SPECIAL MEETING
OF THE BOARD OF TRUSTEES
HOUSTON COMMUNITY COLLEGE SYSTEM
June 12, 2008
Minutes
The Board of Trustees of the Houston Community College System held a Special
Meeting on Thursday, June 12, 2008 at the System Administration Building, 3100
Main, 2nd Floor, Seminar Room A, Houston, Texas.
Board of Trustees Present:
Yolanda Navarro-Flores, Chairwoman
Bruce A. Austin, Vice Chair
Diane Olmos Guzman, Secretary
Mills Worsham, Deputy Secretary
Neeta Sane
Richard M. Schechter
Administration Present:
Mary Spangler, Chancellor
Art Tyler, Deputy Chancellor/COO
Renee Byas, General Counsel
William Carter, Vice Chancellor, Information Technology
Charles Cook, Vice Chancellor for Instruction
Winston Dahse, President, Southwest College
Julian Fisher for Fena Garza, President, Southeast College
William Harmon, President, Central College
Zachary Hodges, President, Northwest College
Willie Williams, Associate Vice Chancellor, Human Resources
Dan Seymour, Associate Vice Chancellor, CTCE
Others Present:
Maureen Singleton, Counsel, Bracewell & Giuliani
Linda Koffel, President, Faculty Senate
Other administrators, citizens, and representatives of the news media
CALL TO ORDER
Mrs. Flores, Chairwoman, called the meeting to order at 12:47 p.m. and declared the
Board convened to consider matters pertaining to the Houston Community College
System as listed on the duly posted meeting notice.
BUDGET WORKSHOP
Dr. Tyler apprised that Dr. Spangler would present the overall outline by which the
budget was developed and apprised that he would discuss the projections and
reasons for some of the suggestions.
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Special Meeting – June 12, 2008 – Page 2
Dr. Tyler apprised that an additional workshop would be held prior to the Committee of
the Whole meeting with the anticipation of getting the budget approved at the Regular
meeting on June 26, 2008, which would allow for the budget to be entered into the
system prior to September 1, 2008.
Dr. Spangler apprised that the budget begins with the Board’s leadership and direction
and noted that the Board has engaged in the strategic planning process. She noted
that the second source for the budget is the strategic plan and commented that this
year’s budget has a significant shift because it will be driven by planning. Dr. Spangler
noted that the operational plan (schedule of classes) is also a part of the budget. She
noted the following differences with this budget process: (1) includes input from the
presidents (2) driven through decentralization efforts and (3) transparency.
Dr. Spangler informed that the budget presentation for 2008-2009 would include the
following:
ƒ
Overview of Issues
ƒ
Discussion of Strategic Initiatives
ƒ
Planning Assumptions for FY 2008-2009
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Budget Forecast for FY 2008-2009
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Specific Recommendations to the Board
Dr. Spangler informed that Linda Koffel, President of Faculty Senate was present to
address the Board on behalf of the Faculty Senate regarding faculty salaries.
Mrs. Koffel presented information that was provided at the previous budget workshop
held on April 18, 2008, which addressed the faculty compensation inequities. She
apprised that HCC has highest number of exemplary programs in the State of Texas.
Mrs. Koffel noted that in order to get such high numbers of exemplary program
requires exemplary faculty. She noted that this includes academic and workforce
faculty. Mrs. Koffel noted that HCC has the best faculty in the state of Texas, but is
also some of the lowest paid faculty in the state of Texas. She mentioned that the
issue has been brought to the attention of administration that have been very open
and having been working with the faculty throughout the year. Mrs. Koffel presented
the following faculty senate compensation committee recommendations:
ƒ
Fix the internal inequities of the current step system to ensure a fair
compensation system
ƒ
Bring faculty salaries in alignment with other colleges in the state of Texas
especially TUCCA 4 based on the assertion of compensation leadership
professed by the Board of Trustees
ƒ
Ensure the scale moves every other year as recommended by the Fox Lawson
Consultants
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(Mr. Austin arrived at 1:14 p.m.)
Mr. Schechter mentioned that the reality is that there are some areas where more will
need to be paid for qualified persons.
Mrs. Sane asked if there is a plan to tie the salary increases to any specific outcome
and how will the outcomes be measured. Mrs. Koffel apprised that the faculty view
pay for performance as being able to be moved up a step if there is professional
performance or above. She reiterated that HCC has twenty-seven exemplary
programs.
Mrs. Guzman asked if there is a mechanism for administration to measure the
standard and keep the quality of the exemplary programs. Mrs. Koffel informed that
there are a series of indicators to review the programs for exemplary such as the
number of students who start in the program and end in the program.
Mrs. Flores asked who determines the professional level. Mrs. Koffel apprised that
the evaluation is written by the department chair and written by the dean; therefore, it
is not one person reviewing.
Mrs. Guzman asked what happens if a dean or faculty receives a needs improvement.
Mrs. Koffel apprised that the faculty member is placed on a need to improve program
and is given one or two years to improve and possible termination if the faculty
member does not improve.
Mr. Austin stated that he was glad to see Mrs. Koffel mention enrollment because in
the past it seems that they were totally disconnected; however, it’s good to see that
faculty understands the connectivity.
Mrs. Sane asked if student evaluations are considered. Mrs. Koffel apprised that they
are considered; however, there are factors regarding the student evaluations.
Mr. Austin apprised that student enrollment is blended with faculty
performance/evaluations and noted that there has been a problem providing step
increases with little to no increase in enrollment. He noted that these are the
constraints that the Board has to deal with. Mrs. Koffel appraised that even though
enrollment maybe flat, faculty may not have much input on how the funds are spent.
She noted that may be this is when faculty salaries should be given first consideration
and may mean not purchasing a building.
Salary Increases
Dr. Spangler continued the budget presentation overview. She provided information
on local competitors as it relates to salary increases. She apprised that administration
is recommending 6.5 percent salary increase, which is recommended in two parts: (1)
4.3 percent in September 2008 and (2) 2.2 percent in January 2009.
Dr. Spangler noted that additional issues that have been considered include the Jail
Program and Early College High School. She noted that a less than $5 million was
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Special Meeting – June 12, 2008 – Page 4
spent on these programs in FY 2006-07 and $6.7 million in FY’2007-08. She noted
that this was a significant increase and noted that this has to be addressed because
the State is only giving $.28 on the dollar.
Mr. Austin mentioned that information was provided by Administration that informed
the State was discussing picking up the cost for dual education. Dr. Spangler
mentioned that there is some discussion on the matter; however, the Board would
have to determine how much the college should invest in the programs. She apprised
that there has been discussion with HISD in regards to sharing some of the cost for
the dual credit program.
Dr. Spangler apprised that staffing request is thirty-three full-time faculty positions to
fill growth with the new facilities, twenty-two positions in the security area, and one
new administration position.
Dr. Spangler noted that a review of the buildings to determined if they are being used
in the most effective way possible such as doubling rooms for multi usage.
Dr. Tyler noted that utilization of the buildings is also under review to view the usage
of the buildings.
Mr. Austin apprised that there was a space utilization analysis conducted throughout
the college in 1990s. He noted that one thing found in terms of utilization space was
that it was not the preference of most of faculty to have classes after Thursday and
this is one of the reasons why the buildings went empty. He noted that when it was
compared to the practice of proprietary schools, it noted that this is when they have
heavy utilization. Dr. Tyler apprised that the issue is under review and noted that the
presidents have been encouraged to review schedules to see determine what is the
most effective way to utilize the facilities and serve the customers.
Mrs. Sane asked if consideration has been give to compensating faculty for teaching
on weekends to fill space. Dr. Spangler apprised that this is an issue to be
considered.
Legislative Initiatives:
Dr. Spangler mentioned that there are a number of legislative initials to be considered.
She apprised that an assessment is underway regarding the charges from the State
House and Senate such as textbook costs, health insurance for students,
developmental education, evaluation instruments, expansion of higher education
programs, and improving state financial aid.
Mrs. Guzman announced that a joint meeting is scheduled for June 25, 2008 with
Texas Association of Community College (TACC) and Community College Association
of Texas Trustees (CCATT). She noted that the CCATT has formally organized and is
preparing to have their issues to present at the budget hearings before the legislature.
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Performance Excellence Program (PEP)
Dr. Spangler apprised that the process is extremely cumbersome and time
consuming. She noted that evaluations should be formative and summative, which
should be used to discipline or to assist in developing skills. She apprised that she is
not certain if the PEP is working as designed. Dr. Spangler informed that pay-forperformance is being considered for the management team (non-faculty; non-staff) for
next year.
Mr. Austin asked if a similar program will be considered for faculty because he views
evaluation as an appraisal of performance. He noted that the issue resulted from the
Board constantly asking if staff is being effectively evaluated as mentioned in the
principal of accreditation. Dr. Spangler informed that she does not think that the
outcome of the system provides such evaluation.
Succession Planning
Dr. Spangler informed that this item includes the expansion of the leadership program
and looking to increase funding by $100,000.
Mr. Austin asked if it was possible to team up with other four-year institutions to setup
graduated classes to assist employees who are enrolled in master and doctorial
programs. He noted that the institutions could setup the classes in block or track
fashion within HCC facilities. He recommended sending out a request to inquire if any
institutions are interested.
Mr. Schechter asked if the executive leadership program is designed to help HCC
employees to advance. Dr. Spangler apprised that this is the purpose of the program.
Mr. Austin requested that counsel periodically provide briefings on new Supreme
Court cases relating to race base selection process.
Budget Assumption:
Dr. Spangler mentioned that Dr. Tyler will provide a summary of the revenues and
expenses. She noted that a balance of ten percent from the prior year-end and a
projected five percent across the growth and noted that funding will be provided based
on this assumption.
Mrs. Sane asked if the revenue from the development of athletics has been
considered. Dr. Tyler apprised that the athletics program was not considered as a
revenue generation program because startup funds are usually needed when a
program is initialized.
Mrs. Flores recessed the meeting at 2:05 p.m. The meeting reconvened the meeting
at 2:26 p.m.
Dr. Tyler presented an overview on the current versus projected revenue and
expense.
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Revenue Projection:
The projected revenue increase is $7.9 million:
Taxation
Tuition & Fees
State Allocation
Tech Fee
-
$84 million
$30.5 million (estimated overall growth of 3.5%)
$65.5 million
Increase from $5
The impact of annexation revenues is not included as a part of the budget
assumptions for 2008-2009.
Mr. Schechter inquired about an international target campaign and out-of-district
regarding tuition and fees. Dr. Spangler apprised that the college could possibly
review other options for increasing enrollment. Dr. Tyler apprised that there is a
review of possible loss leaders; however, he does not want to state that an answer
has been identified and noted that administration is reviewing several models.
Mrs. Sane mentioned that there is a need for new programs in Missouri City areas and
informed that this is the reason that she has requested a meeting to discuss these
concerns. Dr. Tyler mentioned that this will be a part of the discussion with the
presidents.
Mrs. Guzman requested a timeline for presenting the models because they will have a
great impact. She asked if anyone is monitoring the competitive advantage that HCC
could have amongst its peers and mentioned that this along with exercising
agreements, such as the one with Monterrey Tech, could possibly generate revenue.
Mr. Worsham stated that he agrees with Trustee Schechter that all marketing options
should be review; however, he stated that there must be a balance in relations to the
anticipation of annexation.
Mr. Austin mentioned that the under-served communities have issues that must be
addressed and apprised that the purpose of the community college must not
overlooked.
Mr. Schechter noted that there should be a mechanism in place to target individuals
who have graduated but decide to return for training or continue their education.
Mr. Austin noted that there needs to be more impact with non-governmental agencies
(NGA) to determine how to access individuals better at various levels.
Mrs. Flores mentioned that there has been some review of why inner city students are
not pursuing higher education. Dr. Seymour apprised that studies have been
developed and it is known precisely why these students are dropping out; however, a
pipeline needs to be developed. He mentioned that a comprehensive
marketing/enrollment plan is being developed that will allow for specific answer to the
questions.
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Dr. Cook informed that there is a $1.5 million Gates grant in combination with HISD in
which academic advisors are being hired in the eight HISD high schools that have the
lowest going college rate. He noted that the grant is partnership with the State and
HISD.
Mr. Austin asked if the college still has the grant math readiness. Dr. Cook apprised
that the college has several grants relating to math readiness.
Mr. Schechter requested information to see if dual credit is profitable. Dr. Tyler
apprised that the cost for conducting the dual credit program is the same as having a
class at HCC or through shifting dollars to a new program at the campuses. He noted
that if dual credit is not managed, then the college will cross the threshold.
Mr. Austin apprised that economically it has crossed the threshold because when a
break-even analysis is conducted, the college is not breaking even regarding dual
credit. He mentioned that the program is great but avenues must be identified for
investment in the successful dual credit model.
Tech Fee
Dr. Tyler apprised that in 2006, the Board approved borrowing $39.2 million. He
clarified that the tech fee for $39 million partially funded new technology and
infrastructure. He noted that 2008-2009 is the last year of appropriations for the
money; however, it is not the last year for debt services. Dr. Tyler provided a
spreadsheet on the debt services and recommended increasing the tech fee by $1 to
save because there will be the long-term challenge to services the debt. Dr. Tyler
apprised that he will need to research with the Board counsel the resolution actually
passed because it may be limiting the number of years the Board agrees to service
the debt. He stated that he wanted to apprise the Board why the additional $1 is
requested.
Mr. Schechter asked if this would be a twenty-four year as oppose to ten year debt
services and asked what the additional cost would be. Dr. Tyler apprised that it would
be approximately $40 million.
(Mr. Schechter stepped out at 3:09 p.m./returned at 3:11 p.m.)
Dr. Tyler apprised that it is forecasted that the expense for this year’s budget will be
approximately $220 million out of the general operating budget. He noted that next
year expenditure will be approximately $236 million (3.5 percent increase over this
year’s spending). He noted that this is taking into consideration an anticipated 5
percent growth, raises and staff increase for new campuses.
Dr. Tyler provided a summary of the recommendations, which included minimizing
land purchases to necessary purchases only, reduce legal expenses, and improve
marketing expenses.
Dr. Tyler apprised that the recommended budget for fiscal year 2008-09 is $237.9
million with projected revenue in excess of $238.5.
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Questions and Answers:
Mrs. Guzman asked how can HCC foundation contribute in off-setting cost in
particular in dual credit for books and fees on a sliding scale bases and mentioned
that some of the costs could be in the form of scholarships to possible grow
enrollment. She also mentioned working more intensely regarding partnerships within
the community from innovative programs.
Dr. Spangler apprised that the foundation could not provide scholarships for dual
credit because it is a waiver of fees; however, that may be a possibility to the
foundation to help in underwriting the loss. She mentioned that through a partnership
where funds are actually generated, for example the athletic facility on 288, where
there may be an opportunity for a public/private partner to join with the foundation and
give the college the unrestricted funds.
Mrs. Sane suggested possible reviewing the option of combining dual credit and
distance education. Dr. Tyler apprised that the option is actually being explored by Dr.
Cook’s area.
Mr. Schechter recommended changing the accounting format to remove waivers and
exemptions as both revenue and expenditure and set aside on a separate page.
Mr. Schechter asked if there is additional money to be received from the State. Dr.
Tyler apprised that there is an opportunity to get additional funds from the State if
there is growth at the college.
Mr. Schechter apprised that he has concerns that the ten percent reserve is
insufficient and mentioned that there is not enough in the raining day fund to satisfy
any future bonding and noted that there are other potential issues that may need to be
addressed. Dr. Tyler appraised that $6 to $10 million more money will probably be
needed. He noted that there must be other ways to generate revenues.
Mr. Schechter apprised that the Board needs to develop a plan for increase and
recommended administration develop a three or five year plan for generating
revenues.
Mr. Schechter asked if there are any thoughts on how to deal the debt service
payment of $40 million. Dr. Tyler apprised that the most cost effective method would
be the GO Bonds. He noted that there is a significant balloon payment that will be due
in few years.
Mr. Schechter asked Dr. Tyler if he is comfortable that this is the only outstanding
bond where the Board was not fully apprised. Dr. Tyler stated that he does not have
an answer to the question.
Mr. Austin noted that bond counsel and financial advisors provided tremendous
amount of paperwork, but the question is whether the information was read. He noted
that the issue of debt financing must be worked on.
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Mr. Schechter asked if the rating agencies are aware of these issues. Dr. Tyler noted
that the rating companies are aware of the issues and stated that it was included as a
part of the analysis for the senior lien bonds.
ENERGY CONSERVATION PRESENTATION
Dr. Tyler introduced Mr. Burke Keller from Legacy Energy Solutions who is the energy
consultant. Ryk Holden, Director of Energy Rick Management provided a presentation
on energy risk and what it means to HCC. He noted that the review is on exposure to
electricity and price movement. He noted that the total electric for 2008 will be
approximately $7.2 million and apprised that they would devise a program to assist
with managing as well as work with the budget.
Mr. Holden stated that the goal for the discussion is to justify an electricity
procurement strategy and authorize a procurement agreement based on the RFP
currently underway to obtain electricity. He apprised of the energy risk, management
of the risk, why timing is critical and the status of the RFP.
Mr. Holden apprised that the baseline is approximately 60,000 megawatt hours which
will increase with the addition of the capital improvement programs scheduled to come
on board.
Mr. Schechter asked if 100% of the electricity is provided by gas and asked if there
has been any consideration of alternative methods. Mr. Holden apprised that this has
been discussed with Dr. Tyler.
Mr. Schechter asked how the percentage was determined. Mr. Holden apprised that
the primary driver is the volatility of the gas market.
Mr. Schechter asked if the lock-in would be too early. Mr. Holden apprised that the
contract would lock-in for a longer term. He noted that there could be portions of the
lock-in with a first step of the contract. He noted that the ways for locking in would be
gradual with a set of rules.
Mrs. Flores recessed the meeting at 3:52 p.m. The meeting reconvened at 3:58 p.m.
RESOLUTION ACKNOWLEDGING AND ACCEPTING VERIFIED PETITIONS FOR
AN ELECTION ON THE ANNEXATION IN ALIEF, PUBLICATION OF A SERVICE
PLAN FOR ALIEF AND SETTING OF DATES FOR A PUBLIC HEARING ON THE
ISSUE OF ANNEXATION OF ALIEF AND THE PROPOSED SERVICE PLAN
Mr. Gene Locke apprised that HCC received petitions from citizens in the Alief
Independent School District requesting that HCC Board call an election on the
proposition of annexing Alief into HCC area. He noted that the State law says that
before the Board can call an election; there must be verification that at least five
percent of the registered voters are of the last general election in the affective area,
the number must be contained in valid signatures on the petitions. He noted that for
Alief, the number is 4,762.
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He provided an overview of the petition process and noted that the Board Chair has
sent a letter to the petitioners advising that they have met the threshold.
He stated that he would advise the Board of the requirements for going forward.
He noted that students lead a campaign in January 2008 and noted that over 8,000
signatures were obtained.
Dr. Spangler introduced Walter Mrema and Don Nguyen who were the students to
initiate the efforts of getting the required signatures along with the assistance of Chet
Machen.
Mr. Locke informed that the law requires that the signer of the petition is a registered
voter of the Alief area. Mr. Locke commended the staff team assigned by the
Chancellor for a job well done.
He noted that now that the signatures have been verified, three things must happen
(1) there needs to be a validation of the petition (2) publish a service plan, which will
be a draft working document and (3) hold public hearings on the service plans.
He noted that if the Board adopts to publish the service plan today, then the public
hearings must be held within 30 days. Mr. Locke mentioned that the tentative target
dates are hearings are July 15, 2008 and July 17, 2008 in the Alief area. He stated
that he would like to have a court reporter present, sign language interpreter and the
plan should be published in Spanish and Vietnamese.
Motion – Mrs. Guzman motioned to accept the resolution acknowledging and
accepting verified petitions for an election on the annexation in Alief, publication of a
service plan for Alief and setting of dates for a public hearing on the issue of
annexation of Alief and the proposed service plan. Mrs. Sane seconded the motion.
Mr. Schechter asked if there are any options available. Mr. Locke noted that the only
option is when to publish the service plan. He noted that if it is not published now, the
opportunity to hold the election in November 2008 would be lost.
Mrs. Flores provided the students the opportunity to give an overview of their
participation in the signature petition process.
Mr. Walter Mrema apprised that he feels that the effort will provide an opportunity for
current students by lowering tuition and noted that this effort is what led him to joining
the Alief Student Government Association. He noted that he is dedicated to the
betterment of HCC and his fellow students and apprised that he initiated the effort to
get the signatures needed.
Mr. Don Nguyen noted that the annexation will not only benefit the students but HCC
and the community. He noted that he experienced a lot of shut doors but was diligent
in the effort.
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Mrs. Sane expressed appreciation to the students for their hard work on behalf of the
Board. Mr. Schechter associated with Mrs. Sane on commending the students but he
noted that getting the message out will be a challenge because of the number of
registered voters in the area.
Mr. Worsham commended the students of the hard work and noted that the students
are driving the process.
Mrs. Flores announced that the petitions will be considered by the Board.
Vote – The motion passed with a vote of 6-0.
Mr. Austin mentioned that these students should be commended for their service to
the community.
ADJOURNED TO CLOSED SESSION
Mrs. Flores adjourned the meeting to Executive Session at 4:17 p.m., notice having
previously been given and reiterated in accordance with Sections 551.071, 551.072,
and/or 551.074 of the Open Meetings Law. Mrs. Flores stated that any final action,
vote or decision on any item discussed in Executive Session would be taken up in
Open Session or in a subsequent Public Meeting.
Mrs. Flores reconvened the meeting in Open Session at 5:08 p.m. and entertained
motions on pending matters.
(Present: Trustees Austin, Flores, Guzman, Sane, and Worsham)
EDUCATIONAL ENGAGEMENT ACTIVITIES
The item was pulled; therefore, no action was taken.
ADJOURNMENT
With no further business coming before the Board, the meeting adjourned at 5:09 p.m.
Minutes recorded and submitted by:
Sharon Wright, Executive Administrative Assistant, Board Services
Minutes Approved as Submitted: