PERALTA COMMUNITY COLLEGE DISTRICT
AUDIT AND FINANCE COMMITTEE MEETING
MINUTES
Date:
Location:
Start time:
End time:
December 11, 2008
Chancellor’s Conference Room, District Office
1:08 p.m.
2:26 p.m.
PRESENT:
Bill Withrow, Chair
Cy Gulassa, Trustee
Thomas Smith, Vice Chancellor Finance and Administration
Gail Waiters, Inspector General
Joseph Bielanski, President, District Academic Senate
Debbie Budd, Acting Associate Vice Chancellor for Academic Services
Carlotta Campbell, President, COA Academic Senate
Wise Allen, Vice Chancellor Education Services
Elihu Harris, Chancellor
AGENDA:
1. Review and approve the agenda.
2. Review and approve the minutes from November 13, 2008 and
register as a Memorandum of Record for all meetings where a
quorum was not achieved (May 8, 2008 and February 7, 2008).
3. Report by the Inspector General.
4. Review current status of California State Budget and prognosis for
impact upon The Peralta Colleges.
5. Discuss status of the External Audit for 2007-08 including the audit
report of the Peralta Colleges Foundation.
6. Review a written report from CFO on the current status of all
significant and material weaknesses that were documented in the
External Audit Report for fiscal years 2005-06, 2006-07 and 200708.
7. Discuss the progress to date in developing and implementing
Program Based Budgeting techniques for the FY 2008-09.
8. Review the status of the Retiree Healthcare Trust Investments and
modification of Asset Allocation to ensure that we are adequately
positioned for the future economy and financial market.
9. Review the status of the OPEB bond refunding actions.
Chair Withrow opened meeting at 1:08 p.m. with Items 1 and 2.
ACTION:
Trustee Gulassa moved to approve agenda. Chair Withrow seconded.
Motion passed.
ACTION:
Trustee Gulassa moved to approve the minutes from the November 13,
2008. Chair Withrow seconded. Motion passed.
Item 3 – Report by Inspector General (IG Waiters)
No report.
December 11, 2008
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Item 4 – Review Status of California State Budget (VC Smith)
VC Smith said the state’s financial situation is one of the worst in the last 29 years. If a
student drops a class after census date, the community college will not get full pay for
student. This situation will hurt Peralta, Los Rios, Los Angeles.
PFT approved the one year contract extension. The City of Oakland is trying to do a one
year extension with a 5% cut. We offered SEIU a one year agreement but they didn’t
seem to be agreeable. My office will send a letter with deadline for acceptance. Steve
Hatch, Business Representative with Local 39, thinks one year extension it is a good
idea. We should have on next Board agenda. Trustee Gulassa said that the business
representative (Kaden Kratzer) cornered him indicating union wants increase like the
management committee got; seemed the only thing they were looking for. VC Smith
explained we are not going to bargain management salaries with SEIU salaries. PFT
received $600K step increase, SEIU received step increase of $300K, managers was
$79,000. Trustee Gulassa made it clear that even if there was justification for an
increase they would not one because there is no money. VC Smith discussed with SEIU
about swapping Cesar Chavez Day for Admission Day holiday; they want an additional
holiday.
Item 5 – Discuss status of the External Audit for 2007-08 (VC Smith)
Audit should be completed by last Board meeting in January. Audit to be discussed at
next Audit and Finance Committee to be held on January 15th from 3:00 to 5:00 p.m.
For BCC, it appears we can do a sampling for the audit and will not have FY 2005/06
problem.
Item 6 – Review a written report from the CFO on the current status of all significant
and material weaknesses that were documented in the External Audit Report (VC
Smith)
Chair Withrow requested a written report on the status of audit significant and material
weaknesses be brought to the committee and that it was the auditors who said it was a
requirement. He requested it for the January 15th meeting.
Item 7 – Discuss the progress to date in developing and implementing Program Based
Budgeting techniques for FY 2008-09 (VC Smith)
Chair Withrow stated with accreditation guidance they stressed that strategic plan and
goals had to drive the budget which you do through program based budgeting.
Ms. Budd said the District has been working on this for the past year and more
intensely over last six months. There were program reviews, then unit reviews,
educational master plans were presented by each college at last SPPAC meeting. In
good times you can fund, now we are looking at things that are not priorities.
Tomorrow there is a joint meeting with SPPAC, DWEMPC (District-wide Educational
Master Plan Committee) and BAC (Budget Advisory Committee). Ms. Budd has been
looking at successful programs across state and says District has made good progress
here. There is the career advancement academy and basic skills fund and the District
is ready to move forward. Dr. Bielanski said we now have something in writing that
people can respond to, i.e., looking at class schedule, people don’t get caught with how
did you come up with that? There is an actual model. Each college has been assessed
to see which has been most productive; college will go on watch list if they are not
productive (this is by program, not whole college).
December 11, 2008
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Item 8 – Review the status of the Retiree Healthcare Trust Investments (VC Smith)
VC Smith stated there is no change in investments. Bylaws are being developed for the
Retiree Healthcare Trust Investments committee, which was approved by the Board.
Neuberger Berman (NB) – people investing our money, now own the company; 49%
owned by creditors. Gordon Froeb will be at the next Audit and Finance Committee to
discuss their new set up. NB reversed transaction from international and have put into
large and small cap.
Item 9 – Review status of the OPEB bond refunding actions (VC Smith)
There was a meeting at Stone and Youngberg on the bond refunding. The S&P rating
was A and Moody’s was A1. With holidays, may not get completed until January. We
had higher ratings with GO Bonds. This is secured with the assets of Peralta.
Refunding action – 2010 bonds $50 million will be sold. Chair Withrow separate action
to buy back or refinancing the existing bonds. VC Smith says the plan is for the money
to go into the trust, don’t owe until 2010. The money is in trust so we can pay off
bonds if we have to. The District cannot negotiate with them until 2010.
The meeting adjourned at 2:26 p.m.
NOTE: Audit and Finance Committee date changed until Friday, January 23rd from
4:00 p.m. to 7:00 p.m.
December 11, 2008
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