1. finance
2. investing
3. funds
4. mutual funds

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State Capitol – 600 E Boulevard Ave – Dept. 215
Bismarck ND 58505-0230
Phone: 701.328.2960 Fax: 701.328.2961
E-mail: [email protected] Web: ndus.edu
North Dakota State Board of Higher Education
Budget and Finance Committee
Meeting Notice and Agenda
Monday, April 20, 2015
The State Board of Higher Education Budget and Finance Committee will meet by conference call, on
Monday, April 20, 2015 at 4:30 CDT. The call will originate in the NDUS Office, 10th floor of the State Capitol,
600 E. Boulevard Ave, Bismarck, ND.
Call to Order
1. Approval of March 13, 2015 meeting minutes – Chair Morton
2. Review and recommend approval of SBHE Policy 806.3-Moving Expenses – Ms. Glatt
3. Review and recommend SBHE 1.) Authorize issuance of not to exceed $4,000,000 Minot State
University Facilities Revenue Refunding Bonds, Series 2015, for the purpose of refunding the Minot
State University Student Services Facilities Revenue Bonds, Series 2006; 2.) Authorize the MiSU
President and/or Vice President for Administration and Finance to approve the sale of the bonds
provided that the true interest rate not exceed 4.0% provided the present value of the debt service
savings is not less than 2%. The approximate final date upon which the principal amount of the
obligation will mature or become payable is August 1, 2029; and, 3.) Appoint the firm of Arntson
Stewart Wegner PC as the bond counsel and Public Financial Management, Inc.as the financial advisor
Mr. Foisy
4. Review and recommend WSC authorization to arrange for a substitution of $526,958.12, from
Workforce Training funds to WSC Foundation unrestricted gift funds, in the Series 2010 Bonds Debt
Service Reserve Subaccount in such manner as is agreed to by the Trustee so as to at all times meet the
Debt Service Reserve Requirement of the Series Resolution. – Ms. Furuseth
5. Review and recommend to authorize NDSU to proceed with the construction of the Wallman
Wellness Center Aquatics Addition Project at an estimated cost of $11,000,000, with $10,000,000
funded from revenue bond proceeds and $1,000,000 from local funds, subject to appropriate
legislative approval, including the following: - - Mr. Bollinger
1. The issuance of not to exceed $10,000,000 State Board of Higher Education of the State of North
Dakota, North Dakota State University, Housing and Auxiliary Facilities Revenue Bonds, Series
2015B, for the purpose of financing the construction of an Aquatic Center on the North Dakota
State University campus as per N.D.C.C. Chapter 15-55;
The North Dakota University System is governed by the State Board of Higher Education and includes: Bismarck State College • Dakota College at
Bottineau • Dickinson State University • Lake Region State College • Mayville State University • Minot State University of North Dakota State College
of Science • North Dakota State University • University of North Dakota • Valley City State University • Williston State College
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2. Authorize the execution of a Supplemental Indenture of Trust, Bond Purchase Agreement and
Related Documents;
3. Authorize the NDSU President and Vice President for Finance and Administration to approve the
sale of the bonds (Series 2015B) at a price not less than 98% of the principal amount thereof and
at a true interest rate not exceeding 5.00%. The approximate final date upon which the principal
amount of the obligation will mature or become payable is April 1, 2036; and
4. Appoint the firm of Arntson Stewart Wegner PC as the bond counsel and Fieldman, Rolapp &
Associates (Independent Financial Advisors to Government) as the financial advisor.
Contact Terry Meyer (701) 328-2963 or [email protected] prior to the scheduled meeting date if auxiliary aids or services are
needed.
g:\agendas\sbhe budget and finance committee\2015\4.20.15 meeting\20150420 sbhe budget and finance committee agenda.docx
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State Board of Higher Education
Budget and Finance Committee
March 13, 2015
The State Board of Higher Education Budget and Finance Committee met by conference call on
Friday, March 13, 2015, at 9:00 a.m. CT. The call originated in the NDUS office, 10th floor of the
State Capitol, Bismarck, ND.
SBHE Budget and Finance Committee members participating:
Mr. Don Morton, Chairman
Mr. Grant Shaft
Dr. Kevin Melicher
Ms. Janice Hoffarth, non-voting
Other NDUS participants:
Dr. Larry C. Skogen, Interim Chancellor
Mr. Dave Clark, BSC
Ms. Tamara Barber, BSC
Ms. Alice Brekke, UND
Mr. Doug Dawes, VCSU
Mr. Dennis Gladen, NDSCS
Mr. Brian Foisy, MiSU
Dr. Dean Bresciani, NDSU
Mr. Bruce Bollinger, NDSU
Dr. John Richman, NDSCS
Dr. Tisa Mason, VCSU
Ms. Laura Pfeifer, DCB
Dr. Lori Reesor, UND
Ms. Laura Glatt, NDUS
Ms. Robin Putnam, NDUS
Mr. Rick Tonder, NDUS
Ms. Brenda Zastoupil, NDUS
Ms. Robin Putnam, NDUS
Ms. Billie Jo Lorius, NDUS
Ms. Marietta Kemmet, NDUS
Mr. Morton convened the meeting at 9:01 a.m.
Chair Morton asked that an additional agenda item be added to the agenda. Ms. Brekke has
been asked to provide the committee an update on a meeting held with students on the
Pathways Tuition Model. Mr. Shaft moved, seconded by Dr. Melicher to add the item to the
agenda. Shaft, Melicher and Morton voted aye. The motion carried.
February 13, 2015 meeting minutes
Mr. Shaft moved, seconded by Chair Morton, to approve the February 13, 2015, minutes.
Melicher, Shaft, and Morton voted aye. The motion carried.
FY14 Campus Financial Review
Ms. Putnam reviewed the FY14 campus annual financial review report. The purpose of the
report is to provide the committee with a financial analysis of each institution’s financial health
as of June 30, 2014. Ms. Putnam noted that the 2014 SHEEO report, which is referenced on
pages 12-13, has not been issued yet. When it becomes available, an updated report will be
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sent to committee members containing the FY14 data. Ms. Putnam highlighted the Composite
Financial Index of CFI, both including and excluding discretely present component units.
Institution
Component units(s) included
FY2014
CFI,
including
component
units
BSC
BSC Foundation
2.18
1.89
1.71
1.80
DCB
DCB Foundation
3.53
1.75
3.42
0.43
DSU
DSU Foundation
0.79
1.18
4.45
4.19
LRSC
LRSC Foundation
3.69
0.91
2.75
(0.29)
MASU
MaSU Alumni Foundation
1.78
1.78
1.26
1.18
MISU
MiSU Development Foundation
2.19
2.37
2.26
2.37
NDSCS
3.72
3.36
3.43
3.56
4.25
3.9
2.87
3.11
UND
NDSCS Foundation
NDSU Development Foundation
NDSU Research & Technology Park
NDSU Research Foundation
NDSU Team Makers Club
UND Alumni Assoc. & Foundation
RE Arena, Inc.
UND Center for Innovation
UND Research Foundation
4.57
3.9
3.01
2.20
VCSU
VCSU Foundation
4.57
3.98
2.04
3.60
WSC
WSC Foundation
4.01
2.39
2.15
0.56
NDSU
FY2013
CFI,
including
component
units
FY2014
CFI,
excluding
component
units
FY2013
CFI,
excluding
component
units
At June 30, 2014, none of the institutions had a CFI in the “Below” range or in the “In” range for
two consecutive years, as established by the HLC. However, she pointed out that DSU’s CFI was
0.79 when the foundation balances were included, which would put it in the “In” zone for FY14.
Excluding the foundation, DSU’s CFI would be well in the “Above” zone at 4.45.
Ms. Putnam reviewed DSU, LRSC NDSCS, WSC and VCSU status, as they were required to file
improvement plans last year. She noted they were the same or improved, but indicated that
WSC’s overall financial status is of concern and should be carefully monitored.
MiSU’s financial position is good. Several of their ratios are strong or very strong. However,
operating income margin has been negative for the past four years, the 2011 flood and the
tight housing market in Minot have negatively impacted enrollment for the last four years. A
plan for MiSU should be considered to address the negative operating income margin trend.
Ms. Putnam called attention to the most recent Moody’s and Standard & Poor’s rating of NDSU
and UND debt. Both were very favorable.
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Mr. Shaft moved, seconded by Dr. Melicher to accept FY14 Campus Financial report and
require MiSU to present a plan for consideration to address negative operating income
margin trends. Shaft, Melicher and Morton voted aye. The motion carried.
2014 Semi-Annual Budget Report and approve WSC Bookstore deficit reduction plan
Ms. Glatt reviewed the December 31, 2014, Semi-Annual Budget and the schedule of campus
leases. She said the report is produced twice a year, at calendar year-end and fiscal year-end.
This report is for the period ending December 31, 2014 and it identifies variances or
irregularities in several areas including revenues, deficit fund balances, capital projects, and
lawsuits. She highlighted particular areas of the report with the committee.
Three institutions (DSU, MiSU, UND) estimated FY15 tuition income will be less than originally
estimated. Each institution is adjusting their spending to fit within those revenue changes.
NDSCS and NDSU are reporting an expected positive variance in auxiliary revenues by the end
of the fiscal year, where they are expecting to be up over their original projection.
Regarding deficit fund balances Ms. Glatt highlighted certain items due to their nature or
newness as follows:
• Two new deficits reported by DCB: (1) Adult Farm Management program and (2) Adult
Farm Mgt. Tech program. DCB plans to transfer distance education fee revenue or CTE
grant funding to cover these deficits by yearend, until they have time to adjust their
tuition and fees in those programs or other costs long term to bring them back into
balance.
• Ms. Glatt reported that Ms. Brekke updated the committee on the UND EERC deficits
four months ago and laid out a plan to reduce the deficit over a 10-year period, which
the committee approved. Ms. Brekke will bring back to the committee at the next
meeting a more in-depth report on progress that is being made and possibly any
requested adjustments needed going forward.
• The deficit for the Citation Cost Center Aerospace continues to rise over time. UND is
looking at how to address this and will bring back a revised budget deficit reduction plan
on how to address the citation deficit at the next meeting.
• The WSC bookstore deficit is fairly new and there has been some reduction over the last
six months. It is recommended that WSC eliminate the deficit and have a plan in place to
have it eliminated by June 30, 2018.
• The other WSC athletics deficit was previously reported. By the end of this fiscal year,
the WSC foundation will transfer gift funds to eliminate this deficit.
• Ms. Glatt reported that all of the other deficits have plans in place and/or trending
appropriately.
Ms. Glatt noted that there were recent concerns about whether WSC would meet the required
1.15x annual debt service requirement as prescribed in their bond indenture. The office has
been working with WSC, and will continue to work with it, on trying to resolve this matter. If
there is something of concern long-term, this will be brought back to the committee.
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The report provides information related to outstanding lawsuits and Ms. Glatt referred the
committee to the legal division for any questions.
It was disclosed there are two capital projects at DCB which have exceeded spending authority.
They are: (1) generator project, which the SBHE addressed at a recent meeting; and (2)
Thatcher Hall, which is on the agenda later today.
Deficiency appropriation requests noted are currently moving through the legislative process.
Individual campuses have noted issues they are aware of that may have a significant impact on
their revenue or expenses. BSC notes the oil related activity in the western part of the state,
DSU highlights the receivership status of the foundation, and UND the impact of off campus
private apartment developers.
Mr. Shaft said UND has a valid concern in Grand Forks. He continues to be a supporter of
requiring freshman students to reside on campus. There are studies that show if an institution
engages freshmen students early on, they are more successful at a university. As UND wrestles
with the definition of ‘off campus,’ he encourages UND to be mindful of how best to keep
freshman students engaged and connected to the campus so they are successful. Mr. Shaft
also noted the added parking challenges on campus as a result of commuter students.
In response to Dr. Melicher’ s question on the occupancy rate at UND, Ms. Brekke said she
didn’t have those figures readily available but will get that information to committee members.
Ms. Brekke said a housing study is currently in progress, and UND is looking at another housing
master plan. There was one done in 2005, which was updated in 2010. With new housing
leadership in place at UND, it is time to revisit the housing master plan.
Dr. Melicher moved, seconded by Mr. Shaft to accept the December 31, 2014, Semi-Annual
Budget Report and approve WSC Bookstore deficit reduction plan. Shaft, Melicher and Morton
voted aye. Motion approved.
2014-15 Student Affordability Report
Ms. Zastoupil provided an overview of how the North Dakota University System compares to
regional peers in relation to tuition and fees as well as providing trends on financial aid and
other affordability indicators. She noted the newly defined region, used for comparison
purposes, as used in the NDUS Strategic Plan. The regional comparisons now reflect the
contiguous states as well as WICHE region, with the exception of California, Hawaii, and Alaska.
She noted the following highlights:
• Tuition and mandatory fees at NDUS research and four-year universities continues to be
less than their regional peers in 2014-15. Two-year campus tuition and fees are all
above the regional peers.
• Total cost of attendance, which includes an estimate in tuition, fees, room and board,
books, supplies, travel, and other miscellaneous expenses ranges from $15,100 to
$19,500.
• Tuition and fees range from 28% to 40% of the total estimated cost of attendance.
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•
•
•
•
NDUS institutions disbursed 4.34% more in federal grants and loans in 2013-2014 than
they did 10 years prior.
The amount of student loan borrowing increased by over 36% but it is important to note
that the Federal Pell Grant funding has only seen slight increases in that 10 year period,
while federal loan funding has more than doubled in what the students borrowed for
that period of time. Based on the lowest household quintile, which is the 10th percentile,
all 11 NDUS institutions rank ahead of their regional counterparts in affordability based
on net price.
The national indebtedness of a bachelor’s degree recipient at $28,400 for 2013
graduates. The NDUS student total loan indebtedness at this same time is at or below
the national average.
In 2013-14 56.2% of undergraduate students received some type of financial aid. Of
those students receiving aid, an estimated 49% receive some type of grant, scholarship
or waiver.
Ms. Zastoupil provided the committee an update on the Tuition Waiver Report for Academic
Year 2013-14. For 2013-14 the NDUS institutions provided tuition waivers totaling $31.9M to
over 9,500 students. At the same time, students receiving those tuition waivers still paid
campuses over $46.6M in tuition, room and board, and mandatory fees. Of the total degree
headcount enrolled in NDUS, which was 55,724, approximately 17.2% received a waiver.
Ms. Glatt noted that almost two-thirds of waivers are provided to North Dakota residents. The
data also suggests that almost 80% of the waivers are partial waivers.
President Bresciani said the term ‘tuition waiver’ is a misconception, whereas nationally, the
terminology is ‘tuition discounting.’
Dr. Melicher moved, seconded by Mr. Shaft to accept the 2014-15 Student Affordability
Report and 2013-14 Tuition Waiver report. Melicher, Shaft and Morton voted aye. Motion
approved.
MaSU Health and Physical Education Recreation (HPER) facility, to be funded from the SBHE
13-15 capital contingency fund
Mr. Tonder said this project was approved during the 63rd Legislative Session at $5.510 M. With
the escalating construction costs, they were unable to get a base bid that would even fit within
the base appropriation plus contingency. MaSU changed directions and selected a construction
manager at risk, compressed the scope of work, and brought in a project at $5.510 M. The
project was redesigned to reduce it in size by approximately 55% to 17,000 square feet by
eliminating an instructional lab, practice facility area, and locker room. The change in project
scope resulted in cost reductions sufficient for MaSU to proceed; however, MaSU was able to
retain the original functionality and original stated purpose of the project. The additional
contingency funding will allow MaSU to restore a portion of the functionality that was lost due
to the removal of the instructional lab and practice facility noted above.
Mr. Shaft moved, seconded by Dr. Melicher to approve request to increased authorization from
$5,510,000 to $5,754,484, an increase of $244,484 for the MaSU Health and Physical Education
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Recreation (HPER) facility, to be funded from the SBHE 13-15 capital contingency fund; and,
further authorize transfer of $244,484 from the SBHE capital project contingency fund to MaSU.
Shaft, Melicher and Morton voted aye. Motion carried.
Seek an amendment to Engrossed HB 1003
Ms. Glatt said at the last SBHE meeting, the Board was provided an overview of the
amendments that were adopted by the House for HB1003. Historically, legislative approval (full
legislature or Budget Section) was required for projects costing $385,000 or more, if funded
from gifts, grants, or bequests. Per Engrossed HB1003, the statute is being amended to also
include projects funded from local institutional sources. Thus, full legislative approval or during
the interim, Budget Section approval, will be required for these projects. Anticipating the
amended provision remains in the final appropriation bill, the NDUS would like to seek an
amendment to have the known local fund projects added at this time. Ms. Glatt said that
ultimately some of these projects will be completed, while some may not due to changing
needs and resources. Ms. Glatt requested the list be amended to include a late submission
from UND for the UND EERC Fuel Storage Facility at $700,000 to be funded from federal funds.
Project
UND Fuel Storage Facility
WSC Teton “Marsh” Wetland
WSC Stevens Hall 2nd floor renovation
WSC Frontier Hall repair
WSC Crighton Hall renovation
NDSU R Lot Phase II reconstruction
NDSU AR lot reconstruction
NDSU Memorial Union Dining expansion
NDSU RDC Kitchen Renovation & Roof
NDSU Reed Hall Low Rise Lav Phase V
NDSU health plan partial boiler tube replace
Amount
$700,000
$1,500,000
$400,000
$400,000
$400,000
$1,600,000
$550,000
$1,450,000
$2,000,000
$1,300,000
$400,000
Fund Source
Federal funds
Private funds
Private funds
Local funds
Private funds
Local funds
Local funds
Local funds
Local funds
Local funds
Local funds $200,000
State funds $200,000
Mr. Shaft moved, seconded by Dr. Melicher to approve the amendment to Engrossed HB 1003
with the addition of the $700,000 for the EERC fuel storage on UND campus. Shaft, Melicher
and Morton voted aye. Motion carried.
DCB Thatcher Hall Mechanical Upgrades
Mr. Tonder said costs for DCB Thatcher Hall Mechanical Upgrade project have exceeded the
available appropriations and legislative authorization. Due to the inexperience of staff on
campus at the time, when bids were awarded for the project, the staff person didn’t take into
consideration that the design fees also needed to be included as part of the project costs,
leading to the cost overrun. Furthermore, contingency pool funding for the Thatcher Hall
project were previously allocated to assist with the cost overrun on the DCB generator project.
Unable to cover the costs internally, DCB is seeking additional state appropriations for both
Thatcher Hall overrun and replacement of a failed water heater, which wasn’t part of the
original project.
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Dr. Melicher moved, seconded by Mr. Shaft to approve increase for DCB Thatcher Hall
mechanical upgrades from $769,500 to $798,694, an increase of $29,194 from state
appropriated funds. Further, authorize DCB to request a $29,194 general fund appropriation
from the 64th legislative assembly for the additional funds for Thatcher Hall Mechanical
Upgrades as well as a $36,800 state general fund appropriation for maintenance replacement
of a water heater in Thatcher Hall. Melicher, Shaft, and Morton voted aye. Motion carried.
UND Report on Pathways Tuition Model
Ms. Alice Brekke said Dr. Lori Reesor has joined her in the event there are questions. Consistent
with the directive of the Board to work through and move toward a restructured tuition model,
UND has been working for many months toward that end. To stay within the Strategic Plan
principles approved by the Board last fall and fine-tuned at the January/February meetings: (1)
moving from 12-credit cap on tuition up to a 14- or 15-credit cap, (2) blending tuition and nonmandatory fees, (3) moving to a model for on-campus and on-line rates should be consistent to
the greatest extent possible, (4) looking for opportunity where there should be differential
tuition rate, and that would effectively be a substitute for charging tuition plus a program fee,
and (5) adjustments to the residency rates. In addition to those principles, UND also worked to
find a consistent or equitable per credit rate for both full and part-time students. UND was very
conscious of the financial incentives that could help encourage timely degree completion,
including an emphasis on the 15+ credits per semester, as the most cost effective option based
on a four-year degree completion. The Board principles indicated that it should be revenue
neutral to the institution and to minimize the impact on the average student. As UND has
worked through all of this, UND found it almost impossible to accomplish what the Board asked
for.
UND met with Student Government last spring and provided them an overview of the direction,
at which time concerns were raised. Through the Fall, UND continued to work and meet with
deans, department chairs, student affairs, admissions, enrollment services, etc., trying to gather
input and to look to as many avenues as possible to put in place a future-focused model that
would help them get to where they want to be as an institution. The last phase of vetting was
with students, which happened March 4 and 5, where the group size was small and there was
some resistance. Ms. Brekke said some examples, based on credit hour load and residency
status, were provided to students. Students expressed concern about the impact on a North
Dakota resident student where, in some circumstances, they would be paying more than they
are currently paying.
Dr. Lori Reesor, Vice President of Student Affairs, said the overall concern for students is that
most of their students are from ND and Minnesota, and based on this model they would
potentially see the largest increase. And, they were concerned and wanted the board to
understand that this is potentially an outcome of this proposal.
Ms. Brekke said she estimates that an average 15-credit hour ND student would pay about 11
percent more, a MN student would pay somewhere around 9 percent more, a contiguous
student would see an 8 percent reduction in cost, MHEC/WICHE student would have a 10
percent increase, and the other U.S. non-resident would have a 30 percent cost reduction, and
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an international student would have a 25 percent cost reduction. Almost every student would
experience a change, either an increase or reduction.
Mr. Morton said, unfortunately, it is going to take time to get the online and the on campus
credits more in line with one another and there are going to be some winners and losers until
we get there. The Board also realize that by decreasing out of state tuition that more students
come to North Dakota. Another variable is whether a student is taking 12-credits or 15-credits
but at the same time we are very conscience that the campuses have the tuition revenue they
need. So, there are lots of moving parts.
Dr. Melicher asked if the proposed model, at 15 credits, is consistent with NDUS goal to
improve graduation and retention rates. Ms. Brekke said it is and, in fact, students would pay
less in total over their academic career if they graduated in four years.
Ms. Brekke said there are a number of other strategies on campus that are ongoing that are
working toward improving the retention and graduation rates, and not specific to a change in
the tuition model.
Chancellor Skogen said there are two proposed bills to remove the tuition-setting authority
from the SBHE. Prior to the Committee meeting, Dr. Melicher and Chancellor Skogen met with
Senators, including Senator Holmberg on Engrossed HB1003. Senator Holmberg was already
aware of the meeting UND had with students and the impact that the students felt it had on
resident students. It is important that the Board have this discussion and decide what they
want to do at this time relative to a movement within the Legislature on this issue.
Mr. Shaft said the Board needs to be mindful that when the Board looked at this shifting from
12- to 15-credit hours, one of the primary factors for the Board was pushing the graduation rate
up. And, although the Board knew the campus would be able to address graduation rate, that
the 12- to 15-credit hour shift would have an impact. The Board needs to balance asking
campuses to increase graduation rates with the tuition increase. There is an increase from 12to 15-credit hours, but when you go from 10 to 8 semesters there are savings. In response to
Mr. Shaft’s question asking if this is unique to UND or is this also happening at NDSU, President
Bresciani said NDSU crossed this bridge a long time ago and it is no longer an issue at NDSU. Mr.
Shaft asked if there is something unique about UND. Ms. Brekke said she wants to be careful in
speculating on that question. She did say that in the earliest versions of tuition model
discussions, there was a desire for UND and NDSU to essentially end up with the same model
and the same rates; both UND and NDSU worked diligently in that regard and it just simply
wasn’t possible to get there because of the financial differences between the two campuses.
So, it is not a surprise that the institutions have different sets of challenges in trying to
implement a changed model.
Ms. Brekke’s goal was is to provide the committee with information. Und students asked a
couple of questions about alternatives, which the campus will look into. The other thing is how
complicated of a model, over what period of time, and do we have the right tools to manage
the model, and those are other considerations they are working through. Timing will become
an issue for UND.
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Dr. Melicher asked for a comparison of the differences between the UND and NDSU models.
Ms. Hoffarth said the number of graduates in the music department have increased
significantly and questions what impact the change in credit hours will have on program
enrollment.
Meeting adjourned at 10:39 a.m.
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Summary of Proposed Action
SBHE Meeting – April 30, 2015
1. Issue: Proposed revisions to Employee Moving Expense policy 806.3 to provide, at
the discretion of the institution, reimbursement or a lump-sum payment to the employee
for moving expenses for new hires or current employee relocations.
2. Proposed motion: Approve proposed changes to SBHE policy 806.3-Moving
Expenses.
3. Background: Current SBHE policy permits reimbursement of certain actual moving
travel, and living expenses based on receipt. The revised policy would permit either
reimbursement of certain actual moving travel, and living expenses based on receipt
OR a negotiated lump sum amount for relocation expenses for new employees. There
would be no change for relocated employees due to current statutory restrictions.
The changes are intended to: 1.) provide added flexibility to tailor moving payment to
each individual position and/or employee location; 2.) to eliminate disincentive inherent
in current policy for the employee to perform some or all of moving preparations, instead
of outsourcing those to external provider; 3.) with lump sum payment option, reduce the
amount of administrative overhead due to reduced number of receipt and expense
audits; 4.) with lump sum option, provides a fixed moving cost amount for both the
employer and employee upfront at time of hire for budgeting purposes; 5.) with lump
sum option, reduces employee frustration about which expenses are reimbursed and
which are not reimbursed and at what level.
4. Financial implications: Depending on the option chosen by the institution at the
time of hire, the moving cost could be more or less than current costs, depending on the
negotiated lump sum amount. However, it is anticipated that the institutions will
generally choose the negotiated lump sum approach.
5. Academic implications:
positions.
Would apply to faculty positions, as well as staff
6. Legal/policy issues: None
7. Review Process: Controller’s/Accountants, Human Resource Council,
Administrative Affairs Council
8. Enclosures: Revised SBHE policy 806.3
9. Contact person: Laura Glatt, VC for Administrative Affairs, 701-328-4416,
[email protected]
10. Chancellor’s Recommendation: Approve
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NORTH DAKOTA STATE BOARD OF HIGHER EDUCATION
POLICY MANUAL
SUBJECT: FINANCIAL AFFAIRS
EFFECTIVE: April 4, 2000
Section: 806.3 Moving Expenses
Employees hired from outside the institution.
1. Upon approval of the president or designee, designee(s), an institution may, subject to the
limits of this policy, reimburse pay the moving expenses of an employee a benefited
employee as defined in Policy 703.2 hired from outside the University system. institution by:
Personal travel for the employee and immediate family while in transit, and while in
temporary living quarters (both not to exceed 10 days total) may be reimbursed at the per
diem and mileage rates established for employee travel reimbursement. Personal travel may
also be reimbursed for one round trip to the new work location for the employee and spouse
for up to three days to arrange for living accommodations. Transportation expenses for
personal items and household goods may be reimbursed at the actual expenses incurred;
provided, however, that total reimbursement for transporting personal items, household
goods, and personal travel shall be limited to the invoice, plus the current per diem and
mileage limits.
a. Negotiating an amount paid to the employee through payroll as a lump sum for relocation
expenses. Such allowance will be reported as taxable income and included on the
employee’s W-2. The moving allowance will be subject to all tax liabilities at the time of
payment; OR
b. Using a combination of reimbursing the employee for actual moving expenses and paying
the vendor(s) directly. Actual moving expenses include direct travel to and from the new
work location, and while in temporary living quarters for the employee and immediate
family (not to exceed 10 days total). Meals and mileage expenses will be reimbursed at
the per diem and mileage rates established for employee travel reimbursement. Lodging
expenses will be reimbursed at the actual cost of the lodging. Transportation expenses
for personal items and household goods may be reimbursed at the actual expenses
incurred. Additionally, personal travel expenses may also be reimbursed for one round
trip to the new work location for the employee and employee’s spouse/partner for up to
three days to arrange for living accommodations. It is the responsibility of the employee
to provide sufficient documentation to justify the reimbursement; the institution may deny
any claim for reimbursement that is not sufficiently documented. Institutions will need to
refer to IRS rules and regulations regarding taxability of the expenses in part b.
(Institutions may use either method (a and b, above) but must choose one or the other
when paying each individual employee.)
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2. In accordance with N.D.C.C. § 44-08-04.3, total reimbursement of moving expenses for
permanent employees transferred within the system is limited to $5,000. Relocation expenses
being paid or reimbursed should not exceed one month’s salary or a “not to exceed” amount
approved by the president or designee(s).
Employees transferring within the same institution.
3. The moving expenses of employees transferring to a new work location within the same
institution shall be governed by N.D.C.C. § 44-08-04.3.
HISTORY:
Replaces Article II, Section 2(H), 4-5.
SBHE Minutes, November 3-5, 1982, page 5091.
Amendment SBHE Minutes, June 20-21, 1991, page 6143.
Amendment SBHE Minutes, May 19, 1994, page 6361.
Amendment SBHE Minutes, April 4, 2000.
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Summary of Proposed Action
SBHE Meeting – April 30, 2015
1. Issue: WSC requests permission to replace funds in their 2010 Auxiliary Revenue
Bond fund required reserve account with unrestricted WSC Foundation gift funds.
Current reserve funds, which originally came from workforce training revenues,
would be returned to WSC to assist with the costs of the new Workforce Training
Center.
2. Proposed motion: Authorize WSC to arrange for a substitution of $526,958.12,
from Workforce Training funds to WSC Foundation unrestricted gift funds, in the Series
2010 Bonds Debt Service Reserve Subaccount in such manner as is agreed to by the
Trustee so as to at all times meet the Debt Service Reserve Requirement of the Series
Resolution.
3. Background: The SBHE, on behalf of Williston State College, issued Taxable
Housing and Auxiliary Facilities Revenue Bonds (Recovery Zone Economic
Development Bonds), Series 2010 on September 2, 2010. A Reserve Account was
established at the Bank of North Dakota at the time of issuance in the amount of
$526,958.12 (Debt Service Reserve Requirement). Amounts in the Reserve Account
are to be used for the payment of principal and interest on the Bonds to the extent
normal funds are insufficient. The WSC Foundation has agreed to restore the Reserve
Account to the Debt Service Reserve Requirement in the event of any draws on the
Reserve Account. There have been no draws on the Reserve Account.
The funds that Williston State College placed in the Reserve Account came from
monies that TrainND was accumulating for the purpose of constructing a Workforce
Training facility. It was the intent of the college to return these funds to TrainND when
they were needed for the new building. This new facility is now nearing completion.
The WSC Foundation has offered to put unrestricted funds of the Foundation into the
Reserve Account to meet the Debt Service Reserve Requirement. The current funds in
the Reserve Account, from TrainND, would revert back to WSC and would be used to
pay for costs of the SBHE approved $8.7 M TrainND new Workforce Training Center.
When there is no longer a requirement for a Reserve Account, the gift funds will be
returned to Williston State College Foundation.
4. Financial implications: Will assist WSC with covering the costs of the nearly
complete $8.7 M new Workforce Training Center, specifically the $888,267 to come
from private/WF training revenues committed to the project.
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5. Academic implications:
None
6. Legal/policy issues: None
7. Review Process: Laurie Fururseth, WSC VP for Business Services; External Bond
Counsel Scott Wagner; and, Murray Sagsveen and Laura Glatt, NDUS
8. Enclosures: WSC Supplemental Resolution
9. Contact person: Laurie Fururseth, 701-774-4250 or
[email protected]
10. Chancellor’s Recommendation: Approve
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$9,375,000
STATE BOARD OF HIGHER EDUCATION OF THE STATE OF NORTH DAKOTA
WILLISTON STATE COLLEGE
TAXABLE HOUSING AND AUXILIARY FACILITIES REVENUE BONDS
(Recovery Zone Economic Development Bonds) SERIES 2010
SUPPLEMENTAL RESOLUTION
WHEREAS, the State Board of Higher Education of the State of North Dakota (the
"Board") is authorized by North Dakota Century Code, Chapter 15-55 to issue its negotiable
bonds to provide funds for university system projects as authorized by the Legislature; and
WHEREAS, the Board adopted the General Bond Resolution of 2010 (the "General
Resolution"), and the Series 2010 Bond Issuance Resolution (the "Series Resolution" and
together with the General Resolution, the "Resolutions") authorizing the issuance of the
captioned bonds (the "Bonds") by the Board for the construction of a new dormitory on the
campus of Williston State College (the "College"); and
WHEREAS, Section 11.01 of the General Resolution and Section 6.1 of the Series
Resolution provides for supplemental resolutions without Bondholder consent to make such
provisions as the Board deems necessary or desirable and which are not inconsistent with the
Resolutions and which do not impair Bondholder security; and
WHEREAS, at the time of Bond closing, College funds in the amount of $526,958.12
were deposited in the Series 2010 Bonds Debt Service Reserve Subaccount held by the Bank of
North Dakota (the "Trustee"); and
WHEREAS, the College has requested to fund the Debt Service Reserve Requirement as
set forth in the Series Resolution from other available funds in the manner and for the purposes
explained to the Board by representatives of the College.
NOW, THEREFORE BE IT RESOLVED by the Board as follows:
Section 1. The Trustee, in consultation with College officials, is authorized and directed
to arrange for a substitution of funds in the Series 2010 Bonds Debt Service Reserve Subaccount
in such manner as is agreed to by the Trustee so as to at all times meet the Debt Service Reserve
Requirement of the Series Resolution.
Adopted: April 30, 2015.
STATE BOARD OF HIGHER EDUCTION
OF THE STATE OF NORTH DAKOTA
Attest:
__________________________
President
_______________________
Secretary
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TRUSTEE'S ACKNOWLEDGMENT AND ACCEPTANCE
Bank of North Dakota hereby acknowledges receipt of the hereinafter referred
Supplemental Resolution regarding the Series 2010 Bond Issuance Resolution and the
$9,375,000 State Board of Higher Education of the State of North Dakota, Williston State
College, Taxable Housing and Auxiliary Facilities Revenue Bonds (Recovery Zone Economic
Development Bonds) Series 2010, and agrees to perform the duties and obligations imposed
upon it as Trustee, registrar and paying agent thereunder.
IN WITNESS WHEREOF, the Trustee has caused this Acknowledgment and Acceptance
to be executed by an officer of the Trustee on May ___, 2015.
BANK OF NORTH DAKOTA
By _______________________________
Title _____________________________
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