; : I ••! MINUTES OF THE INFORMAL MEETING of the BOARD OF TRUSTEES 7:30 p.m., July 16, 1970 ^Present: Trustees Hartman, Huff, Martin, Merriman, Nisbet, Stevens, Thompson, and White; •i. h | | -.President Wharton, Provost Cantlon, Vice President Wilkinson, Executive Vice President and Secretary Breslin, Assistant to the President Ballard, Attorney Carr, Vice President Dickerson, Assistant Provost Herman King, Vice President Muelder, Vice President Perrin. • jAbsent: No one. Presentation jln the open session of the informal meeting, Dr. Frank J. Blatt, Treasurer of the MSU by Frank Blatt [Chapter of the American Association of University Professors (AAUP), made a brief presenta- ition concerning faculty salaries. Dr. Blatt said there were two questions which must be ' re faculty taken into account when the University arrives at an equitable salary structure for faculty: salaries 1. What are the needs of faculty and what is just recompense for services in light of \ experience and educational investment of MSU faculty? 2. Based on the premise that MSU shall continue to follow the path toward excellence, can the University obtain the goal of national recognition and maintain a salary structure which ivs seriously deficient particularly at the higher ranks? Dr. Blatt stated that a salary adjustment of 8% is needed to meet increased cost of living for MSU faculty. He also added that faculty over the age of 45 or 50 are currently punished ifor their longevity and their lower mobility. Salaries for associate professors and full professors at Michigan State are much lower than those at similar institutions both within and without the Big Ten universities. Dr. Blatt indicated that most faculty members are encouraged and pleased by the establishment of the new standing committee on faculty compensation at MSU. He added that faculty hope this committee will be widely consulted :on all budget matters. Presentation |in the closed session of the informal meeting of the Board, Dean Andrew Hunt and Neil Bracht re development |of the MSU College of Human Medicine made a presentation on the development of a teaching of Teaching Hospital hospital at the University. ! President Wharton and Provost Cantlon indicated that the University had given a preliminary commitment to HEW that matching funds totalling almost $26 million would be found. Final assurance on this is required by January 1971. The Executive Group was generally pessimistic regarding the prospects of raising such funds either from public or private sources in the purrent economic situation, but they did not wish to reject the HEW offer without the guidance of the Board of Trustees. Dr. Hunt had been asked to attend the meeting and make a presentation regarding the teaching hospital and his proposed changes in its original format. Dr. Hunt commented on the amount of growth in various academic departments and colleges brought about by the establishment of the College of Human Medicine. He added that the College's movement toward a four-year school will be approached in the same manner. Dean Hunt reviewed with the Board the steps that the College has taken toward the development jof a teaching hospital. He indicated that the College feels the hospital must be built and designed so that it is one which contributes towards improving medical care through research and decreasing the cost of in-patient and out-patient medical care. He also stated that it is well within the realm of possibility and feasibility that the MSU teaching hospital could become self-supportive and could very easily become self-liquidating in part. Mr. Bracht discussed the research that has been conducted concerning the community interest in a teaching hospital and the movement toward prepaid hospitalization plans. He added that local UAW and credit unions have held meetings on this subject and have asked for participants from the College of Human Medicine. Dean Hunt said that there is every indication that some time this year the U.S. Congress will pass legislation establishing a strong movement toward prepaid hospitalization and that there is general agreement nationwide that this is the direction a new medical school should follow. Trustee Stevens said that this kind of insurance would mean a lot more coverage for students and young people than is currently available through Blue Cross and Blue Shield. Dean Hunt discussed with the Board the possibilities of financing the project through foundations and private sources as well as federal funds. Secretary Breslin indicated that there was currently very little support for a teaching hospital in the Michigan Legislature and that support must be sought outside the State Government. Trustee Stevens stated that the administration and the College of Human Medicine start immediately to explore the possibility of support for the project. Trustee Stevens added that the Board should encourage the administration to explore funding possibilities so that by September or October the Board would have a better idea as to what are MSUfs chances of financing the teaching hospital. Trustee White stressed the need for making the appeal of the program statewide and not just for the local area. He added that more work should be done in the area of continuing education for practicing doctors so that cases could be treated locally rather than referred to teaching hospitals. Dean Hunt indicated that the College of Human Medicine had already made good inroads in both the area of involving more than the local community in planning for a teaching hospital and in working closely with the needs of doctors throughout the state. (_ ^ ^ I B I Minutes of the Informal Meeting, continued July 16, 1970 Presentation by Dean Hunt, continued Trustee Thompson indicated his support for Dean Hunt's approach in developing a teaching hospital and the idea that the administration explore funding possibilities. Trustee Martin said he was highly impressed with the College of Human Medicine and the approach being developed for establishment of a teaching hospital at the University. Trustee Merriman commented that MSU must make greater efforts in generating support for a teaching .. hospital as soon as possible. Trustee Nisbet stated that private foundations are inter- ested in new approaches and that the innovations planned for the hospital should bring about support. Trustee Hartman endorsed Dean Hunt's approach to the establishment of a new teaching hospital. Trustee Huff said that the need for involving top people off campus in developing financial support for the hospital is great and should be undertaken immediately. Based on the suppor of the Board, the administration was instructed to engage in planning funding for the MSU teaching hospital. MINUTES OF THE MEETING of the FINANCE COMMITTEE July 16 and 17, 1970 President Wharton called the Finance Committee meeting to order at 8:40 p.m., July 16, at Kellogg Center. The following members were present: Trustees Hartman, Huff, Martin, Merriman, Nisbet, Stevens, Thompson, and White; President Wharton, Executive Vice President and Secretary Breslin, Vice President Wilkinson, Provost Cantlon, Assistant to the President Ballard. Absent: No one. 1. Investment recommendations from Scudder, Stevens & Clark and Mr. George Cress as follows: I Investment recommendations 1 >I 1 'I I Bouyoucos Graduate Fellowship Amount Security Recommend selling: 150 shs. 100 shs. 400 shs. Sterling Drug Eastman Kodak Pan American Airways Recommend purchasing: $10,000 100 shs. Michigan Bell Telephone Ford Motor Co. Consolidated Investment Fund Recommend selling: $25,000 Federal Nat'l Mortgage Assoc. Part. Ctf. 4-1-81 1,050 shs. Sterling Drug Redeem: Up to $74,000 Ford Motor Notes Oakland University Transfer Approx. Price Principal Income Yield. $ 32 60 8 $ 4,800 6,000 3,200 $ 112 116 80 2.3% 1.9% 2.5% 99 42 78 32 9,900 4,200 862 240 8.7% 5.7% 19, 500 1, 313 33, 600 787 000 74, Approximately $115,000 Forest Akers Fund Recommend purchasing: 215 shs. Capital Holding Corp. Class of 1915 Fund Recommend selling: 218 shs. Sterling Drug Recommend purchasing: Up to 300 shs. Capital Holding Corp. John A. Hannah Professorships Recommend selling 780 shs. Sterling Drug Recommend purchasing: Up to 1,085 shs. Capital Holding Corp. 23 4,945 86 1.7% 32 23 32 23 6,976 163 2.3% 6,900 120 1.7% 24,96.0 585 2.3% 24,955 434 1.7% Finance Committee Meeting minutes, continued July- 16,-1970 1. Investment recommendations, continued Retirement Fund Amount Security Recommend selling: 9,000 shs. Sterling Drug Recommend purchasing: Up to 18,000 shs. Capital Holding Corp. F. A. & E. G. Simons en Fund Recommend selling: 202 shs. Sterling Drug Recommend purchasing: Up to 280 shs. Capital Holding Corp. Approx. Price Principal Income Yield $ 32 $ 288,000 $6,750 2.3% 23 414,000 7,200 1.7% 32 23 6,464 151 2.3% 6,440 112 1.7% 1 f ;0n motion by Mr, Huff, seconded by Mr. Stevens, it was unanimously voted to approve the ^investment recommendations. 1-yr extension ;2. of loan for Trust 6560 approved \ 1 Vice President Wilkinson presented Mr. George Cress and Mr. William Broucek of the Ann Arbor Trust Co. to discuss Trust 6560. This Trust covers the construction of Holden Hall and the refinancing of the Brody Group of dormitories. At the June 1970 Board meeting the Trustees approved a one-year loan with the National Bank of Detroit at a rate of 5X. The balance on this loan is approximately $4,500,000. The Trustees reaffirmed the action they had taken at the June Board meeting relative to the Trust. 2-yr contract Local 1585 3. Executive Vice President Breslin presented for the Board's consideration and approval: jAFSCME approved: A. Two-year wage contract with Local 1585 Council 7 AFSCME, AFL-CIO, effective July 1, 1970 and expiring June 30, 1972. I 3-yr contract \ I Local 547 Oper. i Engineers approved B. Three-year contract with International Union of Operating Engineers AFL-CIO Local 547, effective July 1, 1970, expiring June 30, 1973. :0n motion by Mr. Nisbet, seconded by Mr. Merriman, by a vote of 7 to 0, the two-year contract with Local 1585, Council 7 AFSCME, AFL-CIO was approved. Mr. Stevens asked to be recorded as not voting. ;0n motion by Mr. Huff, seconded by Mr. Merriman, by a vote of 7 to 0, the three-year contract with the International Union of Operating Engineers AFL-CIO, Local 547, was approved. JMr. Stevens did not vote. Copies of these contracts are made a part of these minutes and are on file in the Secretary's Office. New salary ranges for nursing per- sonnel approved |4. ; Executive Vice President Breslin presented for the Board's consideration and approval the following proposed new salary ranges for nursing personnel. Title Minimum Step 1 Step 2 Step 3 Maximum j ! Nurse Licensed Practical Nurse Head Nurse ; Nurse Supervisor $ 7,406 5,555 8,817 9,346 $7,706 5,780 9,117 9,646 $8,006 6,005 9,417 9,946 $8,306 6,230 9,717 10,246 $ 8,606 6,455 10,017 10,546 The current salaries of the nursing personnel can be fitted into these recommended ranges without granting any special increases. The step increases shown above amount to approxi- mately $300, which would be granted each January. This is approximately what the nurses I ; ; \' were receiving under the old system. : The salary ranges for the head nurses and the nurse supervisors represent an upgrading of one pay range under our present system, since it was noted that we were in a poor competi- tive position in the nursing supervisory brackets. It is hoped that, with the establishment of these ranges, the salaries of the Health Center nurses may be kept more in line with the local rates paid in our hospitals. ; ;0n motion by Mr. Nisbet, seconded by Mr. Huff, it was unanimously voted to approve the new salary ranges for nursing personnel. I f Finance Committee Meeting minutes, continued July 16, 1970 5. Vice President Wilkinson recommended the awarding of a contract and approval of the budget for a major alteration to the milking parlor at the Dairy Research Center. The following bids were received on May 29, 1970: : Contractor McNeilly Const. Co., Inc. Charles Featherly Const/ Haussman Const. Co. Base Bid $79 85 95 ,468 ,760 ,650 Alternate #1 Deduct Alternate #2 Deduct $500 370 700 $3,265 3,265 3,300 McNeilly Const, Co. awarded contract for alterations to Dairy Research Ctr; budget for project approved The low bid exceeded the original estimate and the bulletin change was issued as a deduct in the amount of $1,067 plus accepting the two deduct alternates brings the adjusted contract to $78,401. It was recommended that a contract be awarded to the McNeilly Construction Company in the amount of $78,401 and that the following budget be approved. Contract with McNeilly Construction Co., Inc. Contingencies Engineering and Supervision Total anticipated cost $78,401 4,999 6,564 $89,964 Funds have been provided from account number 41-4307 which includes an allocation from the Experiment Station funds and the USDA Facility funds. On motion by Dr. Martin, seconded by Mr. Huff, it was unanimously voted to approve the con- tract for the alterations to the milking parlor at the Dairy Research Center and the budget for this project. 6. Vice President Wilkinson presented for the Board1s consideration and approval the reorganization of his office. Under the new organization for the Office of the Vice President for Business and Finance, Mr. Emery Foster becomes Professor and Assistant Vice President for Business Operations, and Mr. Stephen H. Terry becomes Assistant Vice President for Finance and Assistant Treasurer, effective August 1, 1970. :Re or gani z a t i on !of Office of V.P.for Bus. & Fin. Office space to •be made avail- able in Int.Ctr. for Mich.Part- ners of the Alliance Approval appropriation of $75,000 for Fed. Educ. Oppor. Grant program On motion by Mr. Thompson, seconded by Mr. Stevens, the above changes were unanimously approved. 7. President Wharton and Provost Cantlon presented for the Board's consideration and approval a recommendation that office space be made available in the International Center for the Michigan Partners of the Alliance. On motion by Mr. Hartman, seconded by Mr. Nisbet, it was voted to approve the above recommendation. Mr. Huff did not vote, - 8. The following is a report and recommendation by Vice President Wilkinson on the financial activity of the Federal Educational Opportunity Grant program for the 1968-69 and 1969-70 fiscal years: 1968-69 Initial grant year Renewals University scholarship funds applied toward program 1969-70 Initial year Renewals University scholarship funds applied to initial year grant University grant funds applied to renewal grants Recommended special appropriation Grant $ 493,430 652,500 $1,145,930 Estimated Expenditures $ 600,659 508,693 $1,109,352 $ $1 577, 485, ,062, 194 739 933 $ $1 699 806 ,505 ,228 ,568 ,796 $ 95,384 275,000 370,384 72,479 Estimated Expenditures in Excess of Grant $107,229 - 0- $107,229 107,229 $ -0- $122, 320, $442, 034 829 863 442,863 $ -o- It was recommended that a special appropriation of approximately $75,000 be approved to fund the balance of the Educational Opportunity Grant program, subject to final Federal and Ernst & Ernst audit and that the University funding of the program be approved. On motion by Mr. Nisbet, seconded by Mr. Huff, it was unanimously voted to accept the report and approve the appropriation as recommended by Vice President Wilkinson. I I t 1 t Finance Committee Meeting minutes, continued July 16, 1970 Additional $7128 from Smith Lever Act allo- cated to Coop. Ext. Serv. 9, The University received an additional $7,128 from the Smith-Lever Act for the • Cooperative Extension program for the 1969-70 fiscal year. It was recommended that the Trustees approve the acceptance of this additional revenue. Funds were allocated to account number 71-7300. On motion by Mr. Huff5 seconded by Mr. Hartman, it was unanimously voted to approve the recommendation in item 9. New salary schedules for 01-Tech and AP employees approved as part of 1970-71 budget 10, The Executive Vice President recommended the new schedules of salary rates for Clerical- Technical and Administrative-Professional employees to be effective July 1, 1970. CLERICAL TECHNICAL SCHEDULE OF CLASSIFIED SALARY RATES BY GRADES Effective July 1, 1970 Annual Salary Months Merit Increases Grade Min. Max. Difference 6 12 16 24 30 36 42 48 54 60 66 72' 78 84 II I $4763 $5519 4889 5771 III 4952 5897 6224 5632 6640 IV 5153 V VI VII VIII IX X XI XII 7232 5783 7434 5985 8606 6716 7430 9362 8064 10017 8656 10546 9185 11327 $756 882 945 1071 1008 1449 1449 1890 1932 1953 1890 2142 60 60 60 60 60 60 60 60 60 60 60 60 36 60 60 60 60 60 60 60 60 60 60 60 60 75 87 60 60 60 60 60 60 60 60 60 60 75 90 90 90 60 60 60 60 60 60 60 60 60 60 120 120 120 111 60 60 60 60 60 60 60 60 60 60 90 120 120 78 Years 180 180 240 240 240 240 240 180 180 240 240 240 240 300 180 180 240 240 300 240 300 240 240 300 300 300 300 300 240 240 300 300 300 300 360 240 240 300 300 300 300 360 189 189 270 312 273 270 282 PROPOSED SCHEDULE OF AP RATES BY GRADES Effective July 1, 1970 Impr ovement s in University Retirement Program Proposed Merit Increase Plan AP Level I II III IV V VI VII VIII IX X New Min. New Max. •Dif ..* 1 Yr. 2 Yr. 3 Yr. 4 Yr. 5 Yr. 6 Yr. $ 8380 8910 9310 10040 10770 11500 12630 13890 15150 19080 $ 10640 11300 12240 13100 13970 14960 16490 18680 21030 $2260 2390 2930 3060 3200 3460 3860 4790 5880 $380 400 490 510 530 580 640 800 980 $380 400 490 510 530 580 640 800 980 $380 400 490 510 530 580 640 800 980 $380 400 490 510 530 580 640 800 980 $370 400 490 510 540 570 650 800 980 $370 390 480 510 540 570 650 790 980 *5% rounded to next $10 After discussion, it was agreed that this item would be tabled until the July 17 meeting, at phich time it would be considered as part of the total University budget, (gee page 6863) 111. The Retirement Committee recommended: A. Approval of an increase of $300 a year on the basis of Plan 1 to all current retirees, effective July 1, 1970. B. Approval of an Increase In the maximum annual retirement salary an individual may receive from $3,000 to $3,300, effective July 1, 1970. C. Approval in principle of changes In the computation of service credits and benefits as follows: (1) Change the service credits for the first 10 years of service from 17* for each year of service to 1%% for each year of service, (.2) Eliminate the 10% increment currently added to the base pension if the pension is below $3,000 or the individual has frozen his service credits and is In the TIAA retirement program. 1 I \ \ (3) Retain the present computation of service credits beyond the first 10 years of service at 2% for each year of service. D. That implementation of recommendation C be delayed until the 1970 actuarial study of ! the retirement program is completed. After discussion, it was agreed that this Item would be tabled until July 17 and at that time become part of the total University budget for the fiscal year 1970-71. (See page 6863) i I i Finance Committee Meeting minutes, continued July 16, 1970 12. It was requested that the Trustees authorize the opening of two bank accounts at the Pontiac State Bank to be used to account for the operations of the College of Osteopathic Medicine. {Two bank accts jfor Col of jOsteopathic Med jopened at One account will be used as a depository account in which all receipts of the College jPontiac State of Osteopathic Medicine will be deposited. Vice President Wilkinson and Assistant Vice iBank President Terry will be the authorized signatures to draw funds on this account. j The second account will be an imprest cash checking account not to exceed $705000 in \ balance. The authorized signatures on this account will be Annette Sproull, Comptroller of the College of Osteopathic Medicine^ and FloydeSBrooker, Administrative Officer. 1 Vice President Wilkinson and Assistant Vice President Terry will also be authorized to | ] sign for disbursements from this account. On motion by Mr, Nisbet, seconded by Mr. Huff, the two bank accounts for the operations of | 1 the College of Osteopathic Medicine were unanimously approved. 13. The individuals who were employed by Michigan College of Osteopathic Medicine on June 30, 1970 and who have not already been terminated will be considered temporary employees of Michigan State Urwersity effective July 1, 1970. Their salary and wage levels will be at the same rate as prior to June 30, 1970 except that employees of one year or morejof Osteopathic service may receive raises of the same average level as their counterparts on the East Med employees Lansing campus. Any terminations of hourly workers, CT or AP personnel shall require a Sin transfer of |College to MSU 30-day written notice to the employee. Procedures app for continuation Faculty terminations or reappointments, the latter either in or outside the Michigan State University tenure track, will be reported as special items to the MSU Board of Trustees for action prior to the end of the current fiscal year. . All new appointments subsequent to July 1, 1970 will be processed through the East Lansing campus in conformity with normal MSU procedures. \ [ [ j j On motion by Mr. Thompson, seconded by Mr. Stevens, it was unanimously voted to approve the above procedures. 14. President Wharton discussed with the Trustees his desire to accept an appointment to the Board of Directors of the Museum of Modern Art. He further indicated that his directorship of The American Agricultural Economics Association expires this summer. On motion by Mr. Thompson, seconded by Mr. this membership. Stevens, it was unanimously voted to approve 15. President Wharton' suggested to the Board that he thought it would be appropriate for the Board to have a two-day special meeting or retreat early in September. He also suggested a number of items that should be included in the agenda for that meeting. After discussion it was agreed that the Board would,meet September 3 and 4 for a special meeting. The agenda for this meeting will be prepared by President Wharton and the admin- istrative staff along the lines of his July 16 memorandum to the Trustees. This meeting will convene with a luncheon Thursday, September 3, with adjournment to be late afternoon on-j September 4. It was further agreed that the regular September Board meeting will be held on | Wednesday and Thursday, September 16 and 17. Finally, it was agreed that the December Board ; j meeting would be held Thursday and Friday, December 10 and 11. ;Pres. Wharton1 s lappt to Bd of JDir of Museum of Modern Art approved jSpecial Board meeting to be held Sept. 3 & |4; Dec meeting jtb.be- 10th and illth 16. President Wharton presented to the Board two information papers: A. Statement on Enrollment and Admissions B. Issues and problems of Dormitory Occupancy. 17. On Friday morning, July .17, in a continuation of the Finance Committee -meeting,. President Wharton asked Vice President Wilkinson and Provost Cantlon to review for the Board the proposed'budget, proposed fee schedule, ;'and proposed dormitory rates for the fiscal year 1970-71. Following this general:'discussion, the Board asked to meet with the President in executive session to discuss salaries of the administrative officers. On motion of Mr. Stevens, seconded by Mr. Merriman, the following salaries were approved effective July 1, 1970 (with Trustee White voting "No" on those so marked * ). John Cantlon Leland Carr Jack Breslin $35,000* $27,500 .$35,000*. Hilton Muelder Roger Wilkinson M, B. Dickerson $33,600 $29,000 $30,000 The Trustees asked the President to review the salaries of'Mr. Perrin and Dr, Polley in January 1970 (Mr/ White voted "No") and to discuss with Mr. Carr the possibility of the University providing additional funds for a legal clerk and office expenses. Iwo information papers on Enrollment and Admissions and Dormitory Occu- pancy presented by Pres.Wharton 1970-71 budget, fee schedule and dormitory rates presented; salary inc of administrative officers approved Adjourned. i # i