Minutes of the Meeting of the
BOARD OF TRUSTEES
of Northern Illinois University

September 18, 1996

The meeting began at 1:22 p.m. Before the meeting was called to order, Chair Siegel announced that Secretary Myles would administer the oath of office to the new Student Trustee, David Marquez. Former Student Trustee Willie Fowler was also present for the swearing in. Secretary Myles then administered the oath of office to Mr. Marquez.

Mr. Fowler made brief remarks congratulating Mr. Marquez and offered to be of assistance in the future if necessary. Chair Siegel also congratulated Mr. Marquez, noting the importance of his role as the only Student Trustee. Mr. Siegel remarked on the new challenges facing Mr. Marquez, particularly the need to balance his duties as a Student Trustee for students and for the university as a whole, while fulfilling his main purpose at the university, getting an education. Chair Siegel said, "We welcome you and we look forward to your participation on the Board of Trustees...."

Mr. Marquez dedicated his comments to his homeland, Puerto Rico, and to his mother. He thanked S.A. President Ryan Eggert for appointing him and many other people for helping him maintain his humbleness, dedication and focus on serving students.

Mr. Marquez has served in the Student Association for approximately five years. He said he is a person who likes to do research so he knows what he's talking about when a subject comes up. He looks forward to working for the students and the people. In his closing remarks, Mr. Marquez thanked all those who attended the meeting to show their support for him.

Chair Siegel called the meeting to order at 1:28 p.m. Recording Secretary Mimms conducted a roll call of Trustees. Present for the meeting were Trustees Robert Boey, George Moser, James Myles, David Raymond, Manuel Sanchez, David Marquez and Chair Siegel. Not present was Trustee Susan Grans. Having noted the presence of a quorum, the meeting proceeded.

Confirmation of Open Meetings Act notification compliance was given by Board Parliamentarian Ken Davidson.

There were no other announcements. Chair Siegel entertained a motion to close the public meeting to conduct an Executive Session to discuss the following subjects authorized by the Illinois Open Meetings Act: legal and risk management matters as generally described under Section 2(c)(11) and 2(c)(12) of the Open Meetings Act; collective bargaining matters as generally described under Section 2(c)(2) of the Open Meetings Act; and property matters as generally described under Section 2(c)(5) and 2(c)(6) of the Open Meetings Act. Trustee Sanchez so moved, seconded by Trustee Moser. A roll call vote of the Trustees to recess to Executive Session was unanimous.

The public meeting of the Board of Trustees was reconvened by Chair Siegel at 2:35 p.m.

Chair Siegel took a few minutes to report the results of his summer meetings with faculty and staff from various academic and nonacademic departments. Siegel said he had encouraged an open dialogue to allow each department to talk about anything they wanted. His goal was to find out first-hand what issues were important to faculty and to learn about each department. There were some departments with specific issues but the global issues seemed to be mainly about technology - lack of equipment, lack of PC's, connectivity to the university computer backbone, the cost of connections to the university computer backbone, and access charges. Those issues were passed on to the administration and a request for significant additional funds for technology enhancements has been included in the budget request being presented today. Another issue that concerned faculty was the library and the effects some of the budget cuts have had on the ability to obtain journals for research. An enrollment-driven model for funding was discussed and is in the process of being developed. The faculty were very gracious and clearly wanted to be involved in helping to recruit and retain students.

Another global issue of concern to faculty was communication. Siegel said we are all working on increasing the information flow. Other issues included the admission and recruitment process, especially in the area of the graduate school; the funding formula and the fact that NIU receives only 8% of the appropriated dollars but has 12% of the students; deferred maintenance problems; and some areas of program expansion.

Trustee Myles commended the chair for his efforts. Trustee Boey said that he agreed with Trustee Myles and complimented Chair Siegel saying that he thought the university had benefited from the six months of his strong leadership.

President La Tourette noted that items 8.b. and 8.c. should be switched on the agenda. Chair Siegel asked for approval of the agenda as amended. Trustee Moser made the motion and Trustee Myles seconded. The motion was approved.

Trustee Sanchez moved for approval of the Minutes of the June 17, 1996 meeting. Trustee Myles seconded the motion. The motion was approved.

There was no report from the Executive Committee.

Committee Chair Myles said that a meeting scheduled for Rockford had been canceled for lack of agenda items. He had met with a campus committee which will continue to look at issues raised in the Minority Task Force Committee Report completed by a working committee of the Board of Regents. He thanked those on the campus committee.

Committee Chair Boey said the Finance, Facilities and Operations Committee met on September 5, 1996. The Committee accepted informational report on the following topics: (1) the income fund extension bill, (2) the microwave/refrigerator installations, (3) capital project status reports on the residence hall master plan, the recycling center feasibility study, the Center for University Resources for Latinos and Latin American Studies, the campus child care feasibility study and the West Campus Master Plan. An informational report on heavy rainfall and flood damage was also given. The following action items were endorsed by the Committee and recommended for approval by the Board: (1) the Fiscal Year 1997 Internal Operating Budget, (2) FY98 Budget Guidelines to be used for development of the university budget requests to the Board of Higher Education and the State legislature, (3) the FY98 Capital Budget Request, and (4) the real property lease for the School of Art. A presentation was given on the West Campus master Plan. Representatives from First Chicago Capital Markets and the law firm of Chapman and Cutler presented detailed information regarding the issuance of government bonds to support the projects being undertaken. The Resolution authorizing this financing was recommended to the Board for approval at this meeting along with the other action items described above.

Committee Chair Moser stated that the Legislation, Audit and External Affairs Committee met at 11:30 a.m. in the Regency Room. An extensive report was received from Kathy Swanson, the university's government relations representative, outlining the Governor's actions on higher education-related legislation which passed the General Assembly this past spring. House Bill 2836, permitting Illinois public universities to retain tuition revenues locally, was passed by the General Assembly and signed into law by Governor Edgar on August 2, 1996. Moser thanked Board Chair Myron Siegel and the other members of the Board for their efforts in behalf of this legislation. Chair Moser stated, "It has been said that, next to the bill creating independent governing boards for each public university, this was the most important piece of legislation affecting higher education in over 40 years." He noted that the legislation was sponsored by DeKalb's own legislators, Representative Dave Wirsing and Senator Brad Burzynski and thanked them for their leadership on such important issues. Moser also thanked President La Tourette for his persistent leadership on this issue over the last few years as well as Dr. Eddie Williams, Senior Vice President for Finance and Facilities, and Kathy Swanson, Assistant to the President for Government Relations, for all of their hard work and the countless hours they spent responding to legislative and executive branch staff inquiries about the bill, attending meetings, traveling to Springfield to alleviate concerns and answer questions. All of these actions were crucial to the success of this legislation.

Kathy Swanson, in conjunction with NIU Foundation government relations consultant Craig Burkhardt, presented the outstanding higher education-related issues remaining for the Veto Session. The Governor utilized his amendatory veto powers on House bill 2406 which contains the University of Illinois at Chicago's redevelopment initiative. The Governor recommended that the legislature eliminate the quick-take provisions as well as the exemptions from state approval granted the university in the original legislation. The Governor also set very clear parameters for the utilization of revenues generated from such a redevelopment initiative. These include demolition, land and property acquisition, utility extension and streetscape work. The legislature is expected to support the Governor's changes when it convenes during the Veto Session in November.

Chair Siegel said that a recent report in the Northern Star, stating that Trustee Moser as Chair of the Legislation, Audit and External Operations Committee, had appointed a task force for the radio station was erroneous. Upon investigation, Chair Siegel found that the "task force" was an ad hoc committee from Development and University Relations appointed prior to the March 19 meeting of the Legislation, Audit and External Affairs Committee.

Chair Siegel reported that he had been asked to attend a meeting along with all the state university board chairs on September 30.

Trustee Myles reported that the agenda for the last meeting of the Merit Board was very light. No cases were presented from NIU or any of the other universities. There is a meeting planned for September 25 with an extensive agenda, but no cases from NIU.

Trustee Boey stated that the Foundation Board was scheduled to meet next week.

Chair Siegel recognized UAC Representative Charles Larson. Dr. Larson thanked Chair Siegel on behalf of the many departments he visited during the summer. He said this initiative was unprecedented on campus and that the issues highlighted with regard to improving the flow of information was welcome news. He also said that an informal poll from his class of 105 students regarding the recent installation of the combination microwave/refrigerator units in the dorms received a resounding thumbs-up.

Chair Siegel said he was glad to hear that. He stated that he tries to maintain an open relationship with all the UAC members. In looking at the Board minutes for June 19, he noted the section regarding the Board Regulations that were presented to UAC for their input and Dr. Larson's comments that this was the kind of relationship and collegiality that they had hoped for when the organization was formed. Dr. Larson said that was still true.

President La Tourette requested that the Board of Trustees approve the FY97 Internal Budgets for the university as summarized, following the recommendation of the Finance, Facilities and Operations Committee in its meeting on September 5. That recommendation included endorsement of the procedures used and the FY97 salary adjustments awarded faculty and staff as administered by the university through the President. As a result of suggestions made by the Finance and Facilities Committee, FY96 data was included for a comparison between FY96 and the FY97 budget. The budget for FY96 was $136,843,900 and expenses were estimated at $136,051,600. The reason for the $800,000 difference, President La Tourette stated, is that when the university was under the previous budget development procedure, prior to the income fund bill, enrollments had to be estimated from 18 months to two years in advance of the fiscal year. He then asked the Board to approve these internal budgets.

Trustee Raymond said the itemized comparison was very helpful and questioned why there had been so much discussion about the need for improved maintenance and deferred maintenance of property when the chart showed that actual expenditures for 1996 came out below what was budgeted for repair and maintenance and other capital improvements. Dr. La Tourette explained that the university has always tried, as much as possible, to provide a great deal of funding for repairs, maintenance and other kinds of improvements but, given the tightness of the budget, those things could not be done and decisions to address higher priorities had to be made during the year.

There being no further discussion, Chair Siegel asked for a motion approving the FY97 Internal Budget. Trustee Boey so moved and Trustee Sanchez seconded. The motion passed.

President la Tourette introduced this item stating that this report was a result of the implementation of the guidelines the Board established relative to salary increments. The university was authorized to implement the salary increments associated with the funds provided by the General Assembly, as well as a one percentage point pool of funds referred to as a "market equity distribution pool." Included in the administration of salary increases were the traditional faculty and staff promotions

The university is attempting to achieve salary averages which are comparable to national averages at similar institutions. President La Tourette said he was very pleased that this Board allowed the identification of funds to move us toward reaching at least those averages.

Dr. La Tourette said that partly as a result of the visits undertaken by the Chair during the summer, the budget items reflect some of the input received from faculty and staff. The first item the university recommended the Board approve was a request for a 5% faculty and staff salary increase. Once approved, this request will go to the Illinois Board of Higher Education, which will align all the requests of the various public universities in order to make one consolidated request that would typically be approved at the January meeting of the Board of Higher Education and then sent to the Governor and the legislature. An appropriations bill, approved by the legislature and the Governor, will come out in September.

The other budget items requested were a 4% general price increase to meet the increased costs of goods and services; a 5% utility increase to cover projected increases in utilities; a 10% increase for library acquisitions, materials and technology; an increase of $342,900 to provide sufficient funds to meet mandated contributions for Medicare; an increase of $514,700 to provide sufficient funds to meet mandated payments for sick leave payouts; $3.4 million for program improvements including expansion of access to computer technology for faculty, staff and students; and deferred maintenance.

The formula we are proposing to determine deferred maintenance needs on an annual basis is an amount equal to two-thirds of one percent of the replacement cost of the facilities on the university campus. This would generate $3 to $4 million per year for NIU. For this first year, the university requested an additional $1.5 million, or about half the real deferred maintenance need. This is a question of interest to legislators as well as the universities, so it is hoped that some kind of formula will emerge from the legislative discussions.

Moving to another funding issue, the president noted that Congress had recently acted to increase the minimum wage and that bill was approved by President Clinton. However, no funds were provided for this mandate in the FY97 budget because the new rates became effective long after the budget process started more than a year ago. It is estimated that the cost of increasing the minimum wage in two steps, to $5.15 an hour at Northern Illinois University, would be approximately $425,000. Of that $425,000, about $260,000 would be in the appropriated budget; the rest would be in the nonappropriated budget. Therefore, President La Tourette requested an additional $260,000 for FY98 to cover the increased cost of minimum wages. Because this issue had to be dealt with so late, President La Tourette said he would start meeting with some of the student leaders to talk about how to address the funding situation this year. Students may have to trade off a higher minimum wage for a lower number of hours worked. Complicating this issue is the number of students on work-study funds who have already had their financial aid packages put together for current fiscal year.

Chair Siegel asked for a motion to approve the FY98 Budget Guidelines. Trustee Moser so moved, Trustee Myles seconded. The motion was approved.

The FY98 Capital Budget request included basic capital budget requests and requests for repair and renovation projects. President La Tourette explained that a number of these items represent what was called "Build Illinois" under Governor Thompson. That program was initiated to provide some support to maintain facilities in which the state had invested for a number of years. Nine of the major capital projects presented had not been funded for two years, since the two-thirds vote in both sections of the General Assembly necessary to raise the State's bond ceiling had not been secured, thus causing a tremendous backlog of capital projects. Those problems are shared by a whole range of state agencies, including the corrections facilities. It was hoped that after the November elections that logjam might be broken and additional funding made available to universities, not only for repair and renovation, but also for major capital projects. President La Tourette went on to give a brief description of each of the items contained in the Capital Budget Request: Altgeld Hall renovation; storm water management and flood control project, Phases I and II; Founders Library basement build-out; East Campus chilled water production and distribution; campus infrastructure improvements; Stevens Building renovation; Montgomery Hall HVAC system rehabilitation; College of Business, Wirtz Hall renovation, Phase II; elevator rehabilitation and renovation; Williston Hall roof replacement; Faraday chilled water connection; Theatre Arts, rigging system replacement; East Campus water main loop, Altgeld section; and ADA, signage completion project.

President la Tourette asked Board approval of the above mentioned FY98 Capital Budget Requests projects.

Chair Siegel asked for a motion to approve the FY98 Capital Budget. Trustee Sanchez made the motion, seconded by Trustee Myles. The motion was approved.

President La Tourette explained that the School of Art required additional studio space for the sculpture program and some of its other related programs.

Chair Siegel asked if the university had been guaranteed it was receiving the lowest available rate. Dr. Williams and Dr. La Tourette both stated that it had and that the contract had been negotiated at a rental rate per square foot equivalent to rates for comparable property in the area.

Chair Siegel called for a motion to approve the proposed lease. The motion was made by Trustee Boey and seconded by Trustee Raymond. The motion was approved.

Chair Siegel stated there would be a couple of presentations which would be timed and held to ten minutes each.

President La Tourette stated that the university was asking that the Board fully endorse the bond offering issue which had been discussed for the past few months with the Finance, Facilities and Operations Committee and that the full Board and refer it to the Executive Committee for final action when appropriate after the student advisory referendum which had been scheduled for early the following week. He made a brief introduction to the presentations.

Mr. Swinford and Mr. Dale Sasson were present from the firm of Johnson, Johnson & Roy of Chicago, which was retained by the university to develop a tentative master plan for the West Campus. Mr. Swinford said the goals of the master plan were to identify sites for both near-term and potential long-term development and to enhance the quality of life for residents of the West Campus. A framework plan was developed with the help of a campus committee, and a long-term, detailed master plan will be developed from this framework plan which should be completed no later than early 1997. Five organizational concepts used to accomplish the West Campus framework plan were: finding a location for the child care center; finding a location for the new recycling center; locating intramural field space; storm water management improvements; and overall campus open space improvements. Some of the most important problem areas brought to the Committee's attention were multiple pedestrian/vehicular conflict points, including the duplication of vehicular routes from the West Campus to the main campus, and quality-of-life spaces on the West Campus not being comparable to those found in other parts of NIU. [This presentation was given in whole to the Finance, Facilities and Operations Committee. For more detail, refer to Agenda Item 6.d.(5) - West Campus Master Plan, in the September 5, 1996 Minutes of the FFO Committee.]

Michael Boisvert, a representative from the First Chicago Capital Markets, Inc., gave a presentation on the proposed bond issue financing. The bond issue would consist of two parts - approximately $36 million for new projects (Stevenson Tower renovations, the recycling center, the child care facility, the Latino Center and some West Campus improvements) and approximately $12 million to refinance existing 1985 bond issue debt. Mr. Boisvert stated that refinancing the 1985 bond issue raised anticipated savings to approximately $525,000 as of this meeting date. [This presentation was also given in whole to the Finance, Facilities and Operations Committee. For more detail, refer to Agenda Item 7 - Bond Offering, in the September 5, 1996 Minutes of the FFO Committee.]

Dr. La Tourette thanked both presenters and underscored the lower cost of bond issuance which represented approximately a third of the cost for the last bond issue of the Board of Regents. The President then asked the Board to approve the bond issue to be recommended to the Executive Committee for appropriate action.

Chair Siegel asked for a motion to approve the resolution for the bond offering subject to Executive Committee final approval on the terms set forth in the resolution. Trustee Boey made the motion, seconded by Trustee Moser. The motion was approved.

President La Tourette stated that this agreement had been negotiated within the guidelines established for employees and incorporated merit, market equity and other base increases fully consistent with university fiscal guidelines already approved by the Board.

Chair Siegel asked for approval of the item. Trustee Sanchez so moved and Trustee Raymond seconded. The motion was approved.

Chair Siegel asked the Board if there was any discussion of these information items on the agenda. There was none.

Chair Siegel asked for approval of the Board Regulations, Section I, Academic Programs, that had been rewritten and discussed with UAC. Trustee Raymond so moved, seconded by Trustee Boey. The motion was approved.

Chair Siegel added one other matter to the Chair's Report. He asked the Board to ratify the following resolution, concerning the acquisition of the property of Rosemary Greek Neale, which was duly approved by the Board of Trustees Executive Committee in Executive Session on June 6, 1996.

Resolution

Legal Description of the Greek property: Rosemary Greek Neale (property owner), Tax Identification Number: 08-21-226-002-0000

A part of the Northeast 1/4 of Section 21, Township 40 North, Range 4, East of the Third Principal Meridian: beginning on the east line thereof at the northeast corner of Lot 4 of Willard Orchard Subdivision, thence west along the north line of said Lot 4, 289.8 feet; thence north and parallel to the east line of said Section 21, 361 feet; thence easterly 290 feet to a point on the east line of Section 21, 371.8 feet north of the point of beginning and 458.5 feet south of the northeast corner of said Section 21; thence south 371.8 feet along said east line to the point of beginning; (excepting therefrom a part of the Northeast 1/4 of Section 21, Township 40 North, Range 4, East of the Third Principal Meridian, described as follows: beginning at the east line of Section 21 at the northeast corner of Lot 4 of Willard Orchard Subdivision; thence northerly along said Section line, a distance of 109.45 feet to the point of beginning; thence continuing northerly along said Section line, a distance of 262.35 feet to a point, which point is 458.5 feet southerly of the northeast corner of said Section 21; thence westerly at an angle of 87 degrees 55 minutes measured clockwise from the last described course, a distance of 289.5 feet to a point; thence southerly at an angle of 92 degrees 05 minutes measured clockwise from the last described course, a distance of 252.5 feet to a point; thence easterly at an angle of 89 degrees 51 minutes measured clockwise from the last described course, a distance of 289.55 feet to the east line of Section 21 and the point of beginning), situated in DeKalb County, Illinois.

Trustee Sanchez made the motion to ratify approval of the resolution concerning acquisition of the Rosemary Greek Neale property, seconded by Trustee Raymond. The motion was approved.

The Chair then asked for a motion from the Board of Trustees to ratify the following resolution concerning the acquisition of the property of Ruth A. Gau, which was duly approved by the Board of Trustees Executive Committee in Executive Session on June 6, 1996.

Resolution

Legal Description of the Ruth A. Gau property: Ruth Alyce Gau (property owner), 131 Annie Glidden Road, DeKalb (DeKalb County), Illinois. (Tax Identification Numbers 08-21-276-008-0000, 08-21-276-009-0000, 08-21-276-010-0000, 08-21-276-011-0000)

The south 108.708 feet of the north 208.708 feet of the east 366.292 feet of Lot 5 of Willard Orchard, a subdivision of a part of the northeast 1/4 of Section 21, Township 40 North, Range 4, East of the Third Principal Meridian, situated in DeKalb County, Illinois;

and the south 200 feet of the north 408.708 feet of the west 208.708 feet of Lot 5 of Willard Orchard, a subdivision of a part of the northeast 1/4 of Section 21, Township 40 North, Range 4, East of the Third Principal Meridian, situated in DeKalb County, Illinois;

and the south 100 feet of the north 308.708 feet of the east 366.292 feet of Lot 5 of Willard Orchard, a subdivision of a part of the northeast 1/4 of Section 21, Township 40 North, Range 4, East of the Third Principal Meridian, situated in DeKalb County, Illinois.

Trustee Boey made the motion to ratify the resolution concerning the acquisition of the property of Ruth A. Gau, seconded by Student Trustee Marquez. The motion was approved.

Chair Siegel reminded the Board members that their presence would be needed at the December 15 graduation ceremonies.

The next meeting of the Board of Trustees is scheduled for December 11.

The Chair asked for a motion to adjourn. Trustee Sanchez so moved; Trustee Moser seconded. The motion was approved.

The meeting was adjourned at 3:56 p.m.

Respectfully submitted,

Sharon M. Mimms

Recording Secretary