July 26, 2000 Minutes SPECIAL MEETING OF THE BOARD OF TRUSTEES Houston Community College System July 26, 2000 Minutes The Board of Trustees of the Houston Community College System held a Special Meeting on July 26, 2000 at the HCCS Administrative Center, 2nd Floor Boardroom, 22 Waugh Drive, Houston, Texas 77007. BOARD MEMBERS PRESENT Bruce A. Austin, Chairman James R. Murphy, Vice-Chairman Herman Litt, Secretary Michael P. Williams, D.Min., Deputy Secretary Herlinda Garcia Carol H. Smith BOARD MEMBERS ABSENT Abel Davila Christopher W. Oliver W. F. Russell ADMINISTRATION Ruth Burgos-Sasscer, Chancellor John O'Malley for Jack Daniels, President, HCC-Central Margaret Forde, President, HCC-Northeast Diana Castillo for Sylvia Ramos, President, HCC-Northwest file:///C|/Documents%20and%20Settings/hccs/My%20Do...d%20of%20Trustees%20Minutes%202000/00_26_07min.htm (1 of 5) [3/18/2008 3:44:45 PM] July 26, 2000 Minutes Charles Cook, Vice Chancellor, Educational Development Jose Villarreal, Vice Chancellor, Economic Development Patricia Williamson, Vice Chancellor, Institutional Development Joseph A. Fenninger, Chief Financial Officer Stephen Gonzalez, Executive Director, Public Information and Marketing Nat Campos, Executive Director, Human Resources OTHERS PRESENT Arturo Michel, Bracewell and Patterson Leslie Berardo, Principal, Mir, Fox & Rodriguez Juan Torres, Engagement Principal, Mir, Fox & Rodriguez, David Ahola, Director of Internal Audit Service, Mir, Fox & Rodriguez Other administrators and staff CALL TO ORDER Mr. Murphy called the meeting to order at 4:36 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. REVIEW OF BUDGET ASSUMPTIONS - MIR, FOX & RODRIGUEZ The Board of Trustees engaged the firm of Mir, Fox & Rodriguez, P.C. (MFR) to review the proposed budget for 2000-2001. Leslie Berardo, MFR Principal, explained that the firm had reviewed major budget assumptions for the 2000-01 budget (see Budget Review for the Board of Trustees attached). She pointed out that lease costs have gone down, while physical plant costs have risen, because of the new facilities brought online, although the System continues to lease certain facilities. There will be ongoing expenses associated with ownership including personnel, supplies and maintenance. However, service capabilities have increased as a result of the improved infrastructure. Ms. Berardo noted some duplicate budgeting which needs to be corrected. Duplicate budgeting was found in several areas including the telephone system, physical plant items, computer purchases and in the budgeting of salaries. She explained that sometimes this is caused by incorrect coding. The Executive Team has been apprised of the findings. Juan Torres, Engagement Principal, reported on the revenue side and made the following observations and recommendations: file:///C|/Documents%20and%20Settings/hccs/My%20Do...d%20of%20Trustees%20Minutes%202000/00_26_07min.htm (2 of 5) [3/18/2008 3:44:45 PM] July 26, 2000 Minutes ● ● ● ● ● ● ● Lease income from 3100 Main - At this time, the firm could only make assumptions on increased revenue from leasing. Future budgets will be impacted when 3100 Main is brought online. The leasing of space will, of course, require some investment and capital commitment over and above the renovation and building. Administration should ensure that no sources of revenue have been excluded from the budget. Mr. Torres discussed possible discrepancies in revenue related to the truck driving program. The Executive Team has been advised of this issue. Consider increase in tax rate - Mr. Torres pointed out that HCCS' tax rate is lower than comparable institutions in the area. Implement an enrollment management plan to market the System and increase enrollment. Based on their findings, the College System has not been effective in correlating investments with increased enrollment. The Chancellor noted that the strategic plan is projecting a growth cycle and Ms. Berardo added that the budget for marketing has been increased this year. Ensure that outlying facilities are operating at maximum efficiency in terms of faculty workloads and class size. Information Technology efficiencies and investments - the System has made a considerable investment in this area and should begin to see a payback. The updated technology should eliminate redundancies and duplication of tasks and free up funds. The Board expressed the need for an audit trail for the electronic data processing system, especially in the financial model. General Obligation Bonds - the System needs strong public support before such an initiative is undertaken. The community must perceive HCCS as a long-term, viable entity. Consider annexation of outlying areas to increase the tax base. ADJOURNMENT TO CLOSED OR EXECUTIVE SESSION Mr. Austin adjourned the meeting to Executive Session at 5:45 p.m., notice having previously been given, and reiterated by him, in accordance with the Open Meetings Law. He 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. Mr. Austin reconvened the meeting in Open session at 7:20 p.m. and entertained motions on pending matters. HKMK RELEASED FROM CONTRACT TO PURCHASE DUNLAVY PROPERTY file:///C|/Documents%20and%20Settings/hccs/My%20Do...d%20of%20Trustees%20Minutes%202000/00_26_07min.htm (3 of 5) [3/18/2008 3:44:45 PM] July 26, 2000 Minutes Motion - Mr. Litt moved approval for the first amendment to the contract between HCCS and HKMK, as buyer of the Dunlavy property, effective this date. The amendment has been executed by HCCS releasing both parties from their agreement. Dr. Williams seconded the motion. Motion carried 5-0. Mrs. Garcia abstained from voting. SALE OF DUNLAVY PROPERTY TO HISD AUTHORIZED Motion - Mr. Litt made the following motion: that it be resolved and ordained by the Board of Trustees of the Houston Community College System that the requirements or conditions including the finding that the property is no longer necessary for the operation of the Houston Community College System and any other requirements or conditions necessary for the sale of college property have been met or occurred with regard to the property located at Richmond and Dunlavy, Houston, Harris County, Texas, property for the sum of $2,600,000. The Board of Trustees of the Houston Community College System authorizes the sale of the property to the Houston Independent School District. The Board of Trustees of the Houston Community College System authorizes the execution of the earnest money contract and all attachments to the Earnest Money Contract regarding the sale of the property so long as the same is approved and executed by the Chancellor. The Board of Trustees of the Houston Community College System authorizes the execution of such deeds, documents or other instruments as may be necessary and proper to effectuate the sale of the proper so long as same is approved and executed by the Chancellor. Passed, approved and adopted this 26th day of July 2000 with the amendment to the commercial real estate contract as entered into between HKMK Interests as buyer. Dr. Williams seconded the motion. Motion carried 5-0. Mrs. Garcia abstained from voting. BUDGET PRESENTATION FROM ADMINISTRATION Mr. Fenninger, Chief Financial Officer, presented three budgeting scenarios: Plan A: Original proposed budget of $175 million Plan B: Plan A with cutbacks - $167 million Plan C: Balanced Budget (expenses = forecasted revenue) - $160 million ADMINISTRATION TO PREPARE BUDGET FOR BOARD CONSIDERATION Motion - After an in-depth discussion of the three plans, Dr. Williams made a motion that administration prepare a budget for the Board's consideration based on Plan C, to include a $5.00 tuition increase for out-of-district students only, to file:///C|/Documents%20and%20Settings/hccs/My%20Do...d%20of%20Trustees%20Minutes%202000/00_26_07min.htm (4 of 5) [3/18/2008 3:44:45 PM] July 26, 2000 Minutes become effective September 1, 2001, and a 2% across-the-board salary increase for all faculty and staff. Mr. Murphy seconded the motion. Motion carried 5-0. (Mrs. Garcia had already left the meeting). The Board agreed to retain Mir, Fox & Rodriguez through the budget process. The Board will meet on August 1, 2000 for adoption of the budget. ADJOURNMENT With no further business to come before the Board, Mr. Austin adjourned the meeting at 9:30 p.m. Minutes Prepared By: Linda Gray, Administrative Assistant Board Services Reviewed, Finalized and Submitted By: Herman Litt, Secretary Board of Trustees Minutes Approved as Submitted: October 24, 2000 file:///C|/Documents%20and%20Settings/hccs/My%20Do...d%20of%20Trustees%20Minutes%202000/00_26_07min.htm (5 of 5) [3/18/2008 3:44:45 PM]