MINUTES Kentucky Community and Technical College System Board of Regents Meeting March 11, 2016

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1 MINUTES Kentucky Community and Technical College System Board of Regents Meeting March 11, 2016 Board Members Present: Ms. Venus R. Evans Ms. Betsy E. Flynn Dr. Angela Fultz Dr. Gail R. Henson Ms. Mary R. Kinney Mr. Barry K. Martin Ms. Lacey B. Parham Mr. Porter G. Peeples Ms. Marcia L. Roth Mr. James Lee Stevens Mr. Donald R. Tarter Ms. Tammy C. Thompson Mr. Mark A. Wells Board Members Absent: Mr. Robert G. Cooper Ms. Tammy C. Thompson CALL TO ORDER KCTCS Board of Regents Chair Marcia Roth called to order the meeting of the Kentucky Community and Technical College System Board of Regents at 9:03 a.m. (ET) on March 11, The meeting was held at the KCTCS System Office in Versailles, Kentucky. The press was notified of the meeting on March 2, Hon. Pamela Duncan, KCTCS Associate General Counsel, served as parliamentarian. There being a quorum present, Board business began with the approval of minutes. APPROVAL OF MINUTES ADDITIONS OR CHANGES TO THE AGENDA ACKNOWLEDGE- MENT OF MEETING HOSTS AND INTRODUCTION OF GUESTS CHAIR S REPORT Chair Roth asked if there were any corrections to the September 18, 2015, minutes presented in the meeting materials. There being none, the minutes were declared approved as presented. There were no additions or changes to the agenda. Chair Roth welcomed guests to the meeting. She thanked KCTCS President Jay K. Box for hosting the Board for dinner Thursday evening. She also thanked the staff for their hospitality. KCTCS Board of Regents Chair Roth presented highlights from the January 12, 2016, KCTCS Foundation Board meeting. The Foundation Board received an update on the BuildSmart Campaign as of January 8, She noted that President Box gave the Foundation Board updates from the December 4, 2015, KCTCS Board of Regents meeting, including the KCTCS 1

2 It s On Us Campaign, Financial Aid Loan Default rates, development of an integrated strategic enrollment plan to recruit students, and the Strategic Planning Process. Chair Roth reported that the September 15-16, 2016 Board of Regents meetings were to be held at Madisonville Community College, but due to the retirement of Dr. Judith Rhoads, the meetings have been moved to Ashland Community and Technical College. She expressed her thanks to Regent Peeples for attending the January 7, 2016, Kentucky Chamber of Commerce Day Dinner as a representative of the KCTCS Board of Regents. She also expressed thanks to the Regents Gail Henson, P.G. Peeples, Lacey Parham, Mark Wells, Mary Kinney, and Tammy Thompson for attending the KCTCS Advocacy Campaign events in Frankfort on February 18, PRESIDENT S REPORT KCTCS President Box shared with the Board that the Board Agenda Book now has a new section containing commonly used acronyms. He updated the Board on the KCTCS BuildSmart Investment for Kentucky Competitiveness plans and Dr. Ty Handy, the newly appointed President of Jefferson Community and Technical College, effective January 1, was introduced. President Box provided updates regarding the current activity with the legislative session and presented two videos to the Board on the Fuel The Force Campaign and House Bill 626. Regent Peeples expressed his gratitude to Vice President Wendell Followell and his staff for their Southern Association of College and University Business Officers (SACUBO) award to KCTCS for Supplier Diversity as a best practice and for KCTCS to be recognized for this as a best practice. The written report presented at the meeting is available at: 0Rpt%20to%20Board-March%202016%20FINAL%20to%20web.pdf CONSENT AGENDA EXECUTIVE COMMITTEE Chair Roth asked if there were any changes to the consent agenda. There being none, the agenda was approved as presented. Chair Roth called upon Executive Committee and Board of Regents Vice Chair Gail Henson to make the committee s report. ACTION: REVISION OF MISSION STATEMENT FOR BIG SANDY COMMUNITY AND RECOMMENDATION: That the KCTCS Board of Regents approve the revision of the mission statement for Big Sandy Community and Technical College (BSCTC) as presented in the agenda materials. Dr. Henson noted that it is the policy of the KCTCS Board of Regents that 2

3 TECHNICAL COLLEGE each SACS-accredited college under the jurisdiction of the KCTCS Board of Regents has a statement of purpose approved by the governing board and that the KCTCS Board of Regents periodically review and approve mission statements of each SACS-accredited college. It is also the policy of KCTCS that the college mission statement be reviewed annually and that the mission statement shall be submitted to the KCTCS Board of Regents for approval at least once every three years. She noted that BSCTC assessed the alignment components of their strategic plan with the System s proposed Vision, Mission, and Values in October In December 2015, a draft version of the new Mission Statement was sent to all BSCTC employees along with a survey designed to solicit input and to provide opportunity for feedback. The final version of the of the revised Mission Statement along with the comprehensive BSCTC Strategic Plan and its individual components--vision Statement, Values, Priorities, and Planning Themes--were approved by the BSCTC Board of Directors at the February 11, 2016 meeting. MOTION: On behalf of the Executive Committee, Dr. Henson moved that the KCTCS Board of Regents approve the revision of the mission statement for Big Sandy Community and Technical College (BSCTC) as presented in the agenda materials. Chair Roth called for discussion. There being none, she called for the vote. VOTE: The motion was approved unanimously. ACTION: RENEWAL OF MISSION STATEMENT FOR SOUTHEAST KENTUCKY COMMUNITY AND TECHNICAL COLLEGE RECOMMENDATION: That the KCTCS Board of Regents approve the renewal of the mission statement for Southeast Kentucky Community and Technical College (SKCTC) as presented in the agenda materials. Dr. Henson noted that the SKCTC Leadership Team was charged with developing and conducting the mission review process which included a discussion of SKCTC s present and future service to the campus community and constituent groups. It also included consideration of changes in academic and external support programming to reflect SKCTC s position as the primary provider of postsecondary education in the SKCTC service area. The SKCTC leadership team recommended no changes be made to the mission statement and voted unanimously to endorse the renewal of the document on September 9, The renewal of the mission statement was endorsed by the SKCTC Board of Directors on December 11, The mission statement was presented to the SKCTC faculty and staff via February 1, The faculty and staff were invited to make comments and suggestions in advance of an online vote. On February 18, 2016, a renewal of the current mission statement was endorsed by the SKCTC faculty and staff. MOTION: On behalf of the Executive Committee, Dr. Henson moved that the 3

4 KCTCS Board of Regents approve the renewal of the mission statement for Southeast Kentucky Community and Technical College (SKCTC) as presented in the agenda materials. Chair Roth called for discussion. There being none, she called for the vote. VOTE: The motion was approved unanimously. INFORMATION: KCTCS 2017 REGULAR MEETING CALENDAR Dr. Henson noted that according to KRS , the KCTCS Board of Regents is mandated to meet quarterly. The Board holds special meetings as necessary under the conditions set forth in Section 4 of the KCTCS Board of Regents Bylaws. Board compliance with the quarterly meeting mandate has evolved into a two-day meeting format on Thursdays and Fridays with the meetings scheduled to avoid holidays in March, June, September, and December. Regents were asked to review their calendars and let staff know by April 25, 2016, whether they are available to attend meetings on March 9-10, 2017; June 8-9, 2017; September 14-15, 2017; and November 30 December 1, The proposed dates do not conflict with federal holidays. It was noted that the Board s 2017 regular meeting calendar would be adopted at the June 10, 2016, Board of Regents meeting. UPDATE: 2016 KCTCS LEGISLATIVE AGENDA/ ADVOCACY CAMPAIGN Chair Roth called on President Box to present an overview with assistance from KCTCS Vice President Tim Burcham. President Box asked the Board to review the three handouts in their President s Report folders that detailed the current information on the KCTCS Legislative Agenda. President Box updated the Board on the current state of the budget and bills of interest to KCTCS. President Box updated the Board on the February 18, 2016, KCTCS Business Champions Day held in Frankfort. Business Champions from each college attended the event, along with college leadership. This event drew more than 200 people, including the Governor and Lieutenant Governor. The Governor signed a proclamation declaring February 18 th, KCTCS Day In Kentucky. This event garnered the most social media attention in a single day in the history of KCTCS. In addition to the Business Champions Day, every college was scheduled for a KCTCS Business Champions Showcase Day during the 2016 session, when college leadership and members of the Business Champions Councils visited Frankfort to showcase how college programs and initiatives fuel their local workforces. 4

5 President Box noted that he attended the Showcase Days as his schedule permitted and was asked to address some of the Councils while they were in Frankfort. ACTION: NAMING OF THE REGIONAL POSTSECONDARY EDUCATION CENTER AT MADISONVILLE COMMUNITY COLLEGE RECOMMENDATION: That the KCTCS Board of Regents approve the naming of the Regional Postsecondary Education Center at Madisonville Community College (MCC) as requested by President Judith L. Rhoads and endorsed by the MCC Board of Directors. Dr. Henson noted that MCC is seeking approval to name the Regional Postsecondary Education Center that will be constructed on the North Campus in recognition of The Honorable Steve Beshear s financial support. Governor Beshear has a long and distinguished history in the area of education and has been instrumental in providing significant funding for the college s BuildSmart initiative. The Regional Postsecondary Education Center will be used to raise the level of educational attainment in Hopkins County and the surrounding areas. Murray State University has signed of Memorandum of Agreement to lease half of the facility for a 20-year period. Program offerings will be expanded to include additional programs, Masters, and Rank One programs. Future programming includes a BS in Community Health, a BS in Health Information Administration, and an MS in Organizational Communication. The reference to the Kentucky Virtual Campus was replaced with Distance Learning as the current reference to the KCTCS program. MOTION: On behalf of the Executive Committee, Dr. Henson moved that the KCTCS Board of Regents approve the naming of the Regional Postsecondary Education Center at Madisonville Community College (MCC) as requested by President Judith L. Rhoads and endorsed by the MCC Board of Directors. Chair Roth called for discussion. There being none, she called for the vote. VOTE: The motion was approved unanimously. INFORMATION: KCTCS PRESIDENT S ANNUAL PERFORMANCE EVALUATION Dr. Henson noted that the annual performance review process was revised after President Box was appointed in January The KCTCS Board of Regents Policy 2.5 KCTCS President s Performance Review was approved at the September 18, 2015, meeting, along with President Box s Goals and Objectives. During this meeting the timeline for his first review was also approved. Dr. Henson shared that President Box had provided the Board members a preliminary report of his accomplishments for the first 14 months as President, and will provide a final report for the full 16 months before mid- May so that the Board may finalize his performance review at the June 10, 2016 Board meeting. 5

6 Dr. Henson noted that five key terms that described his first year as President: Communicator, Advocate, Visible, Engaged, and Future-Focused. President Box then discussed the accomplishments of the goals and objectives outlined in the report. Chair Roth called for discussion. Chair Roth added that, as indicated in the Goals and Objectives Timeline and Procedures, after the Board receives President Box s final accomplishment report prior to mid-may the presidential evaluation form/instrument will be distributed in mid-may with a deadline for the return of the form to Chair Roth. A final evaluation of President Box will be conducted at the June 9-10 meetings in Maysville. EFFICIENCY, EFFECTIVENESS, AND ACCOUNTABILITY COMMITTEE UPDATE: KCTCS STRATEGIC PLAN PERFORMANCE MEASURES Chair Roth called upon Efficiency, Effectiveness, and Accountability Committee Chair Barry Martin to make the committee s report. Mr. Martin noted that as required by the KCTCS Bylaws, the Effectiveness, and Accountability (EEA) Committee has been meeting annually each March and on an as-needed-basis for several years now. Routine items considered by the EEA Committee relate to strategic planning and performance measures. He shared that because the Strategic Plan is coming to a close effective June 30, 2016, the committee reviewed the current status of the Performance measures with an eye towards measures that may be appropriate for the strategic plan. Due to data collection timelines, some of the performance measures data is more up to date than others. Some of the measures have already exceeded targets and have been revised over the course of the past Strategic Plan due to changing circumstances or based on new data. INFORMATION: KCTCS STRATEGIC PLAN DEVELOPMENT REVISED GOALS INFORMATION: KCTCS STRATEGIC PLAN DEVELOPMENT PERFORMANCE MEASURES Mr. Martin noted that the committee reviewed a PowerPoint presentation from President Box regarding the revised goals and information needed to develop the KCTCS Strategic Plan The PowerPoint can be viewed here: Mr. Martin shared that the committee reviewed a series of proposed performance measures for each of the revised goals for the KCTCS Strategic Plan The proposed performance measures have been developed with the full engagement of the colleges Institutional Research and Institutional Effectiveness staff, college strategic planning leads, and the KCTCS President s Leadership Team. 6

7 The Board s feedback from the discussion of the proposed measures will be taken into consideration as KCTCS staff prepare for the June 10, 2016 meeting where the Board will be asked to adopt the comprehensive KCTCS Strategic Plan for implementation on July 1, ACADEMIC AFFAIRS AND CURRICULUM COMMITTEE ACTION: HONORARY DEGREE CANDIDATE AT MADISONVILLE COMMUNITY COLLEGE Chair Roth called upon Academic Affairs and Curriculum Committee Chair Angela Fultz to make the committee s report. RECOMMENDATION: That the KCTCS Board of Regents approve the awarding of an honorary associate degree in humane letters to Mr. Bentley F. Badgett, II, as requested by Madisonville Community College (MCC) President Judith Rhoads. He has contributed significantly to the college and the community. Dr. Fultz shared that Mr. Badgett is a well-respected member of the community and has been a positive and guiding force in economic and industrial development in western Kentucky for many years. She noted that the Badgett Foundation has given generously to School Counts!, a work-ethic based scholarship program for public high school students in Hopkins County to attend MCC. Beginning with a lead gift of $50,000 in 2007, the Badgett Foundation s total giving to the School Counts! Program is $480,000. To date, more than 800 Hopkins County students have received School Counts! Scholarships. Dr. Fultz noted that Mr. Badgett had also served as Honorary Co-chair of MCC s BuildSmart Campaign, and worked diligently to ensure that MCC met the $5 million goal to fund construction of the Madisonville Regional Postsecondary Education Center. In addition, the Badgett Foundation provided a lead gift of $250,000 to the MCC s BuildSmart Campaign. MCC faculty and staff support awarding Mr. Bentley F. Badgett, II an honorary associate degree in humane letters. MOTION: On behalf of the Academic Affairs and Curriculum Committee, Dr. Fultz moved that the KCTCS Board of Regents approve the awarding of an honorary associate degree in humane letters to Mr. Bentley F. Badgett, II, as requested by Madisonville Community College (MCC) President Judith Rhoads. He has contributed significantly to the college and the community. Chair Roth called for discussion. There being none, she called for the vote. VOTE: The motion was approved unanimously. ACTION: NEW PROGRAM PROPOSALS ASSOCIATE IN APPLIED SCIENCE RECOMMENDATION: That the Board of Regents approve an Associate in Applied Science (AAS) in Broadband Technology with tracks in Broadband Technician, Broadband Telecommunications Equipment Installer, and Broadband Design and Applications for Big Sandy Community and Technical 7

8 (AAS) IN BROADBAND TECHNOLOGY FOR BIG SANDY COMMUNITY AND TECHNICAL COLLEGE College (BSCTC) to be implemented in August Dr. Fultz noted that BSCTC is in the position to help with the economic development of Eastern Kentucky while enriching the career opportunities for students through this new program of study. The Shaping Our Appalachian Region (SOAR) initiative that seeks to expand job creation; enhance regional opportunity, innovation, and identity; improve the quality of life; and support all of those working to achieve these goals in Appalachia Kentucky supports the efforts to address the region s need for this program. In response to the region s declining economy, implementation of the broadband initiative will begin in Eastern Kentucky. BSCTC will become a significant resource in providing a qualified workforce to meet industry needs. Dr. Fultz noted that a $4.5 million facility is designated for construction on the BSCTC Pikeville campus to house a Broadband and Technology Center. MOTION: On behalf of the Academic Affairs and Curriculum Committee, Dr. Fultz moved that the KCTCS Board of Regents approve an Associate in Applied Science (AAS) in Broadband Technology with tracks in Broadband Technician, Broadband Telecommunications Equipment Installer, and Broadband Design and Applications for Big Sandy Community and Technical College (BSCTC) to be implemented in August Chair Roth called for discussion. There being none, she called for the vote. VOTE: The motion was approved unanimously. ACTION: NEW PROGRAM PROPOSALS DIPLOMA IN PHARMACY TECHNOLOGY FOR BLUEGRASS COMMUNITY AND TECHNICAL COLLEGE RECOMMENDATION: That the Board of Regents approve a Pharmacy Technician II Diploma in Pharmacy Technology, and certificates in Pharmacy Technician I and Retail Pharmacy Technician for Bluegrass Community and Technical College (BCTC) to be implemented in fall Dr. Fultz noted that BCTC Diploma in Pharmacy Technology program provides graduates with an understanding of the opportunities available in the pharmacy industry, best practices, and an understanding of the principles and accepted practices in the pharmaceutical field. Dr. Fultz noted that the demand for pharmacy technicians is expected to grow due to changes in the requirements to sit for the Pharmacy Technician Certification Board (PTCB) exam. Dr. Fultz shared that beginning in 2020, all exam candidates must graduate from an accredited pharmacy technician program. This new stipulation will serve to drive an increased need for pharmacy technician programs and graduates. Recent inquiry as to the demand for Pharmacy Technicians revealed that the University of Kentucky (UK) Hospital Pharmacy currently has 13 vacant pharmacy technician positions out of 86 pharmacy technicians on staff. 8

9 Dr. Fultz noted that BCTC is partnering with UK Healthcare to implement the Pharmacy Technician II diploma, thus UK will provide funding for one fulltime faculty member during the first year of implementation. MOTION: On behalf of the Academic Affairs and Curriculum Committee, Dr. Fultz moved that the KCTCS Board of Regents approve a Pharmacy Technician II Diploma in Pharmacy Technology, and certificates in Pharmacy Technician I and Retail Pharmacy Technician for Bluegrass Community and Technical College (BCTC) to be implemented in Fall Chair Roth called for discussion. There being none, she called for the vote. VOTE: The motion was approved unanimously. UPDATE: BACCALAURETE STUDENT TRANSFER Dr. Fultz informed the Board that the numbers of KCTCS transfer students are increasing, with the majority of those students transferring to a public university. Therefore, CPE and KCTCS are renewing efforts to establish stronger partnerships between KCTCS and the universities. To ensure the most efficient transition for the students as possible, a jointly sponsored CPE and KCTCS summit brought together representatives from each of the KCTCS colleges and all public universities to encourage discussions around the development of degree pathways for KCTCS transfer students. Additionally, a Perkins Leadership Grant received in February will bring faculty groups from KCTCS colleges and the comprehensive public universities together to begin development of applied baccalaureate pathways to increase the transfer opportunities for students with associate of applied science degrees. Systems Office staff, in conjunction with the Transfer Peer Team, are compiling a repository of articulation agreements between KCTCS colleges and their partners. The comprehensive list will allow for the expansion of many of these agreements to cover all colleges within KCTCS. Two examples of the possible results from this effort are the agreements between Morehead State University (MoSU) and Indiana Wesleyan University (IWU). The MoSU agreement, originally between MoSU and Ashland CTC in Space Science has been extended throughout KCTCS. Similarly, the agreement between Gateway CTC and IWU covering several programs is not a KCTCS agreement. UPDATE: CPE/CEO DEGREE PROGRAM ELIGIBILITY ASSESSMENT Dr. Fultz noted that Dr. McCall shared with the committee that in February 2016, CPE announced all 16 KCTCS colleges submitting new program proposals through December 31, 2016 will receive an Automatic Eligibility status. All KCTCS colleges are eligible to submit new program proposals. 9

10 RECESS FINANCE, TECHNOLOGY, AND HUMAN RESOURCES COMMITTEE ACTION: POLICY REVISION KCTCS BOARD POLICY 3.7- KCTCS RETIREMENT PLAN POLICIES The KCTCS Board of Regents recessed at 10:12 a.m. (ET) and reconvened at 10:28 a.m. (ET). Chair Roth called upon Finance, Technology, and Human Resources Committee Chair Betsy Flynn to make the committee s report. RECOMMENDATION: That the KCTCS Board of Regents approve the proposed revision to KCTCS Board of Regents Policy 3.7 KCTCS Retirement Plan Policies as presented in the agenda materials. (See Attachment A) Ms. Flynn noted that in 2004, KCTCS established a 401 (a) Retirement Plan as a qualified governmental plan and selected Teachers Insurance and Annuity Association of America - College Retirement Equities Fund (TIAA- CREF) as the Plan s administrator. The Plan allows for the deferral of taxable income if it maintains qualified status with the Internal Revenue Service (IRS). For the 2005 and 2006 Plan Years, respectively, KCTCS made changes to the Plan increasing the employer contribution from 2 percent of compensation per year to 3 percent of compensation per year, and from 3 percent of compensation per year to 4 percent of compensation per year. As a result of these changes and changes in Internal Revenue Service ( IRS ) code, the Plan required amending. At the December 3 4, 2015, Finance, Technology, and Human Resources Committee and KCTCS Board of Regents Meetings, the Board took action to amend the Plan and directed KCTCS staff to take appropriate actions to execute the Plan amendments. Section 3.7 of the Kentucky Community and Technical College System Retirement Plan Policies has been revised accurately to reflect participation in the Plan. MOTION: On behalf of the Finance, Technology, and Human Resources Committee, Ms. Flynn moved that the KCTCS Board of Regents approve the proposed revision to KCTCS Board of Regents Policy 3.7 KCTCS Retirement Plan Policies as presented in the agenda materials. (See Attachment A) Chair Roth called for discussion. There being none, she called for the vote. VOTE: The motion was approved unanimously. UPDATE: TECHNOLOGY SOLUTIONS REPORT Ms. Flynn reported that the committee was presented highlights of the annual KCTCS Technology Solutions 2015 Accomplishments Report. This report is available at ort.aspx. 10

11 ACTION: KCTCS ANNUAL BUDGET AMENDMENT RECOMMENDATION: That the KCTCS Board of Regents approve an amendment (Attachment B) to the KCTCS Annual Budget approved on June 12, The proposed amendment to the budget will authorize KCTCS President Box to move up to $8,557,300 from the Budget Reserve into the operating budgets of the KCTCS colleges, systemwide operations and support programs, the Fire Commission, and the Kentucky Board of Emergency Medical Services (KBEMS) as necessary to help address the state budget cut. Ms. Flynn noted that the Executive Budget proposed by Governor Bevin and presented to the 2016 General Assembly includes a provision that the current fiscal year appropriation to each state-supported institution of postsecondary education, including KCTCS, be reduced by 4.5 percent. For KCTCS, this amounts to $8,557,300. Ms. Flynn noted that the KCTCS Board of Regents adopted the budget resolution regarding the Annual Budget for KCTCS that included a Budget Reserve of $21,150,900 for the KCTCS colleges, the systemwide operations and support programs, the Fire Commission, and KBEMS. The Budget Reserve was established by the KCTCS Board of Regents several years ago to be available should an unplanned situation arise requiring funds to maintain KCTCS operations. The budget resolution provides that, In the event current fund revenues now estimated should not be realized, the KCTCS President shall take appropriate action to reduce budget authorizations to amounts sufficient to ensure that expenditures do not exceed available revenues. The KCTCS President shall report to the Board in advance any major deviations from the approved operating budget. Ms. Flynn noted that the timing of Governor Bevin s proposed reduction to the General Fund appropriation is so late in the current fiscal year that it would make it very difficult, if not impossible, for the colleges and other KCTCS operating units to balance their budgets without having access to the Budget Reserve funds. MOTION: On behalf of the Finance, Technology, and Human Resources Committee, Ms. Flynn moved that the KCTCS Board of Regents approve an amendment (Attachment B) to the KCTCS Annual Budget approved on June 12, The proposed amendment to the budget will authorize KCTCS President Box to move up to $8,557,300 from the Budget Reserve into the operating budgets of the KCTCS colleges, the systemwide operations and support programs, the Fire Commission, and the Kentucky Board of Emergency Medical Services (KBEMS) as necessary to help address the state budget cut. Chair Roth called for discussion. There being none, she called for the vote. VOTE: The motion was approved unanimously. 11

12 INFORMATION: KCTCS BUDGET DEVELOPMENT SCENARIOS Ms. Flynn reported that the Finance, Technology, and Human Resources Committee discussed the preliminary draft Budget Development scenarios in order to give President Box and his staff a sense of the Board of Regents funding priorities for The Budget will be proposed for consideration at the June 10, 2016 Board meeting. Ms. Flynn noted that the Finance, Technology, and Human Resources Committee discussed various preliminary scenarios for the development of the KCTCS operating budget knowing that the status of the general fund appropriations and the tuition increases approved by CPE are still unknown. The committee discussed primary sources of revenue, including state appropriations and anticipated reductions, tuition, and budget reallocations. The committee also discussed projected increases in fixed costs and employee compensation. As requested by the Board of Regents, a compensation and classification study has been conducted to assess salary and wage competitiveness of KCTCS relative to the market. Options for implementing the recommendations of the study were included in the scenarios discussed. Ms. Flynn noted that as a means to address growing safety and security concerns on KCTCS s campuses, and to appropriately support ever increasing technological demands, consideration is requested for potentially implementing limited charges earmarked to the areas of safety and security and technology resources. Consideration for a one-time application charge is also requested to assist cost avoidance of processing applications and sending recruitment materials that do not result in enrollment. All mandatory fees must be approved by CPE along with tuition. Ms. Flynn added that a KCTCS annual budget proposal will be presented to the KCTCS Board of Regents for action at the June 10, 2016 meeting. UPDATE: KCTCS QUARTERLY FINANCIAL REPORT Ms. Flynn noted it was reported that information for the second quarter of fiscal year , which ended December 31, 2015, was derived from the KCTCS Administrative Financial System. The Statement of Revenues and Expenditures reflects the actual program and operational expenditures compared to the fiscal year budget approved by the KCTCS Board of Regents on June 12, Total revenues of $516 million reflect 55 percent of the budgeted revenue and appropriated funds. Current fund expenditures and budget reserve through the fiscal year total $398 million, 45 percent of the expenditures budgeted for the year. As of the end of the first quarter, KCTCS has received 83 percent of budgeted tuition revenue; and 48 percent of the total budgeted financial aid has been received and expended. A total of 100 percent of the nonrecurring budget reserve from prior year funds is in place. It was noted that investment income was down due to the downturn in global markets. KCTCS staff are reviewing the KCTCS portfolio for possible rebalance. 12

13 The Statement of Net Position, although not specifically required in the Board s Annual Budget Adoption Resolution, has also been included in the Quarterly Financial Report to give the Board a periodic snapshot of the KCTCS financial position using the most common accounting-based schedule. UPDATE: THE COMMONFUND INVESTMENT MANAGEMENT Ms. Flynn noted that Finance, Technology, and Human Resources Committee received a presentation from Commonfund Representatives Lew Wallace and Stuart Ames. The presentation was on Commonfund s investment management services provided to KCTCS. The presentation can be found at: nce/kctcs%20presentation%20-%20march% pdf UPDATE: SUPPLIER DIVERSITY REPORT Ms. Flynn noted KCTCS defines diverse suppliers as those businesses owned by ethnic minorities, women, veterans, or the physically challenged. Fiscal year data indicates that KCTCS has spent $3.4 million (12.6 percent) of a total $27.4 million in impactable discretionary spending with diverse suppliers. Dollars spent with diverse suppliers was slightly higher in fiscal year (12.6 percent) as compared to 2015 (7.2 percent). Dollars spent with all suppliers decreased in fiscal year 2016 (2.3 percent) as compared to previous year due to continued tight budgetary constraints. Ms. Flynn shared on October 1, 2015, KCTCS held the third annual KCTCS Supplier Diversity Fair in Elizabethtown at the Pritchard Community Center with over 200 participants. During November 2015, KCTCS began a pilot program with Kentucky s Procurement Technical Assistance Center (PTAC) as a means to further increase KCTCS spending with diverse businesses. PTAC representatives are working with college and System Office staff to schedule local diversity events in spring UPDATE: OFFICE OF AUDIT SERVICES Ms. Flynn reported that that the Finance committee was provided a summary of audits conducted during fiscal year along with a plan of scheduled audits for fiscal year Ms. Flynn added that the Finance Committee was provided a summary of audits regarding student financial aid (SFA). Given the high priority on the overhaul and redesign of SFA to improve operational efficiency and standardization directed by the KCTCS Board of Regents and management, Audit Services has temporarily suspended its other scheduled activities for the next 3-4 months so it can focus primarily on SFA and the reduction, to the extent possible, of potential audit findings by the new external auditor for KCTCS, Crowe Horwath. In subsequent years, Audit Services plans to dedicate an auditor to monitor and test SFA activities on a continual basis. 13

14 NEXT MEETING ADJOURNMENT Chair Roth announced that the next regular meeting of the KCTCS Board of Regents is scheduled for June 10, 2016, at Maysville Community and Technical College in Maysville, Kentucky. Mr. Stevens moved that the meeting adjourn. Dr. Henson seconded the motion. VOTE: The motion was approved unanimously, and the meeting adjourned at 11:18 a.m. (ET). 06/10/16 SIGNED COPY ON FILE Date Approved by the KCTCS Board of Regents Marcia L. Roth, Chair KCTCS Board of Regents SIGNED COPY ON FILE Betsy E. Flynn, Secretary KCTCS Board of Regents SIGNED COPY ON FILE Jay K. Box, Ed.D. KCTCS President 14

15 15 ATTACHMENT A

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20 20 ATTACHMENT B

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