Chancellor's Report, November 13, 2007
Chancellor Erroll B. Davis, Jr.
Board of Regents Meeting
Thank you, Mr. Chairman. Let me first direct your attention to our newest exhibit from East Georgia College. This new exhibit showcases the various media explored in that college's art program. Of the student artists included in this show, more than a half dozen have shown in juried exhibitions, both regionally and internationally. Three have also had solo exhibitions. These are very high quality artists and artwork, and we appreciate East Georgia College's contributions to our ongoing cultural enrichment.
We are having a "two for one" special today! This is a two day meeting in one full day, albeit a potentially long one. I do appreciate, in advance, your commitment and patience as we move through an important as well as very full agenda. Let me take this time to mention a number of items and to also tee up some key agenda items for your attention. I will also put some of them into a larger context. The University System is a large, complex, and dynamic organization. As such, it is subject to the ebbs and flows of any organization. At times, the news is good – at times, less so. But that is the nature of any organization, and that is the challenge before us as we attempt to manage organizations and particularly as we address change. Every situation, however, is an opportunity to take stock, to evaluate, to make needed changes and to give new opportunities to current and new individuals. In our case, we now have the opportunity to undertake these actions within the context and framework of a much clearer and much more focused strategy. So, please remember this larger context as I move through the items in this report today.
The first item is the Fiscal Year 2009 Budget that you approved in August. This morning, the team and I met with the Governor to go through our request. As always, he was pleasant, probing, but non-committal. We will not know whether we have made the sale until he submits his final budget in November or December. As you know, the next step in the process is for the Governor to submit his full state budget recommendations to the General Assembly, which will, of course, include a recommendation for this System. We will then begin the process of supporting the Governor's budget and the recommendations for the University System within that budget. We have a strong record of support from our funding partners, and we will be working closely with them over the coming months on the Governor's recommendations. It is also important to note that the capital and operating budgets were framed within the context of our new Strategic Plan. I have mentioned often that budgets should be strategy implementing documents, and we discussed, today, how the budget would support those strategies. Clearly, our capital budget is a result of the capital model upon which you worked very hard for over a year. Both are already paying dividends for us in terms of enhanced credibility for our requests. There is a higher level of transparency on how the numbers were generated, and we did get a sense that there was a higher level of acceptance of the validity of those numbers. Whether they will survive in terms of the state's overall priorities, we will not know until later this year. We will, of course, ask for your support as we work with the General Assembly in the upcoming legislature. Thank you, in advance, for your support.
One of the key drivers of our budget is the funding formula, which is, in turn, driven by student enrollment, or, more specifically, the number of credit hours students take. The fall 2007 enrollment report is being released today. So, I have the pleasure of making the official numbers public – although many of our institutions already have reported preliminary numbers for their campus. For those Regents who were not here last year, I did have a drum roll at this point. I was advised to dispense with that this year, and I have agreed to do so. The current enrollment in Georgia's 35 degree granting institutions is at an all-time high of 270,022 students for fall of 2007. This represents a gain of over 10,000 students from fall 2006. So, we have, since the fall of last year, added a University of West Georgia or a Valdosta State University to this System. This is a 3.9% increase over fall 2006, which represents a more robust rise from the more modest percentage increases in recent years of 2.5% from fall 2005 to 2006 and 1.5% from fall 2003 to 2004.
The increase in credit hours is up significantly – 4.4% from fall 2006 to fall 2007. This is good news for our funding formula. As we seek to meet an enrollment projection of 100,000 additional students by 2020, the details of this latest report show us how we are going to achieve this growth. Fortunately, we are seeing some significant increases at our two-year access institutions and at some of our comprehensive universities. This is exactly where we need to direct enrollment growth in the future so that we reach a more pyramid-shaped distribution. We need more of our students selecting our access institutions and our comprehensive universities as a 'first choice' for college. The System's seven state colleges posted an 8.7 % increase, although two state colleges had growth well over 8.7%. Middle Georgia College, for example, gained 12.9% and Gainesville State College gained 11.2%. The largest gains by type of institution were at our access institutions where enrollment grew by 6.2%. These institutions grew faster than the System as a whole. Atlanta Metropolitan College, which posted an 11.8% increase, is at an all time high. East Georgia College is up 15.6%; Georgia Highlands College posted a 10.5% increase; and South Georgia College is up 19.9%. The System's four-year comprehensive colleges and universities posted overall gains of almost 3% and enrollment increased 2.3% at the our research universities. From our planning perspective, that is exactly where we want the increases to take place, and it is exactly the type of distribution of new students that we want. If you look at the four-year comprehensive state universities, Fort Valley State University stands out. President Rivers put a lot of effort into increasing enrollment. Enrollment is up 17.7% there. We are seeing the impact of new leadership and new programs at many of our institutions. Again, this reinforces my continuing view that leadership and management does make a difference. This is good news. We are a growth industry. People continue to flock to our System.
We have two student representatives with us today. Ryan Greene is a junior in business management at Georgia College and State University and serves as the current student government president there. Also with us today is Tiffani Rose Brown, President of the Student Government Association at Georgia State University, where she is pursuing a degree in English. Tiffani transferred from Georgia Perimeter College after she received her Associate's Degree. Thank you both for joining us today. Good luck in your studies, and I hope neither of you is cutting class to be here today.
In October, while we were holding a Board meeting in Carrollton, the University System held an international summit. This was our very first gathering among our academic leaders to discuss international education within the System. The event, at which I spoke, was well attended and held at the Carter Center. I point this event out, because the Director of International Programs, Richard C. Sutton, and others involved with international education have done an excellent job of aligning goals of these programs with the new Strategic Plan. The New York Times, in its annual education focus issue several weeks ago, noted the increasing importance of study abroad in the "must have" portfolio of any college student. The New York Times was also represented at our summit. As you are aware, the University System, through your guidance, has placed an emphasis on international education for a number of years and this past work clearly positions us well moving forward.
On another note, as you are aware from my previous communications to you and news reports, state auditors have uncovered some examples of abuse by state, as well as System, employees of the state purchasing card ("P-Card") program. The Chief Audit Officer and Associate Vice Chancellor for Internal Audit, Ronald B. Stark, and I both spoke before a House committee on this issue on October 22. The committee had good and pointed questions, but was generally supportive of our stance and our actions going forward. Let me be clear that the P-Card program is an excellent program. The idea behind it is a good one. Using the P-Card versus a standard purchasing process eliminates about 14 administrative steps and will save an estimated $100 per transaction. We had in excess of 600,000 transactions last year. If we had to eliminate P-Cards and go back to a purchase order system, we would add approximately 600,000 times $100 to our cost structure. These cards also allow our campuses to be more responsive and reduce costs. Any program requires appropriate oversight to ensure that it is not misused or abused. This is a serious issue, and we are conducting our own, internal audit of all prior year P-card transactions from last year. We will use the results, if warranted, to censure; to create new systems and procedures; and to train, retrain, or change out leadership, if necessary. We will take all necessary steps to create a more effective risk management culture within the University System.
Last week, Mr. Stark provided a preliminary report of the first phase of our internal audit which noted the following key findings. So far, most of our campuses have excellent policies and controls and some campuses require improvement, but the overall conclusion is that there are several areas requiring improvement. Although we have not yet found major transgressions, we are finding a lot of managerial issues. Ultimately, my perspective is that this is all about leadership, all about management and creating a sense at every level of the organization that leadership means accepting the personal responsibility to manage risk, not only in the academic enterprise, but within all aspects of our operations. The reality is that we have a number of learning opportunities in this area – and we will learn. As stewards of public capital, we cannot accept any misuse of this program – or any other program, for that matter. The public's confidence in our ability to manage dollars and manage risk means we must have zero tolerance for those who would knowingly compromise or even unknowingly mismanage risks for which they are responsible.
Water is another topic that is in the news and in our prayers as well. In response to the Governor's Executive Order of October 24, we have developed and submitted a Systemwide water conservation plan to the Governor's office. We have committed to achieving a 10-15% reduction in water usage among USG institutions on a cumulative basis from November 1 through March 30, compared to the same period for the previous year. This will be a challenge for us because we were in fact out in front in many instances on this issue and we have already made some significant reductions. These further reductions will be on top of the reductions we have already made. So, that might a bigger challenge in some areas than others. Our institutions are taking the drought situation very seriously and establishing task forces and committees to develop and implement water conservation best practices on campus. Education is our core mission and a critical part of water conservation. So we will educate all of our employees and students in this area. We are actively communicating with students, staff, and faculty on how they can help conserve water both on and off campus. Our faculty, befitting its expertise, is also acting as expert advisors to the administration during this problem. I am very proud that the expertise of the faculty in the System is becoming a part of the solution to Georgia's long-term water management problems.
I mentioned earlier that we have some key personnel changes here in the System Office and on our campuses. First, we announced the retirement or resignation of presidents at two institutions. Dr. Carl V. Patton will retire from Georgia State University at the end of this academic year. Also, Dr. Richard J. Federinko is leaving the presidency of Middle Georgia College at the end of this year to take up a new challenge in his home state of Alabama at Troy University. And, as you are all aware, Dr. James A. Burran will be stepping down shortly from the presidency of Dalton State College. In that search, we announced the three finalists for this position, and Regent Jolly, the committee chair, along with Regents Wanda Yancey Rodwell, Benjamin J. Tarbutton III, and Allan Vigil, will be working with the Chief Operating Officer, Robert E. Watts, the sector head for the access institutions, and me to further assess the three finalists. We will be bringing forward a recommendation shortly. We would like to get this done prior to year end. All three of these presidents have made significant contributions to their respective institutions and communities, and, by extension, the University System. Each will be missed. For the Board, this means a very active season ahead as we conduct searches to replace the presidents whose resignations and retirements we have just announced.
We also will be losing the services of two outstanding individuals in the University System Office. But fortunately, neither will be leaving the System; they will be moving to new positions within the System. William R. Bowes will be leaving his position as Vice Chancellor for Fiscal Affairs to become the vice president for finance and chief financial officer for the Medical College of Georgia. This means Bill also will be resigning his position as the Board's treasurer. Regent Robert F. Hatcher will have some additional comments on Bill later in today's meeting. Assistant Vice Chancellor Joy Hymel has traded her duties as head of the System's economic development efforts to join Georgia Tech as the business development officer in the strategic partners office of the Enterprise Innovation Institute. For those of you who were in the Centergy Building over at Technology Square last night, Joy will be moving a few floors down from her current office in the Technology Square complex. Joy has led the Economic Development Department in the development and creation of a number of programs, key among these being the System's response to Georgia's health professionals worker shortage through the Intellectual Capital Partnership Program ("ICAPP®") program. She has provided key leadership for the System and at the institutions through her guidance and leadership. She leaves us and ICAPP® in a much stronger position today thanks to her dedicated and professional efforts. Again, both Bill and Joy will be missed, but we know where to find them.
We also have some new faces in the System Office. Chairman Vigil has already introduced yDr. Susan Herbst, our new Executive Vice Chancellor and Chief Academic Officer. She took up her duties on November 1, and we are delighted that she has joined the University System. For the first time since my arrival, we now have permanent – or should I say non-interim – leadership in Academic Affairs, and this should impact productivity there greatly. Also J. Reid Christenberry has returned to the fold to become the new Associate Vice Chancellor for Operations in the Office of Information and Instructional Technology. Reid has been the Chief Information Officer ("CIO") at Miami of Ohio University for the last 4 years and was the CIO at Georgia State prior to that time. We welcome these two individuals as they begin to add their respective creative talents to our efforts.
Our presidents, faculty, and staff win a lot of awards, and I could fill up all of the time talking about them, but I do want to mention one very prestigious appointment. The Skidaway Institute of Oceanography Director, James Sanders, has been appointed to the Environmental Protection Agency's ("EPA") Science Advisory Board by EPA Administrator Stephen Johnson. The three-year appointment will run through October 2010. Sanders will join approximately 30 other scientists from academia, industry and environmental communities on the EPA Science Advisory Board. The Board provides scientific advice to the EPA administration and various congressional committees. Members of this board constitute a distinguished body of scientists, engineers and economists who are recognized, non-governmental experts in their respective fields. This is yet one more reflection of the tremendous quality of the people and the leaders that we have within this System.
In a few minutes we will make presentations to recipients of the Chancellor's Office customer service awards program. I think that it is important to recognize individuals, institutions, programs, and teams that are making a real difference in improving customer service and implementing process improvements across the System. Two weeks ago, Governor Perdue recognized outstanding examples of customer service statewide. The Governor's Excellence in Customer Service Awards for 2007 recognized six individuals and eight teams. First-year winners in the Team Georgia Customer Service Recognition Program were selected from among more than 400 nominations across the state. Nominees were judged by a blue ribbon panel of leaders from the business community and the public sector. The University System was recognized twice. Bainbridge College was recognized in the category of the Governor's Award in Customer Service for Team Excellence for its Academic Resource Center. I love the word "team" and I want to see even more "team" awards. The System was presented with the Governor's Special Award for Extraordinary Commitment to Customer Service. This award was presented in my name, but the award reflects the overall commitment throughout the System to customer service. I gladly accepted it on behalf of all of the employees and teams who are working tremendously hard to improve our processes and procedures and customer focus within in the System. This is a commitment of which we are quite proud. And, we will build on this commitment in the coming year.
Let me turn now to several items of key importance on today's agenda. All relate closely to our Strategic Plan and are themselves interrelated: one affects and supports the others. You will see three presentations today. Jan Kettlewell's report on teacher education in the System; Shelley Nickel's report on maintaining affordability of a college education; and President Bruce Grube of Georgia Southern University will report on his Systemwide Project on improving retention and graduation rates.
There is much good news in Jan's report on teacher education. I do not want to steal her thunder, but please note these key points. The University System is committed to being the primary provider of new teachers in the state of Georgia. We are increasing the number of new teachers by expanding current programs and by developing additional, flexible routes into teaching. For example, I spoke earlier about the development of a collaborative between Georgia Tech and Georgia State to take those people with technical backgrounds who want to teach and give them the teaching skills from a university with a teaching mission. Again, we still have work to do, but that is an example of the kind of cooperation and leveraging of resources that will allow us to turn out more teachers. Our Colleges of Education are further changing the way they do business. They are developing creative solutions to meet the market demands For example, you heard a presentation at an earlier meeting on the masters of education market. They are discussing ways to make our programs more attractive to today's potential teachers of all ages, backgrounds, and career histories. Our teacher quality and quantity initiatives also are paying dividends for us. USG-prepared teachers remain working in Georgia's classrooms at a higher rate than those coming through other routes to certification.
Goal 5 of the Plan has a focus on affordability of college. In her presentation today, Shelley Nickel will frame the discussion for work on this goal and share some interesting data showing that despite our low tuition, strong state support, and the HOPE scholarship, we continue to have low participation from lower income students. Affordability is one of the barriers to higher education. This is important because an educated workforce produces a robust economy, a more engaged citizenry, and a healthier population. Enlarging that educated pool will necessitate some innovative work on how we not only maintain, but increase affordability.
President Grube will discuss two key metrics of performance – retention and graduation. These are, of course, connected. Retention can be seen as a leading indicator of academic performance – both by students and by our institutions in terms of supporting student learning. Graduation rates are lagging indicators. We clearly need to treat both indicators as active measures that call for our disciplined and timely response. Dr. Grube's group is taking that approach and he will bring forward some recommendations that will give us a more focused process and robust response to these key indicators. I should point out that you have seen a number of these Systemwide projects come forward. Many of them have price tags associated with them. We will address resource allocation next year as we start to discuss how to allocate the resources that we receive through the budget process.
Also let me direct your attention to an item on the Academic Affairs Committee. Last month, you heard about the new Georgia ONmyLINE distance education initiative. This month, the committee will be asked to recommend, for the full Board's approval, a number of education degrees that will be offered in the new Georgia ONmyLINE franchise model. Last month you heard the concept and this month we are going to actualize that with degree programs. Again, I want to stress our distance education programs continue to move forward. Last night, those of you who had the privilege of joining us saw the technology of the future. Today, you are going to start to approve programs for future growth. This action item is the next step in the new program model to respond to demand and regain a significant part of the distance education market share.
As you can see, we have a short day but a full agenda. And, as always, please complete your feedback form. These are extremely useful to us in shaping future agendas in ways that you find productive and rewarding. If you have concerns, we ask that you please put them on your feedback form and not allow them to fester. We will try to respond to them as quickly as we can. We are in a higher gear on a number of fronts. I will have a full summary in my state of the system remarks early next year. Until then, we will remain focused on the Plan and the Budget, even as we seek out new leadership in key posts in the System. Thanks for your hard work and contributions. You have had a busy year. Your dedication to your board responsibilities is serving the System well. Your work is appreciated, by me, by our presidents, by our faculty, our staff and our students. On behalf of the entire System, you have our best wishes for a safe, joyous and rewarding holiday season with family and friends.
Let me conclude my report on a more somber note and one that really brings home the precious nature of family and friends. I am speaking of the passing of a former member of this Board and a true educational champion for all Georgians. I am referring to the sad news last week of the death of former Regent Joseph Greene.
He was appointed to the Board of Regents in 1984 and was named by his colleagues on the Board as chairman from 1988-1989, with his work as a Regent concluding in 1991. During his tenure on the Board, Professor Greene was instrumental in developing strategic planning for the University System, increasing accessibility for minorities at Georgia's public institutions, and improving procedures for presidential searches. But his service to education went far beyond his tenure as a Regent. He was the former Cree Walker Professor of Business Administration at Augusta State University, where, at the time of his passing, he still served as the University's Customer Service Champion. He never gave up; he never quit looking for new ways to serve others and Augusta State. He was a trailblazer during a momentous time in the state's recent history. Professor Greene was the first African American to serve on a number of community and state boards in an era when racial tensions were high and integration was in its early stages. He offered a voice of fairness, a voice of equity, and one of reason. Professor Greene's service not only calmed a troubled state, but also gave voice to minority and poor residents of all colors who had been virtually invisible in local and state governments. He was an alumnus of Augusta State as well as the University of Georgia and served on the Augusta State Foundation Board.
I know you join me in mourning his passing. His passing and his accomplishments are important and poignant reminders of the significant role this Board has played in Georgia's development for 75 years. This Board's positive influence comes down, in the end, to the high quality of the people on the Board – to the high quality of leadership exercised by the hundreds of individuals just like you who have served as Regents. Joseph Greene certainly raised the bar very high in this regard. Please join me in a moment of silent reflection and tribute to his life and his good work.
Mr. Chairman, that concludes my report. I would be happy to answer any questions at this point.
There were no questions.