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SEPTEMBER 23, 2003


Present: Chair Daley, Secretary Weiner, Provost Oblinger; Senators Allen, Atkin, Bernhard, Bitting, Branson, Brothers, Brownie, Bruck, DeLuca, Estes, Fahmy, Fikry, Hammerberg, Headen, Honeycutt, Hooper, Jasper, Kasal, Khosla, Krotee, McRae, Middleton, Smith, Stoddard, Tetro, Tyler, Warren

Excused: Past Chair Carter; Parliamentarian Corbin; Senators Beasley, Matthews, Peacock

Absent: Senators Batra, Griffin, Lucovsky, Misra, Rice

Visitors: Mary Kurz, Vice Chancellor and General Counsel; Benny Benton, Assistant Editor, Bulletin; Pete Ellis, Photographer, NCSU SMA; Abhash Baliva; Professor, COT; Charles Duncan, Staff Writer, Technician; Judy Peel, Associate Vice Chancellor; Mark Matthews, Student Senate President ProTempore; Clare Kristofco, Executive Assistant to the Chancellor; Marye Anne Fox, Chancellor

1. Call to Order
The third meeting of the fiftieth session of the North Carolina State University Faculty Senate was called to order by Chair Dennis Daley.

2. Welcome and Announcements
Chair Daley welcomed Senators and Guests.

The following announcement was made by a student.

Last spring the Crime Stoppers Program was started by students, faculty and staff. The bylaws are in place and officers have been elected. There are currently two faculty positions available on the committee. Anyone interested in serving can contact Chair Dennis Daley.

3. Approval of the Minutes, Meeting 2, September 9, 2003
The minutes were approved as corrected.

4. Remarks from Chancellor Fox
I would like to continue the theme that started the meeting about safety, and I thank you for your work on the crime stoppers. We hope to continue collaborations at whatever level you deem appropriate. Safety of course is a top priority on this campus. I wanted to give you an update of where we are on the safety issues as we have gone forward.

At my suggestions, Co-chairs David Rainer, Associate Vice Chancellor for Environmental Health and Public Safety, and Tom Younce, Campus Police Chief have worked with me to appoint the committee that would be a task force on campus safety. I have now appointed them and have tasked them to undertake four tasks.

1) Assist in solicitation of input from constituents about how we can make the campus more safe.

2) To provide effective communication links with the campus.

3) To recommend which security enhancements and new technologies should be deployed and where. Along with these is video surveillance, access cards, displaying of badges, etc.

As I mentioned at the General Faculty Meeting there is going to have to be a balance there because as those kinds of techniques are suggested, not only is there a cost associated with them financially, but there are, for example with restrictions on access to buildings, academic values such as freedom to move on campus, that become partially restricted. Getting advice on that particular area is going to be very important.

I have asked them to provide feedback on allocation of resources that will be used for security.

I mentioned earlier as well that safety as a top priority has been protected from cuts because I think that is an important thing to do. The committee that has been appointed includes students, faculty, and staff. Dennis Daley represents the Faculty Senate on this important issue and we have provided a list of those names for you.

I have asked that I get a recommendation within ninety days so that before Christmas we would be at a stage where we could start making some decisions about allocation of funds and what needs to move to the top of that list. In the meantime, I would ask all of you to encourage your colleagues to interact very significantly with this task force so that the advice and results that come forward will make sense and represent the constituencies very well.

The other thing I wanted to mention to you today is a speech that Brad Wilson, Chair of the Board of Governors gave on August 8th and what it potentially would mean for this campus.

Chairman Wilson has a number of leadership issues that he wishes the Board of Governors to address this year. Of course it has to do with the future of higher public education, and in particular the funding as well as the aspirational basis for institutions in the State of North Carolina. To that end what he has called for is adequate funding of enrollment growth. Today I wanted to elaborate about potential opportunities as the Board of Governors goes forward with their work.

Providing an adequate funding base of course means state appropriation. With respect to tuition I want to bring to your attention the fact that Provost Oblinger is co-chairing with the President of the Student Body, Tony Caravano, a task force to look at tuition and how it impacts the function of the university. The Board of Governors at its last meeting declared that it is possible for us to make a proposal for a campus initiated tuition increase although they have not provided any of the parameters under which such proposals could be advanced. As a result, Provost Oblinger is working under a difficult situation because he is suppose to very quickly, in time for the Board of Trustees Meeting in November, come forward with a proposal for which the parameters will not have been defined until the week before that has to be delivered. He is working hard in that regard and I think we can compile data and look at trends for tuition nationwide and what they mean in terms of the quality of education, quite apart from the final recommendation. In other words, all of the preliminary work will be done. We will interact with faculty, interact with staff and students as well as part of this task force and I am sure that Provost Oblinger and Student Body President, Tony Caravano will provide extraordinary leadership in addressing this possible tuition increase.

The other part of what Chairman Wilson addresses again on this same issue of adequate funding for enrollment growth has to do with what he calls equity funding. Specifically within his speech he calls for details about funding that has created an accolade that works to the disadvantages of five campuses. Those campuses he identifies are Appalachian, East Carolina, UNC Charlotte, UNC Greensboro, and UNC Wilmington. You will notice that the two research institutions, NC State and Chapel Hill are not included in that definition. The reason that he believes these institutions have not been equitably funded has to do with the sheet that was handed out to you. This is the infamous twelve-cell matrix. I hope you will bear with me as I take you through at least a peripheral, very superficial view of how it is that this university gets money and how we have an opportunity, potentially as a function of Chairman Wilson’s leadership, to think about changing to some extent the funding base for enrollment growth.

This step starts out by what is shown in green, which is really the bulk of how the universities are funded. We are funded by a number of enrolled students, we are funded by the number of enrolled credit hours. Therefore the credit hours are assigned to one of the twelve blocks in this twelve-cell matrix. As you read across the green box you’ll see that you have Undergraduate, Masters, and Doctoral Programs and reading down there are four categories ranging from least expensive to most expensive. The first category are those which have little dependence on laboratory facilities or less than the average for a campus. Increasingly the second category has more dependence, the third more, and the fourth right now consists only of Engineering. What happens is that as our students come we look in the fall to see the number of additional semester credit hours that are added on top of our structure from the previous year. They can be plus or minus depending on that category. You will see for example, in Category I undergraduate, we increased the number of semester credit hours for undergraduates by 3,806, but in Category II we declined by 459 semester credit hours. We fill in this green matrix and then we look at where the semester credit hours are related to the number of faculty needed to teach that number of students. The yellow block is defined by a study from the Board of Governors and it suggests that the number appearing in the top left (643.72) means that an instructor offering a course which is an undergraduate Category I course is expected to teach 643 credit hours if he or she is a full time instructor. There are several ways to teach 643 credit hours. On average the system tells us that is the number. If you compare that to Category IV Doctoral, you see that the number is only 70 so there is almost an order of magnitude difference in the credit load, which is suggested for PhD Engineering students, compared to undergraduate, liberal art sorts of students. If you multiply the green block times the yellow block you get the blue block and the blue block tells you how many instructional positions are required at each level. From the number of instructional positions required we add up all the pluses and minuses and we get the numbers shown above the line. Total positions required are 11.24. In order to translate the number of faculty who would be hired to meet this enrollment growth to a number that we would work with in the budget, that 11.24 is multiplied by the instructional salary rate of the campus 72,501 which gives an amount which would be the increment for our budget which is $815,083. This is how our budget is generated each year. Mr. Wilson is willing to look at the equity. We could for example, recognize the Life Sciences which right now are in Category II are among the most expensive disciplines to start up and to conduct labs and if it was possible for us to convince the Board of Governors to move from Category II to Category III that would change the amount of the money that we would get from Life Sciences in a positive way. You can also see in the gray block when we multiply the number of positions by our average salary rate, $72,501, that salary rate is what we now have as a campus average salary for Assistant, Associate, and Full Professors across all departments. I think you could make a very strong case and I am hoping to do that this year that what is, is not necessarily in compliance with what the Board of Governors’ policy is. If you recall, the Board of Governors policy requires eightieth percentile among our peers and we are far from that. If we were to use instead of what is the salary rate on campus what should be the salary rate according to the Board of Governors policy, then that number $72,501 would go up, and therefore, if that goes up the multiplication goes up. What I see from this rendition of our twelve-cell matrix and from Mr. Wilson’s remarks is that there is a very good possibility that we now have the chance to make the case for both changing the yellow twelve-cell matrix that is a differential between different disciplines. If we have an opportunity to change the instructional salary rate, and if the Legislature continues as it has done in the past in fully funding enrollment change, we would have the possibility of having a firmer and more realistic financial basis for going forward. That is my approach in thinking about this positively from the Board of Governors. We are going to make the argument that the equity question that has been raised should be approached by saying we recognize that there are different cost for different categories but we would like to re-examine whether the assignments at each one of those blocks are correct and we would also like to examine whether the salary rate on the campus is the appropriate one for the multiplier in terms of real cost. If you continue to use the salary that exists rather than one that should be, there is no way that we can improve from where we are. I believe that creates inequity for all institutions, not only the five that are sited in Mr. Wilson’s structure.

We are at $815,083 with respect to changes in the instructional budget. We then recognize in what is referred to as the twelve-cell matrix the fact that not all expenses are faculty salary driven. That is, that there are other academic needs. With statistical justification, they have determined that 44.89% of the incremental salary would be enough to address those other needs. The calculated number then goes from $815,083 to $365, 929 to $1,181,012 in the pink block. That is to say it is important to recognize that the twelve-cell matrix doesn’t address only salary differentials and only faculty salaries. It recognizes that there are operating expenses and cost associated with the non-academic part of running an academic operation. So when we say protect the classroom we are talking not only about faculty salaries, but also about the operations of our departments. This gives us a basis for those experiences.

In the blue box you will see that there is another multiplier, the library rate that is 11.48%, which gives you, incremental funding for the library with respect to the additional demand created by the additional number of semester credit hours, and therefore students that are available. Again, we go to the next line and say that we need additional institutional support, 54.05%, the adjustment factor, and in the pink box we get facilities, which is how much is involved in running our buildings with these incremental students.

Finally in the orange box there is an allocation that is made with respect to the number of in state versus out-of-state students giving us a total requirement of almost two million dollars this year. What happens to this two million dollars? You go over to this purple box and see that same figure $1,956.421 and then you look at four categories of tuition. You put in the same number of people rather than semester credit hours into each of those blanks. You calculate exactly how much would be available from college tuition on campus. The number is $487, 170. That $487,170 is the difference that the Legislature will provide us as incremental enrollment funding. The Legislature has completely funded enrollment increases. That is how we get to that $1.9M. We expect approximately one half million from tuition and one and a half from the Legislature. As you know the tuition increased this year by five percent. That five percent was involved in calculating that one half million dollars. If the tuition had not gone up, then the $487,170 would be lower and as you can see nothing would change with respect to our budget. We would still need $1.9M. The $487,170 would be lower because the tuition was lower, therefore, the number that would come from the Legislature would be higher. I go through this because the purple block tells an important message about tuition, namely that if the Legislature raises tuition, it does not really change our budget. It changes their budget and it is where the money comes from whereas, if we have a campus initiated tuition increase that is off of the twelve cell matrix and we would have the funding that comes through this detailed calculation, and in addition we would have tuition increases that allow us to address campus needs. So when we interact on this tuition task force it is important for us to recognize the difference in terms of managerial flexibility between tuition collected and imposed by the Legislature and that which comes as a function of a campus initiated interaction. That is to say if we are forced to have a tuition increase because of operational cost to maintain excellence, it is in my opinion better for that to come as a campus initiated tuition increase because it gives us flexibility and as all of you know for the last several years we have been able to use those in two cases. The campus initiated tuition increases were used to address student financial aid. Both years about one third of it was used to address student needs to make sure that we have access and affordability for our students, and two thirds was available for other needs on campus. The first year, that was largely faculty salaries through an equity study and adjustments imposed by compression, depression, and diversion of salaries within departments. In the second year it was involved with faculty salary raises as well as some contributions to student life, which were deemed necessary at that point. As we go forward, one of the questions that Provost Oblinger is going to be addressing is, "What is the appropriate value for campus initiated tuition increase and how will that impact enrollment funding as we go forward." I want to tell you that this is good news, the fact that Chairman Wilson is bringing up the possibility of looking at this matrix again, gives us an opportunity to state the importance of research universities and to look at the details involved in this calculation. It also provides an impotent for Provost Oblinger to think very seriously about how much should come from base tuition and how much should be retained separately on campus for which we have some managerial flexibility.

In addition to that issue there are a lot of other issues in Chairman Wilson’s report. In addition to this equity funding there is a task force on teacher training and nursing. For example, if the box in the twelve-cell matrix that dealt with teacher education were to move up, that would represent an additional revenue source for us potentially. It also addresses the proposal for an 18% cap for out-of-state freshmen, an effort that is being led by UNC Chapel Hill. There are additional comments about employment contracts, code revisions, and a number of other items. If you are interested in where the Board of Governors is, it is suggested that you review these comments from Chairman Wilson. This may be a real opportunity for us to think about how to go forward and to get a more rational basis for the enrollment that we are continuously pushed to accept to make sure that there is more of an adequate response financially to those revisions as they come forward.

Senator Bruck asked for clarification on the five schools that were mentioned in the Chancellor’s remarks.

Chancellor Fox stated, "These are schools which are not named focus growth institutions, that is, the institutions that do not have unused capacity but they are not the research institutions. I believe that the thought process is that the research intensive universities are very successful attracting federal money and I think that is the reason that NC State and Chapel Hill are not included on this list as well. As you well know, attracting external sponsored research covers only the cost of sponsored research. It does not address the undergraduate or graduate teaching needs in the university, which have largely been funded by our Legislature. I should add that our Legislature has been very generous to us. They have cut us back less than a number of our aspirational peers around the country have been cut back and the fraction of our budget that comes from state appropriation is much higher than other places. That has been traditionally so. If you go back into the 1960's you would find that the budget at NC State was between 70 and 80 percent derived from state appropriation. That fraction is now down to 41% of our budget. At most Research I universities around the country that figure is approximately 25 percent. Although their appropriations are low, they get a larger fraction of their budget from tuition. Most large public, particularly land grant research institutions in the country get approximately one half of their budget from a combination of state appropriation plus tuition. In our case it is 41% from legislative appropriation and approximately 13% from tuition, so it is roughly the same amount. We get it, to a larger extent, from state appropriation. That being the reality, the chances that we are going to get a lot more money beyond what is outlined in this twelve cell matrix is quite remote and I think we have to be realistic about that. If we are to grow to invest in new opportunities, we are going to have to be very much proactive in finding alternate sources of revenue. I have to applaud the faculty for the growth that we have had in our sponsored research. We have been very active in trying to promote opportunities for private donors to step up and give back to this university, whether they are alumni or friends of the university. We have been very successful with that. The annual giving has tripled over the past five years, but still we have a low endowment. Part of the reason we have a low endowment is that our endowment was the beneficence of the citizens of North Carolina. That is, we were getting on the order of 40 to 50 percent of our budget from the state. Unlike many of our peers who have a buffer because of endowment, we don’t have that buffer and therefore the arguments that are made today about this twelve cell matrix become all the more important. I hope I can rely on you to make this argument. We want to enforce the importance of the twelve-cell matrix. We want to argue that perhaps some of the disciplines that are involved in one or the other blocks could be and should be moved to a higher category, and thirdly that this salary rate which is available for the instructional salary should be what it should be for our aspirational peers, not what it is now.

A student wanted to know if the General Assembly or the Board of Governors is making budget calculations for the purposes of appropriations at NC State and Chapel Hill based on federal grant monies.

Chancellor Fox responded: No they do not make determinations about that because that is a campus-based resource. It is controlled by the people around this table and their colleagues. How effective they are in attracting that kind of support provides a very important fraction of our budget but it is not at all controlled by the Board of Governors. The Board of Governors controls the instructional budget and they do so by taking a budget and taking an increment on additional students. Basically we will get no increase in budget unless the enrollment at the university increases which we are increasingly put under political pressure to do because as many of you know the demographics of North Carolina are such that there are 20% more students now in K-12 than there was five years ago.

Senator Warren wanted to know who makes the decisions about campus initiated tuition increases.

Chancellor Fox stated that the Board of Governors’ decision has to be approved by the Legislature but if the Board of Governor’s stops us, there is no proposal to be considered by the Legislature.

Senator Warren wanted to know what the likelihood is that the Legislature would think this year that a tuition increase might go back to the campuses as opposed to their general budget.

Chancellor Fox stated that it depends on how fast the economy recovers. It depends on a number of things.

A student wanted to know what the Campus undergraduate cost factor is that is listed on the chart.

Chancellor Fox stated that there are specific institutions that get special consideration. Those schools that have liberal arts focus growth get a 10% increment. Those are the six schools that have been considered historically black schools, plus Western Carolina. There is an increment for economies and scales of the small schools, which happen to be the same ones, get another 10% increment. None of these apply to NC State and that is why our number is zero. If we were one of those other schools we would have anywhere from 5 to 25 percent multiplied at that stage.

5. Issues of Concern
Response to Library Journals
Secretary Weiner stated that the issue of concern that was brought up was in regard to a request that comes out of Collection Management where they send a letter out asking the faculty to list any editorial responsibilities that they have for journals. It is merely for informational purposes. I can tell you that we use that in a very non-invasive way. I’m sure many of you have been contacted when we have an issue where a journal is going to become electronic or moved to the electronic environment and there are problems with the license and you are on the editorial board. Maybe you could have a conversation with the publisher about the content of the license so that we can in fact, sign a license here at NC State to provide access to the content.

Another issue that was brought to our attention was when the American Chemical Society proposed an interesting model for their access to their archives, we were able to talk with them and have some high level meetings with their editorial group. That is really the focus of what we use the information for. Duke and Carolina are very excited about it. In fact, they are trying to do this and collect that data from their faculty, and have used us as a model.

Senator Bruck is concerned about disasters from hurricanes being funded at the expense of State employees.

Chair Daley assigned the concern to the Governance Committee.

Senator Kasal is concerned about not having enough classroom capacity to guarantee seats for incoming freshmen at the same time as current students or the transfer students.

Chair Daley assigned the concern to the Academic Policy Committee.

Senator Jasper thinks that there is a miscommunication to students on what they understand the Adverse Weather Policy to be as opposed to classes cancelled.

Senator Bernhard is concerned about deceased faculty’s names appearing on the voter roster.

6. Committee Reports
Copyright Committee
Secretary Weiner reported that the Copyright Committee hosted the Provost at their last meeting and he agreed to support their efforts to clarify the airs of concern that have been raised by faculty and staff across campus regarding copyright and the NC State regulation. The issues that seem to cause the most concern are the ones of exceptional use and that of shop rights and these will both be looked at. "We are also examining the roll of the committee in educating faculty and staff on both the NC State Regulation and the UNC policy from which the regulation is written, and exploring the best way to do that and educate everyone on the issues. Copyright is a very complex area and people get confused. The members of the committee felt that this was a very productive meeting and want to thank the Provost for attending. We felt that we were able to provide some very good examples of where there were issues of confusion in the implementation of the regulation. We had a very frank and open discussion about streamlining and speeding up the review process. We plan to involve the Faculty Senate Committee on Resources and Environment and anyone else who is interested in working with the Copyright Committee toward clarification of this policy and making a proposal with recommendations to the Provost for perhaps changes to that regulation. We plan to do that at the next meeting and will be in touch with the Resources and Environment Committee.

7. Adjournment
Chair Daley adjourned the meeting at 3:55 p.m.

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