OREGON STATE BOARD OF HIGHER EDUCATION
MINUTES OF SPECIAL EXECUTIVE COMMITTEE MEETING
TELECONFERENCE

November 5, 1998

CALL TO ORDER

A special Executive Committee meeting of the Board of Higher Education was called to order by President Imeson at 8:05 a.m.

ROLL CALL

The following Executive Committee members were present:

Dr. Herb Aschkenasy
Ms. Diane Christopher
Ms. Gail McAllister
Ms. Phyllis Wustenberg
Mr. Tom Imeson

Other Board members: Mr. David Koch

Institution presidents: Martha Anne Dow, Dave Frohnmayer, Betty Youngblood

Chancellor's Office staff: Bill Anslow, Philip Bransford, Shirley Clark, Joseph Cox, Marilyn Lanier, Diane Vines

Others: Roy Arnold (OSU), Andy Hashimoto (OSU), John Minahan (WOU), George Pernsteiner (PSU), Rob Specter (OSU)

EMERGENCY BOARD REQUEST FOR FUNDS FOR INCREASED STUDENT ENROLLMENT, OIT, OSU

Summary

The Chancellor requested Board approval to seek Emergency Board authorization for funds totaling $3,566,260 to help support exceptional increases of more than 1,000 student enrollments for 1998-99 at the Oregon Institute of Technology (OIT) and Oregon State University (OSU). An increase in funding is required to provide faculty to teach additional classes and laboratory sections and to support associated increases in services and supplies. To adequately cover the needs of the additional students, an Emergency Board request is recommended to augment funds to be provided from Oregon University System (OUS) central funds (tuition and fee revenue) combined with existing resources that will be redirected within each institution.

Staff Report to the Executive Committee

1998 three-term FTE (full-time equivalent) regular enrollment for OUS is approaching 48,000, as indicated on the attached enrollment report (on file in the Board's office). Estimated three-term FTE enrollment reports for 1998-99, based on fall 1998 fourth week data, indicate that OSU is 859 FTE students greater than the 1998-99 number targeted for budgetary purposes, and that the enrollment for OIT is 178 FTE greater than its target. All other institutions are within budgeted corridors.

Allocations for OUS institutions are based, in large measure, on FTE enrollment for each institution, under the current budget model (BAS). The allocation for an institution does not change during a biennium unless enrollment is above or below the established corridor. In recent biennia, under a pooled tuition process, institutions have received an annual allocation of approximately $3,000 from OUS central funds (tuition and fee revenue) and $5,555 from the State General Fund for each FTE student anticipated in enrollment budget projections. When the enrollment exceeds the top of the corridor, $3,000 per FTE student is provided from OUS central funds to the institution for every student above the targeted midpoint. The institution redirects resources, if possible, to fund a portion of incremental student costs.

OSU and OIT, two institutions providing unique, high cost disciplines, have both experienced severe budget challenges in the past few years and, therefore, have limited resources to address such sharp enrollment increases. For example, in 1995-96, OSU experienced a budget reduction of $6,415,117, and, in 1997-98, a budget reduction of $5,933,816. In 1995-96, OIT experienced a budget reduction of $731,267, and, in 1997-98, a budget reduction of $1,623,661. Because 1998-99 FTE student enrollments at both institutions have exceeded corridors of enrollment covered by the current budget, maintaining operations within the current budget places a strain on the ability of each institution to address the needs of Oregon students. This recommendation for the request to the Emergency Board will provide one-time, transitional funds to allow these two institutions to adequately teach the additional students for the remainder of this biennium. The institutional budgets will be readjusted in fiscal year 1999-2000 to reflect enrollment trends, presuming the new resource allocation model becomes effective at the start of the next biennium.

Summaries of unanticipated institutional enrollment changes and associated resource and cost requirements for OIT and OSU are provided below.

Oregon Institute of Technology

Oregon State University

Total: Both Institutions

Staff Recommendation to the Executive Committee

Staff recommended that the Executive Committee authorize the Chancellor to seek authorization from the Legislative Emergency Board for one-time state emergency funds in the amount of $3,566,260 to meet a portion of the resources required to support unanticipated FTE student enrollments at Oregon Institute of Technology and Oregon State University for the 1998-99 academic year. (The full Board will ratify the Executive Committee's action at its next regular meeting on December 18, 1998.)

Executive Committee Discussion and Action

Chancellor Cox explained that approaching the Emergency Board to address enrollment increases is a one-time situation.

"OIT and OSU have been so successful that they've exceeded expectations with this enrollment turnaround," said Chancellor Cox. Further, he said, "I have had conversations with E-Board members and the Governor's Office. I believe they are willing to hear our case, yet some are more supportive than others. I don't think they will hold it against us as we go into the session. These two institutions need some help and I feel committed to look for assistance for them."

Dr. Aschkenasy said that he felt the most important issue was whether or not the Chancellor's Office is successful with the legislature. On an unrelated topic, he asked President Dow and Provost Arnold if faculty were reduced when the student count decreased at their institutions.

Responding to Dr. Aschkenasy's comment, Chancellor Cox observed, "This will be a different legislature in terms of leadership." President Imeson added, "In some meetings, legislators were bringing it up, and asking if we were going to propose something.

In response to Dr. Aschkenasy's question, President Dow shared that OIT did hold back positions that were not replaced, mostly through retirement. "In almost all departments, we had almost a total of six or seven faculty we didn't replace," she said. Dr. Arnold pointed out that at OSU there are a number of vacant positions in various departments.

"I think our biggest concern is our inability to meet required course sections where students could not meet their degrees," said Dr. Arnold. "If we can't add enough faculty resources/sections, we won't be able to accommodate students in the upper division courses. Over time, that does begin to be a factor leading to attrition."

Ms. McAllister asked if the additional students were more or less across the academic range, or if they were concentrated in specific areas. Dr. Arnold replied that the increases were principally in the Colleges of Engineering, Business, and Agricultural Sciences, as well as the Department of Computer Sciences.

Dr. Dow said that OIT's greatest growth was in the Applied Psychology and Software Engineering Technology programs. She continued, "We have been strapped the past several years with our equipment. We don't have enough equipment to support our Portland operations. In terms of general education, our math classes are extremely large. In some cases, we'll have to reduce the number of sections offered and that will put people out of sequence."

Ms. Christopher asked if any of the growth could be attributed to improved retention. Dr. Arnold said it was about equal between retention and new students. Dr. Dow, while saying that she didn't have the exact numbers, felt that the situation was similar at OIT.

"It appears there are 11 fewer students in veterinary medicine. That ought to be a huge savings," observed Ms. Wustenberg. Vice Chancellor Anslow explained, "When you start the year, most institutions hire faculty and plan for enrollment and that's pretty much fixed. It's difficult to make a correction at the end of a term." Dr. Arnold concurred, but added that in order to best respond, he'd have to see the backup figures. "I'd be interested in knowing what those are," said Ms. Wustenberg.

"Having carved $12-13 million out of our budget, we are simply out of options," said Dr. Arnold. "We are not going to invest in new equipment. Furthermore, some advising functions will suffer."

Dr. Dow said, "We are in the same boat. We appreciate the support we've had from the System over the past two years, but we'll simply have to go with fewer sections if it gets that desperate."

President Imeson asked the Chancellor to review the process if the request is approved by the Executive Committee. The Chancellor explained, "I would go to Jon Yunker's [Department of Administrative Services] office with authorization by the Executive Committee. Mr. Yunker has agreed to allow it to go forward. We'd visit with each member of the E-Board and Mr. Wyatt from the Governor's Office to attempt to answer all questions. The E-Board meets on November 19. I would enlist the efforts of Presidents Dow and Risser at that time. As is always the case with an E-Board request, if it doesn't look like it's going to happen, we can always withdraw the request."

"The hard work that you've done is obvious," said Ms. McAllister. Both Provost Arnold and President Dow acknowledged the compliment. President Dow added, "We went through accreditation last week and our peers were very impressed. We did feel as if it reflected well on faculty and staff."

"With regard to other campuses, this is a critical change in the rules to the game that is difficult to explain," said President Youngblood. Provost Minahan added, "I don't think any of us should not support us getting additional money. We've been struggling to grow for years. It would have been impossible for us to have exceeded our enrollment corridor. We could not go over the top."

"I wish to echo the comments of Dr. Youngblood," said President Frohnmayer. "We will be good soldiers. When enrollment was down, we contributed. But we will support this."

"How does this negatively affect our efforts get the budget model funded?" Mr. Pernsteiner questioned. Mr. Imeson responded, "I think if it affects it negatively, we're going to have to look elsewhere. We do not want to jeopardize what we hope to get done this next session. At least several months ago, when we were briefing people on the new model, we were asked by several legislators about whether we were going to try and address this issue when it looked as if there might be increased enrollment."

"I would think it might be important to emphasize the tremendous cutbacks over the years. We've worked hard to change that. I don't think it's out of line to say that this System has had tremendous cuts," pointed out Ms. Wustenberg.

Chancellor Cox said "The primary motivation has to be the overall enrollment of the System. We've had some slips, too. It's the aggregate that's important. We can't afford to risk losing resident students."

Ms. Christopher moved and Ms. Wustenberg seconded the motion to approve the request as submitted. The following voted in favor: Directors Aschkenasy, Christopher, McAllister, Wustenberg, and Imeson. The following voted no: none.

ADJOURNMENT

The special Executive Committee meeting adjourned at 8:40 a.m.

Diane Vines
Secretary of the Board

Tom Imeson
President of the Board