January 23-24, 1981
01-23-1981
Pages 10-32
BOARD OF REGENTS
UNIVERSITY OF NEVADA SYSTEM
January 23, 1981
The Board of Regents met on the above date in the Center for
Religion and Life, 1101 North Virginia, Reno.
Members present: Mr. Robert A. Cashell, Chairman
Mr. James L. Buchanan, II
Ms. Frankie Sue Del Papa
Mrs. Lilly Fong
Mrs. Dorothy Gallagher
Mr. John R. Mc Bride
Mr. John Tom Ross
Mrs. June F. Whitley
Members absent: Mr. Chris Karamanos
Others present: Chancellor Donald H. Baepler
President William Berg, NNCC
President Joseph Crowley, UNR
President Jack Davis, WNCC
President Jim Eardley, TMCC
President Judith Eaton, CCCC
President Leonard Goodall, UNLV
President Clifford Murino, DRI
Mr. Larry Lessly, Vice Chancellor for Legal
Affairs
Mrs. Bonnie Smotony, Secretary of the Board
Also present were Faculty Senate and Student Body Organization
representatives from each of the Institutions.
The meeting was called to order by Chairman Cashell at 10:20 A.M.
1. Adoption of Consent Agenda
Adoption of the Consent Agenda (identified as Ref. A. and
filed with permanent minutes) was recommended. The Consent
Agenda contained the following items:
(1) Approval of the minutes of the special meetings of
December 17 and December 30, 1981, and the minutes of
the meeting of January 12, 1981.
(2) Acceptance of gifts and grants.
(3) Reappointment of the following members to the College
of Arts and Science Advisory Board for three-year
terms:
Steve Brown, Sparks
Fred Davis, Jr., Reno
Mary Gojack, Reno
Clark Hamilton, Reno
Moya Lear, Stead
Kay Winters, Dayton
(4) Appointment of Regent Dorothy Gallagher as liaison to
the College of Agriculture Citizens Advisory Board and
of Regent John Mc Bride and Regent Lilly Fong as liai-
son to the School of Medicine Advisory Board.
President Berg reported a gift of $1000 from Mrs. Reba
Lundberg, in memory of her late husband, Ted, to be used by
NNCC for scholarships.
President Crowley reported an offer by Mrs. Louis E. Lomax
of a gift of her late husband's working papers, library,
manuscripts and memorabilia to UNR, with her request that
the collection would be available as a resource to UNR stu-
dents, faculty, and others who may have occasion to use
them.
Ms. Del Papa moved adoption of the Consent Agenda, includ-
ing the additional gifts reported by Presidents Berg and
Crowley. Motion seconded by Mrs. Fong, carried without
dissent.
The Board adjourned and convened as the Nevada Higher Education
Facilities Commission, then reconvened as the Board of Regents.
2. Design Development Drawings, Phase IV, School of Medicine,
UNR
Design development drawings for this project were presented
by Mr. Ron Mentgen, from the architectural firm of Anshen
and Allen. Following that presentation, and discussion
among Board members, President Crowley recommended approval
of the drawings and authorization to proceed with the proj-
ect. Dr. Crowley noted that the project is funded with
$2 million from the Fleischmann Foundation and $2 million
in gift funds from Mr. Claude Howard.
Mrs. Fong moved approval. Motion seconded by Mrs. Whitley,
carried without dissent.
3. Revision of Board of Regents Bylaws
Chancellor Baepler recalled that in October, 1980, the
System Administration Study Committee submitted a final
report containing a recommended position description for
the Chancellor. This description was approved by the Board
and, together with an amendment to the Presidents' duties
and responsibilities, was incorporated into a proposed
amendment to the Board of Regents Bylaws and submitted
for first reading at the November 6, 1980 meeting. As a
result of a proposal by the Chancellor Search Committee,
approved by the Board at the December 13, 1980 meeting, a
further revision to the Bylaws was proposed and treated as
a "first reading", with final approval to occur following
the necessary 30 days notice. Chancellor Baepler reported
that the Bylaws amendment was now ready for adoption (pro-
posed revision included with agenda, identified as Ref. B).
Ms. Del Papa moved approval. Motion seconded by Mr. Mc
Bride, carried without dissent.
For the purposes of the minute record, Article VI of the
Board of Regents Bylaws, as amended by the above action, is
reflected below.
ARTICLE VI
Officers of the University of Nevada System
Designation Section 1. The Officers are the Chancellor
of Nevada System and Presidents of the Uni-
versity of Nevada, Reno; the University of
Nevada, Las Vegas; the Desert Research Insti-
tute; Clark County Community College; North-
ern Nevada Community College; Truckee Meadows
Community College; and Western Nevada Commu-
nity College.
Appointment Section 2. The Officers of the University
shall be appointed by, and shall serve at
the pleasure of, the Board of Regents. In
making such appointments the Board shall
follow the recruiting and screening for these
Officers specified in the University Code.
Chancellor Section 3. The Chancellor is responsible
for the administration of the University of
Nevada System and implementation of the
Board's policies. Duties are prescribed by
the Board of Regents and include the follow-
ing:
a. To promote a sound plan of organization
in concert with the Presidents to insure
administrative efficiency, maximum util-
ization of resources, and to facilitate
cooperation among member institutions;
b. To coordinate the preparation of all
operating and capital budgets and System
planning documents for Board review.
However, the member institutions are
autonomous with respect to curricular
decisions involving existing programs;
c. To coordinate the presentation of all
University System matters to the Gover-
nor's Office and the State Legislature;
d. To sign all contracts and other instru-
ments requiring execution on behalf of
the Board of Regents;
e. To be the Treasurer of the University
and to provide for internal and inde-
pendent audits; however, appointment of
independent auditors shall be subject to
approval of the Board of Regents;
f. To review the execution of all University
budgets to insure that the intent of the
Board of Regents and the Legislature has
been carried out;
g. To coordinate the preparation of the a-
genda of all meetings of the Board of
Regents;
h. To be responsible for official communi-
cations on behalf of the Board of Re-
gents, excepting personnel actions;
i. To be the appointing authority for all
professional personnel not assigned to
a member institution. The member insti-
tutions are autonomous with respect to
their own personnel decisions;
j. To evaluate and make recommendations to
the Board of Regents concerning the per-
formance and conditions of employment of
the Presidents of member institutions;
and
k. To perform such additonal duties as
the Board may direct.
Presidents Section 4. The President of each member
institution shall be the Chief Administra-
tive Officer of his institution, and shall
report to the Board of Regents. Duties
shall include the following:
a. To provide leadership in the planning
and implementation necessary for the
successful operation of the member in-
stitution and to insure that the insti-
tution develops to its potential;
b. To be the appointing authority for all
professional personnel in the member
institution, subject only to the Code,
and to execute personnel contracts;
c. To review the quality of performance of
all professional personnel in the member
institution and to either take final
action or recommend action to the Board
of Regents on personnel matters in con-
formity with the Code;
d. To make recommendations concerning all
budgets in the member institution and to
administer approved budgets;
e. To transfer budget credits, which in his
judgment are no longer necessary, to the
appropriate contingency reserve and to
transfer budget credits from the contin-
gency reserve to functional accounts,
subject only to the condition that trans-
fers of $10,000 or more or which cumula-
tively equal $10,000 or more within each
object code during one fiscal year shall
require Board approval;
f. To authorize the transmission of appli-
cations or requests for grants, contracts
of gifts to individuals, foundations,
corporations, and the Federal government;
g. To be the principal spokesman for the
member institution and to represent the
institution before the Board of Regents,
the Legislature and all other appropriate
bodies;
h. To perform such additional duties as the
Board may direct.
Relationships Section 5. It is the intent of the Board
of the that the Officers work together for the best
Officers interests of the University of Nevada System
and the achievement of its objectives. The
Chancellor shall have no authority over, nor
make any recommendations concerning, person-
nel decisions within a member institution or
curricular decisions involving existing pro-
grams within a member institution. In these
areas, the Chancellor shall transmit the
President's recommendations to the Board
without comment, assuring only that the
Board's policies are followed in the pres-
entation and transmission of such material.
In all other areas requiring Board action,
the Presidents shall submit their recom-
mendations for inclusion on the Board's
agenda, and the Chancellor shall also make
his recommendations known to the Board. All
Officers shall have direct access to the
Board at all times.
4. Report of Regent's Committee to Develop Officer Assessment
Evaluation Procedures
At its meeting of March 28, 1980, the Board directed that an
ad hoc committee of the Board, in consultation with the
Chancellor and the Presidents, develop a procedure for Offi-
cer assessment/evaluation. Mrs. Fong, who Chairs the com-
mittee, reported that an evaluation document for the Chan-
cellor had been developed, had been reviewed by the Officers
and was included with the agenda (identified as Ref. C. and
filed with permanent minutes). She requested consideration
and approval by the Board.
In response to Ms. Del Papa's question concerning the ade-
quacy of this document in meeting legal and affirmative
action requirements, Mr. Lessly stated that there was no
problem from either standpoint.
Mrs. Whitley moved approval. Motion seconded by Mr. Mc
Bride, carried without dissent.
5. Report of Status of Grant Applications
In response to a request at the December meeting, reports
were submitted by each of the Presidents concerning the
status of federal grant applications and are on file.
Chairman Cashell recalled that the reason for the request
was to determine if there are ways in which the Board can
assist in increasing the level of funding realized by the
various institutions from federal granting agencies.
President Eaton stated that while the Community Colleges
have a fair level of activity in certain areas of federal
grants; such as student financial aid grants, none of the
Colleges have anyone assigned as a full-time Endowment
Officer. She suggested that if the focus was to be in any
given area, it should be on grants that would bring money
in for programs, curriculum and staff development within
the Colleges.
President Goodall suggested that where there is a research
interest, it is important to provide a mechanism of grant
support, both money and in staff who know the system and
know how to work with the faculty in getting grants. He
spoke about the desirability of strengthening the contacts
in Washington.
In response to a suggestion by Chairman Cashell that the
Chancellor's Advisory Cabinet could develop a proposal for
ways in which such assistance could be secured, President
Crowley recalled that this matter had been discussed previ-
ously in the Cabinet and agreement had been reached that it
would be useful to have a Washington-based representative;
however, no conclusion had been reached on whether it ought
to be at the institution or System level.
Chancellor Baepler agreed that this had been an issue for
the past two years, but doubted that it could be concluded,
as suggested by Chairman Cashell, in time to have a final
recommendation at the February meeting. It was agreed, how-
ever, that the Cabinet could bring a report in February on
some alternatives and the problems relating to these alter-
natives.
6. Proposal for Appointment of Ad Hoc System Committee on Fees
Chancellor Baepler endorsed a proposal by President Crowley
that the Board approve the appointment of an ad hoc System
Committee to deal with the subject of fees and tuition, to
examine both the question of appropriate fee and tuition
levels for 1981-82 and 1982-83 and the question of whether
a more systematic approach to the setting of fees and tui-
tion would be desirable for the University of Nevada System.
It was suggested that such a Committee could report its
recommendation in a timely fashion so as to allow proper
planning for the Biennial Budgets and for implementation of
any recommended systematic approach.
Mr. Ross moved approval for the establishment of the Commit-
tee as proposed. Motion seconded by Mr. Mc Bride, carried
without dissent.
Chancellor Baepler reported that the Committee would be com-
posed of Mr. David Wilkins, representing TMCC, WNCC and
NNCC; Keith Evans, representing CCCC; Vice President Jessup,
representing UNR; and Vice President Westfall, representing
UNLV, with two students, one from the Universities and one
from Community Colleges.
7. Agreement for Water Service
Mr. Lessly reported that Sierra Pacific Power Company has
requested an agreement be executed whereby Sierra Pacific's
certified water service territory will be expanded to in-
clude certain land at the Dandini Research Park upon which
the DRI facility and the TMCC Campus are located. The pro-
posed agreement contains a provision whereby any further
expansion by the University of Nevada System in the area
requiring water service by Sierra Pacific will be condition-
ed upon the transfer of sufficient water rights from the
University to Sierra Pacific.
Ms. Del Papa moved approval. Motion seconded by Mrs.
Gallagher, carried without dissent.
8. Scholarship Report for 1979-80
Dr. Robert Mc Queen, UNR Scholarship Chairman, presented a
summary of the 1979-80 Scholarship Report which was distri-
buted with the agenda, noting that the number of endowed
scholarship accounts increased 16% over the 1978-79 academic
year, and that $753,000 in scholarships had been distribut-
ed, an increase of $100,000 over the previous year. The
average stipend increased by nearly 20% as a result of a
deliberate effort by the Scholarship Board to increase the
value of the scholarships in concert with the increase in
educational costs.
In response to a question from Mr. Ross concerning the in-
terest earnings on the endowed scholarships, Dr. Mc Queen
recalled that the Board had recently adopted a policy which
restricts the distribution of scholarships endowment earn-
ings to 6%, with the balance returned to the corpus of the
account.
Chancellor Baepler referred to an article in a recent issue
of The Chronicle for Higher Education which he said indicat-
ed that most institutions in times of inflation and high
interest rates are limiting the distribution of interest
earnings to 6% in order to keep the accounts from being
eroded by inflation. He agreed to provide a copy of that
study to each of the Regents.
Mr. Ross suggested that perhaps the Board ought to suspend
its recently adopted policy on distribution of scholarship
endowment earnings.
Dr. Crowley pointed out that the University will be looking
at a number of possibilities for increases, not just in the
per-credit fee, but also in other areas where the students
are assessed charges. He suggested that perhaps in light
of the heavy financial burden for students next year, the
Board might wish to delay application of the policy for one
year.
Chancellor Baepler requested that before the Board makes any
decision in this area, they review a copy of a report from
Stanford with respect to this matter, which he said he would
obtain and forward to them.
Chairman Cashell expressed the Board's appreciation and
commended Dr. Mc Queen for his effective management of the
UNR Scholarship Program.
9. Proposed Organization Changes, UNR
President Crowley recalled that one of the matters consid-
ered by the Administrative Review Team in the report pre-
sented to the Board of Regents in 1980, was the possible
reorganization of the Office of Continuing Education. The
major question involved was whether the basic functions of
this Office should be responsible to the Vice President
for Academic Affairs, as is the case in most Universities,
or to the Vice President for Public Affairs, as has been the
case in recent years at UNR. The Team recommended that or-
ganizational changes not be considered until after the new
Vice President for Academic Affairs had arrived and has had
an opportunity to review such changes. A postponement of
such consideration was suggested also by the reorganization
that created the Office of Vice President for Public Affairs
and invested in that Office significant new responsibilities
that had not been part of the position previously, when its
title was Vice President for University Services.
President Crowley reported that since that time, in consul-
tation with the two Vice Presidents involved, and other in-
terested parties, there has been an opportunity to review
the principal organizational issues. Based on that review,
he offered the following recommendations:
1. That reponsibility for the Office of Continuing Educa-
tion be transferred from the Vice President for Public
Affairs to the Vice President for Academic Affairs,
with the exception of the functions noted in #2 below.
The functions to be transferred include:
a. Conferences and Institutes
b. Community Development
c. Independent Study by Correspondence
d. Off-Campus Programs
e. Summer Session
f. Intensive English Language Center
2. That the following functions, now part of the Office of
Continuing Education, be continued as responsibilities
of the Vice President for Public Affairs:
a. College Inn
b. Flammable Liquids Fire Academy (Stead)
c. State Fire Service Training Program (Stead)
d. Alumni College
A chart showing the organizational pattern which results
from the above proposed changes was distributed and is filed
with permanent minutes.
Mrs. Gallagher moved approval. Motion seconded by Mrs.
Fong, carried without dissent.
10. Proposal for Establishment of a Pub at UNR
ASUN President Stephanie Brown requested the Board's approv-
al for the establishment of a Pub, to be located in a small
area of the Snack Bar in the Jot Travis Student Union. De-
tails of the proposal, including costs, were included with
the agenda.
President Crowley recommended approval of the proposal,
with a follow-up evaluation toward the end of the Spring
semester to determine whether the Pub should be continued,
and, if so, what changes might be necessary in its concept
and operating policies.
Mr. Mc Bride moved approval, with the conditions that it
meets all legal and health requirments and that the Board
of Regents is adequately protected by securing liability
insurance and that the follow-up suggested by President
Crowley occur at the end of the Spring semester. Motion
seconded by Mrs. Fong, carried without dissent.
11. Public Educational Television Consortium
President Crowley recalled that at its December meeting the
Board of Regents approved a recommendation authorizing UNR
to participate in a consortium which will apply for grants
and licensing for public educational television in the Reno-
Sparks area. Subsequently, it was determined that, for
licensing purposes, it would be necessary for the consorti-
um to be incorporated. In addition, Dr. Crowley recalled,
representatives of UNR and Truckee Meadows Community College
were to be involved in the consortium Board of Directors and
they would now be involved on the Corporation Board. From
the University's point of view, these changes do not signify
any substantive alteration of the original plans and pur-
poses which were approved by the Board of Regents in that
the changes are largely technical in nature. However,
President Crowley noted that upon consultation with Univer-
sity Counsel, it seemed appropriate to seek the Board's
approval of these changes.
In the discussion following, it was agreed that it would be
appropriate to provide for the participation of WNCC and
that President Crowley, President Eardley and President
Davis would be designated as members of the Board of
Directors representing their respective institutions, and
that liability insurance would be secured.
Mrs. Fong moved approval. Motion seconded by Mrs. Ross,
carried without dissent.
12. Proposed Legislative Requests
Chancellor Baepler recalled that the 1979 Legislature had
adopted Senate Bill 255 which had, because of some lack of
clarity in the language, caused some problems for the Uni-
versity with respect to its ability to spend gift monies
received by the various institutions. He requested that
the Board authorize the Administration to seek legislation
to amend SB 255 to exclude the University System from all
its provisions, if possible, but at a minimum to clarify
those provisions as they affect the System.
Ms. Del Papa moved approval. Motion seconded by Mrs.
Gallagher, carried without dissent.
Chancellor Baepler also asked the Board to approve a request
for legislation which would make membership in TIAA-CREF op-
tional for faculty during their first two years of service
with UNS. He explained that frequently the University has
professional employees on grant money who remain with the
System only for the term of the grant and if that period of
time is short enough, for example, two or three years, the
employee can regain his contributions to TIAA. TIAA has
now been advised by the Internal Revenue Service that such
individuals would lose their tax sheltered privileges under
this procedure and will thus no longer be able to recover
their first two-year' contributions.
Mr. Lessly suggested that if this is to be considered by
the Board, it would first have to be declared as an emer-
gency item since it does not appear on the Board's agenda.
He further recommended that the implications for payment
of social security benefits for such employees be examined
before any action is taken by the Board. It was agreed that
this matter could be deferred until February to permit fur-
ther consideration by the Administration.
Ms. Del Papa asked about the legislative matters which the
Board had requested.
Chancellor Baepler reported that the one shot equipment re-
quests have been submitted and will be part of the Univer-
sity's presentation to the Legislative Money Committees, as
will the new program requests. He agreed to provide copies
of the requests to the Regents.
Dr. Baepler reported that the catch-up faculty salary re-
quest had been recalculated at 12.9%, which is a $4.8 mil-
lion retroactive package, and the request would be intro-
duced to the two Money Committees by representatives of the
System Compensation Committee, Dr. Paul Page and Dr. Gary
Jones, along with himself.
In response to a question concerning the status of the pro-
posal to repeal the 95% rule, Chancellor Baepler stated that
the University is pledged to lobby for that. He noted that
there are a great many people interested in it and a lot of
effort is expected to be expended. He stated that he as-
sumed the counties would introduce the legislation.
Ms. Del Papa suggested that since this is a high priority
with the Regents and is a very critical piece of legislation
for the whole system, the University ought to request its
introduction. Chancellor Baepler agreed to check on its
status and if nothing had been introduced, he would seek to
have it introduced on behalf of the University.
Dr. Baepler reported that the proposal to have California
travel treated as in-state travel was turned down by the
Governor.
There was discussion concerning additional legislative re-
quests which had been proposed by the Board, including the
subsidy for Law School students, Regents' per diem, amend-
ment to the Open Meeting Law to permit Regents to handle
investment matters by telephone poll and to discuss legal
matters in personnel session, and agreed to include a full
report of the Legislative Program with the February agenda.
It was agreed that the February 27 Board meeting would be
held on the Western Nevada Community College Campus.
The meeting adjourned for lunch and a meeting of the Investment
Advisory Committee and reconvened at 1:10 P.M.
13. Presentation by Special Tax Counsel
Vice Chancellor Larry Lessly introduced Mr. David Thomas,
representing the firm of Sherman and Howard, the attorneys
retained to advise the Board on tax matters pertaining to
proposed foundations.
Mr. Thomas stated that to provide the type of benefits the
Regents desire, the foundations set up must meet two major
requirements under the Tax Code:
1. The foundations must qualify as tax-exempt organiza-
tions; that is, the organization must be organized
solely for educational or charitable purposes and that
there be no benefit to any individual by reason of the
operation of the foundation.
2. The foundations must be recognized as public charities
rather than private foundations. A major problem here
is that foundations are considered to be private unless
it can be demonstrated that they are public endeavors.
There are two ways to qualify as a public charity, thereby
giving the maximum tax benefit to potential donors and a-
voiding the restriction of limiting a donor's tax benefits
to only 20% of his adjusted gross income with no carry-over
from year to year as is true with private foundations.
The first requirement applies directly to the University
foundations. That is, an organization is a public charity
and not a private foundation if it is a State University
supported organization. It must be organized to receive
and administer property solely for the benefit of the public
University. Secondly, the foundations must receive their
financial support from a broad range of governmental and
public sources as opposed to having the support coming ex-
clusively from investment income.
Mr. Thomas indicated that while the University must meet
the technical requirements under the Tax Code, there are
no specific restrictions or requirments with respect to the
control that the Board might exercise over the foundations.
He further stated that if the University meets these re-
quirements, it is free to structure the entity in order to
accomplish its goals.
In answer to questions from the Board, Mr. Thomas stated
that it makes good sense to have the Board oversee the
structuring of these foundations, however the final decision
as to whether the Board exercises strong control is not dic-
tated by Tax Law. He pointed out that the all important re-
quirement here is that no funds be knowingly or unwittingly
used for purposes other than for the benefit of the Univer-
sity.
President Crowley stated that it was his understanding that
the Board had conditionally consented to the establishment
of foundations and that the proposal he had brought to the
Board had assured substantial Board control, including ap-
proval of the Bylaws and amendments and Board of Directors.
Mr. Thomas stated that he was inclined to believe that the
control question should be set forth in the charter docu-
ments and, if needed, adjustment could be made on an insti-
tution by institution basis. In essence the University
would have uniform charter documents and customized agree-
ments. He believed that this would make sense, but is not
a requirement for a tax standpoint.
Mr. Buchanan moved that the firm of Sherman and Howard be
authorized to prepare a set of Bylaws and conditions and
requirements which are tailor-made to the University System
to be approved by the Board of Regents. If the Board ap-
proves this set of Bylaws, then the Presidents can come
forth with proposals for foundations knowing the parameters.
Mr. Buchanan stated that his motion was to develop a stand-
ard set of Bylaws and Articles of Incorporation and controls
and does not include a memorandum of understanding because
each Campus may be different.
Mr. Mc Bride seconded the motion.
In response to Mrs. Fong's question, it was agreed that the
Bylaws will state the financial responsibility and accounta-
bility of the foundations to the Regents.
Mr. Thomas stated that he would propose coming back to the
Board in February with Articles of Incorporation, Bylaws
and a one-page description of what issues a memorandum of
agreement might deal with.
Chairman Cashell requested that Vice Chancellor Lessly work
with the Presidents to determine what they believed the
agreements should include.
Motion carried without dissent.
14. Report of Finance Committee
Ms. Del Papa reported that the Finance Committee had met
earlier in the day and had taken the following action:
1. Received a Quarterly Report of State Funds from the
Financial Accounting Services Committee. Mr. Scott,
Chairman of the Financial Accounting Services Commit-
tee, will arrange for a short presentation to be made
to the next meeting of the Finance Committee summar-
izing the Quarterly Report and commenting on any prob-
lem areas which have been revealed in the Report.
2. Discussed the proposals which had been received from
accounting firms wishing to be considered for the next
independent audit cycle, and agreed that presentations
from the following four firms would be scheduled at a
special meeting to occur within the next two to three
weeks:
Haskins and Sells
Kafoury Armstrong and Company
Alexander Grant and Company
Mc Gladrey Hendrickson and Company
3. Requested the Officers to be prepared in September to
discuss with the Finance Committee their proposals on
budget parameters and procedures which would guide the
development of the 1983-85 Biennial Budget Request.
Mr. Buchanan moved approval of the report of the Finance
Committee. Motion seconded by Mrs. Whitley, carried without
dissent.
Chairman Cashell asked that the Finance Committee accept the
responsibility for development of criteria for the expendi-
ture of funds from the Board of Regents Special Projects
Account and that a report be made back to the February meet-
ing after consultation with the Presidents.
15. Report of Investment Advisory Committee
Mrs. Fong reported that the Investment Advisory Committee
met at noon and that, at Chairman Cashell's request, she
had acted as Chairman in the absence of Mr. Karamanos, with
Mr. Mc Bride and Mrs. Gallagher appointed as temporary mem-
bers to serve in place of the other absent members.
The Committee took the following actions:
1. Received reports from Mr. Monte Miller, Mr. Bob Lee and
Mr. Tom Josephsen on the portfolios managed by Valley
Bank, FNB and Security Bank, respectively, and on cur-
rent economic conditions. None of these managers wish-
ed to recommend a change in their portfolios at the
present time.
2. Received a presentation by Mr. John Chrissinger of NNB,
which renewed its proposal, made two years ago, that "it
be retained to manage a significant portion of the Uni-
versity of Nevada's endowment fund.'
After some discussion, it was decided to table this
matter until the next meeting. Mr. Mc Bride and Mrs.
Gallagher were of the opinion that a vote on the Com-
mittee's recommendation concerning NNB's proposal should
wait until the regularly appointed Committee members can
be present. It was the consensus, however, that the
Committee should in any event carefully monitor the per-
formance of the banks which are retained to manage the
University's endowment funds.
Mr. Buchanan moved acceptance of the Investment Committee's
report. Motion seconded by Ms. Del Papa, carried without
dissent.
Mr. Cashell reported that Mr. Ross had declared a conflict
which would prevent his service on the Investment Advisory
Board. Accordingly, a substitute appointment would be an-
nounced shortly.
16. Discussion Concerning 1981-83 Biennial Budget
Chairman Cashell recalled that the discussion of the Gover-
nor's recommendation concerning the University's 1981-83
Biennial Budget Request was not completed at the January 12
meeting. He requested that Chancellor Baepler present a
short introductory statement, after which each President
would be asked to cover the appropriation areas under his
administration.
Chancellor Baepler recalled that at the previous meeting
Vice Chancellor Partridge had presented an overall review
of the budget picture and had distributed information re-
lating to the System. Dr. Baepler suggested that there are
five areas of concern which need to be addressed from a
System perspective. He suggested that all are equally im-
portant and difficult to prioritize. With respect to facul-
ty salaries, Dr. Baepler stated that the University is
reaching a situation where it is not competitive and it is
the Administration's intention to pursue the faculty sal-
ary package included in the Regent-approved budget request.
Secondly, of concern to all Nevada institutions is the gen-
eral concept of student-faculty ratios which are at the
heart of education quality and every effort will be made be-
fore the Legislature for sufficient funding. A third area
of concern, one which is critical, is the support positions
which have been requested; i. e., nonteaching professional
and classified positions. Fourth, sufficient money to off-
set inflation, both from the perspective of the way in
which inflation has eroded the University System during
this current biennium and the required money to keep pace
with the expected rate of inflation during the coming bi-
ennium.
Finally, the critical problem in projecting revenues and
projecting student enrollments caused by the question of
student fees. If revenues drop because a lower fee than
projected by the Legislature is charged, or fees are raised
so much that there is a drop in both in-state and out-of-
state enrollment, it will have a critical impact on the
University's budget.
Mr. Buchanan suggested that prior to presentations by the
Presidents concerning their institutional budgets, the Board
ought to determine whether or not there will be any fee in-
crease and, if so, to what level. He expressed his own
opposition to a fee increase. Mr. Cashell agreed that a fee
increase was not desirable, and suggested that until the ad
hoc Committee established to review this matter reports back
the Board should hold with its position reflected in the
University's budget request.
Chancellor Baepler suggested that if a conclusion could be
reached at the February meeting, that would allow sufficient
time to develop the necessary negotiations with the Legis-
lature.
There appeared to be consensus that a strong effort should
be made to avoid a fee increase, and that any action by the
Board to alter its budget request in the area of projected
revenues would not occur until after the ad hoc Committee
had reported to the Board in February.
President Crowley spoke concerning the problems which are
anticipated by UNR should the funding provided by the Legis-
lature be less than requested. In addition to the items
mentioned by the Chancellor as having a System-wide effect,
President Crowley spoke about the problem which will occur
in the grant-in-aid area. In the Executive Budget, fees
and tuition are increased but there is no commensurate
increase in grants-in-aid. This leaves a shortfall for
UNR of $170,000 if the size of the grant-in-aid is matched
to the size of the Governor's recommended fee and tuition
increase.
If fees are not increased to the level recommended by the
Governor, the shortfall is even greater. This produces a
severe impact on the grant-in-aid program, particularly in
the Athletic Program.
A second problem for UNR, which again goes beyond the con-
fines of UNR, is the book acquisition budget. The Executive
Budget proposes an amount equal to this year's level of book
acquisition support which is in effect a 20% decline in sup-
port in that area due to inflation.
President Crowley recalled that the initial recommendation
in the Executive Budget eliminated the entire University
alumni relations set of Offices both at UNR and UNLV. There
has been significant restoration although there are still
some shortages in operating funds with two Offices at UNR
left totally unfunded -- the Office of School Relations,
which was established in response to a clear demand on the
part of the people in the public schools, and the Office of
Information.
The overall Medical School budget is in better shape than
the basic budget, but it does have some specific problems.
Letters of appointment category has been eliminated, and
funding supporting the administrative structure of the
Medical School in Las Vegas has been cut. The other UNR
budget areas, with the exception of Business Center - North,
take a 10% decrease, causing the most serious problems in
Cooperative Extension and Agricultural Experiment Stations.
President Crowley stated that the two most serious problems
overall are the student-faculty ratio and the student fee
problem. As an example of the magnitude of what the stu-
dent fee problem would be if the Board of Regents imposes
the increase in fees and tuition proposed in the Executive
Budget, and if there is a resulting decrease in enrollment
because of that increase, UNR would end up with a shortfall
on the first of September with no way of projecting the
amount of shortfall which might occur and no source of funds
to cover it. On the other hand, if the Board declines to
raise tuition and fees, and if the proposed appropriation
bottom line contained in the Executive Budget is not in-
creased by the Legislature, then UNR would have a $1.8
million shortfall.
Dr. Crowley spoke of the difficulty of making the right kind
of management decisions when it is not possible to accurate-
ly project at this time the magnitude of the shortfall which
will occur. In addition to the fee and tuition problem,
there are serious problems with the 22 to 1 student-faculty
ratio. If that ratio is enforced, UNR is looking at a de-
cline of 9.65 professional positions, a problem which can
be complicated still further by the uncertainty of the tu-
ition and fee problem.
The two Colleges which would suffer most by a limit in en-
rollment, which is one of the alternatives under study,
would be the Business Administration and Engineering Col-
leges -- the high growth program. These are the Colleges
which have over the past five years been meeting the demands
of the Nevada economy. The Colleges cannot add more stu-
dents without additional faculty or they run the risk of
losing accreditation. If you attempt to solve the problem
of faculty retrenchment by termination of first year facul-
ty, you endanger those programs even more because a dispor-
tionate number of the vacancies and the first year faculty
are in the high growth programs such as Business and Engi-
neering.
Dr. Crowley commented on the alternative of elimination of
high cost, low enrollment programs, pointing out that a re-
ducation of 30+ positions represents 10% of the instruction-
al staff, and there are not enough programs to absorb that
by attempting to distribute the reductions among all pro-
grams. Neither is there sufficient flexibility to permit
elimination of total programs since UNR has essentially the
standard type and number of Departments found in a basic
State University.
In response to a question concerning the impact on the Uni-
versity in two years, when the mandatory retirement age
increases to 70, President Crowley agreed that the problem
would be compounded by that factor. He pointed out that
the current Executive Budget will require the elimination
of approximately 60 positions Systemwide. The cumulative
impact of those reductions, plus the implications of the
change in policy in 1982 moving the mandatory retirement age
upward from 65 to 70, are going to be felt by the University
and the State as far in the future perhaps as 10, 20 years.
Dr. Goodall indicated that UNLV was also concerned with the
area of faculty salaries and student-faculty ratios plus an
additional four areas of specific budget needs, one of which
is the Library. UNLV will be opening an addition to the Li-
brary very shortly; however, no increase was recommended in
the book acquisitions budget and a decrease of one profes-
sional position from the present staffing make it very dif-
ficult to adequately staff and equip the new facility.
A further area of particular concern to UNLV is in the area
of Janitorial and Maintenance services. In addition to the
new Library facility, a Fine Arts building is presently un-
der construction and will be completed during the biennium.
The Executive Budget, however, recommends the reduction of
the Janitorial staff from 56 to 36. Chancellor Baepler
pointed out that the Executive Budget also assumes a 5%
vacancy rate at any given time, so that the staff available
would be less than 36.
The Alumni and Development Office at UNLV has been, as is
also the case at UNR, reinstated in the Executive Budget at
a level of 50% funding. Dr. Goodall stated that at the time
the Campuses are being requested to go into the private sec-
tor to do more and more fund raising, fewer personnel are
being provided to do the job.
President Goodall stated that probably the biggest problem
area in the budget is the uncertainty about student fees,
and agreed with what President Crowley had earlier stated
about not being able to predict what the result of a student
fee increase would be in terms of funds available, but that
the shortfall would be approximately $5,400,000 the first
year if the fee increase assumption of the Governor's
Budget is not accepted. This would not be known until the
Fall registration. He further stated that, as at UNR, the
personnel cuts and enrollment limitations would have to be
made in the high growth Departments, which at UNLV are in
the areas of Business, Allied Health and the Computer
Sciences.
Chairman Cashell questioned whether UNLV should accept the
new Library facility, suggesting that perhaps this building
should remain under the control of the State Public Works
Board and its reponsibility to provide insurance and main-
tenance. Mrs. Gallagher agreed, adding that perhaps none
of the new buildings, including the Henderson and Fallon
buildings, should be accepted.
In reviewing the recommendation for the DRI, President
Murino emphasized that the budget for this Division is tra-
ditionally different from that of the rest of the University
System, since it has no students for revenue and receives
only a small fraction of its support from the State. Two
new research programs were, however, approved for both years
of the biennium.
Dr. Murino stated that the DRI recommended budget is gener-
ally adequate with the exception of two areas of enrichment
of the research program. One of these areas was for equip-
ment replacement and the other for seed money to start re-
search programs prior to the time Federal and private spon-
sors are available.
Dr. Murino stated that he was satisfied with the operating
budget as recommended in light of the whole budget climate
but noted that the DRI in Las Vegas is located in crowded,
cramped, quonset-hut-type quarters with no laboratory facil-
ities. He strongly urged the Regents to push for the ap-
proval of the number one priority in the Capital Improvement
Program request, the DRI Southern Nevada facility. He fur-
ther stated that the program of maintenance and utilities
for the new building would not be the problem for the DRI
as it is for the other Divisions since DRI recovers funds
for this purpose from research projects and the State has
never contributed for this purpose.
President Eaton stated that the Executive Budget reduced the
Clark County Community College request by approximately 30%,
not taking into account an assumed addition of half a mil-
lion dollars for each year of the biennium as a result of
the recommended tuition increase which the Board has not
approved. The shortfall, therefore, would be more than half
a million dollars per year.
Dr. Eaton stated that the number one priority for Clark
County Community College is more staff; first and foremost
would be instructional staff; secondly, support staff; and,
third, classified staff. Under the present recommendation,
CCCC would have to reduce services, particularly in the out-
reach areas as well as the Cheyenne Campus. As previously
stated by Drs. Goodall and Crowley, these cuts at CCCC
would also have to be made in the high demand areas, which
at CCCC is in the business area. Dr. Eaton estimated that
it would be necessary to reduce courses and offerings to
such an extent that between 2000 and 2500 fewer students
would attend CCCC during the biennium.
Another area of concern to CCCC is in Library acquisitions.
CCCC had requested $212,000 to bring that Campus part way to
the level recommended by the Northwest Accreditation Associ-
ation; however, this item is not included in the budget rec-
ommendation.
President Eardley reported that Truckee Meadows Community
College experienced a growth in the Fall of almost 20%, but
less funding is being recommended for the next biennium than
is presently available. Even under the present funding,
students are being turned away because classes are already
filled. The other Community College Presidents indicated
that this is also true at their Campuses.
Dr. Davis referred to the earlier statements made that the
new building at Fallon should not be accepted unless addi-
tional funds were included in the budget for maintenance
and utilities. He stated that if funds are not provided to
start a new daytime program in Fallon, the program would
continue at night in the local schools and the business
programs presently being conducted in leased space would
be moved to the new building.
Dr. Davis stated that at WNCC, the major concern with the
Executive Budget is in the area of staffing. He estimated
that the shortfall for WNCC would be $140,000 the first
year and approximately $125,000 the second year.
President Berg also stated that staffing is the biggest
concern for Northern Nevada Community College. The budget
request for NNCC contained 30 professional positions; how-
ever, the Executive Budget contained 24.3 instructional
positions, plus one Counselor, causing a reduction of 4.7
fewer than requested and .7 fewer than the current staff-
ing.
Another problem area at NNCC is in the travel budget. It
was pointed out to the Budget Office that each trip to Las
Vegas costs approximately $500 per person and with six meet-
ings per year that more than takes the whole travel budget;
however, no additional funds were recommended for this ac-
count.
Regent Del Papa asked Chancellor Baepler for details regard-
ing the shortfall of $200,000 in the System Administration
budget.
Chancellor Baepler explained that two professional positions
and one and one half classified positions had been eliminat-
ed. He stated that although the State Budget Office did not
identify the positions recommended for elimination, through
the process of totalling salaries it was possible to deter-
mine that the positions recommended for elimination were
the Director of Institutional Research and the University
Architect. He further explained that possibly the Gover-
nor's reasoning behind eliminating the Architect's position
was that there was no capital improvement funding being rec-
ommended for the University System for the next biennium.
Ms. Del Papa expressed her concern also of the fact that no
funds for litigation expense had been included in the Uni-
versity System request, stating that she believed it to be
poor planning to continue to fund this activity through the
Regents Special Projects Fund as has been the practice in
the past. Chancellor Baepler stated that litigation expens-
es had never been funded in the past.
Chancellor Baepler stated that the one bright spot in the
University budget was at the Computing Center where approx-
imately $500,000 had been recommended. Director Niels
Anderson agreed that this funding for new equipment, time
share computers and communication processors was needed,
although the budget contains no personnel to operate them.
This leaves the Computer Center in somewhat the same situ-
ation as the other Campuses in regard to their new build-
ings.
In answer to Dr. Eaton's request as to how the Work Program
for 1981-82 should be developed, the Board directed the
Presidents to proceed on the assumption that no fee increase
has been approved although it may be necessary to revise the
Work Programs later showing some increase.
17. Report on Faculty Workload Study
Mrs. Fong reported that the ad hoc Committee to coordinate
the Faculty Workload Studies had met and were proceeding
with the necessary steps to provide a completed report to
the February 27 meeting of the Board of Regents.
18. Report on Master Planning
Mrs. Gallagher reported that the ad hoc Committee to co-
ordinate the Institutional Master Plans had met, and is
attempting to develop an overall view of the System. The
Committee will meet again on Monday and then again in two
weeks, also with the objective of having a final report for
the February 27 meeting of the Board of Regents.
19. Report of the Chairman
A. Mr. Cashell expressed concern about the increasing
amount of material distributed at Board meetings and
proposed that henceforth, unless material is transmit-
ted to the Chancellor's Office and included with the a-
genda mailing, it not be considered for action until a
subsequent meeting, unless an emergency can be demon-
strated.
B. Mr. Cashell referred to a memorandum which had been
distributed proposing an amendment to the Bylaws to
establish separate standing committees on Audit and on
Budget, by separation of the existing Finance Committee,
and on Academic Affairs and on Buildings and Grounds,
and requested that this be included on the Februay 27
agenda for action.
20. New Business
Ms. Del Papa suggested that future meetings include a period
of time for informational presentations and that a schedule
be developed so that these opportunities could be rotated
among the various institutions.
The meeting adjourned at 4:30 P.M.
Bonnie M. Smotony
Secretary of the Board
01-23-1981