COLEMAN FIELD RENOVATION, OSU

Staff Report to the Board

Oregon State University is seeking Board approval to repair, renovate, and remodel the Coleman Field Baseball Facility, to provide a completely renovated baseball park and new storage facilities for the men's baseball program. The project will include the replacement of the existing uncomfortable and outdated bleacher seating (current capacity of 3,000) with 590 theater seats, 860 new bleacher seats, and 11 handicapped viewing seats for a total new capacity of 1,461. A portion of the seating will be covered by a roof.

In addition, a new press box will be built to replace the existing inadequate one. Team dugouts will be relocated and new public restrooms, a concession stand, and storage facilities will be provided. Code and handicapped access requirements will also be met. As part of the renovation effort, a brick exterior face of the ballpark will be added to better link the facility with existing buildings in the vicinity.

OSU's Athletic Department has considered this project a high priority for several years. The department will be able to use the enhanced baseball facility as an element in its recruitment drive. The campus intends to generate funds for baseball scholarships and facilities maintenance through advanced, guaranteed ticket sales for the new theater seats.

Maintenance and upkeep of the facility will be paid from gifts and other fund raising activities of the OSU Athletic Department. The project will not result in the need for additional parking since there will be a reduction in seating overall.

University plans call for construction to begin in June 1998, upon completion of the PAC-10 baseball season, pending Board and Emergency Board approval and the completion of successful fund raising.

The campus is seeking an Other Funds expenditure limitation of $2.2 million for this project. The project will be funded from a large private donation (which also provided funds for University scholarships) as well as other private donations and gifts-in-kind.

Staff Recommendation to the Board

Staff requests that the Board approve the Coleman Field Baseball Facility Project to allow the Board's Office to seek authorization from the Emergency Board for an Other Funds expenditure limitation of $2.2 million for the project. Staff also recommends that the Board authorize the Vice Chancellor for Finance and Administration to approve proceeding with bid solicitation to renovate the facilities when the University demonstrates that adequate gift funding has been secured to fund the project as designed and is available for expenditure.

BOARD ACTION:

AMENDMENT TO OAR 580-040-0035, SUMMER SESSION FEE BOOK

Staff Report to the Board

Each year at this time the Board approves summer session fees. The proposed fee rates and policies are set forth in the accompanying Fee Book schedule. A public hearing on the proposed fees was held on December 18, 1997; no one attended this hearing, nor was any written testimony submitted.

Under existing policy (initiated in 1982) summer session instructional costs are to be funded entirely with fee revenues generated during the summer term. As a result, institutions are required to propose fee rates and estimate summer session enrollments so that sufficient revenue will be generated to cover direct costs (faculty salaries, instructional support staff, classroom supplies, and expenses, etc). Therefore, the individual institutional fee recommendations reflect differences in program costs and estimated attendance.

This practice differs from the academic year (fall, winter, spring terms) whereby resident undergraduate instruction fee rates were frozen at 1996-97 levels. The proposed fee rates are currently reviewed to test for reasonableness (inflationary cost increases, changes in minimum wage). In those cases where the fee revenue provides student services and student life activities, the staff reviews the proposed fee to ensure that it was endorsed by student government or through student referendum.

The staff believes that each proposed fee meets this test and warrants the favorable action of the Board.

Tuition represents the mandatory enrollment charges assessed all students in the summer session program of Oregon State System of Higher Education (OSSHE) institutions. Tuition is comprised of the following separate fees: Instruction, Resource, Building, Incidental, and Health Service. The revenue generated by each tuition element is dedicated to a specific purpose, independent of the other components.

Instruction Fees: Instruction fees support the direct instruction and administrative costs of each institution's summer session program. The recommendations are summarized on Schedule 1. To determine the recommended instruction fee rates, institutions must balance the fiscal requirements of their summer session operating costs with market considerations such as tuition rates of competing education providers. Although there was considerable notice about the legislature's action to freeze the instruction fee for academic year resident undergraduate students, that tuition relief was made possible by offsetting state General Fund support. The direct cost support policy of the summer session program requires that it be "self-supporting." Regardless, most institutions are recommending small or no increases in this year's summer instruction fees.

Building Fee: The building fee is the same for all institutions. The rate for 1998 is increasing by 31 percent, to $19 per student. This increase is related directly to the comparable increase for the 1997-98 academic year rate. The summer session building fee was at $14.50 since 1991-92.

This fee generates monies to finance the debt retirement for construction associated with student centers, health centers, and recreational facilities constructed through the issuance of Article XI-F(1) bonds. The rate assessed during the academic year is set by the Legislature through ORS 351.170. In July 1996, the Board was presented with a proposal to increase this fee as part of the submission of the 1997-1999 Capital Construction Budget Request. Subsequently, the 1997 Legislature approved the Board's request to authorize an increase in the academic year student building fee to $25.00. Historically, the building fee during summer session has been approximately 80 percent of the academic year rate.

Resource Fee: Resource fee changes recommended by the institutions are described below and shown on Schedule 2. Resource fees provide funds for specific programs to assist with resource materials, equipment, and specialized services. The fees are assessed only to targeted student populations admitted to, or generally understood to be enrolled in, specific programs. Students enrolled under the part-time student fee policy are subject to the resource fees appropriate to specific courses taken. The technology resource fee is assessed to all students. Resource fees may be proposed by institutions for approval by the Board. Summer session operations are exempt from the academic year policy restricting the estimated income of all such fees to be no more than five percent of Education and General budgeted resources, exclusive of institution-specific income.

Incidental Fee: Incidental fee changes are described below for each institution and summarized on Schedule 3. Incidental fee recommendations are generally made by student committees in accordance with a Board-approved incidental fee policy (OAR 580-010-0090) on each campus. In some instances the student committee recommendations are supported by general campus student referenda. The funds generated by this fee are to be used for "student union activities, educational, cultural, and student government activities, and athletic activities." The president of each institution reviews the student committee recommendations. Once satisfied with each proposal, presidents submit recommendations to the Chancellor, who, after review, submits proposals to the Board. There are fewer incidental fee supported activities during the summer term, resulting in significantly lower rates than those assessed during the academic year.

Health Service Fee: Institution recommendations for health service fees are described for each institution below and summarized in Schedule 4. This fee is used to support each institution's student health service, which are operated as auxiliary services. Generally, rate increases reflect the institutions' efforts to maintain the self-support nature of these services. Optional health insurance policies are also made available by some institutions. During summer sessions, student health services operations are generally at reduced levels or not provided at all. The recommended rates reflect these levels of service.

Total Tuition: The total tuition rates for each institution compared to the 1997 summer session are summarized on Schedule 5. This is the sum of instruction, technology resource, building, incidental, and health services fees.

Institutional Recommendations

The following are explanations for each institution-generated fee recommendation. Each of these proposals has been reviewed by the Chancellor's Office staff. In some cases institution proposals were returned to the institution for further review and justification. Each of these fee proposals has met the criteria outlined at the beginning of this narrative.

Eastern Oregon University

Total summer session tuition at EOU is increasing 3.0 percent for undergraduate students and 3.2 percent for graduate students over the 1997 summer rates. In addition to the building fee increase, EOU is increasing instruction fees.

The per credit instruction fees are being increased by 5.8 percent and 5.7 percent respectively for undergraduates and graduates. The instruction fee rates had not been increased in two years. However, the financial impact on individual students will be lessened because EOU is eliminating the past practice of a higher charge for a student's first credit hour. This reduces the charges for the first credit by $20.50 for undergraduate and $18.50 for graduate students. The result is that students taking fewer than seven credit hours will have the same or a lower total instruction fee cost than in 1997.

EOU is recommending that the technology resource and incidental fees remain at 1997 rates. Health services are not provided during summer session, and therefore no fee is assessed.

Oregon Institute of Technology

Total tuition at OIT is increasing 3.5 percent for undergraduate students over the 1997 summer rates. Graduate courses are not offered during summer session. In addition to the building fee increase, OIT is recommending a minor increase in its incidental fee and is installing a technology fee.

OIT initiated a technology resource fee in the 1997-98 academic year. It is recommending this fee be extended to summer session at $2 per credit hour up to $24 per summer term. All other institutions charge this fee in the summer session.

The incidental fee is being adjusted from $30.50 to $31. This is simply to allow the total tuition to be summed in whole dollars as a result of the change in the building fee from $14.50 to $19.

OIT is recommending its instruction fee remain at 1997 rates. Health services are not provided during summer session, and therefore no fee is assessed.

Oregon State University

Total tuition at OSU is increasing 1.6 percent for undergraduate students and 1.3 percent for graduate students over the 1997 summer rates. In addition to the building fee increase, OSU is recommending increases in its instruction, technology resource, incidental, and health service fees.

The instruction fee for the first credit hour is being increased by two dollars. This element of the fee has not been charged for three years. The per credit hour increment beyond the first credit hour remains unchanged at $71 per credit hour for undergraduates and $120 per credit hour for graduate students.

The resource fee is being increased by one dollar. The fee is $16 for the first four credit hours and $31 above four credit hours. This is a 6.7 percent increase through the first four credit hours and a 3.3 percent increment for more than four credit hours. This proposal is an extension of the fee increase approved for the 1997-98 academic year.

The incidental fee is being increased by $3.50, or 8.5 percent, for the first credit hour. The per credit hour increment for each additional hour is remaining the same as in 1997 at $5 per credit hour. This fee is graduated to a maximum of $79.50 above seven credit hours, which is 4.6 percent over the maximum rate for 1997. The summer session proposal is related to the incidental fee increase approved for the 1997-98 academic year, principally to fund program service improvements.

The health service fee is being increased by 10.2 percent, from $59 to $65, consistent with the $6 increase approved for the 1997-98 academic year. It will be used to sustain health services operations at present levels in response to rising operating costs and lower enrollment levels.

Portland State University

Total tuition at PSU is increasing .7 percent for undergraduate and .6 percent for graduate students over the 1997 summer rates. In addition to the building fee increase, PSU is recommending a minor increase in its instruction fees and an increase in its health services fees.

The instruction fee is being increased by 50 cents to allow the total tuition to be summed in whole dollars as a result of the change in the building fee from $14.50 to $19.

The health services fee is being increased by 8.7 percent, from $23 to $25, to advance PSU's goal of lessening the subsidy of the summer term's health center expenses by students attending in the regular academic year.

PSU is recommending that its technology resource and incidental fees remain at the 1997 rates.

Southern Oregon University

Total tuition at SOU is increasing 1.2 percent for undergraduate students and .9 percent for graduate students over the 1997 summer rates. In addition to the building fee increase, SOU is recommending increases in its incidental and health services fees.

The SOU incidental fee is being increased 8.5 percent, from $29.50 to $32. This is directly related to the approved increase in the 1997-98 academic year and the desire to keep a consistent pattern of charges between summer session and academic year fee rates. The academic year increase was the result of program service increases and the new minimum wage law.

The health services fee is being increased 8.1 percent, from $37 to $40. This also is directly related to the approved increase in the 1997-98 academic year and the desire to keep a consistent ratio between summer session and the academic year rates. The academic year increase was the result of labor increases and a funding shift for counseling services.

SOU is recommending its instruction and technology resource fees remain at the 1997 rates.

University of Oregon

Total tuition at UO is increasing .5 percent and .4 percent for resident undergraduate and graduate students respectively; 4.8 percent and 3.5 percent for nonresident undergraduate and graduate students respectively; and .2 percent and .7 percent for resident and nonresident law students respectively, over the 1997 summer rates. In addition to the building fee increase, UO is recommending a minor increase in its instruction fee and an increase in its nonresident resource fee and its incidental fee. The UO is also proposing minor decreases in the law resource fees.

The instruction fee is being increased by 50 cents to allow the total tuition to be summed in whole dollars.

The nonresident resource fee is increasing 20 percent, from $25 to $30. This fee has not been increased since it was first assessed in 1994.

UO is recommending that its technology resources, incidental, and health services fees remain at the 1997 rates.

The general resource fees for the law program are being reduced by 50 cents for the first credit hour to allow the total tuition to be summed in whole dollars. The per credit rate for each additional hour is increasing by $2, or 7.1 percent, from $28 to $30 per credit hour.

Western Oregon University

Total tuition at WOU is increasing 4.6 percent for undergraduate students and 2.3 percent for graduate students over the 1997 summer rates. In addition to the building fee increase, WOU is recommending increases in its instruction, incidental, and health services fees.

The instruction fee is being increased for the first credit hour by 4.5 percent for undergraduate and 2.5 percent for graduate students. Incremental rates for credit hours above the first are increasing by 4.4 percent for undergraduate and 1.8 percent for graduate students. In recent years the mix of summer session students has shifted to an increasing share of undergraduate students. The greater increase in undergraduate instruction fee is to support this increased demand.

The WOU incidental fee is being increased 2.7 percent, from $37 to $38. This is directly related to the approved 1997-98 academic year increase due primarily to program service expansions.

The health services fee is being increased 3.7 percent from $27 to $28 to support an increase in service level initiated in the 1997-98 academic year.

WOU is recommending its technology resource fee remain at the 1997 rates.

Schedule 1

Instruction Fees - Summer Session 1998

1997

1998

Percent Diff

Instruction Fee

First Hour

Each Add'l

First Hour

Each Add'l

First Hour

Each Add'l

Undergraduate
EOU 93.50 69.00 73.00 73.00 -21.93% 5.80%
OIT 89.00 64.00 89.00 64.00 0.00% 0.00%
OSU 101.50 71.00 103.50 71.00 1.97% 0.00%
PSU 121.50 69.00 122.00 69.00 0.41% 0.00%
SOU 102.00 59.00 102.00 59.00 0.00% 0.00%
UO 100.50 75.00 101.00 75.00 0.50% 0.00%
WOU 99.50 69.00 104.00 72.00 4.52% 4.35%
Graduate
EOU 130.50 106.00 112.00 112.00 -14.18% 5.66%
OSU 150.50 120.00 152.50 120.00 1.33% 0.00%
PSU 169.50 117.00 170.00 117.00 0.30% 0.00%
SOU 155.00 112.00 155.00 112.00 0.00% 0.00%
UO 146.50 116.00 147.00 116.00 0.34% 0.00%
UO Law 192.00 190.00 192.00 190.00 0.00% 0.00%
WOU 140.50 110.00 144.00 112.00 2.49% 1.82%
*OIT offers no graduate courses summer term

Schedule 2

Resource Fees - Summer Session 1998

1997

1998

Percent Diff

First Hour

Each Add'l

First Hour

Each Add'l

First Hour

Each Add'l

EOU
Tech Fee - All 4.00 4.00 4.00 4.00 0.00%

0.00%

OIT
Tech Fee - All 0.00 0.00 2.00 2.00
OSU
Tech Fee - All 15.00 16.00 6.67% 3.33%
PSU
Tech Fee - All 3.00 3.00 3.00 3.00 0.00% 0.00%
SOU
Tech Fee - All 2.00 2.00 2.00 2.00 0.00%

0.00%

UO
Tech. Fee All 30.00 0.00 30.00 0.00 0.00%

--

Nonresident 25.00 25.00 30.00 30.00 20.00% 20.00%
N/R - Law 30.00 28.00 30.00 30.00 0.00% 7.14%
Gen Resrc Law 68.50 68.00 68.00 68.00 -0.73% 0.00%
WOU
Tech Fee - All 2.00 2.00 2.00 2.00 0.00% 0.00%
Maximum amount assessed: EOU - $50; OIT-$24; OSU - $30 @1997, $31 @ 1998; SOU - $24.
OSU rate $16 1-4 credit hours, $31 above 4 credit hours.

Schedule 3

Incidental Fees - Summer Session 1998

1997

1998

Percent Diff

First Hour

Each Add'l

First Hour

Each Add'l

First Hour

Each Add'l

EOU 30.00 0.00 30.00 0.00 0.00%

--

OIT 30.50 0.00 31.00 0.00 1.64%

--

OSU 41.00 5.00 44.50 5.00 8.54% 0.00%
PSU 50.00 0.00 50.00 0.00 0.00%

--

SOU 29.50 0.00 32.00 0.00 8.47%

--

UO 27.00 0.00 27.00 0.00 0.00%

--

WOU 37.00 0.00 38.00 0.00 2.70%

--

Up to 76.00; Up to $79.50

Schedule 4

Health Service Fees - Summer Session 1998

1997

1998

Percent Diff

EOU -- -- --
OIT -- -- --
OSU 59.00 65.00 10.17%
PSU 23.00 25.00 8.70%
SOU (9 hrs or more) 37.00 40.00 8.11%
UO 55.00 55.00 0.00%
WOU (6 hrs or more) 27.00 28.00 3.70%

Total Compared to Summer Session 1997

The following schedule compares rates for summer session 1997 to summer session 1998.
Schedule 5
Total Tuition - Summer Session 1998
12 Credit Hours - Undergraduate 9 Credit Hours - Graduate
Total Tuition Summer
1997
Summer
1998
Percent
Diff.
Summer
1997
Summer
1998
Percent
Diff.
EOU 947.00 975.00 2.96% 1,059.00 1,093.00 3.21%
OIT 838.00 867.00 3.46% -- -- --
OSU 1,062.00 1,079.00 1.60% 1,290.00 1,307.00 1.32%
PSU 1,004.00 1,011.00 0.70% 1,220.00 1,227.00 0.57%
SOU 856.00 866.00 1.17% 1,150.00 1,160.00 0.87%
UO Res. 1,052.00 1,057.00 0.48% 1,201.00 1,206.00 0.42%
UO Nonres. 1,352.00 1,417.00 4.81% 1,426.00 1,476.00 3.51%
WOU 961.00 1,005.00 4.58% 1,117.00 1,143.00 2.33%
UO Law Res -- -- -- 2,451.00 2,455.00 0.16%
UO Law NR* -- -- -- 2,705.00 2,725.00 0.74%

Total Tuition Compared to Preceding Academic Year

Rate structures for summer session have developed as institutions adapted to direct cost support following the 1982 elimination of General Fund support of summer session. The effect of direct cost support on fees and assessments can be measured to some extent by comparison with academic year charges. The summer session rates proposed for 1998 and 1997-98 academic year resident rates, except for the University of Oregon as noted, are compared on the following schedule.
Schedule 6
Academic Year Term to Summer Session
Resident Resident
12 Credit Hours - Undergraduate 9 Credit Hours - Graduate
Total
Tuition
Summer
1998
Acad.Term
1997-98
Summer@
% Acad Yr
Summer
1998
Acad.Term
1997-98
Summer@
% Acad Yr
EOU 975.00 1,077.00 90.53% 1,093.00 1,719.00 63.58%
OIT 867.00 1,103.00 78.60%

--

1,698.00

0.00%
OSU 1,079.00 1,170.00 92.22% 1,307.00 2,004.00 65.22%
PSU 1,011.00 1,119.00 90.35% 1,227.00 1,956.00 62.73%
SOU 866.00 1,068.00 81.09% 1,160.00 1,687.00 68.76%
UO Res. 1,057.00 1,216.00 86.92% 1,206.00 2,050.00 58.83%
UO Nonr. 1,417.00 4,033.00 35.14% 1,476.00 3,483.00 42.38%
WOU 1,005.00 1,051.00 95.62% 1,143.00 1,664.00 68.69%
UO Law Res* -- -- -- 2,455.00 3,350.00 73.28%
UO Law NR* -- -- -- 2,725.00 3,350.00 81.34%

* The Law School amounts are stated in per term rates, although the academic year is on the semester basis.Tuition rates are not fully comparable. The academic year rates apply to a range of credit hours designated for full-time students classified as residents (12-18 credit hours for undergraduates and 9-16 credit hours for graduates). Summer session rates displayed are for 12 undergraduate credit hours and 9 graduate credit hours. Additional summer credit hours require incremental charges. Also, incidental and health service levels differ from academic year to summer.

Room and Board Rates

Summer session room and board accommodations on each campus vary according to the need and demand. They may include rates by day, week, multi-week, or term. A combined room and board rate is usually offered, as well as rates for room only, board only, and conference activities. Rates are generally comparable to those for individual terms of the academic year.

The rates shown in the tables in the fee book are for all campuses except PSU, where College Housing Northwest, Inc., operates the residence halls and establishes the rates as specified in a service contract. The rates require preliminary review and approval by PSU officials before becoming effective.

Proposed rate increases from summer session of 1997 to 1998, summarized in Schedule 7, generally vary from .9 percent to 6.8 percent for a basic housing package. These and the other institutions' rate increases are consistent with increases for the preceding academic year. They are based on anticipated cost increases for labor, utilities, services, food, and debt service pool as well as some facilities improvement and expansion of services available to residents.

Comparison of Basic Residence Hall Rates - Summer 1997 to 1998

The following are comparative samples of room and board rates for a basic dorm room with double occupancy. Each institution offers a variety of room and meal options at rates above and below these listed. Refer to the Fee Book for a more definitive schedule of rates.

Schedule 7

Selected Housing Rates - Summer Session 1998

Institutional Contract Type 1997 1998 % Difference
EOU Per Night - Multiple (Room Only) 10.50 11.00 4.76%
OIT Eight Week - Double (Room Only) 440.00 446.00 1.36%
OSU Eight Week - Double 1,026.40 1,096.00 6.78%
SOU Eight Week - Multiple 969.00 1,012.00 4.44%
UO Eight Week - Multiple 913.00 969.00 6.13%
WOU Six Week - Per Person 773.31 788.78 2.00%

Public Hearing

A hearing was conducted on December 18, 1997, at 10:00 am in Room 121 of Susan Campbell Hall on the University of Oregon campus concerning the 1998 Summer Session Fee Book. There was no testimony presented at the hearing, nor was any written testimony submitted.

Staff Recommendation to the Board

Staff recommends that the Board amend OAR 580-040-0035 as follows:

(NOTE: Underline denotes addition; italics denote deletion.)

Summer Session Fee Book

580-040-0035 The document entitled "Summer Session Fee Book" dated [January 17, 1997] January 16, 1998, is hereby adopted by reference as a permanent rule. All prior adoptions of summer session fee documents are hereby repealed, except as to rights and obligations previously acquired or incurred thereunder.

Through the amendment, the residence hall and food service charges and the tuition and fee rates and policies applicable during the 1998 summer session will be adopted.

BOARD ACTION:

AMENDMENT TO OAR 580-021-0030, VACATION LEAVE

Staff Report to the Board

OSSHE's current vacation policy is somewhat unusual in that 176 hours are awarded at one time, each year, unlike vacation policies in other settings, whereby individuals accrue time on a monthly basis. Most employers require that an employee be at work for at least six months before vacation time can be used, and most employers set a maximum vacation leave balance. We find these patterns to be prevalent with those institutions using the automated Human Resources Information System (HRIS) that OSSHE has acquired.

This new approach should expand vacation planning options for employees and supervisors and should reduce the likelihood that employees will be forced to take time off at inappropriate times, rather than losing the accumulated benefits. It will also allow for a smoother and less costly transition to an automated vacation accrual system, while providing supervisors with a better means of vacation planning.

Staff Recommendation to the Board

After review by the Administrative and Academic Councils, staff recommends that the Board amend OAR 580-021-0030, Vacation Leave, to allow monthly accruals, with a six-month waiting period for new employees, as follows:

(NOTE: Underline denotes addition; brackets and italicized text denote deletion.)

Vacations 580-021-0030
(1) Eligibility. Vacation means absence from work permitting rest and recreation for a specified period of time during which regular compensation continues. [Academic] Unclassified [staff] employees gain vacation privileges only if employed at .50 FTE or more on a 12-month appointment.
(2) Computation. Eligible [academic] unclassified employees [receive] accrue vacation [allowance] on [their vacation anniversary, which is the date on which they first completed 11 months of continuous service] a monthly basis, beginning the first of the month following date of hire [with the Department.] or on the first of the month if an employee is hired the first working day of the month. Vacation accrues on the last day of the month and is available for use the first day of the next month subject to the restrictions in Section (3) of this rule. [ However, academic staff may take a prorated amount of vacation after the first six months.] A 9-month employee appointed to a 12-month contract [may count service on the most recent 9-month contract toward completion of the 11-month vacation anniversary requirement] may receive credit for the previous 9-month contract, on a pro-rata basis. Eligible employees [on a 1.0 FTE,] with a 12-month, 1.0 FTE contract [receive 176] accrue 15 hours of vacation [allowance on their vacation anniversary] per month; eligible employees on [less than 1.0 FTE, but] a .50 FTE or more 12-month contract [; receive an allowance proportional] accrue vacation in proportion to their FTE. An employee who terminates OSSHE employment before completing [11 months of continuous service] the 6-month wait period receives no vacation [allowance], and is not entitled to compensation for [such allowance] vacation accrued.

(3) Wait Period and Maximum Balance [Accrual and Carry over]. Vacation [allowance] accrual is available to the [academic] unclassified employee [to] for use [in the subsequent 12 month period beginning with the employee's vacation anniversary] six months after vacation accrual begins. [The vacation allowance expires at the end of the 12 month period except as follows: the institutional president or designee may approve the carry over of up to 80 hours of vacation time when staffing needs have prevented the employee from utilizing all the vacation allowance within the given 12 month period. The additional hours of vacation allowance shall expire on the employee's next vacation anniversary.] Until August 1, 1999, there will be no maximum limit on the amount of vacation leave that an employee can accrue. However, effective August 1, 1999, no employee may accrue in excess of 260 hours, and any accrued vacation leave in excess of this cap will be forfeited.

(4) Transfer. Inter-institutional/Unclassified to Unclassified. If an eligible [academic] unclassified employee transfers to another unclassified position within the Department and remains eligible for vacation [allowance] accrual [and of the break in service between appointments is 30 days or less], the employee shall transfer all accrued vacation leave to the new position [and the employee's vacation anniversary shall remain unchanged.] However, if [the] there is a break in service [is] of more than 30 days, all accrued vacation pay will be paid off by the sending institution and [a new vacation anniversary date will be established] the employee will be considered a new hire in the new position. Moving from position to position within the same institution shall not be considered a transfer or a break in service for purposes of this rule.

(5) Classified to Unclassified Appointment. If a classified employee of the Department receives an [academic] unclassified appointment within the Department and is eligible for vacation [privileges] leave, the employee may [transfer] bring up to 80 hours of accrued vacation [time] leave; the receiving department or institution may accept up to [176] 250 hours maximum. The former classified employee shall receive cash compensation from the sending department or institution for any remaining accrued vacation [allowance] leave [not transferred]. The former classified employee may use accrued vacation without serving a 6-month wait period.

(6) The accrual of vacation [allowance] leave is reduced on a pro-rata basis for the period of leave without pay, sabbatical leave and educational leave. Vacation [time] leave is accrued during other periods of paid leave.

(7) Payment for Accrued Vacation [Time] Leave. [Academic] Unclassified employees are not entitled to payment for unused vacation [allowance] leave except upon termination of employment or upon transfer within the Department to another [academic] unclassified position not eligible for vacation benefits. [Academic] Unclassified [staff] employees who transfer to a classified position within State of Oregon employment are subject to applicable OSSHE rules or collective bargaining agreements governing payment for accrued vacation. The maximum number of hours that can be paid upon termination or transfer is [176] 180 hours.

(8) Scheduling and Use of Vacation Leaves. Vacation leaves are scheduled with the approval of the employee's supervisor and should be planned cooperatively with the employee. Vacation leave should be scheduled in such a manner as to minimize disruption to the organization. Supervisors must be reasonable in allowing the use of vacation [time] leave and may not unreasonably deny vacation requests where the result would be the forfeiture of accrued vacation. For purposes of calculation, one normal work day is the equivalent of eight hours of vacation [time] leave for a full-time employee.

(9) Record Keeping. Each institution is responsible for maintaining the individual records of vacation accrual and use.

(10) [Alternative Plan. An institution may, upon receiving written approval from the Vice Chancellor for Finance and Administration, use July 1 as the vacation accrual date for all eligible academic staff.] Vacation Donation. The transfer of vacation time, for use by another employee, classified or unclassified, is not permitted.

(11) Vacation Borrowing. Employees are not permitted to borrow against vacation that is not yet accrued.

(12) Interim Provisions for Employees Moving from Management Service to Unclassified Service. Vacation leave for employees in management service on November 1, 1996, shall be provided by the policies established in this section.

(a) For those employees who were employed in management service at the time of conversion of their positions to unclassified or academic service on November 1, 1996, up to 176 hours of the employees' current vacation accrual balance shall be credited to each employee's active vacation account. Any hours in excess of 176 hours will be maintained in a reserve vacation account for the employee. Employees have 36 months, until November 1, 1999, to draw upon the reserve vacation account according to the provisions in section [(7)] (8) of this rule. An employee may be paid for any or all of the hours in the employee's reserve vacation account at the institution's discretion. On November 1, 1999, the institution will pay the employee for any remaining balance in the employee's reserve vacation account at the employee's rate of pay on that date.

(b) Notwithstanding the provisions of subsection [(10)(a)] (12)(a) of this rule, if an employee's employment with the Department ends prior to November 1, 1999, the employee may receive payment for no more than 250 hours of accrued vacation time. Employees will be paid at the rate of pay they are receiving on their last day of employment with the Department.

(c) Employees who were management service employees on November 1, 1996, and who retired from the Department by June 30, 1997, will accrue vacation on a monthly pro-rata basis at the rate of 176 hours per year between November 1, 1996, and their retirement date.

(d) In the event of extraordinary circumstances, the Chancellor or designee may approve exceptions to the policy established in section [(10)] (12) of this rule.

(e) This section is repealed [January 1, 1998.] December 1, 1999.

BOARD ACTION:

FACULTY RECRUITMENT AND RETENTION FUNDS

Staff Report to the Board

In September 1997, the Board approved an initial allocation (approximately $4.3 million) of the $7.5 million special fund dedicated by the 1997 Legislative Assembly to improve faculty recruitment and retention. This initial allocation increased the available faculty salary pool by one percent each year of the biennium.

Staff recommends that the remaining available amount (approximately $3.2 million) be distributed to campuses following the same techniques used in the initial allocation for these funds. This final allocation will allow the total pool of faculty salaries at each campus to increase by an additional .75 percent each year of the biennium. Distribution guidelines will follow those approved by the Board in September of 1997, which include:

Campuses have the discretion to allocate portions for recruitment and retention, but allocations are expected in each category;

Those campuses with faculty unions are subject to collective bargaining statutes;

Each campus' compensation plan will be reviewed and approved by the Chancellor prior to the expenditure of funds, and;

Each campus is required to report actual distribution to show how the incremental salary increases were applied. Reports will be due in February and June of 1999.

Staff will continue to collect and analyze data to form the basis of longer-range strategies for faculty compensation so that campuses can recruit and retain the most talented faculty.

Staff Recommendation to the Board

Staff recommends that the remaining available amount (approximately $3.2 million) of faculty recruitment and retention funds be distributed to campuses following the same guidelines used in the initial allocation for these funds, as outlined above.

BOARD ACTION:

APPOINTMENTS TO THE FOREST RESEARCH LABORATORY ADVISORY COMMITTEE

ORS 526.225 specifies that the Board of Higher Education shall appoint a Forest Research Laboratory Advisory Committee composed of 15 members, nine of whom are to be individuals engaged, actively and principally, in timber management of forest lands, harvesting, or processing of forest products; three individuals who are the heads of state and federal public forestry agencies; and three individuals from the public-at-large. Although the statute does not prescribe the terms of the Committee members, the practice has been to make appointments for a period of three years. Traditionally, those who are performing actively and effectively have been recommended for reappointment to a second three-year term, with all members replaced at the conclusion of a second term.

Dr. George W. Brown, director of the Forest Research Laboratory, with the concurrence of President Paul Risser, has made the following recommendations:

Appointment of Mr. John Foster, managing partner with Oregon Tree Farms, Ltd., to a three-year term as the non-industrial woodland owner representative to replace Senator Bob Kintigh, who has completed six years of service on the Committee. Mr. Foster currently serves as vice president of the Clackamas County Farm Forestry Association and is managing editor of the Forest-Tree Leader newsletter. He received the Oregon Small Woodlands Association "Education Award" in 1997, and was honored by the same organization in 1994 and 1995 with the "Distinguished Achiever Award." In 1993, he received the National Woodland Owners award for the "Outstanding Forestry Newsletter."

Appointment of Ms. Sara Vickerman, director of Defenders of Wildlife West Coast office, to replace Patty Bedient, who has completed six years of service as a public representative. Ms. Vickerman has been a national leader in efforts to shift the emphasis in conservation from single-species to broader concerns for biological diversity. She has worked for Defenders of Wildlife since 1978, including three years as the organization's legislative director in Washington, D.C.

Staff Recommendation

Staff recommends that the Board approve the above appointments to the Forest Research Laboratory Advisory Committee.

BOARD ACTION:

SEMI-ANNUAL AUDIT REPORT

Staff Report to the Board

The Internal Audit Division's (IAD) Semi-Annual Audit Report, included in the supplemental materials, summarizes internal audit activity for the six-month period July 1997 through December 1997. A brief description is provided for each report conducted during this six-month period, as well as a status report on the 1997-98 Internal Audit Plan. This report is submitted to the members of the Board, the Chancellor, and to the State of Oregon Department of Administrative Services. (Copies are on file in the Board's office.)

(No Board action required)

INDEPENDENT AUDITOR'S REPORT

Staff Report to the Board

The OSSHE financial statements for the fiscal year ending June 30,1997, have been audited by a private audit firm, Deloitte & Touche, LLP, Independent Public Accountants. The use of Deloitte & Touche was authorized and monitored by the State of Oregon Division of Audits. The auditors have concluded that the financial statements present fairly, in all material respects, the financial position of OSSHE, and they have issued an unqualified opinion. Copies of the financial statements have been previously mailed to Board members. (Documents are on file in the Board's office.)

In addition, Deloitte & Touche will provide to Board members a management letter that includes comments and recommendations for improvement in internal controls. Responses to the internal control recommendations from OSSHE institutions and the Chancellor's Office are included in the management letter.

(No Board action required)

FIRST QUARTER REPORT ON INVESTMENTS

Staff Report to the Board

The first quarter investment report of the Pooled Endowment Fund of the Oregon State System of Higher Education for the period July 1, 1997, through September 30, 1997, prepared by R. V. Kuhns and Associates, investment consultants, is included in the supplemental materials. (Copies of the report are on file in the Board's office.)

(No Board action required)

PROGRESS IN STREAMLINING PROGRAM DEVELOPMENT & REVIEW; ENHANCING COMMUNICATIONS

Introduction

In recent years, the OSSHE Office of Academic Affairs has responded to requests by Board members to change the process of new academic program development and approval in order to provide for input at an earlier stage. Staff has also studied the program development, review, and implementation timeline to determine where streamlining can occur without compromising quality. To that end, the following steps have been taken.

Program Preproposal Process

Since summer 1995, staff has presented program preproposals to the Board. This has enabled the Board to learn about academic programs in the early development stages and to provide direction and feedback to the campuses. Program preproposals were aggregated and presented for Board comment about three times per year. Then, in October 1997, staff recommended (and the Board concurred) that preproposals should be presented to the Board the month following positive review by the OSSHE Academic Council, thereby reducing unnecessary delays in the program development process.

Campus Program Development Process

Staff review of the development process for new programs revealed that campus procedures require a significant proportion of the process time. This has been discussed at OSSHE Academic Council meetings and, in October 1997, Vice Chancellor Clark sent the provosts a letter asking them to provide a plan for streamlining the campus processes. Those plans are due in January 1998 and will be reported to the Board at a subsequent meeting.

Consent Agenda

Lately, several Board members have questioned the necessity of putting new academic programs on the consent agenda for the Board meeting the month following initial approval. While this tradition was justified by saying it provided more time for public input, the reality is that in the past six or seven years, no comments have been received by the Board's office. Consequently, staff agrees that placing new programs on the consent agenda unnecessarily delays program implementation, and proposes that step be deleted from the process.

SB 917 and Communications with Other Sectors

Vice Chancellor Clark and Compliance Officer Melinda Grier have been engaged in discussions with representatives from the Office of Degree Authorization, Oregon community colleges, independent colleges, the Oregon Independent Colleges Association, the proprietary (career) colleges, and the State Scholarship Commission. These meetings have been called to provide consultation to the State Scholarship Commission where, as a result of recent legislation (SB 917), the Office of Degree Authorization now reports. The Commission is in process of establishing the rules for decision making about the degree authorization process, particularly related to the review of new publicly funded postsecondary degree programs and locations.

One objective of these meetings is to enhance communication among these entities. Dr. Clark offered to have her staff create and maintain an e-mail list of the chief academic officers from each of the institutions and key representatives from these organizations. On a monthly basis, OSSHE Academic Affairs will send e-mail abstracts of preproposals of new undergraduate and graduate degree programs, certificates, licensure/endorsements, and proposed existing programs to new locations. This electronic process establishes an easy, orderly way for expressing and resolving concerns. This new form of communication was very positively received by the recipients and is poised to begin January 1998.

(No Board action required)