Peralta Community College District Planning and Budgeting Council Meeting Minutes January 27, 2012 Present: Rich

Copenhagen, James Blake, Linda Berry, Tae-Soon Park, Fabian Banga, Bob Grill, Debbie Budd, Elnora Webb, Matthew Goldstein, Rick Greenspan, Eric Gravenberg, Timothy Brice, Thuy Nguyen, Rebecca Kenney, and Pieter de Haan. Chair/Co-Chair: Ronald Gerhard and Karolyn van Putten Guests: Jim Grivich, Ann Elliott, Betty Inclan, Joe Doyle, Mike Orkin, Susan Rinne, Shirley Slaughter, Pieter de Haan, Laurie Brion, and two student representatives. Facilitator/Recorder: Linda Sanford and Joseph Bielanski Absent: Abigail Brewer, Jenny Lowood Agenda Item Discussion Follow-up Action Decisions (Shared Agreement/Resolved or Unresolved?)

Meeting Called to Order I. Agenda Review II. Review of Minutes: Dec. 9 2012 III. Revised PBC 2011-12Timeline IV. Budget Update VC Gerhard

9:02 AM Agenda: APPROVED Minutes: APPROVED Informational Correction: College 2012-13 Annual Plans and Draft Budgets are due on April 20th, not February 24th. On Jan. 5, 2012, the Governor released the budget update early for fiscal year 2012-13. Included within the budget are some additional dollars for community colleges, but we wont see it in terms to augmentation of our budget or allocation from the State. It will be used specifically to buy down the current $963 million in deferrals that we as a system receive on an annual basis. It would

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Peralta Community College District Planning and Budgeting Council Meeting Minutes January 27, 2012 buy down the amount of money borrowed from the bank on an annual basis for cash flow and operational purposes. The additional dollars would not materialize in funding any FTES, growth, or COLA. The Governors budget had affected course offerings. State Finance Office argues for the Governor not to buy down the deferrals but instead give us more budgetary dollars so we can serve more students. The counterargument is the Governor is trying to make a point with the rating agencies that he is making a conscious effort to reduce the States overall debt burden. The State is using a new model in dealing with budget issues. Last year, they lowered the percentage needed to approve the State budget from 2/3 to 50%. Based on this new model, they would approve the expenditures by 50% but anything involving taxes or additional revenue will still require a 2/3 vote. Tax increases are going to the November election; an election that is five months into the fiscal year. Peralta is budgeting for it right now, but there are a lot of risks and more uncertainties involved in this model. It puts us in the same situation as last year where we are planning for the worst. We are going to go with the assumption that the tax initiatives fail because it is always easier to add dollars back into the budget than it is to cut. (If the initiatives were to pass, Peralta would need to set priorities.) Our contingency plan is to add more money into our budget via a parcel tax. The Board of Trustees, on January 24, 2012, approved the resolution authorizing the District in going forward and placing on the ballot a parcel tax in the June election. In the last polling done before the holiday break, around 71% of likely voters

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Peralta Community College District Planning and Budgeting Council Meeting Minutes January 27, 2012 within the poll would support the colleges. The community recognizes that the colleges need additional funding in order to support instruction, classrooms, and course offerings for students. If Peralta can renegotiate a deal with Morgan Stanley, PCCD could save $1.3 million annually. The way the Swap agreement was structured back in 2006 created a burden on the general fund. $1.3 million equates to about 300 sections. Susan Rinne 2012-13 Budget Assumptions This is a living document and updates will be brought to the Council as frequent as possible. The goal is to project three years out. Funded FTES will decrease to 16,692.37 for 2012-2013. Peralta was recently informed that healthcare premiums will increase significantly: Core Source by 13% and Kaiser by 18%. There will be a Kaiser open forum and VC Gerhard was selected as the moderator. A request was made to use the same units of measurement throughout the document, preferably in dollars. Item #19, PERS increase is based on the PERSs actuarial study. Employers share will be 14% while employees contribution will remain at 7%. Motion to revise the budget assumption so that for years 201314 and 2014-15, we will use a five year average of combined past increases per year and make projections for future increases, including medical. APPROVED (unanimous) Ms. Rinne will bring the numbers back at the next meeting.

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Peralta Community College District Planning and Budgeting Council Meeting Minutes January 27, 2012 Concern was expressed regarding the Governors proposal on the $400 million block grant for categorical programs. Communication is needed on the methodology in order to avoid disruptions to programs. VC Gerhard explained that at the local level, the Board of Trustees can allocate the funds with flexibility and discretion based on students need and demographic. The same amount of funding is still given to the District but without restrictions to a particular program. Motion: if the money comes in as a block grant (consolidated), for budgeting purposes, we agree for the first year to distribute as currently disbursed with some room for renegotiation. APPROVED In regards to Rick Greenspans email received on Wednesday, Jan. 25th, the District has done projections for the past five years. There was a need for more time in order to include the retirements. In every category other than 1101, the District has had a decrease. The $1.5 million is a projection despite the fact that we are six months away from the beginning of a new fiscal year. We can bring back information but not on a granular level. 75% of Classified employees are at the highest step (5). In contrast, 75% of Faculty qualifies for a step and column increase. This does not factor in Confidential and Administrators because their increase is not automatic. If requested in the course of negotiations, we will bring the information at the employee level. Such granular level of data is not in the scope or charge of the PBC. It was requested that the Finance Office provide data for the past

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Peralta Community College District Planning and Budgeting Council Meeting Minutes January 27, 2012 five years and exact amount, omitting individuals name, for each constituency to help guide the budget and planning integration process at the colleges. VC Gerhard agreed to bring in the cost perspective. A report showing all the budgeted positions were sent to SMT at this time last year. In the past, we did not have positions budgeting. Finance is working with HR and the College Presidents to come up with an agreement in terms of what are the funded positions. There are different lists of funded positions: College record, HR record (positions control module), and Finance record (funded positions). The prior model did not directly link or tie the funding to the position. If a college has a vacant position within their budget right now and they need to access those dollars; they can, upon the Chancellors approval on salary savings given our current financial position; otherwise, the budget that supports the position will remain in the 1101 account. Going into 2012-13 budget development process, all salary savings that occurred this fiscal year, come July 1st, will go back to support the original positions. Therefore, the positions will maintain their funding. It is up to the college to request the transferring of funds through a PA form. We are making the transition to budget on a positions level. VC Gerhard explained that if a faculty retires, the District will pay for their retiree benefits and the budget stays at the college level. Retirees are not, under state guidelines, a cost to instruction so the total cost cannot stay at the college. That would overstate the cost of service provided to students at the college. VC Budd added that this was part of the first step to implement the

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Peralta Community College District Planning and Budgeting Council Meeting Minutes January 27, 2012 BAM. The goal was for students to have the same chance of having a full time faculty as their instructor at each college. Looking at the growth at BCC, BCC had so much less money because they had so few full-time faculty members. V. Finalize the 2012-13 Budget Building Calendar Last year, a memo was sent to the Presidents and Vice Chancellors in regards to a 5%, 10%, and 15% reduction on discretionary budgets. The Office of Finance will send a similar memo out by Friday, Feb 3rd, to each President and Vice Chancellor. It will then go through the same shared governance process. The information needs to get back to the District Office of Finance by April 20th. Finance will make sure it fits the budget guidelines and then upload it into PeopleSoft. Finance will then create reports for the Colleges to review. The tentative budget will be ready for the PBC to review in May 2012. If the parcel tax passes, the District would have time to incorporate additional revenue in the Tentative Budget at the June 2012 Board of Trustees meeting. In terms of position budgeting, a need for clarification was pointed out that funds (savings from positions) will reside with the college and they may be used at the colleges discretion to replace those positions. Given the current economic condition and circumstances, VC Gerhard does not believe the Chancellor would object to such language. International Student Fees/ Out-of-State Student Fees (NonResident) Draft language to be inserted into the BAM regarding these funds

VI. Review/Updat e the Budget Allocation Model

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Peralta Community College District Planning and Budgeting Council Meeting Minutes January 27, 2012 Note: Overseas online students are counted within international student fees. Motion to approve the International Student Fee distribution with modification to include Out-of-State students (Non-Resident Student Fees). APPROVED (unanimous)

IT Planning and Budgeting Need for draft language to be inserted into the BAM Currently 99% of IT expenditures are out of one time money, i.e. bond funds [such as Measure A). This language is an effort to put into our BAM a mechanism to fund IT projects and multi-year IT projects. VC Gerhard suggests that after the District closes the books (in Oct/Nov), to identify one-time dollars at the District-level that he will recommend to the Chancellor to be allocated to match the colleges dollars for IT budget. Essentially, it would provide additional dollars for the college that would be dollar-for-dollar match to help that college fund IT needs on an ongoing basis. PCCD cannot continue with the assumption that we will always have bond funds. The forum for discussion and requests for consideration would be at the District Technology Committee (DTC). Recommendations will then be forwarded to the PBC and ultimately to the Chancellor. It was suggested that more explicit wording be used, such as, in order to ensure a robust investment in the IT infrastructure of the District, deplore of the colleges, the District Technology Committee will have the responsibility for reviewing and recommending to the Chancellor for the

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Peralta Community College District Planning and Budgeting Council Meeting Minutes January 27, 2012 budget allocation on an annual basis. It will also need to go through our district-wide shared governance process. It was suggested that the draft language begin with The colleges will identify and prioritize projects. Dr. Karolyn van Putten, Council Co-Chair, asked if there was a regular budget line item for District IT expenses. VC Gerhard confirmed that IT has its own cost center and budget, but a majority of that is used for salary and annual renewal of PeopleSoft software licenses. The IT department has very little discretionary dollars to fund requests from the colleges. It was stated that there is a need for funds to be set aside for instructional software for IT equipment purchased and installed at the colleges. It was further stated that there should be a regular IT line item that includes all district and college IT needs including but the limited to IT people, cost of equipment on campus, and replacement cost for computers and equipment on campus. It should be part of the regular operating budget. A question was raised as to when we can change the organizational structure for IT so that we can have an idea what everyone (within IT) is doing at each college. It was stated that we should have a sound college technology plan incorporated in a transparent way into the District technology plan. The District should make available some of the funding to the colleges. The colleges should have the flexibility, by the use of their own planning and budget integration model, to distribute and allocate the IT funds without having to go to the DTC as to how they should spend the money. It was stated that each

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Peralta Community College District Planning and Budgeting Council Meeting Minutes January 27, 2012 college has their own unique IT needs. Therefore, they should have their own IT Team. It was stated that Tony Tortorice is working on the IT restructure. It is a very complicated process. For a District this size and the technology that is needed, we are way under budget. Just to compare the number of programmers here and that to UC Berkeley, we dont have 5% of the programmers that UC Berkeley has, yet we have a larger population. Motion for the meeting minutes (in the form of a memo) be given to the DTC. Specifically the draft language for BAM regarding IT funding be sent to DTC requesting DTC provide the PBC with DTC approved language. APPROVED (the following was sent to the DTC).

Due to the current economic environment, the District has very little ongoing discretionary funding to support the evolving needs of IT planning. It is the intent and desire to provide flexibility and support to those colleges and central office services that have multi-year planning mechanisms in place and that have set aside funding within their Unrestricted General Fund discretionary allocations to support these plans. To support this effort the Chancellor will on an annual basis, no later than November 1st, announce a restricted allocation of one-time funds within the Unrestricted General Fund that will be used as a dollar for dollar match to fund IT projects identified and partially funded. The Colleges will identify and prioritize projects and forward their lists to the District Technology Committee (DTC) for its review and consideration. To the extent that there are one-time funds available, the DTC will review all requests submitted for consideration of these matching funds and forward to the PBC its recommendations no later than January 1. The PBC will review and provide its recommendations to the Chancellor no

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Peralta Community College District Planning and Budgeting Council Meeting Minutes January 27, 2012
later than February 1.

VII. Bench mark Survey VIII. Strateg ic Planning to Resolve the Impact of Workload Reductions IX. Policies and Administrative Procedures Jim Grivich

tabled tabled

Motion to approve BP 4230, BP 3100, BP 3200, BP 3250, BP 3300, AP 3200, AP 3250 and AP 3300. APPROVED BP 4230, Grading and Academic Record Symbols BP 3100 Organizational Structure BP 3200 Accreditation AP 3200 Accreditation BP 3250 Institutional Planning AP 3250 Institutional Planning BP 3300 Public Records AP 3300 Public Records Pull for discussion: AP 2430 Delegation of Authority to the Chancellors Staff AP 3100 Organizational Structure BP 3720 Telephone, Computer, and Network Use AP 3720 Telephone, Computer, and Network Use

X. Other Topics Adjournment: Next meeting:

12:00 PM February 24, 2012 from 9:00am 12:00pm

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Peralta Community College District Planning and Budgeting Council Meeting Minutes January 27, 2012 Minutes taken: Sui Song Attachments: All handouts for this meeting can be found at http://eperalta.org/wp/pbi/planning-and-budgeting-council/pbc-documents/

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