L. Finance, Technology, and Human Resources Committee 12:00 noon (ET), March 12, 2010 Conference Room 102B KCTCS System Office, Versailles, Kentucky

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1 L. Finance, Technology, and Human Resources Committee 12:00 noon (ET), March 12, 2010 Conference Room 102B KCTCS System Office, Versailles, Kentucky Page Call to Order Roll Call Approval Minutes Approval of December 3, 2009, Meeting Minutes **Action: Ratification of Personnel Actions Information: KCTCS Budget Development Scenarios Update: KCTCS Quarterly Financial Report Information: KCTCS Board of Regents Accounts Update: Technology Solutions Update: Fulfilling the Promise Campaign Next Meeting June 2010, KCTCS System Office, Elizabethtown Community and Technical College, Elizabethtown, Kentucky Adjournment ** All items listed with two asterisks (**) are considered to be routine by the Board and will be approved by one motion. An item may be removed from the consent agenda at the request of a regent. Agenda items removed from the consent agenda will be discussed in their normal sequence at the full Board of Regents meeting. Consent agenda items will be discussed separately during committee meetings of the Board of Regents. 161

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3 MINUTES KCTCS Board of Regents Finance, Technology, and Human Resources Committee December 3, 2009 DRAFT Committee Members Present: Mr. Larry D. Savage. Committee Chair Mr. Richard A. Bean, Committee Vice Chair Mr. Jackie B. Cecil Dr. Michael Ginsberg Ms. Joyce C. Kelly Ms. Doris C. Thomas Mr. Thomas O. Zawacki Committee Member Absent: Mr. Porter G. Peeples, Sr. CALL TO ORDER Committee Chair Savage called to order the meeting of the Kentucky Community and Technical College System Board of Regents Finance, Technology, and Human Resources Committee at 2:20 p.m. (ET), December 3, The meeting was held in Conference Room 102B of the KCTCS System Office in Versailles, Kentucky. Chair Zawacki announced that the press was notified of the meeting on November 24, 2009, and that Hon. J. Campbell Cantrill, KCTCS General Counsel, would serve as parliamentarian. There being a quorum present, Committee business began with the approval of minutes. APPROVAL OF MINUTES MOTION: Mr. Zawacki moved and Mr. Cecil seconded that the minutes of the September 24, 2009, KCTCS Board of Regents Finance, Technology, and Human Resources Committee be approved. VOTE: The motion was approved by unanimous consent. ADDITIONS OR CHANGES TO THE AGENDA There were no changes or additions to the agenda. ACTION: ANNUAL AUDIT REPORT RECOMMENDATION: That the KCTCS Board of Regents receive the financial audit results for the fiscal year. Chair Savage called on KCTCS President Michael B. McCall to present this item. President McCall introduced representatives of Crowe Horwath LLP, Ms. Laurie A. Haun, Senior Manager in Charge, and Mr. Doug Allen, Senior Staff Auditor, and he welcomed the audit representatives to the meeting. Ms. Haun and Mr. Allen assisted with the presentation. It was noted that the Finance, Technology, and Human Resources Committee 163

4 DRAFT also acts as the Board s Audit Committee and that the KCTCS Board Chair and Finance, Technology, and Human Resources Committee Chair met twice with the auditors. Chair Savage thanked the KCTCS staff responsible for the audit process, noting that they do an outstanding job. Crowe Horwath representatives expressed appreciation to KCTCS management and staff for their readiness, help, and cooperation during the audit process. The representatives noted that the audit went well. Overall, KCTCS auditing support and documentation are very good. Testing of internal controls did result in a management letter citing one deficiency related to pledges and two best practices (one related to the review of return of Title IV funds calculations and the other related to the adoption of a Whistleblower Policy). Auditors noted that KCTCS has responded to the findings listed in the management letter. The audit firm s management comment letter, including KCTCS responses, and other audit correspondence are included in the document titled Audit Correspondence. As mandated by law, audit correspondence has been completed and submitted to the appropriate state and federal agencies. The KCTCS financial statements and the audit firm s opinion letter are included in the document titled Annual Financial Report. The independent opinion issued by Crowe Horwath LLP is an unqualified opinion, which is the highest form of assurance. The unqualified opinion means that the KCTCS financial statements present fairly, in all material respects, the KCTCS financial position on June 30, The auditors reported that there are no weaknesses in the KCTCS internal controls considered to be material weaknesses or significant deficiencies. KCTCS has a strong statement of net assets with approximately $877.9 million in assets and $109.9 million in liabilities resulting in net assets of $768 million. Net assets increased by $76.4 million during fiscal year 2009 from $691.6 million to $768 million. Unrestricted net assets, which are net assets available for operations, decreased for the first time, from $145.6 million at June 30, 2008, to $136 million at June 30, During fiscal year , Governmental Accounting Standard s Board (GASB) Statements 45 and 50 were adopted. These accounting pronouncements relate to postemployment benefits other than pensions and also modify required pension disclosures. The fiscal year 2009 effect of adoption of GASB 45 was an increase in long-term obligations and benefits expense of approximately $18.3 million. There will continue to be an impact from GASB 45 in future years since the unfunded actuarial liability is being amortized over a 30 year period. In compliance with the requirements of the U.S. Office of Management and Budget Circular A-133, KCTCS major federal programs were audited and an unqualified opinion issued. No material weaknesses were identified; however, there was one finding related to return of Title IV funds. The auditors noted that corrective action had been taken regarding an exit counseling finding, which had been a finding for the past four years. The audit report for KCTCS major federal programs is in the document titled Report on Audit of Institution of Higher Education in Accordance with OMB Circular A

5 DRAFT The auditors reported that they also tested the KCTCS President s expenses and that they found nothing out of the ordinary in those expenses. Auditors noted that considering the size and complexity of KCTCS, having only one deficiency and one finding is excellent and demonstrates a good job by KCTCS Finance staff. The Committee commended KCTCS staff, especially President McCall, KCTCS Vice President Ken Walker, System Director of Business Services Wendell Followell, and their staff for the outstanding management of the System s fiscal resources. The results of the audit support KCTCS efforts to be responsible stewards of the public and private funds entrusted to the System. The Committee discussed the finding related to Title IV funds. It was noted that staff researched the financial impact of the finding and estimated that it amounted to less than $2,500 or approximately $10 per student. KCTCS notified the Kentucky Higher Education Assistance Authority of the finding and also reimbursed the agency the $30 for the three test cases resulting in the audit finding. MOTION: Mr. Zawacki moved and Mr. Bean seconded that the Finance, Technology, and Human Resources Committee recommend that the KCTCS Board of Regents receive the financial audit results for the fiscal year. VOTE: The motion was approved unanimously. UPDATE: KCTCS QUARTERLY FINANCIAL REPORT Chair Savage called on President McCall to present the item. Mr. Walker assisted with the presentation. Information for the first quarter of fiscal year , which ended September 30, 2009, was derived from the Administrative Financial System. Actual program and operational expenditures compared to the fiscal year 2010 budget approved by the Board of Regents June 12, 2009, are reflected on the Statement of Revenues and Expenditures. The Statement of Net Assets reflects the overall financial position of the System and includes assets, liabilities, and net assets. As indicated on the Statement of Revenues and Expenditures, through the first quarter total revenues were $333 million, 47 percent of the budgeted revenue and appropriated funds. Current fund expenditures and budget reserve through the first quarter of fiscal year were $230 million, 32 percent of the expenditures budgeted for the year. By the end of the first quarter, 56 percent of the total budgeted tuition revenue had been received and approximately 48 percent of budgeted investment income. All of the budget reserve (from prior year funds) was in place by the end of the first quarter. The Committee discussed the current state revenue estimates, noting that at some point during the biennium higher education budgets likely would have to incur another budget reduction. Anticipating another budget reduction, the Committee suggested that KCTCS continue to be proactive in its budgeting practices and develop Plan B scenarios for discussion at an upcoming Committee meeting. 165

6 DRAFT UPDATE: FACILITIES, MAINTENANCE, AND CAPITAL CONSTRUCTION STATUS REPORT Chair Savage called on President McCall to present this item. Mr. Walker assisted with the presentation. The complete report is included in the document titled Facilities and Capital Construction Status Report, which contains specific project information based on type of project and year funded in addition to information concerning the capital construction process. A report of major initiatives relating to the Office of Facilities Management also is included in the report. The booklet and report are provided to give Board members information on capital projects in their communities and to have information needed to answer questions they may receive about the projects. Twenty new construction or major renovation projects are authorized for the biennium and total approximately $247 million. These projects are in various stages of design or construction as described in the report. An update on major initiatives was provided. A summary of the initiatives follows: Capital Construction: KCTCS staff prepared and submitted the KCTCS Capital Budget Request to the Council on Postsecondary Education. Capital Maintenance. HVAC Maintenance Service Contracts were administered for several existing or recently constructed KCTCS college facilities. The contracts provide for the preventive maintenance and component replacement of all mechanical systems in covered facilities. Five Energy Savings Performance Contracts (ESPC) in the measurement and verification phase were administered at five colleges. Contracts were finalized for three other KCTCS colleges, and contract development continued for the remaining colleges. Four colleges expect to enter the program early The four remaining colleges expect entering the ESPC program during the biennium. Property Management. KCTCS staff visited the Toyota Manufacturing Plant in Georgetown to learn about its recycling program. Using knowledge gained from that visit, staff has begun designing a more comprehensive recycling program for the System Office to be implemented in In addition, staff initiated several new leases, updated insurance policies, and closed 20 insurance claims totaling approximately $400,000. H1N1 Prevention. Facilities Management and the KCTCS Crisis Management Team/Environmental Safety and Health Office have developed guidelines to reduce the occurrence and/or spread of H1N1 in the System Office. The Committee expressed appreciation to Mr. Gary Cloyd, System Director for Facilities Maintenance, and his staff for their good work ensuring that capital projects remain on schedule and within the funding scope. The Committee also discussed the Energy Savings Performance Contracts. It was noted that because of the program s success and the positive return on investment, all KCTCS colleges want to participate in the program. In order to accommodate the colleges requests, a phased approach is being used to obtain ESPCs for all KCTCS colleges. Colleges are being brought into the program in groups of four. 166

7 DRAFT ACTION: RATIFICATION OF PERSONNEL ACTIONS RECOMMENDATION: That the KCTCS Board of Regents ratify the personnel actions listed in the agenda materials. Chair Savage called on President McCall to present the item. KCTCS Vice President Gwendolyn Joseph assisted with the presentation. It was noted that the personnel actions presented were in accordance with reporting guidelines and policies adopted by the KCTCS Board of Regents. MOTION: Mr. Bean moved and Mr. Cecil seconded that the Finance, Technology, and Human Resources Committee recommend that the KCTCS Board of Regents ratify the personnel actions listed in the agenda materials. VOTE: The motion was approved unanimously. UPDATE: KCTCS BOARD OF REGENTS HUMAN RESOURCES UPDATE REPORTS Chair Savage called on President McCall to present this item. Dr. Joseph assisted with the presentation. At the June 12, 2009, KCTCS Board of Regents meeting, the Board discussed the content of future Human Resources (HR) Updates, noting that the report s current content has diminished in relevancy relative to the Board s governance role. Staff was asked to bring a proposal to the September 25, 2009, meeting regarding the content and frequency of future Human Resources Updates. At its September 24 meeting, the Board s Finance, Technology, and Human Resources Committee suggested that discussion of the proposal be postponed until the December 3-4, 2009, Board of Regents meetings. The proposed Human Resources Annual Report would provide an annual demographic profile of regular/full-time employees based on Integrated Postsecondary Education Data System (IPEDS) data that is reported to the Department of Education in November of each year. An initial recommendation is that information be provided graphically on an annual basis in March to facilitate the Board s decisions regarding annual compensation. The report would include: Percentage of Regular Full-time Employees, which would show the number and percentage of employees. Percentage of Regular Full-time Employees by Status. Percentage of Regular Full-time Employees by Gender. Percentage of Regular Full-time Employees by Ethnicity. Average Regular Full-time Compensation. The Committee noted that the proposed report s content is appropriate as is the proposal to present the report annually in March to inform the Board s budgeting process. In addition, the Committee noted that it liked the visual presentation and the inclusion of other information categories related to employee demographics. 167

8 UPDATE: FULFILLING THE PROMISE CAMPAIGN Chair Savage called on President McCall to present the item. KCTCS Vice President Tim Burcham assisted with the presentation. A comprehensive report was distributed at the meeting. As of November 27, 2009, the total number of gifts and pledges recorded for the Fulfilling the Promise Campaign was approximately $93.5 million, with $36.3 million for featured campaign objectives and $57.2 million for non-featured objectives. Since the September 25, 2009, Board of Regents meeting, one lead gift was received. The City of Mayfield, Graves County Fiscal Court, and Graves Growth Alliance gave $500,000 to West Kentucky Community and Technical College. The gift was given to provide support for the purchase of the former Twin Hills Collectible Building. After renovation, the building will house a new skilled craft training center with space for computer classrooms, offices, and industrial work areas. NEXT MEETING Chair Savage announced that the next Finance, Technology, and Human Resources Committee meeting would be March 11, 2010, at the KCTCS System Office in Versailles, Kentucky. ADJOURNMENT Mr. Zawacki moved that the meeting adjourn. Mr. Cecil seconded the motion. VOTE: The motion was approved unanimously, and the meeting adjourned at 3:20 p.m. (ET). 3/12/10 Date Approved by the Finance, Technology, and Human Resources Committee Larry D. Savage Committee Chair 168

9 ACTION RATIFICATION OF Agenda Item L-1 PERSONNEL ACTIONS March 12, 2010 Recommendation That the KCTCS Board of Regents ratify the personnel actions listed in the agenda materials. Rationale On March 19, 1998, the Board of Regents delegated to the KCTCS President the authority to administer personnel actions, with such actions to be presented to the Board for review and ratification at each regularly scheduled Board meeting. Background Kentucky Revised Statute gives governing boards exclusive control of employment, tenure, and official relations of employees. 169

10 Personnel Actions Presented to the KCTCS Board of Regents March 12, 2010 I. Individual Personnel Actions A. Administrative Appointments System Office Quillen, Michael, System Director of Transitional Education, 1/4/10. B. Retirements C. Promotions Promotions with Tenure Promotions without Tenure D. Special Leaves with pay longer than 90 days E. Deaths Big Sandy Community and Technical College Johnson, Columbus, Maintenance and Operations Supervisor, 11/30/09. Elizabethtown Community and Technical College Burnett, Enisa, Virtual Learning Initiative Coordinator, 1/3/

11 II. Summary Personnel Actions A. Academic Appointments Adult Education, 1 Anatomy & Physiology, 1 Biology, 3 Communications, 1 Dental Hygiene, 1 Developmental Education, 1 English, 2 Health Information Technology, 1 History, 1 Mathematics, 5 Medical Assisting, 1 Nursing Assistant, 1 Nursing, 12 Nursing Practical Nursing, 1 Physical Therapy Assistant, 1 Polysonography, 1 Psychology, 1 Respiratory Care, 1 B. Administrative Appointments C. Reappointments D. Terminal Reappointments E. Leaves of Absence Sabbatical with Full Salary, 2010 Fall Semester, 1 Sabbatical with One-Half Salary, Academic Year, 1 F. Retirements Faculty, 6 Staff, 2 G. Resignations Administrators, 4 Faculty, 14 H. Non-Renewal of Appointment Administrators, 1 171

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13 INFORMATION: KCTCS BUDGET Agenda Item L-2 DEVELOPMENT SCENARIOS March 12, 2010 The budget will direct the use of financial resources available to the Kentucky Community and Technical College System to help achieve the mission and vision of KCTCS. The KCTCS Board of Regents discussion of the following factors is necessary at the March 12, 2010, meeting to provide guidance to the KCTCS President and his staff in the development of a proposed budget for consideration at the June 18, 2010, Board meeting State Appropriation The biennial budget is being developed by the 2010 General Assembly. The following table shows the appropriations to KCTCS and the recommended appropriations to KCTCS as included in Governor Beshear s Executive Budget Recommendation to the 2010 General Assembly. Budget Year State Appropriation Federal Stimulus Funds Appropriation Total $200,554,700 $14,376,500 $214,931, $198,166,700 $11,580,300 $209,747, $205,839,600 $0 $205,839,600 The reduction in is the result of a planned transfer of the Corrections Education funding ($5,348,100) from the KCTCS budget to the Justice Cabinet (Department of Corrections) budget and a planned transfer of the East Kentucky Science Center funding ($163,900) from the Education and Workforce Development Cabinet budget to the KCTCS budget. The Kentucky House of Representatives is developing its version of the Appropriations Bill (HB 290). As of the date of this writing for the mailout of the Board meeting materials, the details of the budget being developed by the House of Representatives had not been made available. It is anticipated that detailed information on the House version of the budget will be available by the date of the Board meeting, March 12. If so, staff will have as a handout an updated version of this agenda item that will contain that information. Once the House of Representatives completes its work on the Appropriations Bill, the bill will move to the Senate for its consideration and action. Inevitably, the final version of the Appropriations Bill will be determined by a House-Senate conference committee near the end of the 2010 General Assembly in mid-april. Tuition Rate Increases Following state appropriation for KCTCS provided through the biennial budget, the second primary source of funds to support the KCTCS operating budget is tuition revenue. The Council on Postsecondary Education (CPE) will establish tuition rates for Each $1 increase in the KCTCS tuition per credit hour rate for Kentucky residents (with corresponding rate increases for students from out-of-state) will produce approximately $1.6 million in new tuition revenue. 173

14 Internal Base Reallocation Reallocation of the existing funding base is a third possible source of funds to support Board priorities for expenditure. Fixed Cost Increases in Employee Benefits and Utilities The cost of certain employee benefits and utilities and property insurance will increase in Employee benefits include the increased cost of health insurance coverage for continued participation in the state and University of Kentucky health insurance plans, workers compensation, long-term disability, and unemployment insurance. Current estimates indicate that these employee benefit costs will increase by $3.9 million in , a 10 percent increase. Current estimates indicate that utilities and property insurance costs will increase by approximately $1.1 million in , a 7 percent increase. Thus, fixed costs in employee benefits and utilities and property insurance will increase by an estimated $5.0 million in , a 9 percent increase. Employee Compensation Increases Except for and , the KCTCS Board of Regents has funded increases in compensation for KCTCS faculty and staff each year since KCTCS is one of only two public postsecondary education institutions (UK is the other) that have not provided a base salary increase for faculty and staff for the past two consecutive years. As in the past, the Board must determine compensation increases (salary, benefits, and performance bonuses) for KCTCS faculty and staff. Systemwide, in each 1.0 percent salary increase for full-time faculty and staff would cost $2.4 million. Each year since the Board of Regents has funded the cost of faculty promotion in rank. In the cost of faculty promotions will be approximately $0.8 million. The Board of Regents may consider also providing funds for nonrecurring merit bonuses for high performing faculty and staff in all personnel systems, as it has done in the past several KCTCS budgets. Funding for nonrecurring merit bonuses is included in the recurring budget; therefore, there is no additional cost to maintain the current merit bonus program. Discussion This information will be discussed at the March 12, 2010, KCTCS Board of Regents Finance, Technology, and Human Resources Committee and full Board meetings. 174

15 UPDATE: Agenda Item L-3 KCTCS QUARTERLY FINANCIAL REPORT March 12, 2010 The financial statements depict activity through the second quarter of fiscal year ; the quarter ended December 31, Information for these statements was derived from the KCTCS Administrative Financial System. The Statement of Revenues and Expenditures (Attachment A) reflects actual program and operational expenditures compared to the budget approved by the KCTCS Board of Regents June 12, This report reflects total revenues of $487 million, 68 percent of the budgeted revenue and appropriated funds. The Statement of Revenues and Expenditures also reflects current fund expenditures and budget reserve of $360 million, 51 percent of the expenditures budgeted for the year. The Statement of Net Assets (Attachment B) reflects the overall financial position of the System and includes assets, liabilities, and net assets. 175

16 Attachment A Kentucky Community and Technical College System Statement of Revenues and Expenditures December 31, 2009 (in thousands) APPROVED BUDGET REVENUES General Fund State Appropriations 200,554 REALIZED TO DATE PERCENT $ $ 120,624 60% State Fiscal Stabilization Funds 14,376-0% Tuition and Charges 186, , % Investment Income 6,350 4,215 66% Governmental Grants and Contracts 30,495 14,592 48% Sales/Services of Educational Activities 6,068 1,638 27% Other 54,356 28,286 52% Total General Fund 498, ,580 72% Restricted Funds 214, ,214 59% Total Revenues and Appropriated Fund Balances 713, ,794 68% EXPENDITURES BY PROGRAM Instruction $ 241,403 $ 108,035 45% Public Service 38,608 18,690 48% Academic Support 31,136 16,511 53% Student Services 54,969 22,551 41% Institutional Support 92,366 34,886 38% Student Financial Aid 164, ,185 68% Operations & Maintenance 68,781 26,303 38% Total Expenditures by Program 691, ,161 49% Budget Reserve 21,151 21, % Total Expenditures and Budget Reserve $ 713,019 $ 360,312 51% Current Year Revenues in Excess of Expenditures $ 126,

17 Attachment B Kentucky Community and Technical College System Statement of Net Assets December 31, 2009 and 2008 (in thousands) ASSETS Current Assets Cash and cash equivalents $ 251,388 $ 198,440 Short-term investments 6, Loans, accounts and gifts receivable, net of bad debt 101, ,763 Other current assets 800 1,015 Total current assets 360, ,256 Noncurrent Assets Restricted cash and cash equivalents 16,510 17,642 Loans and other receivables 7,060 8,495 Endowment investments 28,983 20,555 Other long-term investments 56,312 27,045 Capital assets, net 560, ,464 Total noncurrent assets 669, ,201 Total assets 1,030, ,457 LIABILITIES Current Liabilities Accounts payable and accrued expenses 2,614 2,539 Employee withholdings and deposits 12,282 12,111 Compensated absences 11,510 10,465 Deferred revenue 18,140 18,755 Leases payable - current portion 1,998 2,159 Total current liabilities 46,544 46,029 Noncurrent Liabilities Leases payable - noncurrent portion 18,746 12,707 Other long-term obligations 46,395 27,417 Total noncurrent liabilities 65,141 40,124 Total liabilities 111,685 86,153 NET ASSETS Invested in capital assets, net of related debt 540, ,599 Restricted for: Nonexpendable Scholarships, instruction, and other 26,848 13,620 Expendable Scholarships, instruction, and other 21,163 25,444 Loans 16,543 16,060 Capital projects 19,210 51,504 Unrestricted 294, ,077 Total net assets $ 918,645 $ 783,

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19 UPDATE: Agenda Item L-4 KCTCS BOARD OF REGENTS ACCOUNTS March 12, 2010 At the June 12, 2009, KCTCS Board of Regents meeting, the KCTCS Board of Regents briefly discussed establishing KCTCS accounts for each Regent. At that time, Board leadership indicated a desire to discuss the possibility further and requested information on whether Kentucky s other public governing boards publish contact information for their members. It was reported at the September 25, 2009, Board meeting that the majority of Kentucky s public universities, five of the eight, do not list contact information for governing board members. The other three list personal or personal regular mailing addresses. None of the eight list a university account for governing board members. During the September meeting, it was noted that the Kentucky Department of Education and some postsecondary institutions in other states also publish personal contact information for their governing board members. As a result of the Board s discussion at the September meeting, the Board requested that staff propose an system for the Board of Regents to receive meaningful input from Kentuckians and to include guidelines related to Board members responding to s. At the December 4, 2009, Board meeting, a proposal was made and guidelines along with the KCTCS Administrative Policy KCTCS Policy were distributed. After discussion of the proposal, the Board requested that the topic be added to the Finance, Technology, and Human Resources Committee agenda for further consideration. 179

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21 UPDATE: Agenda Item L-5 TECHNOLOGY SOLUTIONS March 12, 2010 KCTCS Number One in Distance Learning Delivery A recent Southern Regional Education Board (SREB) publication, State Data Exchange 40 Years and Still Counting, Highlights, reveals that KCTCS led the 16 SREB states with 20.4 percent of its undergraduate instruction being delivered online. Tennessee, Oklahoma, and North Carolina complete the top four. KCTCS Interactive Digital Center EON Professional Training The KCTCS Interactive Digital Center (IDC) is the national provider of training on use of EON Studio and EON Professional 3D visualization software. During this period IDC trainers provided training to staff from Hazard Community and Technical College, West Kentucky Community and Technical College, West Virginia University at Parkersburg, and Miami University. This training was provided to faculty and staff who are interested in developing content for teaching and learning applications and for staff who are specifically dedicated to the development of visualized learning content. KCTCS IDC Participation in IDC World Symposium The KCTCS IDC staff participated in the January 2010 IDC World Symposium in Irvine, California, at the offices of EON Reality. Staff presented information on the KCTCS Interactive Digital Center and on the services and solutions provided for teaching and learning and workforce. This venue provided an opportunity for promotion of KCTCS, establishment of an expanded network, knowledge of new technologies and innovations that are soon to be released, and business development opportunities. KCTCS IDC Supports Online Learning Programs The KCTCS IDC recently finalized development of 3D interactive models to be integrated into the Industrial Maintenance Technology program online Fluid Power courses as part of the degree offered by Bluegrass Community and Technical College. These models will be accessed directly from the Blackboard learning management system. The IDC has also converted content for integration into Blackboard that was created for Hazard Community and Technical College A+ Computer Certification simulation/application. These solutions are excellent examples of the integration of new applications of 3D into virtual learning. 181

22 KCTCS IDC Contracts Creation of a Large Scale 3D Interactive Product Configurator Update The KCTCS IDC, through working relationship with EON Reality, is building a large scale online 3D product configurator for Lowell Manufacturing of Pacific, Missouri. Lowell is a custom manufacturer of high end technology rack systems for networks, audio, and other components. Phase I of this project is complete with the development of a configurator for PowerStac, a Lowell signature trademark technology. The project will be built over four phases and includes configuration of over 1,200 3D models from Lowell s inventory. The IDC has coordinated with EON Developers, Lowell Engineering, Marketing and Leadership Staff, and other Lowell Web Service providers. The working team supporting this project is located in Bowling Green, Australia, New Jersey, Nevada, and California, which exemplifies the diversity of IDC collaborations for content development. KCTCS IDC staff continue with the coding of a web interface, configuration logic, 3D modeling and prototype creation, and testing of created content. The team has also been working with other partnering service providers to create complex system integration for shopping carts, database integration, and output data. The project culminates with the integration of several hundred 3D models and part files provided by the client and a full live launch of the configurator to Lowell s client base, which is projected for early March. PeopleSoft Upgrade Technology Solutions staff members are working on the next major PeopleSoft upgrade of Campus Solutions (Student Information System) and Human Capital Management (Payroll, Human Resources) which will go live in July This new version of software will greatly enhance self service, interactive student schedule planning, better performance, and streamline business processes. This release also vastly improves the user interface making interactions more intuitive. Spring Registration Activity Very Heavy Technology Solutions staff worked diligently with the PeopleSoft application service provider Cedarcrestone to ensure a smooth beginning for students in January Early January has typically been the busiest time of the year, and 2010 was no exception. On January 11 there were over 75,000 logins to the student system, which is nearly double in comparison to January 2009 statistics. Students were very active making class changes, payments, and checking their course schedules. 182

23 Security Incidents Reported and Investigated There were five significant security breaches since the last report. One stolen laptop contained a number of student reports with personally identifiable information. Two breaches involved web access to DocuShare reports that contained personally identifiable information (administrative error). An administrative employee at a college distributed personally identifiable information to unintended employees through distribution (human error awareness). A student employee at a college changed an employee record at another college (measures were implemented at the system level to prevent future occurrences). All events were reconciled through the security breach process as outlined in KCTCS policy. Technology Solutions Infrastructure Update for , Active Directory, and Support Servers In December the hardware for messaging and its support servers, including the primary Active Directory servers, was upgraded. The KCTCS messaging infrastructure was upgraded to Exchange 2010, and all 150,000+ mailboxes were migrated to the new version. Exchange 2010 provides a rich, familiar Web experience, using any major Web browser, which is especially important for KCTCS students who primarily access through Outlook Web Access. The updated hardware was placed at the newly designed and built Center for Rural Development Network Operation Center located at the Convention Center in Somerset, Kentucky. Microsoft Partnership The Lead Administrative System Programmer Analyst for KCTCS was the keynote speaker representing education on November 10, 2009, for the Microsoft virtual new efficiency launch event. He shared KCTCS experience to date with Exchange 2010 and Windows 7 and how KCTCS is realizing value today with the technology. Also, two case studies were completed with Microsoft based on recent pilots of Windows 7 and Exchange 2010 with the upgraded version of System Center Monitoring Software: Kentucky Community and Technical College System Windows 7 Case Study. Microsoft System Center KCTCS Customer Solution Case Study. 183

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25 UPDATE: Agenda Item L-5 FULFILLING THE PROMISE CAMPAIGN March 12, 2010 As of February 19, 2010, the total number of gifts and pledges recorded for the Fulfilling the Promise Campaign is 26,452. A total of 1,174 volunteers have been enlisted to serve in either soliciting divisions or service divisions; and 14,203 donors have supported the campaign. The Fulfilling the Promise Campaign total is $95,759,532. Of this amount, $37,713,713 is for featured campaign objectives, and $58,045,819 is for non-featured objectives. Nine colleges and the System Office are actively involved in the campaign. The following colleges have celebrated campaign closure: Ashland Community and Technical College, Hazard Community and Technical College, Henderson Community College, Madisonville Community College, Owensboro Community and Technical College, and Somerset Community College. Bluegrass Community and Technical College will enter the campaign soon. The following lead gifts have been received since December 4, 2009, KCTCS Board of Regents report: A gift of $125,000 was given to West Kentucky Community and Technical College by McCracken County for the Community Scholarship Program. A gift of $125,000 was given to West Kentucky Community and Technical College by the City of Paducah for the Community Scholarship Program. A gift of $125,000 was given to West Kentucky Community and Technical College by Paducah Bank for the Community Scholarship Program. A gift of $100,000 was given to West Kentucky Community and Technical College by Computer Services, Inc. for the Community Scholarship Program. A gift of $100,000 was given to West Kentucky Community and Technical College by Paducah Power for the Community Scholarship Program. A gift of $100,000 was given to West Kentucky Community and Technical College by Community Services Bank for the Community Scholarship Program. A gift of $100,000 was given to Maysville Community and Technical College by the Crounse Corporation to the Maysville Scholarship Endowment. At the March 12, 2010, KCTCS Board of Regents meetings, additional information will be provided on the Fulfilling the Promise Campaign. 185

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