Board Report from Lane Community College President Mary Spilde
Board of Education Meeting
March 9, 2005

Budget

There are several important things I would like to report to you this evening. As always, I will start with the budget. You will recall from the budget plan you approved that we are waiting for several "unknowns" to become "knowns."

• PERS ruling: You will have read that the Oregon Supreme Court has ruled on the PERS legislation. The Court ruled against two key changes by the 2003 Oregon Legislature to reduce the future cost of public employee pensions. The court unanimously ruled that the legislature could not end an annual 8 percent guarantee on investment earnings for workers who joined the Oregon Public Employees Retirement System before 1996. Nor can it freeze all earnings on regular accounts for 2003 until PERS erases the deficit. The court ruled that workers must have money restored to their accounts for 2003, because of the 8 percent annual guarantee for workers enrolled before 1996. It also ruled that the legislature could not cancel cost-of-living increases for about 22,000 workers who retired between April 2000 and April 2004. The justices upheld several other changes, including the legislature's decision to steer future employee contributions into 401(k)-style individual investment accounts and ended variable accounts. The court's ruling upholds the legislative change regarding mortality tables. Despite those rulings-which may require PERS to restore money to some retirees' accounts-Gov. Ted Kulongoski, the speaker of the House, and PERS have said there will be little overall effect on the state's 2005-07 budget.
• The governor and PERS director both said that good investment earnings during the past two years have allowed PERS to build a reserve of more than $1 billion to deal with potential problems and the system will not need to raise contribution rates for the state and hundreds of local government members. However, PERS is saying that the impact on future budgets could be significant. What does all this mean for us? It's too early to tell. We have a little over $3 million in a PERS reserve account and we have budgeted $1.6 million in the 2006 projections to deal with this. It does not look like there will be an impact in the next biennium but we do know that even before this decision, PERS rates were scheduled to be increased significantly for the 2008 fiscal year. It is likely this decision will increase the rate further but we won't know any time soon how much that will be. We will get more information for discussion at the next board or budget meeting about our choices regarding the reserve. I do want to note that it was very prudent of the college to set aside a reserve and I want to congratulate Marie Matsen on her projections. The portion of PERS savings (in OPE points to four decimal places) overturned by Supreme Court was 3.9176 percent. The OPE percent we've been charging in our OPE rate the last two years to cover this eventuality (also to four decimal places) is 3.9150 percent. Can't get any better than that!
• State funding: The second unknown affecting college budget development is the amount that we might receive from the legislature. The state revenue forecast which is up $200 million. The state economist told legislators that higher education was the best place to invest the additional money. There was a minor "hiccup" when the Senate Democrats came out with their own budget and the Ways and Means Committee was suspended. However, that has been resolved and the committee is back on track but we have not seen a co-chair's budget as of today. It appears that the Republicans and Democrats are scrapping with each other about who will give more to community colleges, and that's okay with me. The Senate Democrats had included $428 million for community colleges and at the Oregon Community College Association meeting last week, we heard $420-$428 million. This is certainly better than the governor's budget.
• Community college funding formula: Marie Matsen has continued to work on the funding distribution formula. It is likely that the final outcome will not be exactly the proposal that we made and the committee is still looking for compromise. We are expecting a spreadsheet on the policy elements any time.

I hope to come back to you in April with some of these things closer to being resolved and possibly with a new set of projections.

Bus strike

I want to comment briefly on the LTD strike. Obviously, our students are impacted and as you read in the paper today there are some who feel that we should be doing more. We did explore a number of possibilities but the college is not in a position to run a bus company. We do not have the expertise or resources to do this. However, we understand the hardship it causes for those who usually ride the bus. The Faculty Council discussed this and faculty are doing what they can to assist students. We will restart conversations with LTD about reimbursement since services are no longer being provided. I would simply urge the LTD board and management and the union to get back to the table and work toward a solution.

Nursing program accreditation

Our nursing program received accreditation affirmation for eight years. We received five commendations and seven recommendations. Kudos to the faculty and staff.

Arts division

I would like to introduce Rick Williams, new division chair in the Division of Arts. I hope you will take the time to visit the Downtown Initiative for the Visual Arts for the exhibit titled, "Artists Who Teach," which features our own faculty. I want to acknowledge Tracy Simms and the Marketing and Public Relations Unit who conceived the idea of the show, its theme, as well as the participation of music, dance, theater and culinary students at the opening. My office also provided funding for this effort. Twenty-six Lane artists who teach displayed nearly 100 pieces of artwork in various media including wood, stone, and metal sculpture, painting, drawing, and watercolor, photography, ceramics and fiber art. More than 400 visitors attended the opening. The Division of Arts also introduced their new initiative and brochure based on the theme of Artworks. Drawing on contemporary research in art, psychology and education Artworks recognizes that participating in the arts offers individuals opportunities to enhance their overall creativity, intelligence, problem solving abilities and quality of life. Lane artists who teach are dedicated to introducing these concepts into the Lane community and beyond through curricular innovations that facilitate the highest levels of learning and creativity and demonstrate how Artworks for education, business and the community.

Women's basketball

I want to take a moment to recognize our great women's basketball team. The Lady Titans won their first ever Northwest Athletic Association of Community Colleges Southern Region Title with a league record of 13-1. The following student athletes were selected to the All Southern Region teams: Lisa Fernandez and Cora McVeigh were named to the first team; Ashley Sequeria to the second team; and Kellie Griner was awarded honorable mention. Sally Moore, Ashley Sequeria and Kellie Griner were invited to the Southern Region All-Star Team. The all-star team will be coached by southern region coach of the year, Lane's own Greg Sheley. At the Northwest Athletic Association of Community Colleges championship, the Titans finished second and ended the season with 31 wins, the most in Lane history. The following Titans were named to the All Tournament Teams: Freshman Cora McVeigh to the first team and Freshman Ashley Webber to the second team; Kellie Griner and Corrinne Kaleese were named to the NWAACC All Academic Team. Great job, Titans.

In Memory

Finally, I am sorry to announce that Bernice Staton, our benefactor who donated $2 million to the college for scholarships, passed away last month. Foundation Director Janet Anderson attended the services in Idaho Falls on behalf of the college. Bernice was a generous woman who loved our Staton Scholars. She will be missed.

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