square footage used. I don’t see the fairness metric and I know no market based metric for it and they knew it would cause big problems because you are having to restrict exchange. And you already know it will cause massive withdrawal from substandard facilities. So we are aware of the huge problems, the inequities, the unfairness of it and the lack of any market basis for it, yet we did it. So what was the basis?

Drew Clark, Dir., Office of Institutional Research: The basis in this as in all other allocation of central unit cost is what looked like an allocation method that would first of all get those costs fairly distributed amongst units. I understand if you…

Mike Stern, Dept. of Economics: Fair?

Drew Clark, Dir., Office of Institutional Research: Yes, distributed amongst units.

Mike Stern, Dept. of Economics: How is it fair? Tell me.

Drew Clark, Dir., Office of Institutional Research: Because Facilities does have to maintain all of the properties on campus not just the high ones, all of them. Marcie Smith, did you want to jump in on this?

Marcie Smith, VP for Business and Finance: One clarification that might be important is it is only the operating cost that are allocated, so the value of the real estate, the depreciation is not in the calculation. So that might make a difference. For instance, it’s utilities, elevator contracts, things that Facilities supports, custodial services and such. I don’t know if that makes a difference or not, but might be an important distinction.

Mike Stern, Dept. of Economics: All facilities cost one form or another. If you are giving everyone their revenue then all centralize expenses must be apportioned somehow, right? So if I build a new building, something the university has to pay for or anything I do the university is something that has to be apportioned in some way, so it has to be distributed out. The metric of the fraction of the facilities you are using on this campus is based on square footage consumption, I am not sure what the relevance of that point is, it would have to be apportioned up to some point. Again if the metric is used by square footage you consume I don’t understand the market metric and I don’t understand the fairness metric. That’s just me, I’ve heard no justification for it except it creates a particular tax and transfer scheme that I think is relatively clear.

Drew Clark, Dir., Office of Institutional Research: Thanks for your opinion. Any other questions? [47:52]

Larry Teeter, chair: Thanks a lot Drew. That’s the kind of explanation I was hoping for about the committees.

Our next item on the agenda, James Goldstein, chair-elect, will present the results of our election of next year’s officers.

James Goldstein, chair-elect: Good afternoon. I also wanted to thank the nomination committee chaired by Bob Locy for getting us a slate of candidates. It’s so good that I wanted to thank all of the candidates for being willing to run for election. The winner of the contest for chair of the Senate and Faculty is Dan Svyantek. And the winner of the contest for secretary (of the Senate and Faculty) is Donald Mulvaney. Look forward to working with them in the future.

Larry Teeter, chair: Thanks James and congratulations. Look forward to working with you in the future.
Is there any unfinished business? Any new business? Hearing none, meeting’s adjourned. [49:48]