Arizona Board of Regents-Minutes

A meeting of the Arizona Board or Regents was held April 27 and 28, 2006, in the Arizona State University Memorial Union. President Palacios called the meeting to order at 10:30 a.m. on Thursday, April 27, 2006.

PRESENT:	Regent Fred Boice Regent Robert Bulla Regent Ernest Calderón Regent Dennis DeConcini Regent Benjamin Graff Regent Edward Hermes Regent Jack Jewett Regent Anne Mariucci (joined the meeting Thursday afternoon) Regent Christina Palacios Regent Gary Stuart Superintendent Tom Horne (Thursday morning only)
ABSENT:	Governor Janet Napolitano

Also present were: President Michael Crow, Dr. Milt Glick, Mr. Paul Ward, Dr. Christine Wilkinson, Mr. Rich Stanley, Arizona State University; Dr. George Davis, Mr. Greg Fahey, Ms. Judith Leonard, Ms. Edith Auslander, Dr. Patti Ota, and Mr. Joel Valdez, University of Arizona; President John Haeger, Dr. Elizabeth Grobsmith, Dr. M. J. McMahon, Mr. Mark Neumayr, Mr. David Harris, Dr. Kathe Shinham and Rich Bowen, Northern Arizona University; Executive Director Joel Sideman, Board Counsel Paulina Vazquez Morris, Secretary to the Board Peggy Martin, Dr. Art Ashton, Mr. Michael Hunter, Ms. Cathy McGonigle, Mr. Ted Gates, Ms. Stephanie Jacobson, Ms. Anne Barton, Dr. Mark Denke, Ms. Kathy Bedard, Mr. Dan Anderson and Ms. Stella Galaviz, Central Office; and Mr. Robert Mitchell, Arizona Faculties Council.

All lists, reports, summaries, background materials, and other documents referred to in these minutes can be found in the April 27 and 28, 2006, Documents File.

Regent Palacios introduced Billy Valencia. Billy was class valedictorian from Rio Rico High School in southern Arizona. In addition to being a Flinn scholar, Billy is the recipient of additional scholastic awards including the Leadership Scholarship, ASU President's Scholarship, National Hispanic Recognition Program and Ventures Scholar. Billy is a junior majoring in supply chain management in the W.P. Carey School of Business Supply Chain Management Program and plans to declare his second major in Chinese this fall. Billy served as an intern in Governor Napolitano's office, was a participant in the ASU Summer Program in Beijing, and spent his Flinn trip in Budapest participating in a service project in the Romas camps and surrounding areas. He plans to spend this summer at Remnim University in Beijing in an intensive language study program. Coupling his supply chain management classes with his Chinese language studies, Billy is pursuing his education to ultimately lead to work in China that will allow him to be competitive and valuable in the workplace and also create positive changes in his community. Billy described how he is trying to better understand the Chinese culture.

Regent Palacios also welcomed Mary Venezia, from Northern Arizona University. Mary has been appointed by Governor Napolitano as the next student regent and will take her position effective July 1, 2006. In addition to being a full-time student, Mary is involved in student government and the Greek system at NAU. She also serves as a resident assistant. In high school she was student body vice president and a member of the National Honor Society. She was also captain of the varsity girls' golf team and a state finalist. Her diverse and expansive volunteer experience ranges from working with deaf, blind and disabled pre-school children to leading a junior high youth group.

CHRIS GUSTAFSON: Student at ASU wanting to discuss the student effort to lobby the legislature for more state funding. He stated the students wanted to send a message to the state legislature that students cannot shoulder the entire burden for the cost of higher education. Over 8000 letters were sent to legislators by students. Several students spoke directly with legislators. The legislators were receptive to the students’ issues. He stated that he was very proud of the students for working so hard to get their position known.

ROSS MEYER: The president-elect for undergraduate student government at the Tempe campus. He stated the student advocacy campaign was a success. Students came together for one cause. Students from all walks of life participated in this campaign. The work the students did has paid off. Students have been the focus of the media and the students have effectively communicated with the legislature. He further stated the campaign does not end today. The students will continue to work toward the university system being fully funded. He stated that he too was proud of all the work the students did.

SAIF AL-ALAWI: Student Body President - West campus. He came today to say goodbye and thank you. He then introduced Jessie Peterson who is the new Student body president.

TRAVIS SHUMAKE: Student Body President at NAU. He introduced Eric Norgard, the new Student Body President at NAU.

Items on the Consent Agenda, which are marked in these minutes with an asterisk (*), were considered as consent matters and were unanimously adopted upon the motion of Regent Calderón, seconded by Regent Bulla.

The Board approved the following continuation award to ASU: The Department of Defense, Defense Advanced Research Projects Agency Award, #FA95500510424.

The Board authorized the University of Arizona to sell one or more series of System Revenue Bonds not to exceed $3.9 million for the purpose of financing the acquisitions and construction of Phase 2, Part A, of the Residence Life Building Renewal Project, as recommended by the Capital Committee.

The Board authorized Arizona State University to sell one or more series of Refunding Certificates of Participation up to a maximum principal amount of $9.5 million, in amounts to produce sufficient proceeds to refinance all or a portion of its COP Series 1999A and 1999B and to pay costs related to the refinancing, as long as a net present value savings of at least 2% of the principal amount of the COPs being refunded is achieved, as recommended by the Capital Committee.

The Board approved the UA request to purchase technologies needed to extend the useful life of the Legacy Student Information System for an anticipated five-year total cost of $1.058 million, as recommended by the IT/AZUN Committee.

The Board approved the UA request for the annual renewal of the Oracle Site License (data base, tools, maintenance and support) at a one-year cost of $1.39 million, as recommended by the IT/AZUN Committee.

The Board approved the UA request for the installation of the Keating Facility Voice and Data Infrastructure at an implementation cost of $576,108, as recommended by the IT/AZUN Committee.

The Board approved the UA request for the voice and data infrastructure for the MRB Building including wireless, voice-over-IP, at an implementation cost of $563,123, as recommended by the IT/AZUN Committee.

The Board authorized the University of Arizona to promote Professors Carol Barnes, Mary Koss, Toni Massaro, and Mark Nichter to the rank of Regents’ Professor effective July 1, 2006, and to award the $5,000 salary increase that customarily accompanies these appointments.

The Board awarded the Regents’ Medal to Peter Likins, President of the University of Arizona, to be presented at the University of Arizona Spring 2006 commencement and designated “President Emeritus” status to President Likins, effective July 1, 2006, in honor of President Likins’ outstanding contributions and service as university president.

The Board is requested to set resident undergraduate tuition rates for the 2006-2007 academic year.

Regent Boice stated that at the Board's March meeting, the Board approved tuition and fees for all other students, graduate students and nonresident undergraduate students. Setting resident undergraduate tuition was postponed in order to assess the state of the FY 2007 state budget process. The Board previously heard from students all around the state, student leaders at each campus and from the three university presidents.

Regent Boice asked each president to briefly state his position beginning with President Crow.

President Crow stated that Arizona State University's objectives of excellence and inclusiveness require resources. ASU has greater access by students that are eligible for Pell Grants (an increase of 30%), greater access by students below the poverty line (an increase of 50%), and ASU has reduced the average debt of an undergraduate student graduating from this institution. Further, ASU has increased the number of classes, increased the quality of their classes and increased diversification. The university's system is complicated. In the last several years the university has seen a decrease in state funding of $1,250 per student per year. That equates to a missing $76,250,000 in the budget per year. Arizona State University's proposal for undergraduate resident tuition has been changed from 8.5% to 6.5% for the schools on the Tempe campus and remains 3.5% for schools on the Polytechnic campus and the West campus. President Crow stated that he felt he was able to make this change because he believes there is support in the legislature for additional appropriations to the university.

Provost Davis emphasized how important and valued the tuition setting approach is. The University of Arizona is seeking a 4.6% increase in undergraduate resident tuition for the main campus. For UA South the university has taken a different approach and recommend no increase in tuition. Students at UA South will be asked to participate in the library tech fee of $65.

President Haeger stated that Northern Arizona University's proposal was quite simple. Northern Arizona University is seeking a 3.6% increase for undergraduate resident tuition. President Haeger stated that he was very much concerned about whether the legislature will come to an agreement relative to the funding of the universities. All three universities, and NAU in particular, are facing some challenges in terms of infrastructure and even though the state has put money into faculty and staff salaries, and it is greatly appreciated, it will probably only hold NAU even because other states are also putting money into salaries. Another issue is that even though the state and the Board have been very supportive of building projects on the NAU campus the reality is that NAU still has more than $275,000,000 worth of renovations that are needed and the university needs to keep those projects moving. The campus also needs to keep up with technology infrastructures, including a wireless campus. This year the university is moderating its tuition request, but if the state does not come through in terms of funding the institution, next year the tuition picture will be very different.

Regent Boice stated that the requests before the Board do not include the Student Recreation Center fee, the Arizona Financial Aid Trust surcharge fee and university-specific mandatory fees charged to the students.

Regent Calderón stated that he felt the universities were doing the best they could with the limited resources they had. He commended President Crow for listening to the students and reducing his recommendation.

Regent Hermes stated that the Board had postponed setting tuition at the last meeting so that they could assess what was going on with the budget. He stated that he believes this year the state will give the universities additional funds. He is putting his faith in the legislature that they will come through for the universities. He also commended the students for their efforts with the legislature.

Regent DeConcini asked what would happen if the Board approved a tuition increase that was based on receiving a certain amount of funding from the legislature, as set out in the letter received from Representative Knaperek and Senator Gray, along with a tuition increase that was based on not receiving that amount of funding from the legislature. He stated that he felt there was an opportunity to use the legislature's statements that they were willing to fund more as a basis for setting lower tuition. The opportunity is available to put the legislature on the spot by saying back to the them that the Board has approved tuition lower than the recommended amounts based on the legislature's comments that they would be giving the universities additional funding and the tuition amount will be increased if the legislature does not come through with the funding.

Regent Palacios stated that Regent DeConcini might be interested in seeing the report that was sent to the Legislature regarding the advisability and options of capping tuition because information regarding the relationship between funding and tuition was stated quite clearly.

Regent Jewett stated that he felt compelled to thank the students for their advocacy on the tuition issue. The Board has had the support of the students as it raised tuition because the students realized that the Board was working to keep accessibility, affordability and diversity where it should be. The Board analyzed various financial data and set a policy that was mindful of the constitution and reasonable; this policy was the top of the bottom one-third. The Board has allowed each university to differentiate their mission to do what they could do best and to have differential tuition. The Board has asked Arizona State University to be able to manage an additional 35,000 students. The Board has pledged funds for financial aid. The reality is that if the Arizona State Legislature would show a commitment to affordability and accessibility and to set aside more funds for financial aid, it would take the pressure off the Board to raise tuition. But, in the meantime, the Board needs to continue on the track that it is on. In Representative Knaperek's letter to the students she stated that it was the state's responsibility to fully fund each student. She continues on to say one-third of public university funding comes from the general fund, and one-third comes from tuition and the remainder comes from other funds. Regent Jewett stated that he would like to be refreshed on this matter because he does not believe those numbers are correct.

Regent Bulla also thanked all the students who worked to communicate the financial situation to the legislature. He stated that he believes the Board needs to make a decision on tuition now. Students and their parents need to know what the tuition is going to be, financial aid people need to know what tuition is going to be. The next item on the agenda will look at changing when the Regents set tuition and might make something like what Regent DeConcini is suggesting more possible, but for now, he believes the Board needs to set tuition. If the legislature does not fund the universities it will make a big difference to tuition next year. The presidents are taking as much risk now as they can take.

Regent Graff stated that he wanted to remind the Board to watch the access and affordability issues as time goes on. Arizona State University's student population needs to be watched as ASU is entering into a new situation as far as overall mandatory costs for living on campus. The Regents need to keep a close watch on this and see what effect the new parking rates, the mandatory meal plan and a 6.5% increase in tuition will have on access and affordability. It is a unique situation for on-campus students and needs to be monitored. Regent Graff further stated that he is in full support of the 6.5% tuition increase. It is a good example of the students giving voice to their needs and the university and President Crow listening to the students. Regent Graff also thanked the students for all their work.

Regent Calderón stated that there is a bill bottled up in the appropriations committee sponsored by Representative Konopnicki and Representative Downing that provides $5 million in work study money. If the legislature is sincere in helping students, this bill could be approved and students could immediately benefit. Regent Calderón further stated that he thinks that Regent DeConcini has a good idea. He believes that it might be a good idea to say tuition will be x% if the legislature funds the universities and will be y% if the legislature does not fund the universities and put the decision back where it belongs.

Regent Stuart stated that he was very sensitive to Regent DeConcini's idea but he believed that tuition setting should not become a bargaining chip in the lobbying process that the Governor carries on with the legislature. Tuition is a separate animal. He believes that the Regents should continue to engage the legislature on their obligations to fund the universities particularly with respect to enrollment growth money, building renewal money and a variety of other infrastructure needs. The Board should want the state to invest, the students and their families to invest and all of the other revenue streams to be enhanced so that education is an important, high quality product. The Board is obligated to set a rate of tuition that the Board thinks is consistent with the quality of the product.

Regent Hermes stated that Regent DeConcini has a very innovative idea and he believes that may be the way the Board will have to go in the future. The Board needs to put more pressure on the legislature and make the connection that it is state funding that affects tuition. Regent Hermes stated that he believes the Board is in a very unique situation this year in that we may actually be receiving more financial aid dollars for students and he hopes that happens.

Upon motion by Regent Boice, seconded by Regent Bulla, the Board approved the request of Arizona State University to increase resident undergraduate tuition at Arizona State University at Tempe by $280, for a total resident undergraduate tuition of $4,591 in 2006-07; and increase tuition at ASU Polytechnic and ASU West by $149 for a total resident undergraduate tuition of $4,400 in 2006-07 with a vote of 7 in favor, 2 opposed. Regent Boice, Regent Bulla, Regent Calderón, Regent Jewett, Regent Stuart, Regent Graff and Regent Palacios voted in favor of this motion and Regent DeConcini and Superintendent Horne were opposed to the motion.

Upon motion by Regent Boice, seconded by Regent Calderón, the Board approved the request of the University of Arizona to increase resident undergraduate tuition at the University of Arizona Main Campus by $200, for a total tuition of $4,594 in 2006-07; and maintain the University of Arizona South resident undergraduate tuition at current levels with a vote of 8 in favor, 1 opposed. Regent Boice, Regent Bulla, Regent Calderón, Regent DeConcini, Regent Jewett, Regent Stuart, Regent Graff and Regent Palacios voted in favor of this motion and Superintendent Horne was opposed to the motion.

Upon motion by Regent Boice, seconded by Regent Calderón, the Board approved the request of Northern Arizona University to increase resident undergraduate tuition at the Flagstaff campus by $152, for a total tuition of $4,375 in 2006-07, and increase tuition for Statewide Programs by $149, for a total resident undergraduate tuition of $4,291 in 2006-07 with a vote of 8 in favor, 1 opposed. Regent Boice, Regent Bulla, Regent Calderón, Regent DeConcini, Regent Jewett, Regent Stuart, Regent Graff and Regent Palacios voted in favor of this motion and Superintendent Horne was opposed to the motion.

Regent Boice stated that the Board is being asked to review and adopt a tuition setting process and calendar for the 2007-08 academic year. The calendar presented proposes that tuition for the 2007-08 academic year be set this fall, at the November 30 - December 1, 2006 meeting. Regent Boice asked for questions or comments.

Regent DeConcini stated that he supported this change but asked if the campuses have been consulted.

President Haeger responded that each campus has been consulted. The university has spoken with administration and students. This move requires each campus to begin the process of setting tuition much earlier. In fact, at NAU the process will be starting in the next few weeks prior to the students leaving for the summer.

President Crow stated that this process will allow the Board to move into a better position for working with the legislature when setting tuition and the university believes that it will be able to engage students early enough to make this process work.

Regent Graff stated that he was concerned, as were some students, that the various stakeholders in this process might not be able to develop the necessary relationships within the university system because of the timeframe. Regent Graff stated that there was an issue regarding differential tuition. The students this year were able to support differential tuition because they had been in a program for almost a complete year and they were more able to see the complete picture and were therefore able to support the requested differential tuition. The concern is that if tuition is set in the fall, students won't have a complete picture of what they would like or need to have so it might be more difficult to get student support on these matters.

Provost Davis stated that he had also given thought to the relationships that develops between the president of the university and the presidents of student shared governance organizations and believes that the university will have to work on bringing the newly elected student leaders into the process immediately. One of the challenging roles of a provost is sitting before the Board engaging in a conversation regarding program fees and differential tuition and that cycle is going to come back very fast. Provost Davis stated that he worried about the psychological impact of the universities having to make another presentation so quickly.

Regent Hermes asked what type of state funding will we be looking at when we are setting tuition. Will we look at what we received in the previous session, or what we think we will receive in the next session?

Regent Boice stated that the Board needs to run its business which is to provide an education to the citizens of this state. What the universities get from the legislature is an integral part of the financing of that process, but the Board has to do what it has to do. He felt that as long as it is done in a reasonable, logical, fair and responsible way it should be respected. It is certainly a process that needs to be considered. Regent Boice stated that he believed we would be in a better position to do something like what Regent DeConcini is suggesting in the fall.

Upon motion by Regent Boice, seconded by Regent Calderón, the Board unanimously approved the tuition setting process and calendar for the 2007-2008 academic year which will allow the Board to set tuition at the November 30 - December 1, 2006 Board meeting.

Regent Boice stated that the Board is being asked to approve terms and conditions of the multiple-year employment contract for Robert N. Shelton as President of the University of Arizona. At the Board's special meeting in January, 2006, the Board approved the appointment of Dr. Robert Shelton as President of the University of Arizona and a total compensation package. At that time, specific elements of the compensation were subject to further discussion. Separate from the multiple-year employment contract, Dr. Shelton will be compensated in the amount of $30,000 to provide consulting services to the Board during the transition period prior to his July 1, official starting date. Regent Boice then asked for questions or comments.

Upon motion by Regent Boice, seconded by Regent Bulla, the Board unanimously approved the terms and conditions of the multiple-year employment contract for Dr. Robert N. Shelton as President of the University of Arizona, effective July 1, 2006, which include an annual salary level of $420,000, an annual housing allowance of $45,000, an annual contribution to a retirement program of $75,600, and an annual automobile allowance of $9,400, and compensation in the amount of $30,000 to provide consulting services to the Board during the transition period.

Regent Mariucci joined the meeting. Superintendent Horne and Regent DeConcini left the meeting.

President Crow gave a report on Arizona State University's mission and organizational structure. He stated that the core objectives of the university were to build an institution of high academic excellence which was inclusive and had high impact on the region and the state. The institution can best be characterized by the following terms: comprehensive, metropolitan, research university which will ultimately have 100,000 students. Comprehensive means all subjects of importance to the metropolitan region and its ultimate development. Metropolitan means the university is an urban focused metropolitan area university, focused on what the region needs. Research means that everyone who holds the rank of assistant professor, associate professor or professor is held to the standard of teacher/scholar and at least one of the campuses will be research intensive.

The single most important concept is the concept of one university in many places. It is a university called ASU; it is one university operating at four different campus addresses. Each campus will have various schools. Each school within the university has been given an intellectual niche and a defined mission and a set of operational and aspirational peers. Every individual school has had their niche defined in a way that is complementary and at the graduate levels is non-overlapping. At the undergraduate level some of the schools have similar programs and similar academic environments but they are differentiated. The programs will stand on their own, the schools will stand on their own, and each school will be driven to excellence in each of their own categories.

For example, the Tempe campus house the School of Engineering. This school consists of roughly 7500 students. The School of Engineering is math intensive, theoretically oriented, research intensive relating to theoretical and scientific engineering work. In this college, the engineering programs are intended to be tactile and spatial in their orientation, certainly math driven, but less math intensive and all of the research is practical and applied as opposed to theoretical and long-range. Aspirational peers for this program are the engineering schools at Stanford, Berkeley, Washington, UCLA, Texas, Utah, etc. Many of these students will be graduate students. This is the competitive arena in which the Fulton School of Engineering should compete.

On the Polytechnic campus the College of Science, Engineering and Technology has a general engineering program which consists of about 1000 students now, but in the years ahead will grow to 5000 students and is an undergraduate only, non-research intensive, general engineering program surrounded by a series of applied engineering programs and what are called engineering technology programs. They are different in their style, in their niche, in their orientation and in who hires people from their programs. Both programs have high demand for their students and both programs serve a different population and put people into different types of jobs. Some of the aspirational peers for the Polytechnic College are the Technology School at Purdue University, the Rochester Institute in Rochester, New York, and the CalPoly San Luis Obispo campus.

Regent Mariucci stated that she believed this concept is very ambitious, innovative and inspiring. Regent Mariucci then asked if there was an analog to what we aspire to be and what have we learned from that analog. President Crow responded that there are several universities that Arizona State University pays attention to, like the Pennsylvania State University with thirteen campuses spread out throughout Pennsylvania. It is hard to make comparisons because the programs are funded very differently, but structurally, ASU does look at what they are doing. The University of Texas is a little different, it has nine campuses with heavy tiering, and Arizona State University does not have heavy tiering. The admission standards for the University of Texas are different by campus, at Arizona State University the admission standards will be basically the same for all locations. The University of London with thirty-five campuses is one that the university watches. That university has idealized elements that Arizona State University finds attractive. Another university that Arizona State University pays attention to is the University of Minnesota, because of its capacity and its ability to serve the people of Minnesota. Arizona State University wants to learn from other people's successes and failures, so they try to watch as many other universities as possible.

Regent Jewett asked how do you rationalize differentiated tuition going forward and does the original concept where you have a lower cost structure still hold up. President Crow responded that the idealized answer is there would be differential tuition. Some students and others have made social arguments against differentiated tuition because they believe that differentiated tuition could lead to some students being attracted to a certain major, just because of the cost. The practical problem is the core funding for ASU as a whole. ASU received 95% of the new students coming into the system but only received 50% of the new resources coming into the system. The problem then is the gap in resources availability, which in turn makes the tuition issue very complicated.

Regent Jewett then stated that this appears to tie cost structure to funding, so at the end of the day, in the ideal state and with the assumption that funding is caught up, this construct would allow for a differential cost structure. President Crow agreed.

Regent Boice stated that the Capital Committee, comprised of Regents Bulla, Calderón, Jewett, Student Regent Graff and himself as chair, met on March 28 and on April 13 to consider the items appearing on today's agenda. At the March 28 meeting, the Committee reviewed and approved Northern Arizona University's Request for Project Approval of the Wayfinding and Campus Entry Project.

Rich Stanley, Mernoy Harrison and Ted Gates joined the meeting for this presentation.

Regent Boice stated that Arizona State University would present an overview of the planning for the opening of the Downtown Phoenix campus in the fall 2006. The review included: the goals and mission of the campus; the academic program plans; the relationship with the City of Phoenix in implementing the campus; the phasing plans; and the budget parameters for the campus. The report will also cover the progress achieved to date in the implementation of the plans, the milestone dates in completing the campus, and the schedule anticipated for future Board review and approval of specific projects related to the campus. The Capital Committee reviewed this presentation at its meeting on March 28, 2006.

Rich Stanley stated that from the start Arizona State University focused on a campus that would be an academically rigorous university experience in a vibrant, urban campus environment that is integral to the success of the Phoenix community. Critical to the thinking about moving forward with the downtown campus is the university's need to be ready to handle growth in the overall student body. None of this would have been possible without a strong and supportive partner, the City of Phoenix. This partnership is working so well because it is truly a win-win situation. The university will get facilities to handle enrollment growth, and put academic programs in the right physical location for students to take advantage of internships and professional opportunities; the City of Phoenix will get a vibrant student body to enliven and revitalize the downtown area and this location will provide greater educational opportunities to Phoenix residents.

At the beginning of this year, renovations began on the first two buildings that will be used in the downtown campus. The location of the campus is between Van Buren and Fillmore and 1st Avenue and 3rd Street. Light rail will be going through the center of the campus and that was critical to the location of the campus.

Mernoy Harrison described the programs that will be downtown. The Colleges that are moving to the downtown campus are the College of Nursing, the College of Public Programs, the University College, the Walter Cronkite School of Journalism & Mass Communications, including KAET-TV, and the School of Global Health. These programs are currently on the Tempe campus and will be moving to the downtown campus.

The College of Nursing has approximately 1700 students and four centers: Center for Improving Health Outcomes in Children, Teens and Families; Center for Improving Health Outcomes in Aging; Center for Advancement of Evidence-based practice and the Center for Research as well as the Institute for Community Health and Wellness. The College of Public Programs has approximately 1400 students and three schools: School of Public Affairs, School of Social Work and the School of Community Resources and Development. The University College, which will be headquartered downtown, but will operate on all four campuses, will include the School of Interdisciplinary Studies, the School of Extended Education, the Center for Academic Advising, Academic Success and Engagement Programs, and Academic Services. The Walter Cronkite School of Journalism and Mass Communications is scheduled to move to the downtown campus in the fall of 2008. It has approximately 2000 students.

Mernoy Harrison stated there will be emphasis on student support. There will be full library services, and computing support. Some of the services will be provided through partnerships with downtown business such as the YMCA and the Arizona Center.

The time schedule for the downtown center is as follows: The first day of classes will be in August 2006 with the opening of the College of Nursing, Public Programs and the University College. There will be approximately 2500 students and 250 of them will be living in student housing downtown. Phase II will consist of expanding program enrollment and adding Journalism and KAET. This will begin in 2008 and be completed in 2011. By then the downtown campus should then have approximately 7500 students with 1800 of them housed at the downtown campus. The project will be complete in 2020 and will have approximately 15000 students with 4000 of them living at the downtown campus.

Rich Stanley reviewed the terms of the proposed Intergovernmental Agreement (IGA) with the City of Phoenix. The City is responsible for land acquisition to create the campus, for the construction of academic facilities and creation of a civic space using proceeds from bond funds, and for the payment of debt service on the bonds. Ownership of the facilities will be turned over to ASU after bond repayment is completed. ASU is responsible for operating and maintaining the facilities, running the academic programs, student housing and parking programs. The City has the right to purchase the Mercado to advance the biomedical campus for the cost of the outstanding ASU debt on the property if the campus facility needs have been otherwise met.

Rich Stanley stated that the Master Lease Agreement with the City of Phoenix is the agreement that formalizes property ownership and property management relationships outlined in the IGA. Individual properties become subject to the master lease as they are conveyed to the university through a separate process.

Rich Stanley stated that the Phoenix Police Department and the ASU Department of Public Safety will be cooperating on the security of the campus. There is some structure parking and surface parking already available that will be used as such. There will be a dedicated shuttle system running between the downtown campus and the Tempe campus until light rail is available. The Ramada Inn will be used for student housing in the beginning and has a food service area on sight. The university is also working on partnerships with various vendors downtown that will also provide food services. The university is working with the private sector to find a long-term housing solution.

Rich Stanley then discussed budget parameters for the downtown campus. New operating costs of $17 million include the new operating budget for administrative support, the academic budget for staffing and growing University College and the O&M budget. The budget details are still being worked on. FFE costs are $11.1 million and are funded through the use of available/budgeted one-time and capital funds and covered by newly budgeted annual funds to re-pay internal loan; moving costs are $500,000. Funding for this is coming from a variety of sources such as the tuition rate growth in the existing schools that are moving downtown, tuition from enrollment growth at the University College and existing schools; state enrollment growth funding, strategic investment and prior year base budget reserved in anticipation of the needs of this project.

Rich Stanley stated future projects include working on a proposal for longer term student housing, working with the City of Phoenix on a change to the IGA for the university to take on construction management of the new projects going forward. The demolition of some of the properties will occur in the next few months and in August the campus will open.

Regent Hermes asked how, if residence halls are being owned by private companies, the process works regarding setting room rates. Rich Stanley answered that some residence halls on the campuses are already owned by private companies and the rates are not set by the Board, they are determined by the outside company. On the downtown campus the discussions today indicate that the contracts will include starting rates and inflation rate boundaries for room rate increases.

Regent Bulla asked if additional data sets had been run on budget pro formas. Rich Stanley stated that the pro formas had been updated and stated that the overall expense has increased by about $1 million. The level of investment in the academic programs has decreased a small amount and the administrative costs have increased about 10-15% as the specifications have changed, such as increased security needs, etc. The sources of revenue used to support this campus are just about the same as they originally were.

Regent Bulla asked if the City of Phoenix was managing the construction of the projects. Rich Stanley stated that the City of Phoenix was managing the renovation of the projects in the two buildings that are being renovated, and the intent is for the new construction to be managed by the university. Regent Bulla suggested that this item come to the Capital Committee for discussion.

Regent Mariucci stated that it had been previously mentioned that the university was contemplating being the construction manager on the new projects downtown and she was now glad to hear that is what the university and the City want to have happen. In her opinion it is very important that the university control their destiny in this project and doing the construction management themselves is the appropriate thing to do. Regent Mariucci believes it is very difficult for two unrelated entities to share this kind of responsibility and the university has the most to gain and the most to lose, so the university should be doing the construction management.

Rich Stanley stated that the negotiations with the City of Phoenix have been very positive and he believes they share a mutual goal of having the university assume the duties of construction management.

Regent Mariucci stated she thinks it is very important that the downtown campus have some really good signage that helps, what is now a hodgepodge of different kinds of architecture, be seen as a total and cohesive campus. Signage is the only way there is at this point in time to create the imagery that is required. Signage will communicate to the public and the marketplace who we are, what we are, what we stand for and how proud we are. The university should not be pennywise and pound foolish, signage is the only thing that we have for the next several years to define our brand. Rich Stanley agreed and stated that there was a fairly large budget for signage on the downtown campus and the details were being worked on.

Rich Stanley, Mernoy Harrison and Ted Gates joined the meeting for this presentation.

Rich Stanley stated that the Master Lease Agreement would put into lease form the relationships that govern property ownership and control of the operating issues within the buildings that the university will occupy and the City of Phoenix will own through the bond program. Specific properties become subject to the lease through a separate letter of conveyance that takes place in a separate document once the buildings have been completed and are ready for university use and occupancy. In other words, the university does not take on any responsibility for any buildings that it has not agreed are ready for occupancy. The lease governs the occupancy use by the university during the time the city owns the buildings and specifics the terms and timing under which the transfer of the ownership of the buildings to the university will occur at the end of the indebtedness period. The Master Lease Agreement does not fully duplicate the IGA, but only includes the terms that are relevant to the lease relationship.

Upon motion by Regent Boice, seconded by Regent Calderón, the Board unanimously authorized Arizona State University to enter into a Master Lease agreement with the City of Phoenix regarding the Downtown Phoenix campus which formalizes the lease terms of the IGA previously approved by the Board, as recommended by the Capital Committee.

Rich Stanley, Mernoy Harrison and Ted Gates joined the meeting for this presentation.

Rich Stanley stated that this lease would only be for a two year term while the university is in the midst of getting permanent housing built through private development mechanisms. The set up at the Ramada Inn requires very little renovation to make it usable for the students. Rent and property taxes will be $805,000/year. The university handles all of the operations associated with the building; security, upkeep and maintenance and has full control over the facility including the restaurant which allows us to create a dining program.

Regent Mariucci asked if there was any option for extension of the two year lease term. Rich Stanley stated that there was not and the property owners were not willing to give us any extension.

Upon motion by Regent Boice, seconded by Regent Calderón, the Board unanimously authorized Arizona State University to enter into a lease of the 267-bed Ramada Inn facility in downtown Phoenix from City Center, LLC, to be used as a student residential life facility known as the Residential Commons as recommended by the Capital Committee and in accordance with the total costs and terms set forth in the executive summary, subject to review by Board and University Counsel of the final document and that each of the President of the University, or the Senior Vice President and University Planner, shall take such actions as may be necessary and proper to negotiate and execute the Lease on behalf of ASU.

Dave Harris, Kathe Shinham, and Ted Gates joined the meeting for this presentation.

President Haeger introduced Dennis Vollink, the president of Drury Southwest. Mr. Vollink spoke about the history and the philosophy of Drury Southwest. Drury is a family owned company that started in the 1940's. The philosophy of the company is to deliver value and consistent quality to its customers. Drury wants to deliver more value than their competitors. Drury does not franchise. Drury was rated as number one in mid-class hotel chains in eight of the last nine quarters. Drury does all of its own projects. Mr. Vollink thanked everyone that he had been working with and stated that it was a challenge to make any project a success and it was only by working very closely together that the conference center and the hotel will be a success. Drury is committed to making this project a success.

Upon motion by Regent Boice, seconded by Regent Calderón, the Board unanimously authorized Northern Arizona University, through its president or designated representative, to enter into a 30 year ground lease with two ten-year renewal options with Drury Southwest for the development of an approximately 150-room hotel on the NAU Flagstaff campus as recommended by the Capital Committee.

Kathe Shinham stated that this facility will complement the new Agriculture and Science building that Arizona Western is building right now. Originally this facility was planned to be larger, but as the planning progressed it was determined that this facility could fit into a smaller footprint. Certificates of Participation will fund the project, and the debt service will be funded through interest capitalization until July 1, 2007, when state appropriations for Research Infrastructure are to begin.

Regent Calderón stated that this project is precisely what the Joint Conference Committee talked about when the community colleges were asking us for more cooperation. This is clearly consistent with the community college mission and consistent with the universities’ mission. This is a win-win situation for everyone, particularly the taxpayer.

Upon motion by Regent Boice and seconded by Regent Calderón, the Board unanimously approved Northern Arizona University's request for Project Implementation Approval for a 10,000 s.f. applied research facility sited on the campus of Arizona Western College, with a total project budget of $4 million, as recommended by the Capital Committee.

Kathe Shinham stated that this is a request to sell Certificates of Participation to finance four projects, three on the NAU Flagstaff campus and one at NAU Yuma and to enter into a no cost ground lease with Arizona Western College on which the Yuma facility will be constructed.

Regent Boice asked approximately when NAU would be coming forward with a more comprehensive utility replacement project plan. Kathe Shinham responded that they would be working on the capital development plan next week and that project is one of the key components. Regent Boice then asked about the loss of the federal grant on the Applied Research and Development Building. Kathe Shinham explained that NAU had a grantor that was going to be taking space in that building, but their needs exceeded what NAU was able to provide so they were no longer going to be a tenant.

Upon motion by Regent Boice and seconded by Regent Calderón, the Board unanimously approved Northern Arizona University's request for authority to sell COPs to produce sufficient proceeds, not exceeding $12.5 million, for the purpose of financing the following four capital improvement projects: the Arizona Western – NAU Yuma Project; new Laboratory Facility; North Campus Utility Infrastructure, and Applied Research and Development Building and approval for Northern Arizona University to enter into a ground lease with Arizona Western College for land on which the Yuma facility will be located, as recommended by the Capital Committee.

Regent Boice stated that the Board is being asked to consider, at first reading, revisions to the Board Policy Chapter III, Section H. - University Procurement Code that would conform the University Procurement Code to the State Procurement Code.

Hank Traeger stated that many people had been working on the State Procurement Code to modernize the Code to allow alternative project methods. Now that those changes have been made to the State Procurement Code, it is necessary to amend the Board's Procurement Policy to conform. In addition a few changes were made to the Policy to update it and make it conform with other changes that had been made to the State Procurement Code. Hank Traeger further stated that a question was asked about individual Job Order Contracting. Mr. Traeger explained that Job Order Contracting allowed the university to hire someone to do a great number of unidentified future projects. The state law requires that a maximum dollar amount be set for each of those future individual projects. Once that amount is set and you hire a contractor that contractor can do an unlimited number of individual jobs as long as each job does not exceed the maximum dollar amount set. The maximum dollar amount for job order contracting is being set at $1,999,999.

Regent Mariucci asked about sole source providers and if there was a policy for checking possible conflicts. Mr. Traeger stated that was a good idea. Regent Calderón then asked who approves sole source contracts. Mr. Traeger stated that it depended on the size of the contract, but assured the Board that sole source contracts were used very rarely. Regent Calderón asked if the changes in the code were going to make it easier or more difficult for start-up businesses to do business with the universities. Mr. Traeger stated that he felt there were elements that would make it advantageous for smaller business, but overall the policy was neutral.

President Crow stated that the university has tremendous outreach programs that target minority and women-owned businesses and the university takes pride in the success that it has had in getting these types of firms to compete.

This policy revision will be brought to the June 2006 Board meeting for Board action.

Regent Stuart introduced Beth Shermer, Vice Dean for Administration at the UA College of Medicine-Phoenix (UA COM-Phoenix). Regent Stuart stated that the recent progress on the UA COM-Phoenix is because of Beth Shermer. She has done an absolutely outstanding job of coordinating and communicating with all of the stakeholders.

Beth Shermer stated that the UA COM-Phoenix is moving forward rapidly on the expansion of the Phoenix Program. An informal consultation with LCME, the accrediting body for the University of Arizona College of Medicine was held last week. The Coordinating Committee for ACMER, the Governor's Arizona Commission on Medical Education and Research, joined the group in the afternoon for a recap of the meeting. The meetings went very well. They were cordial, informative and candid. THE LCME representatives commented that working relationships appear strong and the UA COM-Phoenix appears to be taking the right steps in moving forward. There is a lot of work to do. Over the summer there is a filing due and the LCME will be on site for a visit on November 1. We have to show sufficiency of academic resources, financial resources and an actual first year program ready to go forward at that point.

Beth Shermer reported that on the administrative front, the UA COM-Phoenix hired Stuart Flinn, M.D., as the Associate Dean, Academic Affairs. Dr. Flinn received Yale's Teacher of the Year Award in 2004 and "America's Top Physician's Award" from the Consumers' Research Council of America in 2003, 2004 and 2005. He is currently a professor of pathology and surgery, as well as co-director of medical studies at Yale and director of the residency program. Dr. Flinn received his medical degree from the University of Michigan, and was a postdoctoral fellow at Stanford University School of Medicine. He will officially begin in his new capacity in June, and is already participating in ongoing curriculum and academic program development work. The search for a Vice Dean is underway. The search committee will review initial resumes by the end of this month and airport interviews are scheduled for mid-May.

The UA COM-Phoenix is negotiating with eight top candidates to join the core faculty. These individuals will be responsible for continuing curriculum development and teaching. The UA COM-Phoenix is working with ASU to identify interim research space for these individuals before construction of ABC1 is completed. The UA COM-Phoenix is also completing arrangements for seven ASU faculty members to be appointed at the UA COM-Phoenix to be part of the basic science faculty. It is anticipated that other College of Medicine faculty, in Tucson and in Phoenix, will assist in curriculum development and teaching responsibility for the new Phoenix track.

Ms. Shermer stated that curriculum development is accelerating. The UA COM-Phoenix is working closely with the College of Medicine-Tucson Vice Dean for Academic Affairs to maximize the benefit of the new Tucson curriculum, ArizonaMed, in developing the Phoenix track. The Academic Working Group and related sub-task forces are focusing on areas of differentiation in scholarly work, bioinformatics, and personalized medicine for the Phoenix track.

The UA COM-Phoenix plans to move into the three completely renovated former Phoenix Union High School buildings at the end of July. Dedication of these buildings has been scheduled for October 10. There was a press conference on March 16 on the Phoenix Biomedical Campus to observe the start of construction on ABC1. Work is moving forward, with a scheduled completion date of March 2007. The UA COM-Phoenix is focusing on the space needs for expansion in the upcoming years. With ACMER's approval, the UA COM-Phoenix is establishing a working group, with representatives from the UA, ASU, TGen, and the City of Phoenix, to begin planning processes for ABC2, in terms of identifying research needs, potential tenants, and financing. The UA COM-Phoenix is also in the initial stages of planning the medical education building that is necessary in order to expand class size in future years.

At this time, the Board agreed that the report from the Board's Representative to the Joint Conference Committee (JCC) of the Universities and Community Colleges would be moved up on the Board Agenda and the IT/AZUN Committee items would be moved to after the recess.

Regent Calderón stated that he was very pleased to see the first direct university effort, the NAU Yuma Applied Research Facility, to comply with the recommendations that were previously brought to the Board. The Board and the Arizona Community College Association needs to respond to the Joint Conference Committee and set out a plan for the first steps toward the implementation of the six recommendations that were approved. The legislators who saw the report said it looked good but wanted to see measurability and accountability steps. Providing that information will be the next project.

The meeting recessed at 4:30 p.m. and reconvened at 9:00 a.m., on Friday, April 28, 2006, without Regent Horne.

Regent Bulla presented the report on the proceedings of the IT/AZUN Committee meeting held on April 27, 2006. The University of Arizona presented its wrap-up report on the original Cosmos project. It had become apparent that the university was not going to be able to get the results that they wanted from Cosmos. Therefore, the university had decided to not complete the project. Three of the original five modules have been implemented. They are admissions, financial aid and common person modules, which are now operational. A new project titled the Legacy Student Information System Extension is being proposed by the university to implement the remaining student billing and curriculum and registration modules. This project continues to use legacy (COBOL based software) with a new relationship data base software and software to allow for web access for existing mainframe data.

To implement the two remaining modules, a proof-of-concept for testing three new software products was performed. Two of the three software packages were found to be acceptable. In addition, an alternative procedure was successfully tested to substitute for the third software package. The Legacy Student Information System Extension project will come to the Board in the future; however, the software acquisition for that project is in the consent agenda as Item 18.A. The Committee encouraged the university to come back as soon as possible with costing and timeframes regarding these concepts. This is an important issue for the University of Arizona. These are the systems that make the university run. The Committee expressed concern about the future. Using the Legacy System is a stop gap measure needed to provide the much needed functionality for a short period of time, but is not the answer for the future.

Regent Boice stated that the committee looked at these IT systems and is making incredible progress. However, he expressed concern that expending $300,000,000 over the next ten years just to shore up a system that is outdated is not what should happen and hopes the university will be able to come up with a better solution.

George Davis responded that the $300,000,000 number is for the development of the network masterplan over a ten year period. He felt that the workgroup demonstrated that it will be a large amount of money, but it is broken down into highly specific activities and goal structures and investments that are, even now, guiding the university in ways that are cohesive and effective. As the technology team describes the different kinds of software programs that are going to help in creating tighter interfaces between mainframe and web based analysis, they cannot speak in “computer-eze.” They need to be able to break it out and describe the specific benefits that will accrue to students, faculty, and administrators as the university moves forward.

Regent Bulla stated that everyone has been involved in computer conversions, usually they work out and they almost always come in over budget. He commended the University of Arizona for doing the right thing even though the right thing was a very hard thing to do. But, once everyone understood that they needed to do something different the university began working on solutions. Regent Bulla further reported on how the university plans to address the Gartner Report recommendations which were reviewed by the Committee. A key recommendation of the Gartner report had to do with limited staff resources and insufficient experience of staff with newly introduced technologies. Regent Bulla stated that he believed this was a major part of the issue with the Cosmos system. To address this recommendation, the university is creating a project management office and funding additional staff at a budget of $1.765 million over the next 5 years.

Regent DeConcini asked if the Board was going to be looking at this in a universal manner, attempting to find a program that will work for all three universities. He asked if the Regents needed someone to look at this on a universal level.

Regent Bulla stated that over the last three years there has been tremendous cooperation and progress between all three universities, in fact one item that has been approved is the PeopleSoft project which ASU and NAU are working on together. The Committee is very pleased with the cooperation between the universities on various projects but he agreed the committee needed to take a bigger look at this specific issue. But at this moment in time the University of Arizona is trying to avert a crisis. The CIO's have been working together and the committee hopes to begin working on looking at an overall university system. Frankly speaking, the universities are behind the curve in the IT arena.

Regent Bulla then stated that AZUN had obtained a new membership with a new service, Eduventures Learning Collaborative Service, which will provide the committee with three reports a year on how students learn and use e-learning.

The committee approved two projects for the ABOR IT Innovation Fund. The first was a project for up to $75,000 to plan for a Tri-University Identity Federation for the Arizona University System. This is a system to establish identity relationships with federal, state and higher education identity management systems. This should help with AZUN activity in the future. The second was a consulting contract for up to $36,000 with Fred Estrella to provide independent oversight of the ASU Student Information/Human Resources System development and implementation. ASU and Fred Estrella will be reporting to the committee on a quarterly basis.

The committee also discussed centralization and each university presented a report regarding centralization. It has been a challenge to move in this direction and slowly but surely movement is occurring and things are happening. The CIO's have been asked to come back and address their issues and explain why certain things had not or were not being centralized.

Regent Stuart stated that progress is being made on centralization. Further, he stated that in the committee meeting a report was received which stated that the CIO's had not been able to justify a good enough budget case for some departments to feel it was necessary to centralize. Regent Stuart stated that Regent Bulla has agreed to give copies of the reports to the Presidents and ask them to take this matter under advisement and assist with moving it forward. The IT/AZUN committee believes there is much money to be saved by centralization and there is a need to get everyone, from department heads on up, on board.

President Crow stated that he agrees with the notion of maximization of resources, linking between the institutions and pooling together of our IT assets because it is certainly the case that every dollar that we can save on IT we can spend on professors and other central features to the institution. It is not the case that it is the function of decades of incompetence that the universities find themselves in this decentralized modality; it is a function of unbelievable resource compensation mechanisms. The universities have not spent enough money over the last decade or two keeping themselves up to date so that they must now spend an enormous amount of money getting updated.

Upon motion by Regent Bulla, seconded by Regent Stuart, the Board unanimously approved the request of the University of Arizona for authority for the installation of the voice, data, and video network infrastructure in the Phoenix Biomedical Campus, Buildings 1, 2, and 3, and ABC, at an anticipated five-year cost of $4.558 million, as recommended by the IT/AZUN Committee.

Upon motion by Regent Bulla, seconded by Regent Calderón, the Board unanimously approved the University of Arizona's request for a complete campus overlay for wireless capability, which has been a component of the university network master plan, at an anticipated three-year cost of $6.881million including facility work, electronics and networking equipment, survey fees, software costs, installation and project management costs, as recommended by the IT/AZUN Committee.

Regent Bulla stated that for clarification purposes he wanted everyone to know that this system is needed for automation of manual processes that Arizona State University has in place so that there is better linkage between other systems so financial reports can be more easily produced.

Upon motion by Regent Bulla, seconded by Regent Boice, the Board unanimously approved the request of Arizona State University to approve the request to purchase and implement a Business Performance Management System with an anticipated five-year budget of $1.284 million, as recommended by the IT/AZUN Committee.

Michael Hunter, Greg Fahey, Charlene Ledet, Scott Smith, and Christie Farley joined the meeting for this presentation.

Regent Bulla thanked the entire group of Government Affairs officers for a job well done. Regent Bulla stated that the second regular session of the 47th Legislature is now at a point where they are no longer hearing regular legislation in standing committees. The Legislature still has some important work to do, most important of which is the state budget. The Legislative Affairs Group met twice earlier this year to discuss and evaluate ABOR's positions on various pieces of legislation under consideration by lawmakers that would have a significant impact on the state university system. The Board book includes a list of bills that the Government Affairs officers have been tracking and, in some instances, engaging on during this session. Regent Bulla then introduced Michael Hunter who gave a presentation on proposed legislation, legislative activities, and the status of budget discussions.

Michael Hunter gave a budget update. Legislative leaders from both parties have been meeting with the executive staff and with the Governor, exchanging priorities and perspectives. Michael stated that he believed the tax package was going to be a major sticking point in the budget process. Feedback indicates that progress is occurring.

Michael Hunter then discussed the Rural Regent Bill, Senate Bill 1058, which passed the Senate, then passed the House with amendments. It will go for a final vote in the Senate and will then be transmitted to the Governor. The Bill has one change. The Bill states that in 2008 the replacements for the Regents who are going off the Board will have to come from designated rural counties - one from the north and one from the south. One of those appointments would only be a four year term to stagger the rural regents. The other would be an eight year term and all following terms would be for eight years. The part about legislators being appointed is no longer in the Bill.

Regent Bulla stated that he believed there were some issues that weren't completely understood by the Legislature, such as the Regent with the four-year term will not really be getting to take advantage of the way the system works and that hopefully there will be an opportunity to make some technical corrections to the Bill.

Michael Hunter then stated that SB 1331, the Offensive Coursework Bill, brought about a great deal of controversy. The Bill was defeated in a floor debate, the discussion still reverberates around the legislature and some of the legislators who supported the Board’s position on this issue continue to talk to the Government Affairs officers.

Regent Bulla stated that this was a serious issue. The university faculty were very concerned about this matter. The provisions of SB 1331 were unacceptable and overreaching. The Government Affairs officers did a fantastic job communicating to the Legislature the detrimental impact this bill would have. That said some of the issues raised during the legislative debate on this bill deserve discussion by this Board. Some of the Senators who supported the universities' position on this bill believe public universities and colleges should adopt and implement policies designed to notify students at the beginning of a course, if the instructor believes necessary, that some course content may be deemed offensive by some students. The Government Affairs group believes it would be responsive to issues raised at the Legislature for such policies to be considered and developed by each university. Regent Bulla stated that he believed this notion has some merit. An example of what he has in mind is already part of the policies relating to class syllabi approved by the University of Arizona Faculty Senate.

Regent Bulla stated that he would like to make a motion that would be intended to provide guidance to the universities on this issue.

Therefore, Regent Bulla moved that the Board direct each of the public universities to adopt and implement policies designed to notify students at the beginning of the course, if the instructor believes that some course content may be deemed offensive by some students, and that each university president report to the Board, no later than the September Board meeting, regarding progress in implementing this directive. Regent Boice seconded the motion.

A discussion ensued among the Board members regarding the definition of offensive, academic freedom, the ability to enforce a provision like this and the fact that the University of Arizona has a policy in place. George Davis stated that there has been a changing of the role of the syllabus. A syllabus has turned into more a statement of understanding of expectations between the faculty member and the student. George Davis discussed how the policy was working at the UA. If a student had an issue with course content, they would go to the Provost or the Vice Provost for Instruction who then goes to the Department Head and the faculty member and they work out a solution to the matter. To date, it has been a productive process.

Regent Calderón stated that he didn't think it was appropriate for the Regents to be the police of offensiveness. Regent Bulla stated that if the Board asked the other universities to do something similar to what the University of Arizona did it might appease the legislature so that this issue does not come back again and again.

President Crow stated that the UA's method seems to be fine. He stated that he just doesn't want it to appear that the Board is trying to control what the faculty is expressing in class, but sets forth a policy so that the students are aware of what the content of their class will be. The board needs to distance itself as far as possible from this bill.

Regent Jewett stated that he was uncomfortable voting for this at this time. He felt that he needed to better understand the possible consequences before having a vote.

President Crow stated that the presidents had discussed this issue in the Council of Presidents meeting and they had all agreed to move forward on implementing similar policies.

Regent Graff was also concerned about unintended consequences. He asked how the policy would play out when a student finds something in a main stream, required course that they felt was offensive.

George Davis said that in most of the cases at the UA, there has been a reasonableness of exchange that takes place and a solution is worked out. There may be one case, at some point in time, in which something can't be worked out, but that hasn't happened yet.

Regent Stuart stated that he believed the purpose in making this motion was to assist the legislative people in expressing the notion that the Board opposed this bill because we already have a process in place for dealing with this type of matter. The Board needs to make certain that there are no unintended consequences from the legislature because of the language used.

Robert Mitchell stated that he does not believe the policy would impinge on academic freedom nor was that the intention. The policy is a kind of a truth in advertising type issue. It allows the student to know the content in advance and if there are any issues, accommodations can be made if possible.

President Palacios asked whether since the presidents have said they are already going to do this, is that not a sufficient response to the legislature.

Regent Bulla responded that the Government Affairs officers feel it would be helpful if the Board would give a directive to help start the process and the Legislature would see it as a positive thing.

Regent DeConcini asked, since it seems that the universities are already doing this in some form, if it might help if the language could be redrafted so it states that the Board is in favor of continuing the policy of alerting students that if they have an issue with course content, there is a procedure available to them to negotiate a different outcome if at all possible.

Regent Mariucci asked if we could include a statement that sets forth the Board's belief in academic freedom.

Upon motion by Regent Calderón, seconded by Regent Stuart the Board tabled this matter by a vote of 5 to 4 pending an opportunity for legal counsel and government affairs staff to develop possible recommendations for Board consideration.

Regent Bulla stated that Regent Jewett serves on the Board of Directors of the Association of Governing Boards of Universities and Colleges (AGB) and is representing the Board very well, making significant contributions to AGB and higher education on a national basis through this prestigious appointment. He stated that Regent Jewett was going to provide an update on the programs, activities, and strategic direction of AGB. In fact, the AGB Board is meeting in Phoenix this week, so Regent Jewett will be able to give very current information on what is underway.

Regent Jewett stated that it was a privilege for him to serve on the Board of AGB. The mission of the AGB is to promote citizen trusteeship and sound governance practices in public and independent education through Board education, programs, and publications. He stated that when he was President of the Arizona Board of Regents he was asked to provide a column for the trusteeship magazine. Regent Jewett thanked the central office for helping him shape ideas and put them in a form that resulted in a number of these columns.

Regent Jewett stated that as a member of the AGB Board he chairs the Ad Hoc Committee on Intercollegiate Athletics and has become the AGB representative to the NCAA Division I Presidential Task Force on the future of college sports. For the past several years AGB has been following the ongoing debates on many campuses between the desire to promote athletics and sporting events and also looking at the academic mission of requiring athletes to excel academically to make sure they can survive outside of the athletic arena. This Board is well aware of the information available from AGB regarding athletics. Regent Jewett stated that he will be attending a Presidential Task Force meeting in Dallas the week after next and will be meeting with a number of people including Myles Brand, the President of the NCAA and James Duderstadt, the President Emeritus of the University of Michigan, Bob Lawless, the President Emeritus of the University of Tulsa and Gerald Turner, the President of Southern Methodist University. He was invited to meet with this group to review how the AGB can play more of an educational role going forward. There are presidents around the country that believe that trustees have reached in and not acted appropriately with respect to intercollegiate athletics. There are some presidents that believe that Board members should be mandated to not interfere in athletics. The position of AGB is that a better approach will be to provide the tools to educate Board members.

AGB is well equipped to customize its work for the public sector of higher education and during the past decade, AGB has renewed its commitment to public sector boards and presidents. In the mid-90's, the AGB's Commission on the Academic Presidency produced an influential report that among other recommendations introduced an effective reform agenda for public higher education trusteeship. That also led to the report "Bridging the Gap" which focused on building stronger ties between state government and public higher education while stressing the public interest. It was also in the mid-90's that AGB recognized the increasing importance of public university affiliated foundations which in an era of falling or flat state appropriations have become essential tools in providing what is often referred to as a margin of excellence in public universities. AGB launched several programs and publications targeted at the foundation section, which has become its fastest growing membership group. In 2000, AGB launched the Center for Public Higher Education Trusteeship and Governance. The idea was to create a focused effort within AGB that addresses needed reforms in public sector governance. The Center allows Boards to research higher education public policy and offers an array of publications, research and consulting services through which AGB and facilitators have worked or supported work around the country. This Board took advantage, during Regent Stuart's leadership, of the programs and consulting services available from AGB that resulted in Focused Leadership.

The AGB's current work is based on four trends or assumptions. First, there is an increasing pressure for greater accountability among colleges and universities to increase their productivity and demonstrate that they are providing students with the essential 21st Century Learning that makes wide access to a modern college education an indispensable social priority for the public. Indeed, higher education as a public purpose is an issue that Boards can lead the way on. Secondly, the days of generous appropriations for higher education from the federal and state governments are gone for the foreseeable future. There is a great knowledge around the country that public support for public universities is in the decline. Third, Boards are under greater scrutiny than ever to hold themselves and their CEO's accountable for the wise use of institutional resources and above-board conduct in fulfillment of their fiduciary duties. Finally and most significantly, more than ever colleges and universities and affiliated foundations need to attract the best and the brightest talent to serve on their boards.

AGB is being positioned to assume a leadership role that may be different going forward, and is addressing several national priorities through specific project initiatives. Yesterday AGB addressed a subject that is frustrating for everyone and that is making the case for public investment in our universities and colleges. Regent DeConcini spoke to the AGB Wednesday night and the theme of his message was political engagement. We need to have every citizen in this country believe that this is where America's future is - in higher education and in each university and college being funded appropriately from the public side and through other revenue sources. It is a political issue and needs to start grassroots in this country. What is the purpose of the colleges and universities in this country? The purpose is transforming lives, one student, and one discovery at a time. That should be our positioning; investing in solutions to society’s most pressing problems. What do the universities do? They prepare the people who solve the problems and teach the people who change the world. Regent Bulla thanked Regent Jewett for his presentation and indicated the need for similar presentations on a periodic basis.

Michael Crow described Arizona as a state that is considering heavily its engagement in the new rapidly evolving knowledge economy. Arizona leaders have spent some time looking at two highly transformative economies, one in Singapore and one in Ireland. Both have localized, focused science investments that are used to bring together convergence between disciplines to enhance competitiveness in this knowledge economy. Both of these economies are about 4 million individuals. They are small, they are highly adaptive and highly engaged. These studies have resulted in the design of a new entity called Science Foundation Arizona. It has been formed as a 501(c)(3) entity by a number of leaders in the Greater Phoenix Leadership community. It is underway, a president has been hired, a private pledge of $100,000,000 to secure the initialization of this science foundation has been made as well as funding from the private groups to help move the foundation forward. The State is considering, through the 21st Century Fund, its contribution to programs that would be implemented by this science foundation. Progress is being made; there are large numbers of supporters in the legislature and the business community. This will lay down a foundation for new leverageable, competitive resources for our universities to amalgamate converged teams of scientists and engineers and to work to enhance competitive positioning for our universities. This is a tremendous step forward for this state and our communities. Bill Harris, the outgoing president of Science Foundation Ireland, is the new president of Science Foundation Arizona.

Regent Bulla stated that the Board is being asked to review the Memorandum of Understanding between Northern Arizona University and the Maricopa County Community College District to increase NAU’s presence on various campuses within the Maricopa System to serve students who wish to pursue a baccalaureate, master’s or even doctoral degree on their community college campus.

Regent Bulla stated that NAU recently signed a Memorandum of Understanding with the Maricopa Community College District to increase NAU's presence on campuses within the Maricopa system. This MOU is another great example of close collaboration with our community college partners to enhance access to baccalaureate education.

President Haeger reported that the agreement was a formal statement of what NAU has been doing for some time with the Maricopa System. The agreement says that the relationships will be expanded where there is a need to do so. This is a niche agreement. These programs that are being offered serve older students who want to finish out at the community colleges what they started there. They don't need the traditional university campus. The build out of the ASU campuses, combined with agreements like this and NAU's presence in virtually every county of the state and willingness to serve the Maricopa students who want to stay on their community college campuses will greatly enhance access throughout the state.

President Crow stated that President Haeger and he are in close cooperation as to the deployment of their assets in cooperation with the Maricopa Community College District. Regents will recall that ASU has launched its Maricopa/ASU Alliance Program which has a range of features associated with it. There are joint offices and joint alignment between Maricopa and ASU offering more points of access for students of various types and ages and desires and interests.

President Crow stated that he and President Haeger are in alignment with Central Arizona College as Pinal County struggles to deal with its population growth. Arizona State University will be taking more of a central role in assisting them and NAU resources will work in the niches. Likewise at Yavapai NAU is in the central role and ASU is the niche partner.

Regent Bulla stated that he was very pleased with this MOU and that there is obviously a niche for both ASU and NAU to work within the Maricopa system to meet the demand for baccalaureate education for our citizens. Regent Bulla also stated that he believes there should be a process in place to assess the implications when the universities wish to establish new programs or enter into partnerships, such as this one, in a geographic area in which another one of the universities is located or offering programs, to make sure there is no program duplication, overlaps, and no small range wars are started. The Board needs to figure out how a process can work as we move into new programs in different parts of the state, how it all fits together as a system. There is a need to have methodologies in place for the Board to review so it can assess what is going on.

Regent Palacios stated that she is satisfied that there has been adequate discussion between ASU and NAU, but she agreed that the Board should formalize some process so the Board can be mindful of new proposed programs as they develop.

Mark Denke stated that since 1999 Learner Centered education has been a high priority for the Board. In 2001 the Regents authorized $500,000 of TRIF Regents Innovation Fund from Prop. 301 for grants to faculty to improve and expand learner-centered education through the system. Beginning in 2002, 14-20 grants have been awarded annually. The 2005 projects will end on June 30. 429 faculty, teaching 397 classes to 32,750 students have been directly impacted by 68 funded projects over the four-year life of this project.

The Board heard presentations from three of the recipients of 2004 LCE grants on their projects; Dr. Anthony Muscat from the UA, Dr. Karen Pugliesi from NAU and Dr. Judy Grace from ASU.

Dr. Muscat discussed his learner-centered surface science course web based simulation environment that he developed. This is a website that was developed for a course on surface chemistry in physics. This website is the only "textbook". This course is taken by a range of students at the UA.

Dr. Pugliesi discussed her joint ASU and NAU project called "A Collaborative, Portable, Learning-Centered, 34-credit hour Master of Social Work Degree Program." This project worked to provide access to Master's level social work training to rural social work professionals.

Dr. Judy Grace discussed the Tri-University Collaboration on Learner-Centered Practice: "Creating Learning Communities among Faculty and Students." The purpose of this project was to develop a critical mass of faculty who will engage in the study of learner-centered and instructional practice and for those faculty to develop and implement LCE advocacy plans for each of the campuses.

Regent Boice stated that he would like it if there were some way to show what the Board has spent for learner-centered education grants and be specific about what the Board and the universities got in return.

Regent Jewett stated that he hopes to be able to provide more information in the future. The issue regarding outcomes and measuring those outcomes is being examined by the Programs Committee and it will come back to the Board with more information.

George Davis stated that learner centered was and is a radical alternative to the concept of having faculty members in a lecture hall without clear attention to learning modalities. As the Board looks for measures the faculty are commonly focusing in on how much students are learning in this new environment. In addition to that we need to measure the degree to which individual faculty like those presenting today have had an impact on faculty colleagues in terms of transforming styles and approaches.

President Crow stated that the focus on the outcomes of these innovative processes are important to make note of and ASU is increasingly spending more time and more energy trying to measure its products as opposed to worrying about qualifications for entry.

President Haeger stated that it is known that what makes a difference with students in the classroom is the connection that they make with faculty. Where you are likely to see the results of these efforts is in the universities ability to retain and graduate more students.

Dan Anderson, Liz Grobsmith, George Davis and Milt Glick joined the meeting for this presentation.

Regent Jewett stated that the Board is being asked to review the 2006 RAM Report. This is the second report to the Regents on this set of accountability measures, which were established under Changing Directions, to track system priorities such as affordability and institutional measures which reflect their differentiated missions.

Dan Anderson stated that as part of Changing Directions, the Board approved policy changes requiring the addition of information and accountability measures in the areas of admissions and enrollment, financial aid, student access and graduation rates. The universities developed plans for implementing these various reporting and accountability measures and developed measures specific to their differentiated missions.

System measures are categorized into three areas: access and participation; affordability; and student success. The 2006 System highlights are: direct access of eligible Arizona high school graduates was up 220 or 2.2% in Fall 2005; average Regent Set-Aside amounts to Pell students was up $135 over last year; average loan amounts declined 1.6%; unmet need was down 1.4%, and the six year graduation rate was up from 57.1% to 58.4%.

Two measures address access and participation. The measure for direct access addresses eligible Arizona high school graduates who enroll in an Arizona public university within one year of graduation. The 2004 high school eligibility study showed that 41.7% of qualified students entered a university within one year of graduation. The goal of the Board is to raise this percentage to 43% by 2009. Due to expected growth in high school enrollments, the universities will need to increase the numbers of these freshmen by 22% over the next 5 years. The combined access measure includes students who delay entering the university up to 4 years after high school graduation. Freshman in this measure include students in the direct access measure plus students who started their university education 2-4 years after high school graduation, plus students who transferred to the universities from another postsecondary institution within 4 years of their graduation. The baseline, as set in 2004, is 29.1% of the students enrolled within 4 years of graduation. The goal for this measure is to maintain this enrollment level system wide for the next 5 years. Again, because of growth in high school enrollments, the universities will need to increase the numbers of this student group by 27%, or nearly 3,500 students over the next 5 years. The number of high school graduates used to calculate the indirect rate this year is over 7,300 students larger than the number used last year and this caused the rate to fall from 29.1% to 26.4%.

The next three goals address affordability of higher education. In 2003, the Regent's priority was to keep the neediest students, defined as Pell recipients, unharmed from the 40% tuition increase. However, for long term efforts to address the needs of all students with unmet need, the Regents established a goal that the universities will allocate no less than 50% of the Regents’ Financial Aid Set-Aside for resident full-time undergraduate Pell eligible students. This became effective for fall 2005. In 2002, 38% of the regents set aside funds were awarded to Pell students. In 2003, 64% was awarded and for the current year 60%. In fall 2005, there were 15,518 resident undergraduate Pell students who received gift aid. At the same time, there were 23,544 resident undergraduate students with unmet financial need. So, for every two Pell-eligible financially needy students, there is another non-Pell student with unmet financial need. The Student debt measure looks at the average amount of debt for resident full-time undergraduate students with subsidized loans for an academic year. On average students experienced about a 1.6% decrease in loans for this academic year over last year. The next measure looks at the unmet need of all resident undergraduate students with cost of attendance not met by expected family contribution, grants, scholarships and waivers, subsidized loans and federal work-study. During this past year, unmet need decreased by $79, while tuition increased by $100-$400. In addition, the cost of attendance also increased. For dependent students living on campus the increase was approximately $750.

The last two measures address student success. The first of these is the system 6-year graduation rate. This rate is based on resident students who enter an Arizona university as freshmen and graduate from one of the state universities within 6 years. The graduation rates have been for 2002-03, 57.1%; for 2003-04, 58.4%; and for 2004-05, 58.6%. The second success measure requires information which has not been captured historically by the universities, such as high school graduate rates for transfer students. In order to have adequate data, the earliest this measure will be reported is 2008.

Milt Glick reported that ASU had five measures they were going to report on. Measure one is the annual number of degrees granted. The number of degrees awarded has increased over 20% in the last five years. Additionally, baccalaureate degrees increased nearly 7% the last year alone. This trend is expected to continue as ASU continues to find ways to remove barriers to student progress through the baccalaureate pipeline. Measure two, is the percentage of undergraduate degree recipients who begin as freshmen and graduate in five years or less. The percentage of degree recipients graduating in five years or less remained stable at 87%. However, continued focus on learner-centered approaches and technological enhancements is expected to gradually improve this measure. Measure three is the percentage of graduating seniors who rate their overall university experience as good or excellent. Overall satisfaction with the university experience for graduating seniors also remains stable at 94%. Continued emphasis on improved advising and expansion of programs should result in an increase in satisfaction over the next couple of year. Measure four is fiscal year gifts, grants, and contract revenues. ASU received a total of $287.7M in gifts, grants, and contract revenues in FY 2005, a 17% increase since the prior year and a 30% increase since the base year of FY03. This rate of increase puts ASU directly on track to reach its goal of $357M by FY 2008. Measure five is Arizona K-12 educational teachers served through ASSET (Arizona School Service through Educational Technology). In July 2005, the Arizona Department of Education committed resources to allow all public school districts and some private districts throughout the state an opportunity to sign up as members of KAET's ASSET program, which provides a variety of education resources to K-12 teachers in Arizona, including curricular materials and professional development courses. As a result, projects for future years were modified in December 2005 to accommodate the expected increases in the number of teachers served statewide.

Liz Grobsmith reported that NAU had five measures they were going to report on. Measure one is the number of tenured and tenure-eligible faculty teaching lower division undergraduates. NAU is proposing making some changes in Measure one. The university feels that a better measure of faculty-student interaction should be full-time faculty contact rather than just tenured and tenure track faculty contact. NAU will continue to monitor credit hours taught by tenured and tenure-eligible faculty, but will measure the number of student credit hours taught by full-time faculty. The universities goal under this measure will be 70% reached in 2010. Measure two is the success with the undergraduate student research or capstone experience. NAU intends that 99-100% of its graduates fulfill this requirement. This goal was reached this year; next year, assuming the goal achievement remains stable, a new accountability measure of undergraduate excellence will be proposed. Measure three is the graduating senior satisfaction with overall education. Graduates state that they are highly satisfied. NAU's goal is to remain in the 95-99% satisfaction range. Measure four is the number of graduate degrees awarded. Although the number of awards decreased from 2005, the university met its goal. NAU's Master's level graduation rate is over 80%. Measure five is the student credit hours taken through distance delivery by Arizona region. For the latest reporting period, NAU saw growth of nearly 800 credit hours throughout the state.

George Davis reported that the UA also had five measures they were going to report on. Measure one is the undergraduate 4 and 6-year graduation rates. The UA has made substantial progress on 4 and 6-year graduation rates. Double and dual majors have increased significantly since 1997 while the average hours at graduation declined from 143 in 1997 to 137 in 2003, a significant improvement in institutional efficiency. This goal may need to be reevaluated. Measure two is student engagement. More than 84% of UA's students are involved in engagement activities as recorded in the student information system. Measure three is grant and contract expenditures. The UA consistently ranks as one of the top institutions in the country in this area, providing rich opportunities for our graduate students. Measure four is doctoral degrees granted including Pharm.D., J.D., and M.D. Increasing these numbers is a challenge. The university has been increasing the number but they need to become more active in recruiting top graduate students for targeted areas. Measure five is people served by the AHSC Telemedicine and Telehealth programs. These numbers are on the rise. Telemedicine has become a powerful tool for education, public health, outreach and a reference source for health professions. The expansion of Telemedicine illustrates the increasing role of technology in delivering quality services to new populations.

Regent Mariucci stated that this is the most robust tool of accountability and it needs to be brought back for more thorough discussion and commentary, less data and more information regarding what the data is telling us and what we are doing to make continual improvement. Regent Mariucci asked if we are far enough along in the indoctrination of this as a management tool that we can begin to incorporate absolute benchmarks, either some national or peer group benchmarks on the measures that are the most strategic and big picture in nature? Milt Glick responded that the benchmarks and goals have actually served the universities very well. Even though none of the universities are satisfied with retention and graduation rates the reason that they have made the progress that has been made is because of the focus on these accountability measures. The Board originally said these are the outcomes that really matter and the universities focused on them.

Regent Boice stated that this is a work in progress and he would be willing to spend some time looking at these measures and what they are trying to do and see if more can be done to accomplish the goals and demonstrate the outcomes.

Regent Jewett stated that it appeared that there was a consensus that this needs to be brought back prior to the end of the next reporting period for further discussion.

Stephanie Jacobson, Liz Grobsmith, Milt Glick and George Davis joined the meeting for this discussion.

Regent Bulla asked why the Master in Real Estate Development Degree was centered in the Design College. Milt Glick responded that it is probably one of the most significant initiatives that ASU is doing. Approximately 30% of Arizona's economy is in construction and development. The development industry is concerned about how to improve the skill set of their employees. The university has created a set of initiatives that relate to real estate development. For example the Business School is just implementing a track in the MBA program that is in real estate finance. This program is hosted in the College of Design, but it, in fact, brings together the College of Design, the College of Business, the School of Construction and the College of Law. It is an executive education program provided by the four colleges with the College of Design being the sponsor. The College of Design wanted to host this program; the College of Business did not. Milt Glick also stated that the university was asking for a waiver of policy on this program. ASU is asking the Board to allow them to charge an additional fee for this class outside of what was approved during the regular tuition and fee setting process. ASU would hold a public hearing and follow the complete process. This program will be coming back for implementation in June.

Regent Mariucci stated that she had worked on a group that evaluated the feasibility of this program and helped to design the curriculum of this program. Regent Mariucci initially shared Regent Bulla's concern regarding the School of Design. It is unusual for this to be in the School of Design, but the reason it is there is because the Dean of the School of Design has the most entrepreneurial enthusiasm for this project and is recognized in the Arizona development community as the most developer oriented of the deans and the marketplace will recognize that and the curriculum is sufficiently multi-disciplinary to truly train people in real estate development.

Regent Bulla then stated that he had questions about Public Programs taking on non-profit leadership and tourism development and wondered how the students would get management training and is it included in the Business School. Milt Glick stated that the program is included with the Business School. There are many students who are crossing between Public Programs and the Business School.

Regent Boice asked if there might be a different way to report on new programs and eliminated programs. For example, the Board could tell each university that every year they have to eliminate 1% of their programs and for each program that they eliminate they have to show the Board why those programs were eliminated. He stated that he felt the universities were much better positioned to evaluate programs than Regents, but he felt that the Regents needed more information. Stephanie Jacobson stated that the Board does receive a report annually on the changes to the number of programs. A program inventory is presented with a five year summary of programs deleted and added to give some idea of the changes that have occurred.

Milt Glick stated that having more programs is critical to a campus that is growing. Every seven years every program is reviewed with outside experts. Th

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