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September 22, 2009

Present:  Chair Overton, Past Chair Martin, Secretary Hergeth; Provost Arden; Parliamentarian Weiner:  Senators Akroyd, Anson, Argyropoulos, Auerbach, Bernhard, , Edmisten,Fahmy, Fleisher, Franke, Hatcher, Havner, Headen, Kidd, Kiwanuka-Tondo, Krim, Kocurek, Kotek, Levy, Murty, Paur, Poling, Roberts, Towsend, Williams

Excused:  Senators Croom

Absent:  Senators Carver, Genereux, Hemenway, Honeycutt, Miller-Cochran, Poindexter, Sawyers

Guests:  Lee Fowler, Athletic Director; P. J. Teal, Secretary of the University; Betsy Brown, Vice Provost for Faculty Affairs; Marc Okner, Employee Relations; Karen Helm, University Planning and Analysis; Marcia Gumpertz, Assistant Vice Provost, Diversity and Inclusion; Jon Rust, Textiles; Scott Goldsmith, Student Senator (CHASS); Joe Hice, Communications, Jeannette Moore, CALS Courses and Curriculum Committee, Animal Science; Fred Corbin, Professor Emeritus, CALS

1. Call To Order
Chair Overton called the third meeting of the 56th session of the NC State Faculty Senate to order at 3 p.m.

2. Welcome and Annoucements
Chair Overton welcomed Senators and Guests.

Chair Overton provided an update (handout) on the H1N1 virus as a follow-up to information received from Student Health Services on August 25th.

Chair Overton provided unedited draft copies of the comments from the September 8th meeting and noted that feedback should be sent to the Provost and to Karen Helm’s office. 

Senator Anson has set up an online survey to get feedback from CHASS on Provost Arden’s University budget and streamlining strategies.  He stated that it was a wonderful system and that thus far he has received 51 responses.

Chair Overton reminded attendees of the link to the Chancellor’s job description on the NCSU website.

3.  Approval of the Minutes, Meeting No. 2, September 8, 2009
A motion passed to approve the minutes.

4. Comments from Provost Arden
Provost Arden welcomed Joseph Hice as the new Associate Vice Chancellor and Chief Communications Officer.  Mr. Hice comes from the University of Florida.

Associate Vice Chancellor Hice stated that he’s looking forward to working with everyone on communication and noted that he has a very open door policy.

H1N1 Virus
Provost Arden voiced his concern about the number of students still going to classes sick because they do not want to miss class or get behind.  On the other side there are still a lot of instructors asking students for documentation of their illness.  He explained that the students have to get an appointment and go to Student Health Services and take up slots just to get documentation when Student Health Services are already overwhelmed with sick patients.  We need to get the word out that this is a time for increased flexibility and that with more than 500 cases on campus it is going to get worse before it gets better. He encouraged the faculty to show some flexibility on this issue.

Budget Update
Provost Arden stated that he is discussing the budget today because of the release of some budget information from the BOG meeting last week. 

Provost Arden explained that he wants to have a discussion about the differences between the data put out by GA and the data provided by himself and the Chancellor over the last month or so.  He handed out the budget cut spreadsheet and explained that the discussion is important not because it is going to make any difference in the amount of money available in our current budget, but in the spirit of full transparency, and making sure that faculty understand where the numbers come from, how they vary, and why they vary. 

Referring to the handout, Provost Arden explained that when the budget discussions began and we did not know what the actual budget cuts would be, we decided as an institution that rather than limping along with the minimum permanent cut from year to year, we were going to do a somewhat larger reduction anticipating the likelihood of further cuts that would occur over the year.  We actually started out planning for 18%, and then as we came through the process the budget predictions came in significantly lower, and finally GA requested to plan for a 10% budget reduction. 

Provost Arden stated that General Administration did not say that they would take 10% from our budget, but they requested a plan for 10% of our budget.  Different campuses in the UNC System handled this in different ways.  We and several other campuses decided to go forward and execute a 10% reduction.  He explained that they wanted to account for not only whatever permanent reduction came from the Legislature this year, but also for whatever reductions would come from the Governor during the course of the year. This way we could ensure that if there were different allocations from the Legislature and GA, we could account for that and give ourselves some flexibility rather than having to go back to the campus with further cuts multiple times during the year.   

Provost Arden stated that in his opinion there is nothing more demoralizing than going through a 5 or 6% budget cut and then coming back for another percent and then another percent. Therefore NC State submitted a plan for a 10% permanent reduction.  Other campuses submitted their planned 10%, but did not execute a reduction until the final legislative reduction was announced. That legislative reduction was around four to six percent depending on the campus.  He explained that when you are reconciling numbers in your head remember, a 10% reduction of our state allocation translates roughly to about 8.5 percent of our academic budget on campus, because we have to include tuition and fees in that, but then we have to renew student financial aid from the state allocation, so the numbers don’t match up completely. 

Provost Arden reported that NC State executed the 10% reduction, while other campuses have not.   About one month ago there was a lot of press about growth in administration after our budget reduction plan was already submitted.  There was a lot of press on reducing administration across all UNC campuses, not just NC State, and President Bowles reiterated that he was determined to reduce the administrative component and reallocate those resources. Consequently, when GA received the 10% plan from the campuses, the way they looked at it was that the amount of the permanent reduction ends up being about five percent and the remainder of it was a one time reduction that came from the Governor about one week after the budget was passed.

Provost Arden explained that General Administration looked at that 10% plan and allocated all administrative cuts components of the plan to the 5% permanent reduction, and the rest of the cuts to the non-recurring portion of the reduction.  When the data came out in the newspaper over the weekend, it was broken down into a permanent pot and a non-recurring pot.  On some campuses they only cut by the permanent budget reductions and kept the mandated flexibility reduction and the non-recurring portion in their budgets.  They are coming back to their campuses over the course of the year for additional funds, sometimes from one time funds and from vacant positions. NC State on the other hand had already executed the full ten percent. Where this gets a little confusing is if you recall some of the numbers that were publicized earlier.  The now 10% reduction shows impact in many aspects.  There was a loss of vacant faculty positions—117 faculty positions across the campus, most of which were vacant.  There was a loss of non-faculty EPA positions—about 117, and a loss of more than 200 SPA positions.  We lost seats, sections and we also lost about 3% of our total instructional capacity.  If you look at the data that is probably from GA, it shows that 96% of all the cuts for NC State were administrative and that very few of the cuts were academic. Essentially they looked at the administrative portion that was largely grouped into the permanent reductions part, and they view the remaining portion as a non-permanent reduction although we had taken it that way and treated all reductions the same.  In other words, it was a post hoc analysis of what we had already done, re-categorizing what was administrative and what was non-administrative or academic.   It is confusing and that is why Provost Arden discussed the issue today. It is also important that if faculty and other stakeholders are trying to reconcile that, someone comes away thinking that 96% of all the cuts at NC State were administrative, as it shows in some of the spreadsheets.  It really has to do with how GA looked at the cuts, in terms of mandated and non-permanent, and how they grouped administrative cuts into the mandated portion.

Provost Arden stated that there are several other things in the report worth noting.  At NC State we talk about a possible $53M cut, and the report shows a figure of $57M.  At the top of the sheet there is a line itemizing “unfunded continued budget increases” of $4.8M.  When we received our current years budget there was an additional amount that we would normally get as inflationary increases. In the budget planning process, NC State’s administration considered ten or eleven million dollars of inflationary increases that were not being funded, and decided that about $4.8M of those could be taken off of the top of our budget cuts. This is basically the difference between the $53M that the Chancellor and I have been talking about and the $57M. 

Provost Arden stated that it is important that when we talk to our stakeholders that we are able to explain these differences.


What should we say? (Headen)

Provost Arden responded that if you simply look at the legislative required permanent reduction, which is about 5%, then in the way GA groups our reductions, the majority of that pot is defined as administrative.  He explained that there are a lot items in this group that we may not think of as administrative.  Looking at it from the GA perspective, they took from our budget cuts what they considered the legislative mandated permanent reduction, and the majority of that was administrative. In NC State’s particular case we deliberately implemented a larger reduction and considered it permanent so that we wouldn’t have to go back and take those one time reductions over and over again.  If the majority of those one time reductions do not turn into permanent reductions then we will have funds available for strategic reinvestment into the campus. So we as a campus enacted a far larger reduction.  We on this campus are not necessarily considering those one time reductions as truly one time, because history tells us that most frequently those one time reductions become permanent reductions. We did not want to have to keep coming back and reducing each time again.  In fact, the reductions that we saw on our campus were not 96% administrative but did involve a significant number of faculty positions and non-faculty EPA positions and they do have a significant impact on the future of the university.

Do you know why GA is doing this?  This looks like shooting off a smoke bomb to confuse people.  I think we have had enough confusion over the last two years.  It really appears that GA is sacrificing the university for some political argument. (Martin)

Provost Arden stated that he believes President Bowles has a sincere intention to cut the administrative portions of our operations way more than the non-administrative portions.  We have to remember that for many of the campuses they had submitted a 10% plan, but they had not enacted that 10% plan. GA came back and said we want several parts that adds up to roughly 5%, and we are going to group that together and that is your mandated permanent cut.  The rest you can deal with as a one time cut, so what they are generally saying to many of the campuses is the part of the permanent cut that we are telling you to take is these administrative positions.  In our particular case and with a couple of other campuses we had already enacted the full 10%, so that is from where the difference comes.

Past Chair Martin voiced his concern about a non-administrative position in his college that he feels was included in the cuts as administrative.

Provost Arden stated that he is concerned that people would look at these numbers and come away thinking that NC State took 96% of its cuts in administration only.  There are two issues there:

We enacted more than the minimum 5% permanent cuts.
  1. We define administration in different ways than GA, and the position that you (Past Chair Martin) referred to is not one that you and I would call administrative. 

Provost Arden stated the important thing is not to be able to defend one way or the other, but to be able to reconcile and explain, to let people know that there are a couple of different dynamics going on.  He thinks that President Bowles and General Administration are very genuine in their desire to reduce the administrative component of the budget. 

Provost Arden believes that we as an institution decided to act more broadly and more comprehensively and he thinks that was the right thing to do.  He stated that the short term plan definitely extends beyond the positions listed here in GA’s administrative cuts.  Folks do need to understand that many of the cuts that we made are part of that 10%, and they are not reflected in that five percent mandate. They are really reflected in the one time academic cuts. 

Have we looked at the way they categorized these cuts?  The argument could be made that we are trying to protect the academic side of this house.  (Kocurek)

Provost Arden responded that he thinks that the strategy that President Bowles and GA are taking is that we are going through some tough times, but we are trying to protect the academic side of the house.  He thinks that is a reasonable and valid argument to make. 

Provost Arden explained that the reality is the way we and other campuses chose to execute this.  We executed them as permanent cuts across the board on the full ten percent and at the end of the day there may not be as much difference because many of those one-time cuts may become permanent cuts and we did not want to keep going back for more one time cuts. 

Senator Auerbach commented that it would be good to communicate something that is consistent.  It seems that there is a lot of fudging going on in what counts as an administrator.  He thinks a system needs to be designed.

Senator Headen commented that we are talking about technical solutions—but the game is image problems. 

Assistant Vice Provost Gumpertz commented that what is done here looks like it is either academic or administration.

Provost Arden stated that he thinks that is the way they are billing it, that if it is not in the cross wing in teaching, then it’s administrative; that it goes back to the study that defines the core and support roles for the university system.

The question was asked, before GA came up with their percentage, what was NC State’s percentage?

Provost Arden stated that we could come up with a number, but he does not know how that compares to GA’s number. He stated that there is always a tendency to think that something is going on there, but the reality is if you look at the way GA intended for this to happen, they intended for the campuses to submit a 10% plan. And depending on how the permanent reduction came down they would select different pieces of that plan that matched the permanent reduction that they wanted to implement. So in those campuses that went ahead and implemented that part of the permanent reduction, their numbers pretty much match up with the GA numbers.

Of the people that lost positions how many ended up staying at the university? (Paur)

Provost Arden stated that the vast majority of all those filled positions that were lost have been notified and those RIFs executed.  How many ended up staying at the university, he could not provide an exact number but did not think it was a lot. GA has asked our financial officers to reconcile those things. In other words where we said that a particular position would be eliminated or riffed, they have come back and insured that this is what happened.

Vice Provost Brown noted that that some people were moved to other sources of funds. 

What does President Bowles and GA say when you go back to them and say we’ve already taken permanent cuts?(Martin)

Provost Arden stated that he will be at GA tomorrow and plans to have that discussion. He thinks the discussion that Charlie Leffler has had with their Chief Financial Officer is that they think the way we went about it was strategically appropriate, that rather than executing the minimum permanent cut having to come back with a one time cut that may become permanent to actually do a broader 10% cut which would cover the cost of this year. This way we do not have to come back with more layoffs, more cuts, more adoptions wondering what it’s going to be like toward the end of the year but we may have the opportunity for a strategic investment out of that ten percent.  The feedback that we have been given is that it was very wise budgetary planning.  They are giving us the flexibility to make those budgetary decisions.

Provost Arden stated that there can be uniformity across the campuses in the way we agree as to among our academic affairs budget, what proportion goes to expenditures or how we define what is truly core academics. He thinks that would be handy for all of us.  Part of the issue may be defining for our own campus what is truly administrative, and this is a worthwhile exercise.  I fundamentally agree with President Bowles that we need to be looking at redirection of our resources through our core mission as appropriate so we can have that discussion and we can define it, so that we can track it on campus, but at the end of the day we also have to be aware that we exist in a larger system, that we cannot be using number sets and data sets that are meaningless when compared with other campuses or GA.

What positions within a department would you consider administrative? (Fahmy)

Provost Arden responded that he thinks GA defines it more broadly than you or I might.  The Administrative Assistants in some of these cases are defined as administrative.  It would be nice to have some uniformity across the campuses so that they are comparing apples for apples.

Provost Arden noted that in at least three different faculty meetings he was asked, why do we get hit harder than Chapel Hill?  If you look at Chapel Hill on their adoptions and percentages their total percentage of adoption is higher than ours. 

If we don’t reach a 10% cut there is some possibility of what you call strategic investments coming back to the University—so how are those decisions going to be made.  (Anson)

Provost Arden responded that those decisions would be made with advice from the University Budget Advisory Committee, the Executive Officers, the Deans, Department Heads, and input from the Faculty Senate.  The Chancellor has made it very clear that he has certain strategic reinvestment priorities as a campus.  He has also made it clear that money is not necessarily going to come back the way it went out.  He has talked about things such as investments in interdisciplinary programs.  He has talked about investment in development and these are things that he thinks are very high priority for the long term of the university. 

Provost Arden stated that if things level out this year financially, even at the end of this financial year we should have some funds to begin to reinvest.  We have a little bit of tuition increase money this year.  We do have a little bit of enrollment increase money that normally would have been given out to the third year of the compact plan.  We did put that third year of the compact plan on hold.  He predicts a fairly even but lean year.  We may have some funds to start reinvesting in the last quarter, but in the next financial year we are predicted to get even more enrollment increase money.  We should start seeing a little bit of improvement next year. 

The one thing that will hurt us a little next year, unless it changes, is tuition.  In the second year of this budget it is currently in the legislation that there will be a two hundred dollar increase to the base tuition, which will be an offset to state appropriations. It is not a campus initiated increase, so that will not come back to the campus.  That, for this year will raise about $3.0M, which cover things like need based financial aid, faculty promotions, and graduate student support plans. 

Provost Arden stated that the Tuition Committee just finished making recommendations to the Chancellor, but in that he sees the opportunity for some strategic reinvestment in the last quarter of this year, and that we are definitely going to have some funds to invest in the coming year.   

Does the state take back money that we don’t spend?  (Franke)

Provost Arden stated that if receipts are lagging behind then they can put in place appropriated funds like they did this year and then we have to give some back.  His hope is that if the economy stabilizes and that this will not be the case.  I think one of the reasons that Governor Purdue enacted this one time rescission fairly rapidly and early in the financial year was that she did not want to be caught in the same situation as last year where she did not have enough money. 

Provost Arden stated that he wants to achieve a balance on this discussion.  It is very important that we are transparent on this and if there are issues like difficulty in resolving the numbers that the Chancellor and Provost are putting out there, faculty should bring them to their attention so that we can work through them.

5. Issues of Concern
Jeanette Moore from Animal Science is concerned that the planned Environmental Science major is going to be administered by the Provost’s Office/DUAP, and that there would not be the usual faculty oversight of the curriculum.  She is also concerned that there will be a degree granted by the Division of Academic Programs rather than by an academic unit.

Provost Arden commented that the issue is a valid concern.  One of the things we need to struggle with is how we best administer interdisciplinary programs and. There has been extensive work over the last couple of years on an environmental science program which would award an undergraduate degree in environmental sciences.  One of the discussions is where would that be administered and at one stage there were several ideas put on paper.  One of them is to run it out of the Provost’s Office but the Provost does not favor this idea.  Another one was that DUAP would provide an administrative home. 

The Chancellor and the Provost feel strongly that academic degrees, in general, belong into the academic units and the colleges and that is their overwhelming preference on this. There is still the question of how to appropriately support and encourage programs to be truly interdisciplinary, and often when they go into a specific college they end up being retreated into that college rather than being interdisciplinary. This is an issue that we are wrestling with, the Provost would like everyone’s input on this at some future meeting.  This is something that we need to discuss as a community.   DUAP or the Provost’s Office were discussed as an option, because the institution was struggling with what would be the best way to administer interdisciplinary programs. 

Past Chair Martin is concerned about a discussion by GA that instead of using enrollment growth funding, we may have to look at graduation rates as a means to deal with university base funding.  He thinks that this is a bad idea that is getting a lot of press. 

6. Adjournment
A motion passed to adjourn the meeting at 4:20 p.m.
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