Minutes of October 27, 1994 Meeting

The meeting convened at 10:06 a.m. in room 2428 Cathedral of Learning.

UPBC members present were: Nitin Badjatia, Jacob Birnberg, George Chambers, Thomas Detre, Ronald Gardner, Darlene Harris, James Holland, James Isaacs, Randy Juhl, Peter Koehler, James Maher, Franklin McCarthy, Richard Nelson, Joan Slezak, Ben Tuchi, Philip Wion, Bruce Williams, and Julius Youngner. Also present were: Rhonda Gross, Jeffrey Liebmann, William Madden, Robert Pack, James Stuckart, and Lawrence Weber.

UPBC members not present were: Thomas Anderson, Toni Carbo Bearman, Sharon Nelson-Le Gall, Jack Ochs, Jeffrey Romoff, and Judith Zimmerman.

Approval of Minutes

The minutes of the October 14 meeting were approved.

UPBC Member Appointments

Maher discussed the need, expressed by many members, to increase terms of UPBC appointment from two years to three years. Harris agreed that a three-year term would allow new members a more appropriate amount of time to acquire necessary knowledge. She added that such a term fits well with the new configuration of Staff Association Council officers, consisting of a three-year sequence of positions, from President-Elect to President to Past President. She suggested that, starting next year, the President-Elect be appointed as a non-voting UPBC member in addition to the current staff representation. Maher asked the Committee to vote on the proposed change in term length from two years to three years. The recommendation to change the term length was approved unanimously (with two abstentions).

Wion noted that the terms of ex-officio members depend upon the terms of the positions they hold. Maher suggested that either members be replaced as their eligibility changes, or that once an ex-officio member is appointed to the UPBC they serve a three-year term whether they remain in the relevant position or not. Detre moved that the UPBC recommend that ex-officio appointments should change as the persons occupying those positions change. Holland seconded. The motion was approved unanimously.

Wion suggested that necessary changes to the Planning and Budgeting System document should be submitted for review to the University Senate. Maher agreed, stressing the need to facilitate endorsement of those changes needed to meet current appointment requirements. Nelson suggested that the PBS text relative to the UPBC subcommittee structure be edited to reflect current practice. Detre agreed, emphasizing the retention of flexibility in creating subcommittees as needed.

Members discussed other operational matters, including the use of proxy votes and the schedule for staggering replacement of members. Gardner expressed concern over the assignment of voting versus non-voting status to regional campus faculty members (currently, only two of the four regional campus faculty representatives have voting status). Birnberg suggested that all four regional campus faculty representatives should be given voting status. Wion did not disagree, but stated that some Pittsburgh Campus faculty may object to a perceived over-representation of the regional campuses. Chambers responded that the University consists of five campuses and should not be viewed as a main campus with four lesser regional campuses. Birnberg added that the Pittsburgh Campus is generally also represented by the ex- officio Senate representatives. Members agreed to take up these issues at a later date.

UPBC Priorities for FY 1995

Maher discussed a proposed list of UPBC priorities for the coming year including the following.

-- Establish a task force (co-chaired by Pack and Gross) to identify duplicated services and programs and examine University processes in need of reengineering.

-- Establish a task force (chaired by Birnberg) to study costs associated with University services and internal pricing mechanisms and budgeting practices of auxiliary enterprises, with an emphasis on evaluating potential "make or buy" decisions.

-- The Attribution and Cost Study Methodology Subcommittee (chaired by Wion) will revise the methodology developed last year, refining the allocation of costs associated with space, debt service, Computing and Information Services, and the University Library System. Detre stressed the need to involve deans and department heads in attribution discussions and to examine the total context especially for departments for which the standard methodology may be inappropriate. Maher agreed that every effort will be made to solicit input and involve interested parties in the development of the methodology. He stressed that any attribution scheme must be used wisely and not merely as an excuse to reduce unit budgets without consideration of qualitative factors.

-- The Strategic Issues Subcommittee will discuss the establishment of institutional financial and management ratios aimed at improving resource allocation decisions, as well as University policies and practices associated with the use of Plant Funds.

-- The FY 1996 Parameters Subcommittee (chaired by Koehler) will produce operating budget parameters for FY 1996, identify the most appropriate format for reporting budgetary information, and work with the Strategic Issues Subcommittee to develop a long-term University budget.

Maher also stressed the importance of the University making necessary budget reduction and reallocation decisions humanely and intelligently. He explained the pressures facing the University from faculty, trustees, legislators, parents, and others to set priorities and finance them appropriately. For example, he cited the need to improve the satisfaction graduates feel about their experience with the University. Maher stated that he would look to the UPBC for advice on related procedures, issues, and available data bases.

Juhl asked whether a subcommittee would work on the capital budget process. Tuchi recommended retaining the Capital Projects Subcommittee for one more year to complete the implementation of the process and address the large number of deferred capital projects. Gross stated that units will soon be asked to submit five-year capital budgets and that this year will see the production of the first year of a five-year institutional capital budget.

FY 1996 Parameters

Pack distributed the latest draft FY 1996 operational budget parameters, which are consistent with the appropriation request recently submitted to the Commonwealth. Among the assumptions included are:

  • program enhancements of $1.25 million;
  • $1.5 million in savings from changes in medical insurance coverage;
  • a compensation increase of 4.25%;
  • combined tuition/appropriation increase of 9.5% (presently consisting of a 3.5% increase in tuition and fees and a 6% increase in Commonwealth appropriations);
  • increases in financial aid in excess of the increase in tuition rates (in order to address current deficits and planning strategies); and
  • a reduction in the operating budget of $4.0 million. He stated that the assumptions used to produce these parameters were very reasonable, especially relative to the capital budget and debt service, and did not understate expenditures.

    Tuchi stated that issues being discussed in the higher education task force being chaired by Representative Cowell stress the need for Pennsylvania institutions to come together on various financial and management issues. Tuchi stated that the Tuition Challenge Grant Program will likely continue and that Commonwealth support will more likely take the form on one-time capital funding rather than increased funding for ongoing operational expenditures. He also cited growing concern by legislators linking increasing tuition rates with increases in compensation and the need for institutions of higher education to pursue more cost cutting measures.

    Proposals for New Academic Programs

    Maher discussed two new academic programs he plans to submit to the Chancellor for approval. The interdisciplinary Ph.D. program in Rehabilitation Science will educate researchers who will impact individuals with physical and psychological limitations secondary to musculoskeletal and/or nervous system dysfunction. The program is integrally linked to the recently approved funding for the construction of a new building for the School of Health and Rehabilitation Science and ongoing long-range planning efforts of the School. The Master of Law degree (LL.M.) in International and Comparative Law will be open only to students with law degrees from institutions outside the United States who wish to deepen their understanding of the American legal system. Maher explained that projected program revenues would offset additional incurred expenditures.

    Birnberg expressed concern over the incremental nature of the Ph.D. program proposal. He stated that a better review could have followed submission of a complete proposal from the School on all related initiatives. Birnberg added that since the University will be responsible for addressing any revenue shortfalls, that the University should also benefit from new revenues produced which are planned to offset new expenditures. Pack responded that both proposals will be implemented with existing resources and that, especially in the case of the Ph.D. proposal, it would be cost ineffective to not make the proposed use of faculty in which the School has already invested.

    The meeting adjourned at 12:11 p.m.