IFO and MnSCU Meet and Confer
UNOFFICIAL NOTES
November 18, 2005
IFO Present: Dave Larkin, George Seldat, Dave Bouchard (replacing Becky Omdahl), Cindy Phillips, Stephen Bohnenblust, Mary Kesler, Judy Kilborn, Patrice Arseneault, Nancy Black, Russ Stanton, Cindy Finch (taking notes)
MnSCU Present: Chancellor McCormick, Whitney Harris, Bill Tschida, Ken Niemi, Leslie Mercer, Chris Dale, Lynda Milne, Deena Allen, Gary Janikowski, Barb Miller, Mary Jacquart, Karen Kedrowski
Called to order 8:30
MnSCU: Linda Baer is in China. We are not having a university president this morning, they were all busy. We will also have trouble having a SU president attend our April meet and confer.
IFO: We need to keep our schedule. I find it dismaying, we work hard on the schedule; we thought one president would be here.
MnSCU: The inauguration of Dr. Ramaley at Winona State is on April 7, so it is going to be very hard to have a SU president here.
Chancellor: Maybe we could have a meet and confer in Winona on that April date.
MnSCU: Historically the SU president hasn’t been in attendance at our meet and confers.
Chancellor: We should line up our presidents in advance.
MnSCU: We have the other dates committed, these are the two days we had trouble.
IFO: It is important to us that a state university president is here.
IFO: We’ve been asked to change the order of the agenda to accommodate people’s schedules. Thank you, Barb Miller, for putting out the agenda.
MnSCU: I tried to be more efficient for this meeting; the four policies and procedures we are discussing today are in the folders I gave you this morning in the order listed on the agenda. These four policies are all second readings; you’ve seen these at least once. They are going to the Board for the second reading. Because we review procedures with all constituents and the Chancellor approves procedures (the Board of Trustees approves Policy), they will not go to the Board unless they ask us for them, which they have not for these four.
Proposed Amendment to Policy 3.1 Students Rights and Responsibilities:
MnSCU: Mike Lopez and Steve Frantz are both at a meeting in Moorhead. I’m going to do my best to explain. Nancy Black was at a meeting two days ago discussing these. On the front cover page you will see a summary. We are adding two new sections that assure information is available to students and the other is dealing with student involvement. We deleted part ten on this policy that dealt with off campus student conduct. This section is not a positioned in the right policy and this content exists in the code of conduct policy and it was a duplication of information.
IFO: We reviewed this at the last meet and confer; we brought up the “substantially disruptive” language and were assured we would not lose any authority here. We heard this was added for the comfort level of the students and I need to ask about the comfort level of the faculty. We did agree with this and are going ahead with it; one issue raised is there are no minutes being taken at these meetings.
MnSCU: I have changed our practice immediately; each person who is on the agenda is going to be responsible for summarizing the issues that surfaced during the meeting.
IFO: We need a record of those comments at the meeting.
IFO: I’m assuming you are saying these policies/procedures were emailed to the campuses.
MnSCU: Yes, to the union leadership.
IFO: When you send attachments, I can’t forward those to my campus via our list serve. I have to cut and paste into an email. We have the same problem in our office. I would suggest that you put this on a website and put in a hyperlink then I can send email out that you send to me and forward to all faculty and they can read it…it’s is more efficient. I cannot forward attachments it is a security issue related to viruses. But I can send it to one individual.
MnSCU: We can’t put all the language in one email, so we’ll have to look into different ways.
MnSCU: With any attachment, at some institutions you’re stuck. You need to do it both ways with an attachment and one with a hyperlink.
MnSCU: We were talking about this word “substantial” on line 11. This one word has been a topic of significant discussion between all people. The board is ok leaving it in. They understand it is a comfort issue for students it should stay there. The rest of us seem to think we can live with it; we did talk about this at our last meet and confer.
MnSCU: Ultimately these are Board of Trustees policies and it is up to the employer to determine if this policy is being violated.
IFO: at the last meet and confer Mike Lopez said faculty have the authority to enforce these policies dealing with student conduct (Nancy recited those notes).
MnSCU: Ultimately it is the employer’s call, but we appreciate you carrying out our policies.
IFO: If the employer isn’t there, for example one day “Puke and Snot” was right across the hall from the class I was teaching and it created such a disruption. I had to conclude my class early.
Proposed Amendment to Policy 3.6 Student Conduct:
MnSCU: On the background coversheet, one of the changes is to move policy language into a new procedure. You can see a couple of other issues in the summary document. In a previous version we had to consult with attorney Gail Olsen, because state statute is referenced. Mike may have been referring to hazing. I don’t see any other significant changes.
IFO: Does anyone have any questions?
MnSCU: There are no controversial issues here.
Proposed Amendment to Policy 3.8 Student Grievance:
MnSCU: According to my notes from a couple of days ago, there have been no changes in the policy amendment from the previous version that you may have seen. We did have some discussion on the proposed procedure. On part 3 and the students had some issues with the language we had with the word “encourage” and “require” in the same sentence. As I’m looking at the previous version, I think the students were ok with this change.
IFO: Who is the “employee”? Does it include faculty?
MnSCU: We think of faculty as employees.
MnSCU: Administrators are also employees; we need to fix that and I’ll talk to Mike Lopez about this. This is not going to the Board because it is procedure not policy. The Chancellor approves procedures. This should be taken care of before January.
This does not apply to your institutions with the exception of Bemidji who is responsible for the oversight of the two year college and they need to be aware of this. This has been three years in the making with MSCF and there is one concern that Nancy Black raised a couple of times, dealing with the procedure on line 29, using the term “external faculty”. We are still in discussion with MSCF; this is their policy and we need to work with them and make them comfortable with this. We have this on our list.
IFO: I realize this is their policy, but when this system starts using terms like “external faculty” it is defined as individuals not holding faculty positions. As defined in the contract, the term faculty has a different meaning. We said we want it to be called external instructors.
MnSCU: We may end up reaching agreement with MSCF to change the word faculty to instructor. The purpose of this term is to organize the groups of people who might be assigned to this procedure 3.32, this is what we’re talking about. This is procedure not policy. By the end of the year we want to put this to rest with the Chancellor’s signature.
Chancellor: Why wouldn’t instructor be ok?
MnSCU: Besides, when students come into the room they don’t make that distinction of instructor or faculty.
MnSCU: One reason it might make a differenced is because the IFO contract makes that distinction.
MnSCU: This only applies to MSCF and faculty in our colleges. I’ll discuss this with Larry Oveson.
IFO: We hear this will affect Bemidji so it is not exclusive to MSCF. I am so glad you are going to be doing Minutes. When we left that meeting two days ago it was my understanding this would be changed.
MnSCU: Larry said whatever we ended up with would work. We have it on our list and we will address it. You’ll see this for a second reading in a couple of weeks.
Chancellor: I thought it was my responsibility when I started working here to help the Board of Trustees grow. The reason these are coming up is because all good Boards need to look at policies from time to time. The one thing I want to say is that we don’t have to change anything. We should just look at them. If they are still good, they don’t have to be changed. The question is, does it still fit? I’m thinking people think they have to change them.
MnSCU: Many of our policies were developed so long ago and we find now that we have lots to change.
(The fourth handout given by MnSCU was Proposed Policy 3.32 College Faculty Credentialing to Include Repeal of Policies 3.9 Licensure of Faculty Requiring a License and 4.3 Designation of Assigned Fields/Designated Assignments and Minimum Qualifications for Faculty. This was not specifically discussed.)
1.B.1:
IFO: Pat Arseneault is here to address agenda items 1.B.1 and MnSCU’s antiracism initiatives.
IFO: We brought up the important issue of the 1.B.1 and there was one meeting and the postponement of two other meetings.
MnSCU: As you know we had a meeting the second day after I started working in my position at MnSCU. We discussed the policy and we decided some of the discussed changes needed to be reviewed by the attorney general’s office. They decided to look at the whole policy. The person who was looking at it is no longer in charge of that and now we are back to square one. We have continued to meet as a staff and Ms. Hogoboom has agreed to meet with the attorney general’s office. In the meantime we have a scheduled meeting on November 30 from 9-3 and we sent this announcement out via email earlier in the month. At that meeting we will look at the consensual part of the policy. The issue was, when we took this to the attorney general’s office they asked quite a number of questions that didn’t specifically deal with the section we were asking them to review. Then we sent out a request to the 1.B.1 review committee for a meeting with a list of websites for them to review in the meantime.
IFO: Where does that put us in terms of the time line? Renee thought this would go before the board this year.
MnSCU: This is mere speculation, but it is not going to happen this fall, maybe spring early March and hopefully at least we can complete the process before end of the academic year.
IFO: Do you anticipate submitting the policy before we finish work on the procedures?
MnSCU: It is a good idea to at least complete the skeleton on the procedure so you don’t have to back step on your policy. I’m not entirely clear on how we do that here.
Chancellor: I am suggesting that in July we’ll have major new changes with 6 new positions on our Board. I think you have to wrap up as much as you can before then.
IFO: It would be nice to have process but we haven’t met for 120 days. We are not seeing an agenda, or anything. We haven’t even seen an agenda for the November 30 meeting; I don’t know what the issues even are.
MnSCU: Consensual relationships are on the agenda.
IFO: The issues are broader than that. We had no input in the agenda.
MnSCU: Since the rest of the policy is being reviewed, we shouldn’t move forward with those areas. We’re not prepared to provide more detail.
IFO: You said changes were being reviewed. Is this committee going to be looking at all of this and areas that needed to be discussed for change? It seems this is going along in a parallel fashion even why you’re waiting for the attorney general’s office to identify issues. Certainly the change in staff has created some problems; on my campus we’re more concerned about the procedures than we are about anything else. Here we have this committee who hasn’t met more than once and we understood this to be an opportunity to talk about the issues that are on the campus. We can have those discussions while the attorney generals office is working. We’ve lost a lot of time.
IFO: This is an unnecessary delay; you are only looking at one small aspect of the broad issue at this November 30th meeting. Isn’t there any other conceivable input that we could have besides consensual relationships? I didn’t realize this was even an agenda when you sent out the email.
MnSCU: The general consensus of the staff is when policy is being reviewed; the entire policy was raised as a concern.
IFO: We haven’t even heard what the concerns are that were brought to the attorney general.
MnSCU: The Board has the role to determine policy.
IFO: Does the attorney general’s office have the power to reject our policies? What is the role of the ag?
MnSCU: Without talking specifically, I can only say that in general we do run into the issue with the AG because to them it is perceived that their client in this matter is the State of Minnesota. Sometimes there is a disconnect. That usually doesn’t happen but because they perceived the client as the State of Minnesota they may believe they have mandates.
IFO: When we are reviewing these policies do we normally send them to the AG?
MnSCU: Gail Olsen works at MnSCU but belongs to the attorney general’s office. Whitney consulted with her.
IFO: Gail was at that first meeting and she said she needed to take this to the AG’s office.
MnSCU: We’re not at liberty to say what happened between us and the AG, but I think part of the answer is a lot of policies aren’t - this policy has particular pitfalls. We have attorney client privilege. We’re talking about the communications between MnSCU and the AG’s office.
IFO: I’m concerned about the other policies. They are talked about by the committee and staff bringing information. What I heard you describing is the MnSCU staff are getting together and determining what the agenda is. You should bring the committee together to determine what the concerns are and you look at them. I fully appreciate the staffing changes and you are coming into a new system, but I am disturbed that we have a committee with significant issues to the campuses and now they are coming together and there is no input.
Chancellor: What should be next?
IFO: It may be necessary to get out notice about that meeting and need to have some input on the agenda.
MnSCU: The committee was notified on the 10th of November.
IFO: At our first meeting, the discussion was far broader than this one item on the agenda for November 30.
MnSCU: Without blaming, did you ask those questions to Renee when that email was sent to you?
IFO: We were hoping that Renee might attend this meet and confer.
MnSCU: It occurs to me it may be more effective for you to talk to Renee about this.
IFO: The reason this was brought forward is because of concerns on the campus, I’ve had to deal with this on my campus. As Cindy Phillips pointed out, the process is causing problems. Our faculty were glad this policy came to this level, we need to look at this.
Chancellor: How do we go back and get the right agenda for the 30th? How do we get back on track for the 30th? We need to agree what we’d like to do. What about making the 30th a great day and everyone feels like we are doing the best we can.
IFO: This will take 6 hours out of people’s lives.
IFO: I’m looking at the minutes from the September meet and confer when Renee was ill and could not be here and we were saying then this needed to be moved forward.
IFO: Listing 6 steps about consensual unions is side stepping and does not address what concerns we brought forward originally.
MnSCU: We’ll take care of this.
Chancellor: If Whitney talks to Renee Hogoboom, Pat Arseneault and Steve Bohnenblust the four of you need to work this out.
IFO: We weren’t even consulted about the meeting date.
IFO: At the first meeting we crafted an agenda for the second meeting and determined a date but that was cancelled.
MnSCU: It is my understanding from talking to Renee that the second meeting could not take place until the AG gave advice. That is why she is probably gravitating to other issues. It sounds like a misunderstanding.
IFO: When you have a committee you consult with them about the agenda and rescheduling. If she had done that with the committee this discrepancy in understanding would have come out and have been resolved much sooner. I like Renee.
Chancellor: Cindy makes a good point.
IFO: I suggest the more transparent you can make this process irrespective of the attorney client privilege, at least people know something is taking place and we are working towards resolution.
IFO: For me, we are hearing there is a need for problem analysis. The problems are coming from the campus, and we should be gathering information.
Desire to Learn Update:
IFO: I had a request from Ken to report on d2l because he has to leave.
MnSCU: Since the last time we met the Ad Hoc D2L Committee met and has 8 specific recommendations dealing with D2L performance issues co –chaired by Barbara Kienath and Barry Dahl. Eight excellent recommendations were given. The biggest issue with all of those is in the area of staffing and hardware – to upgrade the database server itself it will be installed before the holiday period. During this Thanksgiving period we will be putting in software upgrades which should have performance improvements. Other than quirks here and there, service has been adequate. We’re far from a disaster situation; I do my best to keep in contact with you. The review committee met a few days ago and came up with 3 more recommendations for longer term. We met with John Baker dealing with the ITeach program. That’s it in a nutshell
Chancellor: At the last meet and confer, Barbara Keinath made a diagram on the board and she was able to explain that problem so I could grasp it. Ken, will your problem resolve the inventory of backlog?
MnSCU: No, that’s a medium problem; these recommendations will allow us to eliminate this problem late spring.
Chancellor: Can you monitor the problem hour by hour?
MnSCU: We are able to monitor them at least every 5 minutes.
Chancellor: I would like you to invite me and Nancy to join you when these higher volume times are talking place so we can witness.
MnSCU: Yes, I’d be glad to do that.
IFO: The Chancellor’s comment was well placed. The short term issues do relate to scalability as a basic underlying design issue. Until we have the archive capability and the key tools are turned on, scheduling html editor, we can’t tell if we’ve solved the problem or not. All of the courses are placed in one pool, as a practical matter we don’t need that right now. One solution is to split some of these out and do a regional rollout and fix it that way. We need to be careful about fixing design problems by throwing hardware at it. We understand the short term issue, but there are some folks who can give you other suggestions as well. There are some ongoing design and scalability issues delaying the database structure. We’d be happy to help in any way possible.
MnSCU: I’d like to contact you outside of this. Thank you! Yes, there are architectural issues. When you take a product that’s small and try to make it big you will have problems.
IFO: With the issue of scalability testing, we want to test it as we increase it, there are some very specific concepts we can suggest.
IFO: If that fix this summer is going to address the database issues does that mean we don’t see features added back in until after that?
MnSCU: No, as a matter of fact the hardware upgrade will allow us to turn on some of these tools after they’ve been tested.
IFO: As part of the work plan to increase use, are we at the point of stability now where we can tell faculty to start creating their spring courses?
MnSCU: we don’t think there’s a need to tell people to throttle back after talking with Baer and President Bradshaw this month and next month are critical. There’s no time to relax. Thank you for all of your input in resolving these issues.
Chancellor: We’re all pioneers.
IFO: There is always a certain incentive issue; do we want to commit the time and effort to do this when we’re unsure about the stability? We’ve decided as a system that this is a priority to us. There are unintended consequences there as well.
Chancellor: I’ve been working with faculty for a long time and I’m worried about discouragement. We want it to work but it’s not perfect. I’d be very angry if I spent all summer working on my course and it didn’t work.
MnSCU: It’s not just an IT issue it is an academic issue. ITeach was a wonderful idea.
MnSCU: Nancy asked for D2L to be put on the CTL agenda. I’ve heard communication is the most frustrating aspect for faculty and their IT people are communicating.
IFO: We appreciate so much Ken’s willingness to reach out to faculty. Related to this is Minnesota Online, we have to go back to that. I want to follow up on that later in the meeting because it is an important question with faculty involvement. We haven’t heard of this term before – “e-curriculum”. Pat if we want to go back, we have a last question for Whitney on the anti-racism initiatives in the system.
MnSCU’s Antiracism Initiatives:
MnSCU: The HEART initiative is a combination of both public and private institutions. I met with them in October at Bethel College. How can the system continue to stay involved? What we did is we were able to ensure Raul Ramos would be involved to the end of this fiscal year; in the meantime we’re looking for a permanent solution. At this point the concrete thing I can say is that Raul is involved until the end of the fiscal year for sure, 10% of his time is dedicated to the HEART and system initiatives. They have asked me to become involved and we will do that to the extent we can. We are going to replace a person who left but, we asked to redesign that position to a higher level to include responsibility for antiracism initiatives. I am meeting with human resources this afternoon and we want to post for the position by next Wednesday. I will send the position description to Nancy Black as soon as it is approved.
IFO: Good, thank you!
IFO: One of the serious issues we have is the pension RFPs. We need to address that because this has ignited the faculty beyond belief even more so than D2L. Russ IFO is here to summarize.
Russ passed around handouts.
IFO: You can take the most docile faculty member and you mess with their pensions and they become so mad. There are a number of issues that come to the forefront on this. Faculty just don’t like people changing their investment options. In a defined contribution plan the risk is placed on the faculty member. These people have adopted long term investment plans and people come in and change the parameters midcourse and messes up their plans. We are talking about 775 million worth of faculty money. It is their life savings, this is their major source of their income for the last ¼ or 1/3 of their life; they do get emotional.
IFO: There is more than emotions, people were forced to invest in something else and lost money.
IFO: …when this system changed the investment options available to them about 5 or 10 years ago.
IFO: The key points are probably the most important, faculty have built up a long term relationship with TIAA-CREF (TC); they cover 70% of faculty in the United States. For TC, higher education has been their market; they’ve developed services that are honed into that market. They are good at what they do. If you look at the emails I handed out, it shouts out that TC was a major factor in their recruiting. If you look at the four pages of “My Issues” that I handed out, when you give people the option of where they are going to put their money, the TIAA-CREF tax sheltering annuity plan is favored 10 to 1 over Wells Fargo. The other issue is the SBI funds. This isn’t as big of an issue for faculty but it is an issue, they have low investment fees. The real issue is that we currently offer 23 funds and they are competitive, but what they are doing in this RFP is reducing that to 13 funds…ten funds are going and people are going to have to move their money and if they don’t move it themselves, it will be moved/mapped for them. The RFP fund line up seems rigged against TIAA-CREF, if you look at the options on page 2, the RFP shows the line up of funds, there are no annuities. The TIAA-CREF traditional annuity is the most sought after fund; there is no social choice, no real estate, and no inflation linked bond fund. So the strengths of TIAA-CREF, what makes people like them, are being knocked out of this process due to the RFP structure. Not only that, you can see that the State Board of Investment (SBI) will select a single provider in each asset class - the only competition occurs every 5 years. The line up of funds is a major concern.
Chancellor: On that line up problem, all of us have talked to TIAA-CREF and most of us have a division of what we put it in and most of it moves more to traditional annuity when we get older. Many people that I know try to get 70% in traditional.
IFO: I raised all of these issues to MnSCU before the bid process started, I got a pat on the head, and “We hear you.” The RFP came out and it was contrary to every concern I raised. We then took it to the IFO Board and they adopted some positions basically regarding the line up adding real estate, bond, annuity, social choice, SBI and supporting TIAA-CREF, and we took those positions to the DCR Advisory Committee, which is supposed to statutorily advise the State Board of Investment, and has reps from all the different unions. The DCR Advisory Committee adopted the core of what the IFO Board adopted, however yesterday Gary sent me the SBI fund lineup in their bid document and we are right back to the exact same fund line up that we started with and it really feels like a pat on the head because you are just doing what you set out to do in the first place.
Another concern is the issue of revenue sharing. What we mean by that is there are some companies who pay the employer as part of their bid process. Good companies like TIAA-CREF don’t do that. In the past we had a fight with the TSA program where we said we wanted direct access what we got was revenue sharing insurance companies. Last year the DCR said they wanted TC; after that recommendation was made MnSCU decided to add Wells Fargo as the middleman who added a paid record keeper. That revenue sharing distorts the bid process. We’re back to the same old fights, we don’t think our concerns are being registered or communicated to the SBI and it is not reflected in their document. We are appealing to you, Chancellor, directly, so we make sure that they do understand how important this issue is to faculty.
MnSCU: Before these guys talk, we know this is intensely felt and I don’t think it will be helpful to use emotional or judgmental words. We don’t think anyone was going around messing with anything. I think it’s a passionate issue.
IFO: In my communications I always point out MnSCU’s perspective, one perspective is they wanted to simplify the plan and do one stop shopping. I put that in all of my communications. People clearly hear that message and they said that doesn’t matter but what does matter is they have access to the people. Messing is a valid word. People are making judgments about faculty pensions without even listening to them.
IFO: Focusing on the passion of the issue is the wrong way to go. My husband served on the DCR Advisory Committee several years ago and I think one of the things that I most object to in this the process is if we have a committee looking at the process and MnSCU turns around and says we’ll ignore those recommendations. That is very bothersome to me. I think if we’re going to make a good decision about this we need to know that MnSCU is looking at the best funds with the lowest fees so their employees have good choices for retirement.
IFO: For my campus the emails I’ve seen come from knowledgeable people who have a rational process for thinking and although an obnoxious email came from my campus, the argument is very rational and he knows about investments. It’s not just a passionate emotional response, it’s based on reason.
MnSCU: Maybe we shouldn’t do anything that impugns people’s integrity.
IFO: The issue is we have hundreds of emails and a committee offering recommendations, and none of us are being heard. We will have serious ramifications if people feel like they aren’t being heard.
IFO: Whether it’s true or not, there is going to be a perception out there and it is going to appear that there is a greater concern for a kick back. That’s the way people are going to read this.
MnSCU: Both Bill Tschida and Gary Janikowski are waiting to discuss the issues with you. I’m suggesting that we avoid any suggestion that there is another motive.
MnSCU: We didn’t do this because we felt the need to do it; it is required under Board policy every five (5) years. We have to conduct a search. I invest in TIAA-CREF. For us to say we’ll appoint them (TIAA-CREF) without conducting a search could send the wrong message and wind up in the legislature for being unfair. We want to keep this as objective as possible. We have to go through the process; we can’t just appoint TIAA-CREF without making them work for it.
IFO: My concern, as you look at making a change, there’s risk associated with loss. Can you guarantee that this will not happen?
MnSCU: I cannot guarantee that.
IFO: Dave Larkin, Bemidji FA President, lost funds. If an individual decided to make a change in their own portfolio, that’s different. The end result is we have millions of dollars sitting here and could mean that we could see substantial loss in those assets which belong to us. They are the funds we need to retire. I teach investments. I should have analyzed the possibility for loss in this proposal. Since you can’t guarantee that, I have a problem eliminating 10 funds.
MnSCU: The State Board of Investment selects the investment products. At the system office we don’t do that.
IFO: I know the contracts are running out, but you don’t need to change the structure from 23 to 13 funds. While the SBI does select the funds, you know there is a closer relationship and the RFP was drafted by you or the consultant MnSCU hired. No one has ever said TIAA-CREF automatically gets a buy; our concern is that the bid specs you used eliminated TIAA-CREFs strong suits. That is the issue. If you look at the IFO’s recommendation, we said we like competition, but at the consumer level.
MnSCU: I disagree that this RFP plays against TIAA-CREFs strong suits. Neither plan envisioned doing away with SBI, TIAA-CREF, and Wells Fargo. I’m concerned who this message came from that TIAA-CREF is going away. We are trying to conduct a process that is objective and fair.
IFO: Just a quick point, the point Russ started out with, this is a defined contribution plan. If the RFP criterion does not meet the needs of the people assuming the risk, then it does not meet our needs. TIAA-CREF is critical.
IFO: The other point I want to discuss is this is a recruitment issue. I’ve got 6 new faculty who said I would not have taken this job if it wasn’t for TIAA-CREF. We will seriously hamper our recruitment if we limit our options – social choice is a prime example.
MnSCU: Over the last year I’ve attended two meetings for TIAA-CREF. We anticipate TIAA-CREF being very competitive and taking on a larger role. I have trouble with how people perceive this.
Chancellor: What about TIAA-CREF traditional? That’s been the fundamental policy.
IFO: The fact that when they did branch out other things were offered. TIAA-CREF gives people the ability to spread their money out so not all eggs are in one basket. It is wrong with this new structure in that these funds are treated as commodities. When people buy into a fund, they aren’t just buying into the rate of return and fees, they are buying the services. A lot of faculty like the services. With this new system the record keeper will have an alignment of funds, what happens if ever a TIAA-CREF fund is offered, and you have a different record keeper, you can’t call TIAA-CREF if you have a problem, you have to contact the record keeper. That is what is going on with TRA. You are severing the relationship between the faculty member and TIAA-CREF. I know there was good intent to try to consolidate this but it isn’t selling. People value the direct relationship.
IFO: To personalize it, why don’t you want me to have money in social choice? Why can’t I invest in that?
MnSCU: When the RFP went out, we had an opportunity for people to ask questions and TIAA-CREF asked about that and the response was we told them for the initial selection we didn’t want to include what the SBI considers specialty finds, they were doing their review we didn’t want to look at an energy or technology fund, they’re not totally out of the game at this point.
IFO: Are you telling me it’s too much trouble administratively to let me have a social choice fund?
IFO: the convenience of the analysis is not to do that. With a defined contribution plan, the risk is on the person doing the contribution those people doing the contribution -the people involved need to have input. Each of these points being raised is the sense that our input was not important, that is why this is not selling. It is as simple as that.
MnSCU: It’s true that the primary responsibly falls on the faculty to select the funds, but we have a fiduciary duty.
Chancellor: Some people don’t want their retirement with companies that sell tobacco or liquor. The social choice isn’t always about the return.
IFO: If it’s our money and our responsibility, then we should have the kinds of choices we want. Ignoring the faculty is fundamentally wrong.
MnSCU: In terms of the reduction of funds, we have three money market funds and we have five large camp funds and four bond funds and especially when you look at money market funds there isn’t a significant difference.
Chancellor: If the traditional annuity isn’t there, then how do you do that?
MnSCU: The recommendation from the committee did say they wanted to keep those funds. Those recommendations are still being considered.
IFO: If you look at the statement Russ provided, they voted that fund the highest number on the page. It is very important.
IFO: Bill Tschida’s comment on the publication on the three exact or overlapping funds. We call that competition.
MnSCU: That adds to plan costs. If you have to record keep more funds, then it is going to cost more administratively.
IFO: I’m not sure that’s true. I practically memorized the RFP. You are to assume a fund structure exactly as provided - which it doesn’t look like there’s a lot of flexibility. While there was strong support for TIAA-CREF and concern about SBI funds, I did not receive a single email on the support of Wells Fargo. And yet Wells Fargo always wins the bids. This is a very strong concern here. Whenever we’ve had bidding in the past they seem to do very well.
IFO: Regarding my husband’s participation on the DCR Advisory Committee, Wells Fargo was chosen as the administrator and at that time they said they would never be a provider of funds because it would be a conflict of interest. And now they are providing funds?
MnSCU: I don’t’ want people to misunderstand how we administer the bid process, we are free to negotiate with the vendors we select; that is what we have done and will continue to do. I do not mean this factiously, but the IFO demonstrates more involvement and expertise than any other group and we would be supportive to turn IRAP the retirement plan over to the IFO and let them run it. It is something to think about it. I think we would be supportive it of that.
IFO: What is the process that we are looking at; what are the next steps?
MnSCU: We have three finalists/applicants; the RFP was sent to 15. The time line was up on November 7. I can’t say who the three finalists are. The consultant is analyzing them and should be coming to us with a recommendation for the first week in December and the DCR Advisory Committee will be involved in the interview process.
IFO: Is this the same consultant who created the RFP?
MnSCU: Segal Advisors from New York.
IFO: Will there be an opportunity for the IFO to speak?
MnSCU: I don’t know.
MnSCU: Isn’t your DCR committee representatives speaking for you?
IFO: We have two reps and this is a very important decision. The DCR recommendations were made by that body and none of them were followed. We want to be really up front here with you.
Chancellor: Is that correct that none of their recommendations were heard?
MnSCU: As far as I know we are going forward with the possibility that all of them can be used.
MnSCU: Part of the problem with specialty funds is to be able to get ones that are comparable. We’ve eliminated that ambiguity. There is nothing that restricts us. We are talking about asset categories. If we had a social choice asset category then our advisors have told us is it difficult to compare.
IFO: What is it you are comparing is what people are concerned about. The ultimate result is not going to be what people want. The heart of the decision is in the criteria. You could have the best process in the world but if faculty aren’t agreeing with your criteria then they will not be happy.
IFO: With record keeping, does TIAA-CREF do their own?
MnSCU: Yes, and they can record keep the SBI funds. The one stop shop came from the DCR Advisory Committee.
IFO: The State Board of Investment ultimately chooses the funds. What would give us a great deal of comfort is to see those specs changed.
Chancellor: The bids are already in.
IFO: We would like some reflection that the SBI heard our concerns. If we don’t see some reflection we could have people write directly to the State Board of Investment and make their opinions known.
Chancellor: I’m sure the SBI isn’t fully aware of the history of this.
IFO: Realistically the SBI is going to look to MnSCU for direction on this and you’ve heard faculty points of view and we hope this will be communicated to back to them.
Chancellor: I’ve heard the emotional connection with TC.
MnSCU: We have to go through the objective process.
Chancellor: So you know I’ve said from time to time I wish we could do business in Minnesota.
5 minute break at 10:45
224 Duty Days:
IFO: We were supposed to get a report back on that?
MnSCU: Yes, John Asmussen’s department completed their initial research and they’ve identified 170 faculty who are affected and told me they will have their report done in February/March and should be ready in plenty of time to be ready for next year. We could mail a copy of the report to Nancy or talk about it at the next available meet and confer.
IFO: To clarify, what is going to be in this report?
MnSCU: Recommendations on how to delegate authority to the presidents. They are looking at past practice and have identified people who earn more than 1.33% of their salary and will look at them to see how their additional assignments are being handled in best practices.
Pensions Discussion Resumed:
Chancellor: I heard Bill say that the health care money went into the fund managed by the faculty maybe the time comes that the IFO is more involved in their pension management. I wondered if there is some long term thought where this is not immediate but I don’t know if this can be done. I heard you say you maybe want to elect your own board of management. How can we think about that more? Mary Jacquart is the new Director of Government Relations here at MnSCU.
MnSCU: I need to have some more internal conversations. Maybe Gail Olson will tell us we can’t do it.
IFO: I don’t think it should be just the IFO; it should be the participants.
MnSCU: I’m talking about the entire administration of the plan.
IFO: That sounds like a threat. We might be interested in the bid but we weren’t born yesterday.
Supplemental Budget Request:
MnSCU: The legislature is looking for 10-20 million in addition to the stadium. We are looking at specific items.
MnSCU: The Board will have a recommendation in December for the ….fuel increases, Centers of Excellence, … There is no priority. We are looking at a request of 25-30 million for MnSCU. We need to keep our eye on the November forecast. That forecast could influence what the Board does.
Chancellor: I was personally disappointed that we didn’t get the money for biosciences. I was thinking of funding what we have and going for a fifth one. I’m thinking about a football field, a project at Bemidji or St. Cloud.
MnSCU: We’d be looking at our bonding initiative and will have that out by the end of the year, the supplemental and stadium bill. We heard about fuel increases on Wednesday. We want to be in on that.
IFO: Has there been any discussion on buying down tuition?
MnSCU: I don’t remember the amount, but yesterday we had a discussion. To buy down 1 percent is 6 million per percent.
MnSCU: I heard the Chancellor is possibly considering that for the next biennium.
Chancellor: We’ve got some board members who want to weigh in on this tuition issue. The buy down might happen. We can’t make this system work until we spend money. When I came here we began investing in IT. I’ve asked the presidents to come up with a four year plan; I’m hoping the next appropriations request will have a line item on it. I don’t want my successor to get into a system that isn’t right. You may want to talk about that at the next meet and confer.
IFO: Disaster recovery is very important as well as security.
Teacher Center:
IFO: We understand that there is a graduate course being developed for online science education and we are concerned where these are being offered, what institution, where did the $100,000 come from?
MnSCU: This is a faculty-driven committee led by Professor John Truedson at Bemidji, and they have been meeting for several years on the issue. There are new requirements for science teachers. There are a lot of k-12 teachers especially in small rural school their concern is to meet a need. They talked about this and this is still in the initial phase, what they’ve identified is that Bemidji, maybe Mankato and two others. The idea was they picked four areas of science: physics, chemistry, biology and earth science. Why not have a more coordinated way to do this? They haven’t decided who would grant the degree. They have to go through curriculum committees; this is not a done deal. Intellectual properties are a concern. This will come back to you. It is hard to know what to do first. We’re trying to work on the concept of curriculum and now when issues come up like intellectual properties, we will need to talk to you and Nancy.
Chancellor: I know you were disappointed that the teaching center wasn’t funded. How does this fit in?
MnSCU: The teacher center is all of the state universities; we have a person right now who is Nancy Bennet temporarily. We hired her last year; she is the interim system director for planning. Until we have a permanent person in place, she is continuing to do this.
IFO: Can you send me a list of the 7 coordinators on each university?
MnSCU: Yes. Every university does this differently, that is why we thought we needed something concrete to talk about. They have given us a proposal for $100,000 which is the cost to provide release time for faculty to do this. We have not made any agreements yet. We’d like to talk to you more.
IFO: You are talking about conditions of employment and it is not appropriate. We are the ones who need to be talked with.
MnSCU: We are entitled to have ideas and talk about them first before consulting with you. We know you are the exclusive reps.
MnSCU: This group of faculty are really excited. This isn’t just a metro issue which is why we want to do it online. The high school teachers will do the lab part in the summer. All I can do is assure you that now we have enough to say to you that we can talk to you about how this will work.
There are 7 campus coordinators, I don’t know if all of them are faculty members. They have been in place for two years but it is different on each campus. Some institutions had a formal consultation organized discussion and other cases the practice on that campus was not as formal.
IFO: What I understand, if each school is specializing then each school would have a different licensure?
MnSCU: I don’t think they have an answer to that yet. That’s when we get into the Intellectual Properties issue. We need talk about that sharing of curriculum. For example, if I develop a curriculum at Bemidji then someone on Southwest wants to use it, we need to work that out. We need to find projects that have both a real need, are of faculty interest, and then try to figure out the structure.
IFO: It is hard to divide the compensation to the intellectual property rights. We should not do something that would be precedent setting that would give away people’s intellectual property rights.
MnSCU: This group needs to focus on that; we’re trying to look out for your interests.
MN Online:
IFO: We are concerned about unnecessary duplication at MN Online with the e-curriculum grant. This is a new term for us.
MnSCU: I am not the expert on this. Gary Langer is at a conference and Linda Baer is in China.
IFO: Where did these recommendations come from?
MnSCU: These e-curriculum grants came out a year ago and were the Chancellor’s initiative funding and the legislature, these were competitive grants for people to develop online curriculum. Several grants were awarded. I can give you a list of those grant recipients.
IFO: That would be helpful.
MnSCU: My understanding is the MN Online Council, as one of their things to do, wanted to talk about such things as unnecessary duplication in the online world in terms of resources being directed for example in grants. Should we for example fund six proposals that will create an online 101 course? With the limited funds that the online group has, should they be thinking about not funding duplication? You will need to talk to Gary Langer about this. We are not talking about limiting what faculty could create, this is about how we can best use our money.
IFO: We definitely need more discussion.
Chancellor: How about at our next meet and confer on December 9?
MnSCU passed out a few handouts including one on CLEP.
CLEP:
MnSCU: Do you want to have another opportunity to get more feedback to us about the cut score setting?
IFO: Yes.
Governor’s Accountability Project:
MnSCU: Here are a few handouts on that. If you go there all of the materials are there. Read the memo, they are looking at a high level accountability system. There is material there if you are interested.
IFO: At this second accountability round table, did they talk about discount tuition?
MnSCU: No, it was Dennis Jones giving a slide presentation. People said we have increasing growth in people of color, and a gap in people retiring. We need to close the gap so students are coming prepared.
Adjourned at 11:35 p.m.