Mott Community College Board of Trustees

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1 Mott Community College Board of Trustees Regular Meeting Monday, June 22, 2015 Room 1301 Regional Technology Center AGENDA The mission of Mott Community College is to provide high quality, accessible, and affordable educational opportunities and services that cultivate student success and individual development and improve the overall quality of life in a multicultural community.

2 77 I. CALL TO ORDER Board of Trustees Charles Stewart Mott Community College Regular Meeting, June 22, 2015 Volume 46 AGENDA II. III. IV. ADDITIONS TO THE AGENDA ADOPTION OF THE AGENDA SPECIAL PRESENTATIONS and Budgets - Larry Gawthrop, Chief Financial Officer V. COMMUNICATIONS VI. VII. VIII. IX. COMMENTS FROM THE PUBLIC APPROVAL OF MINUTES Approval of Regular Meeting Minutes of April 27, h Approval of Special Committee of the Whole Minutes of May 8, a Approval of Special Meeting Minutes of May 28, b INFORMATIONAL REPORTS Acceptance of Standing Board Committee Reports: 1. Personnel (Joseph, Norwood, Turner) 2. Finance/Audit (Koegel, Freeman, Snell) UNFINISHED BUSINESS 1.24 Amendment to Board Policy 7300 (Tuition and Fees) X. NEW BUSINESS Consent Agenda: 1.26 Treasurer s Report for May Approval of Regular Meeting Dates for Individual Items: Public Hearing Proposed Operating Budget 1.28 Adoption of Property Tax Millage Rates for Budget Amendment Tuition and Fee Increase Budgets for Adoption Curtice-Mott Building Partial Roof Replacement Purchase Award 1.33 Creation/Appointment of Board Goals and Objectives Ad hoc Committee

3 1.34 Appointment of Michigan Community College Association 119 (MCCA) Representatives 1.35 Appointment of American Association of Community Colleges 120 (AACC) Representatives 1.36 Appointment of Association of Community College Trustees 121 (ACCT) Representatives 1.37 Amendment to Board Policy 1005 (Definitions) First Reading XI. XII. XIII. ADMINISTRATIVE ITEMS President s Report 123 MISCELLANEOUS BUSINESS Comments from Board Members EXECUTIVE SESSION ADJOURNMENT

4 79 FOR ACTION Board of Trustees Charles Stewart Mott Community College Regular Meeting, May 28, 2015 Volume Amendment to Board Policy 7300 (Tuition and Fees) Federal Law PL , the Veterans Access Choice and Accountability Act 2014 (Choice Act) becomes effective July 1, Section 702 of the Choice Act requires the Department of Veterans Affairs to disapprove programs of education if while living in the state of the institution, a covered individual is charged tuition and fees in excess of the rate for resident students at a public institution. This means the VA will disapprove the education programs (ultimately our ability for students to use VA Education Benefits) at Mott Community College if we do not comply with this law. The method of compliance for the State of Michigan requires an institution of higher learning to use specific language in any and all applicable Board policies and has provided an approved recommendation. The approved language being recommended for Board approval is an amendment to Board Policy 7300 (Tuition and Fees). On the basis of the preceding information and to ensure a covered individual is charged the resident tuition rate while living in Michigan, the following resolution is recommended. Be it Resolved, That The Charles Stewart Mott Community College Board of Trustees Amends Board Policy 7300 (Tuition and Fees) as detailed on page 80 (new language denoted by bold): Reviewed and Submitted by: Date: April 27, 2015 Scott J. Jenkins Vice President, Student & Administrative Services Board Policy Statement Reference: 1800 Policy Development General: The Board shall review its policies and shall delete, amend, and supplement existing policies, and/or adopt new policies, as necessary.

5 Tuition & Fees General: Annually, in consultation with the President, the Board will set tuition rates for the College. The following policy statements apply: 1. The President or his/her designee(s) will develop an annual report on recommended tuition, based on projected College revenues and expenditures, comparative study of other community colleges, and the local college/university market. 2. Tuition: Because the costs at the College are subsidized by taxpayers in the College District and the State of Michigan, in-district students receive the lowest tuition rate. Therefore, proof of residency in the District is required to be eligible for the indistrict student tuition rate. There are three types of tuition rates for students: In-District: Legal residents of the College District for at least 30 days preceding the first day of classes. Out-of-District: Legal residents of Michigan for at least 30 days preceding the first day of classes outside of the College District. Out-of-State: Students whose permanent residence is outside of the state of Michigan. In-State Tuition for Military Personnel and Dependents: The College will adhere to the following policy for all active duty members of the armed forces of the United States, or those members spouses and dependent children, as outlined in the Veterans Affairs Handbook. The College retains the right to require any documentation it considers necessary to verify that the student qualifies as active duty military personnel, or as the spouse or dependent thereof. The College will work to identify and eliminate any obstacles students from military families face. In-State Tuition for Veterans: Any individual using educational assistance under either Chapter 30 (Montgomery GI Bill Active Duty Program), Chapter 33 (Post- 9/11 GI Bill), of title 38, United States Code, and /or the Marine Gunnery Sergeant John David Fry Scholarship (38 U.S.C. 3311(b)(9)) who lives in the state of Michigan while attending the College (regardless of his/her formal state of residence) will receive an in-state tuition rate. 3. Fees: Fees may be assessed by the Administration to cover costs such as, but not limited to: Lab/Class Fees Registration Fee Student Services Fee Late Registration Fee

6 81 FOR ACTION 1.26 Treasurer s Report for May 2015 This resolution is recommended. Be it Resolved, That Board of Trustees Charles Stewart Mott Community College Regular Meeting, May 22, 2015 Volume 46 The Charles Stewart Mott Community College Board of Trustees Accepts the financial report of the College for the month of May 2015 as presented by the Administration. Reviewed and Submitted By: Date: June 22, 2015 Lawrence A. Gawthrop Chief Financial Officer Board Policy Statement Reference: 3100 Budget Adoption General: The annual budget represents the programmatic direction and vision of the College. It is also designed to meet both the legal requirements and needs of the College.

7 82 Summary of May Treasurer s Report Larry Gawthrop, CPA Chief Financial Officer June 22, 2015 Month of May s Spending: General Fund: $ 7,336,636 All Other Funds: $ 3,234,913 Total: $ 10,571,549 Comments on General Fund Financial Statements: Statement of Revenues, Expenditures and Changes in Net Assets In summary, total revenues for the eleven months ended May 31, were approximately $68.7 million, representing 90.9% of the annual budget, exactly the same as the prior year. The most significant changes are in the Tuition and fees and State appropriations which are discussed further below. Expenditures for the eleven months ended were $64.9 million, which represents 86.1% of the annual budget, compared $66.4 million and 88.2%, one year ago. A significant difference in the current year is a combination of the Unfunded Actuarial Accrued Liability (UAAL) pass-through from the State of Michigan appearing in both State Appropriations and Fringe benefits, a timing difference in when the transfers were made, and continued savings in Salaries and wages. Revenues Tuition and fees revenues are $35.8 million, $558 thousand less than last year and 99.7% of the budget, compared to 99.3% at this time last year. The amended budget reflects the revised actuals from fall and winter and a revised estimate for the spring 2015 semester. Property taxes collected are roughly $16.4 million. The amount budgeted is $17.4 million, the same as it was in the fiscal year and is based on final taxable value figures provided by the Genesee County Equalization Department. State appropriations payments for FY are paid in eleven monthly installments starting in October. The total budgeted amount for the current fiscal year is $18.4 million or roughly $400 thousand (2.7%) more than last year excluding the UAAL stabilization pass-through. We received our May payment without exception.

8 83 Expenditures Salaries and Wages are roughly $33.4 million, or 88.3% of the annual budget, compared to $35.7 million and 89.3% a year ago. The decrease in actual expenses year over year is attributable to the lower class offerings in response to lower enrollment and thereby less instructional costs, continued holds on vacant positions and transfer of Mott temporary workers to a temporary agency on January 1st. Fringe Benefits are at $16.5 million, or 84.7% of the budgeted amount compared to $18.6 million and 86.4% of the budget one year ago. The increase in this line item is directly attributed to the UAAL stabilization payment received by the State of Michigan that is directly remitted to the Office of Retirement Services (ORS) for the unfunded retirement obligation. Other Expenditures A majority of the changes in the Other Expenses area for May is due in large part to an increase in the contracted services line item in the area of maintenance, ITS, and moving Mott temps to the temp agency and the timing of the transfers made from year to year. Balance Sheet Total Assets are at approximately $21 million, up $622 thousand from last May. The largest differences are a $1.2 million decrease in Cash and cash equivalents, a $2.4 million increase in Due from other funds and a $564 thousand decrease in Accounts receivable. The Accounts receivable decrease is due to lower enrollment, the reduction of the allowance for doubtful accounts and continued work on the collection and student accounts receivable management process. Due to/due from Other Funds result from the College maintaining one checking account for all of its funds; deposits and disbursements. This necessitates the shortterm loaning or borrowing between the funds throughout the year depending on which funds revenue or expenditures are being deposited or paid out. Each month the accounting department clears these due to s and due from s respectively assigning the activity to the proper fund. However, significant activity can occur after these transfers are completed, causing large variances when compared to the previous period. At roughly $11 million, Total Liabilities are down $964 thousand from the prior year. The most significant changes were decreases in Other accrued liabilities and Accrued payroll and related liabilities. The other accrued liabilities were due to an overall reduction in the valuation we recorded for past property tax refund obligations and reduction in the actuarial valuation of the college liability for termination benefits paid upon leaving employment at MCC and accrued payroll is due in part to timing differences in month-end cutoff year over year as well as less payroll overall.

9 84 Comments on spending from other funds: Of the roughly $3.2 million expended in the other funds, $547 thousand was charged to depreciation, $360 thousand was expended out of the Maintenance and Replacement funds, $560 thousand out of the Bond funds, and the remaining $1.7 million out of the Agency, Scholarships, and Federal Grants, for grant activities and student scholarships.

10 85 Mott Community College General Fund Statement of Revenues, Expenditures and Changes in Net Assets - Modified Accrual For the 11 Months Ended May 31, 2015 With Comparative Totals at May 31, 2014 FY Budget YTD Actuals as of 5/31/15 YTD Actuals as of 5/31/14 Actual to Actual $ Change Actual to Actual % Change Tuition and fees $ 35,872,035 $ 35,782,097 $ 36,340,535 $ (558,438) -1.54% Property taxes 17,438,093 16,378,351 16,409,586 (31,235) -0.19% State appropriations 18,427,215 13,436,363 12,359,931 1,076, % Ballenger trust 1,891,446 1,733,826 1,618, , % Grants and other 1,935,841 1,368,580 1,530,680 (162,100) % Total revenues 75,564,630 68,699,217 68,259, , % Salaries and wages 37,804,980 33,381,854 35,677,418 2,295, % Fringe benefits 19,495,862 16,516,877 16,080,755 (436,122) -2.71% Contracted services 5,965,929 4,426,456 4,140,936 (285,520) -6.90% Materials and supplies 2,300,771 1,795,461 1,734,355 (61,106) -3.52% Facilities rent 172, , ,626 (10,467) -6.13% Utilities and insurance 2,734,635 2,602,831 2,696,037 93, % Operations/communications 5,261,539 4,569,604 4,326,193 (243,411) -5.63% Transfers out 1,345,617 1,263,527 1,371, , % Equipment and Improvements 324, , ,503 (20,381) % Total expenditures 75,405,522 64,935,587 66,375,285 1,439, % Net increase/(decrease) in net assets 159,108 3,763,630 1,884,063 1,879, %

11 86 Mott Community College General Fund Balance Sheet - Modified Accrual May 31, 2015 With Comparative Totals at May 31, 2014 As of As of May 31 May 31 $ Change Assets Current Assets Cash and cash equivalents $ 12,038,944 $ 13,193,139 $ (1,154,195) Due from other funds 1,215,556 (1,191,696) 2,407,252 Accounts receivable - net of allowance for uncollectible accounts ($4,529,594 for 2015 and $5,286,901 for 2014) 7,382,862 7,946,851 (563,989) Inventories 48,024 44,069 3,955 Prepaid expenses and other assets 360, ,408 (71,354) Total Assets $ 21,045,440 $ 20,423,771 $ 621,669 Liabilities and Net Assets Current Liabilities Accounts payable $ 1,604,353 $ 1,150,904 $ 453,449 Accrued payroll and related liabilities 1,461,850 2,024,772 (562,922) Deposits held for others 14,682 14, Other accrued liabilities 151, ,470 (300,013) Total Current Liabilities 8,661,841 9,510,870 (849,029) Accrued termination pay 2,332,096 2,447,677 (115,581) Total Liabilities 10,993,937 11,958,547 (964,610) Net Assets Unrestricted 10,051,503 8,465,224 1,586,279 Total Net Assets 10,051,503 8,465,224 1,586,279 Total Liabilities and Net Assets $ 21,045,440 $ 20,423,771 $ 621,669

12 87 FOR ACTION 1.27 Schedule of Regular Meetings for Board of Trustees Charles Stewart Mott Community College Regular Meeting, June 22, 2015 Volume 46 The following dates are recommended for regular meetings of the Charles Stewart Mott Community College Board of Trustees for the year: August 24, 2015 January 25, 2016 September 28, 2015 February 22, 2016 October 26, 2015 March 28, 2016 November 23, 2015 April 25, 2016 December 21, 2015 (early due to Winter May 16, 2016 (early due to Memorial Day holiday) holiday season) June 27, 2016 All meetings will begin at 7:30 p.m. A Committee of the Whole session may be held at 6:30 p.m. The location for all meetings shall be determined by posted meeting notice. On the basis of the preceding information, the following resolution is recommended. Be it Resolved, That The Charles Stewart Mott Community College Board of Trustees Adopts the above schedule of dates for the regular meetings of the Board of Trustees for the year. Reviewed and Submitted by: Date: June 22, 2015 Michael Simon Assistant Secretary, Mott Community College Board of Trustees Board Policy Statement Reference: 1500 Board Meetings General: The Board shall transact all business, including information sessions, at public and legally noticed Board meetings.

13 88 FOR ACTION Board of Trustees Charles Stewart Mott Community College Regular Meeting, June 22, 2014 Volume Approval of Property Tax Millage Rates for Section 141 of the Community College Act (1966 PA331) states: The Board of Trustees shall prepare annually on a day to be determined by the Board in each district, an estimate of the amount of taxes or appropriation deemed necessary for the ensuing fiscal year for the purposes of expenditures authorized by law as within the powers of the Board. The College is authorized and required to levy such ad valorem taxes as may be necessary for the payment of such principal and interest, which taxes may be imposed without limitation as to rate or amount. The Administration has calculated the maximum allowable operating millage rate and desires to levy that rate in accordance with Michigan Compiled Law (MCL) d ( Headlee ) Millage Reduction Fractions, and Truth in Taxation rollbacks under Michigan Compiled Law (MCL) e. Management, in accordance with the Community College Act, has calculated the necessary debt millage rate to be.8700 to meet payments of principal, interest, and fees on all outstanding bonds in the fiscal year. On the basis of the preceding information the following resolution is recommended. Be it Resolved, That The Charles Stewart Mott Community College Board of Trustees Adopts the operating millage rate of mills and the debt millage rate of mills for the fiscal year, and directs Administration to notify all cities, townships, and counties of the new rates forthwith. Reviewed and Submitted By: Date: June 22, 2015 Lawrence A. Gawthrop Chief Financial Officer Board Policy Statement Reference: 3100 Budget Adoption General: The annual budget represents the programmatic direction and vision of the College. It is also designed to meet both the legal requirements and needs of the College.

14 89 FOR ACTION 1.29 Budget Amendment Board of Trustees Charles Stewart Mott Community College Regular Meeting, June 22, 2015 Volume 46 At the regular meeting of the Charles Stewart Mott Community College Board of Trustees on June 18, 2014, the Board of Trustees adopted the budgets for the fiscal year. In compliance with Public Act 621 of 1978, as amended, known as the Uniform Budgeting and Accounting Act, the Administration has amended the College s budgets to reflect more current estimates of revenues and expenditures. On the basis of the preceding information the following resolution is recommended. Be it Resolved, That The Charles Stewart Mott Community College Board of Trustees Adopts the Budgets as amended for the fiscal year as shown on pages Reviewed and Submitted By: Date: June 22, 2015 Lawrence A. Gawthrop Chief Financial Officer Board Policy Statement Reference: 3100 Budget Adoption General: The annual budget represents the programmatic direction and vision of the College. It is also designed to meet both the legal requirements and needs of the College. (3). Budget revisions will be presented for Board action as necessary, but not less than twice a year, in February and June.

15 Budget Amendment June 22, 2015 The budgets have been prepared in accordance with generally accepted accounting principles (GAAP) for financial reporting of colleges and universities, and in compliance with the Uniform Budgeting and Accounting Act of 1978 (Public Act 621 as amended). They are presented as required in MCC Board Policy #3100: Budget Adoption, statement #3. Mott Community College Larry Gawthrop, CPA CM Chief Financial Officer General Fund (01) Tuition and Fees revenue is adjusted downward by $150 thousand or.4% from the original budget. The decrease is due to a higher than anticipated enrollment and contact hour decrease in the Spring 2015 semester. Tuition and fees now make up 47.4% of total budgeted revenues. Property Tax as a revenue source is now 23.0% of the total budget. The operating millage rate for FY is mills unchanged from last year s rate. State Aid has not been adjusted for the amended budget. State aid as a revenue source now represents 24.4% of total budgeted revenues, including the $2.6 million in the Unfunded Actuarial Accrued Liability (UAAL). Exclusive of the UAAL, State aid represents 22% of revenue The above three major revenue sources represent 95% of the total budget. The remaining 5% of revenue sources include investment earnings distributions from the Ballenger Trust fund and Grants and Other income (e.g., rental and auxiliary activities). Total revenues and transfers are $137 thousand lower than the Amend I budget.

16 Budget Amendment Page 2 91 General Fund (01) (continued) Salaries and Wages as an expenditure category is 50% of the total budget. Fringe Benefits as an expenditure category are 26% of the total expense budget. Total Salaries, Wages and Fringe Benefits in total equal 76% of the college s expense budget, within the maximum set by Board Policy. The total decrease of about $170 thousand compared to the Amend1 budget for FY14-15 is due in part to the work by the college on course section management and release of open position pool dollars in an attempt to minimize the budget impact on the decreased enrollment. Contracted Services, Materials and Supplies, and Utilities increased approximately $84 thousand; as a result of increased focus on expenditure reductions. Operations and Communications decreased $125 thousand mainly due to less bad debt write offs of student accounts receivable accounts. Transfers include required transfers to keep our reserves and Board policy levels, transfers for annual maintenance and repair projects, and for designated scholarships. There was an increase of budget dollars in Fund 72, capital spending accounts, and a reduction in the scholarship designated fund. All other expenditure categories are not being amended. Total expenditures are $233 thousand, or.31% lower than the original budget, keeping in line with cost containment measures adopted by the college. The General Fund Balance is expected to be $6.5 million at June 30, 2015, and increase of $250 thousand. The revised ending balance represents 8.7% of the operating budget, well within the Board Policy of 5-10% of General Fund expenditures. Designated Fund (02) In the Scholarships Fund, a downward adjustment of $14 thousand was made to reflect the net scholarship activity for the year so far with an offsetting decrease in the transfer from the General Fund. The Paid Parking and Student Copy Machine expenditures were decreased approximately $8 thousand to allow for planned capital projects taking place in the parking areas. The Campus Life Enrichment Fund (CLEF) and Student Clubs were adjusted to actual activities for the year. The Instructional Technology budgets were adjusted to actuals. There are no other significant changes to the budget in the Designated Fund and Rainy Day Fund.

17 Budget Amendment Page 3 92 Auxiliary Fund (03) Major activities in the Auxiliary Fund are Catering, Vending, Bookstore, and Student Computer Lab Pay for Print. A $8 thousand positive adjustment was made to vending revenue, a $92 thousand decrease in the bookstore revenue due to the reduction in enrollment and a $2 thousand increase in the student computer labs. The net effect of these adjustments and net overall increase of $7 thousand in the related expenses, results in a $92 thousand decrease in the amount transferred to the General Fund from the Auxiliary Fund (03) making the total budgeted transfer $582,300. Maintenance and Replacement Fund (72) Expenditures within the fund account for ongoing capital repairs, deferred maintenance items and equipment and technology life cycle funding plans capital items not eligible for funding from bond proceeds. The most significant changes are the receipt of insurance proceeds, and the regularly scheduled transfers and amended budget changes for the Student Technology Fees. Debt Retirement Fund (73) The only significant changes were in the current year premium, and adjustments for the discount, cost of issuance and a reduction in the interest expense attributable to the refunding activity in the current year. Building and Site Fund (78) Fund 78 accounts for the building and site fund reserves as required by Board Policy #3930 Fiscal Reserves. This fund reports the installment purchase payments for Lapeer. The ending fund balance at June 30, 2015 is budgeted to be $1.3 million and meets the Board Policy #3930 range of 1-3% of the college s depreciated assets. Building and Site Fund (83) Fund 83 accounts for the 2014 series bonds issued by the college in March of These funds are used for capital projects needs of the college outside of the scope of the General Fund. The amended adjustments represent an increase in the investments earned and an acceleration of spending related to the State technology grants awarded to us that was not known at the Amend I budget in February 2015.

18 93 MOTT COMMUNITY COLLEGE General Fund (Fund 01) Amend Budget Fiscal Year Current Budget Amended Budget $ Change % Change Tuition and Fees $ 35,998,023 $ 35,847,600 $ (150,423) -0.42% Property Taxes 17,438,093 17,438,093 - State Appropriations 18,427,215 18,427,215 - Ballenger Trust 1,891,446 1,891,446 - Grants and Other 1,944,880 1,957,828 12, % Total $ 75,699,657 $ 75,562,182 $ (137,475) -0.18% Salaries and Wages $ 37,736,676 $ 37,523,332 $ (213,344) -0.57% Fringe Benefits 19,492,862 19,535,677 42, % Contracted Services 6,132,002 6,071,368 (60,634) -0.99% Materials and Supplies 2,373,576 2,350,175 (23,401) -0.99% Facilities Rent 172, ,052 - Utilities and Insurance 2,734,635 2,734,635 - Operations/Communications 5,245,257 5,120,026 (125,231) -2.39% Transfers Out 1,345,617 1,492, , % Equipment and Improvements 306, ,137 - Total $ 75,538,814 $ 75,305,519 $ (233,295) -0.31% Surplus/(Deficit): $ 160,843 $ 256,663 $ 95, % Budgeted Increase in Fund Balance $ (250,000) Final Surplus/(Deficit): $ 6,663 Ending Net Assets: $ 6,448,720 $ 6,544,540 $ 95, % LAPEER* Tuition and Fees $ 1,853,034 $ 1,826,063 $ (26,971) -1.46% Grants and Other 83,787 84, % Total $ 1,936,821 $ 1,910,354 $ (26,467) -1.37% Salaries and Wages $ 171,478 $ 579,208 $ 407, % Fringe Benefits 75, , , % Contracted Services 30,000 30,000 - Materials and Supplies 5,500 5,500 - Operations/Communications 39,520 39,520 - Transfers to Building & Site 75,000 75,000 - Capital Outlay 12,500 12,500 - Total $ 409,187 $ 971,854 $ 562, % Surplus/(Deficit): $ 1,527,634 $ 938,500 $ (589,134) % Ending Net Assets: $ 1,527,634 $ 938,500 $ (589,134) %

19 94 (continued) Current Budget Amended Budget $ Change % Change LIVINGSTON REGIONAL M-TEC* Tuition and Fees $ 859,300 $ 636,154 $ (223,146) % Grants and Other 105,260 98,993 (6,267) -5.95% Total $ 964,560 $ 735,147 $ (229,413) % Salaries and Wages $ 173,861 $ 174,671 $ % Fringe Benefits 82,865 82, % Contracted Services 384, ,485 (45,140) % Materials and Supplies 113,108 91,425 (21,683) % Operations/Communications 24,680 24,624 (56) -0.23% Capital Outlay 18,637 18,637 - Total $ 797,776 $ 731,817 $ (65,959) -8.27% Surplus/(Deficit): $ 166,784 $ 3,330 $ (163,454) 10 Ending Net Assets: $ 166,784 $ 3,330 $ (163,454) 10 LAPEER CORPORATE SERVICES * Beginning Net Assets: $ - $ - $ - Tuition and Fees $ 212,900 $ 136,299 $ (76,601) % Grants and Other 10,000 5,127 (4,873) % Total $ 222,900 $ 141,426 $ (81,474) % Salaries and Wages $ 32,381 $ 36,181 $ 3, % Fringe Benefits $ 9,561 $ 10,574 1, % Contracted Services $ 96,892 $ 82,102 (14,790) % Materials and Supplies $ 12,100 $ 10,382 (1,718) % Operations/Communications 6,658 6,483 (175) -2.63% Total $ 157,592 $ 145,722 $ (11,870) $ (0) Surplus/(Deficit): $ 65,308 $ (4,296) $ (69,604) % Ending Net Assets: $ 65,308 $ (4,296) $ (69,604) % * Lapeer, Livingston, and Lapeer Corporate Services budgets are parts of the General Fund budget

20 95 MOTT COMMUNITY COLLEGE Designated Fund (Fund 02) Amended Budget Fiscal Year Scholarships: Current Budget Amended Budget $ Change % Change Mott Memorial Building Rentals $ 83,000 $ 74,000 $ (9,000) % Transfers from General Fund 500, ,917 (3,500) -0.70% Total $ 583,417 $ 570,917 $ (12,500) -2.14% Athletic Scholarships $ 218,000 $ 209,000 $ (9,000) -4.13% Trustee Scholarships 275, ,000 1, % Senior Citizens Scholarships 50,000 51,000 1, % Presidential Scholarships 12,000 8,500 (3,500) % Honors Scholarships 42,000 40,000 (2,000) -4.76% Total $ 597,000 $ 584,500 $ (12,500) -2.09% Paid Parking and Student Copy machines: Surplus/(Deficit): $ (13,583) $ (13,583) $ - Ending Net Assets: $ - $ - $ - Paid Parking Fees $ 92,000 $ 90,500 $ (1,500) -1.63% Student copy machine fees 700 1, % Total $ 92,700 $ 91,500 $ (1,200) -1.29% Capital Outlay $ 100,000 $ 100,000 $ - Total $ 100,000 $ 100,000 $ - Surplus/(Deficit): $ (7,300) $ (8,500) $ (1,200) 16.44% Ending Net Assets: $ 189,263 $ 188,063 $ (1,200) -0.63% Campus Life Enrichment Fund (CLEF) and Student Clubs: Student Activity Fees $ 118,000 $ 109,005 $ (8,995) -7.62% CLEF Allocation Tfrs 200, ,000 (15,000) -7.50% Miscellaneous Revenues 32,295 29,349 (2,946) -9.12% Total $ 350,295 $ 323,354 $ (26,941) -7.69% CLEF Allocations $ 200,000 $ 185,000 $ (15,000) -7.50% Club Activities 139, ,000 (4,000) -2.88% Total $ 339,000 $ 320,000 $ (19,000) -5.60% Surplus/(Deficit): $ 11,295 $ 3,354 $ 7, % Ending Net Assets: $ 279,139 $ 271,198 $ (7,941) -2.84%

21 96 (continued) Current Budget Amended Budget $ Change % Change Instructional Technology: Student Fees $ 1,595,496 $ 1,538,000 $ (57,496) -3.60% Total $ 1,595,496 $ 1,538,000 $ (57,496) -3.60% Instructional Technology Support $ 40,000 $ 49,870 $ 9, % Transfers to Maint./Repl. Fund 1,555,546 1,488,180 (67,366) -4.33% Total $ 1,595,546 $ 1,538,050 $ (57,496) -3.60% Surplus/(Deficit): $ (50) $ (50) $ - Ending Net Assets: $ - $ - $ - Designated Projects: Pierce Community Activity Fund $ 8,622 $ 8,622 $ - Total $ 8,622 $ 8,622 $ - Pierce Community Activity Fund $ - $ - - Total $ - $ - $ - Surplus/(Deficit): $ 8,622 $ 8,622 $ - Ending Net Assets: $ 56,809 $ 56,809 $ - Rainy Day Fund Transfer $ - $ - $ - Total $ - $ - $ - Rainy Day Fund $ - $ - $ - Transfer to General Fund Total $ - $ - $ - Surplus/(Deficit): $ - $ - $ - Ending Net Assets: $ 750,000 $ 750,000 $ -

22 97 MOTT COMMUNITY COLLEGE Auxiliary Fund (Fund 03) Amended Budget Fiscal Year Current Budget Amended Budget $ Change % Change Catering 262, ,600 - Vending 77,000 85,000 8, % Bookstore 632, ,000 (92,500) % Student Computer Lab 20,000 22,000 2,000 1 Lapeer Campus Auxiliary Total $ 992,100 $ 909,600 $ (82,500) -8.32% Catering 267, ,600 - Vending Supplies Bookstore Overhead 35,000 37,000 2, % Student Computer Lab 15,000 22,000 7, % Transfers to General Fund 673, ,300 (91,500) % Total $ 992,100 $ 909,600 $ (82,500) -8.32% Surplus/(Deficit): $ - $ - $ - Ending Net Assets: $ - $ - $ -

23 98 MOTT COMMUNITY COLLEGE Maintenance and Replacement Fund (Fund 72) Amended Budget Fiscal Year Current Budget Amended Budget $ Change % Change Transfer from General Fund $ 765,000 $ 915,000 $ 150, % Transfer from Designated Fund(Tech Fee) 1,555,546 1,488,180 (67,366) -4.33% Other Revenue 32,933 32, Investment Income 3,000 12,000 9, Total $ 2,356,479 $ 2,448,113 $ 91, % Vocational Education Equipment $ 407,344 $ 407,000 $ (344) -0.08% Vehicle Replacement 42,144 42, Technology Replacement/Upgrade 156, ,898 11, % Technology Fee Equipment 1,557,203 1,405,557 (151,646) -9.74% Facilities Master Plan 72, , , Other Maintenance Projects 611, ,156 86, % Total $ 2,846,788 $ 3,012,243 $ 165, % Surplus/(Deficit): $ (490,309) $ (564,130) $ (73,821) 15.06% Ending Net Assets: $ 3,942,607 $ 3,868,786 $ (73,821) -1.87%

24 99 MOTT COMMUNITY COLLEGE Debt Retirement Funds (Fund 73) Amended Budget Fiscal Year Current Budget Amended Budget $ Change % Change Property Taxes $ 7,341,167 $ 7,341,167 $ - Bond Premium 160, ,341 25, % Interest Income 656 1, % Total $ 7,502,580 $ 7,528,625 $ 26, % Administrative Fees $ 2,500 $ 2,500 - Bond Discount 194, ,312 (28,412) % Cost of Issuance - 137, , Interest on Indebtedness 1,971,126 1,580,525 (390,601) % Retirement of Indebtedness 5,595,000 5,595,000 - Total $ 7,763,350 $ 7,481,836 $ (281,514) -3.63% Surplus/(Deficit): $ (260,770) $ 46,789 $ 307, % Ending Net Assest $ 422,712 $ 730,271 $ 307, %

25 100 MOTT COMMUNITY COLLEGE Buildng and Site Fund (Funds 78) Amended Budget Fiscal Year Current Budget Amended Budget $ Change % Change Fund 78 - Building & Site Reserve Fund Investment Income $ 720 $ 654 $ (66) -9.17% Total $ 720 $ 654 $ (66) -9.17% Lapeer Purchase $ 232,958 $ 232,958 $ - Total $ 232,958 $ 232,958 $ - Surplus/(Deficit): $ (232,238) $ (232,304) $ (66) 0.03% Ending Net Assets: $ 1,328,997 $ 1,328,931 $ (66) MOTT COMMUNITY COLLEGE Building and Site Fund (Funds 83) Amended Budget Fiscal Year Current Budget Amended Budget $ Change % Change Investment Income $ 5,614 $ 11,758 $ 6, % Total $ 5,614 $ 11,758 $ 6, % Bond Project Costs $ 5,331,994 $ 5,842,507 $ 510, % Finance Charges 2,500 2,500 - Total $ 5,334,494 $ 5,845,007 $ 510, % Surplus/(Deficit): $ (5,328,880) $ (5,833,249) $ (504,369) 9.46% Ending Net Assets: $ 3,805,929 $ 3,301,559 $ (504,370) %

26 101 FOR ACTION Board of Trustees Charles Stewart Mott Community College Regular Meeting, June 22, 2015 Volume Tuition and Fee Increase In light of the less than inflationary increases in local and state funding, minimal increases in state funding, and the necessity to continue with sound business practices while ensuring the availability of sufficient resources to provide quality student success programs and services and maintain academic integrity, a tuition increase beginning with the Winter 2016 semester is necessary. On the basis of the preceding information, the following resolution is recommended. Be it Resolved, That The Charles Stewart Mott Community College Board of Trustees Approves tuition and fee increases to begin in the Winter 2016 Semester as follows: 2015 Calendar Year Rate 2016 Calendar Year Rate Increase Per: In-District Rate $ $ % Out of District Rate $ $ % Contact Hour Out of State Rate $ $ % Institutional Technology Fee $ 7.24 $ % Student Administrative Fee $ 8.76 $ % Semester Student Services Fee $ $ % Reviewed and Submitted By: Date: June 22, 2015 Lawrence A. Gawthrop Chief Financial Officer Board Policy Statement Reference: 3310 Tuition General: Tuition and fees constitute a major source of revenue in support of a comprehensive program. The Board of Trustees acknowledges the importance of tuition and fees as a revenue source, while striving to hold rates at a reasonable level to enhance competitiveness in the marketplace and cost to students. (1). The Board will review and set tuition and fees periodically. (3). When fiscally prudent, tuition and fee increases will conform as much as possible to state tuition restraint guidelines.

27 102 FOR ACTION Budgets for Adoption Board of Trustees Charles Stewart Mott Community College Regular Meeting, June 22, 2015 Volume 46 The budgets as presented were prepared using the best estimates of revenues and expenditures available at the time and in accordance with established and generally accepted budgeting procedures. On the basis of the preceding information the following resolution is recommended. Be it Resolved, That The Charles Stewart Mott Community College Board of Trustees Adopts the budgets for the fiscal year as shown on pages and approves the Table of Approved Positions on page 108. Reviewed and Submitted By: Date: June 22, 2015 Lawrence A. Gawthrop Chief Financial Officer Board Policy Statement Reference: 3100 Budget Adoption General: The annual budget represents the programmatic direction and vision of the College. It is also designed to meet both the legal requirements and needs of the College. (1). Prior to the end of each fiscal year, the Board will adopt a balanced General Fund Operating Budget, and other fund budgets as appropriate, to the end of the current fiscal year, in accordance with the Uniform Budgeting and Accounting Act of 1968, as amended from time to time.

28 Mott Community College Budget Proposal 103 Lawrence A. Gawthrop, CPA CM Chief Financial Officer June 22, 2015 The budgets have been prepared in accordance with generally accepted accounting principles (GAAP) for financial reporting of colleges and universities, and in compliance with the Uniform Budgeting and Accounting Act of 1978 (Public Act 621 as amended). They are presented as required in MCC Board Policy #3100: Budget Adoption, statement #1. General Fund (01) Tuition and Fees represent 46.4% of the total revenue budget for , down from 47.4% in This continues to be the largest category of operating revenues for the college, and will continue to be so in the foreseeable future, as we continue to receive less than inflationary state aid increases and inflationary increases in property tax revenues. Also included in this category is revenue from all academic credit courses as well as all non-credit courses and training activities, except for grant-funded training projects. Overall tuition and fees are budgeted at $34.6 million, a decrease of $1.2 million, or 3.5% lower than the final amended budget, a net decease further explained in the following paragraph. Credit-side tuition and fees (main campus, Southern Lakes Site-Fenton, Lapeer, Northern Tier Center and distance learning) are accounted for as a group in the General Fund. Based on an anticipated 6% decrease in credit side enrollment and contact hours for the budget year, and a $4.04 in-district per contact hour rate increase for tuition and fees for the for the calendar year 2015, is how we arrive at the $1.2 million or 3.5% decrease in this revenue line item. We are taking several steps to positively impact this anticipated decline and any positive outcomes will be reflected in the Amend I budget. Property Taxes are budgeted at 23.7% of total revenues, which is.7% higher than the budget. The 2015 property taxable values have been published by Genesee County as of May 2015 and administration will recommend that we levy the same millage rate as 2014, as allowed by the Uniform Budgeting Act, which is Based on the collection rate and a 1.6% increase in taxable values next year, an increase of $225 thousand is budgeted as compared to the amended budget. State Aid has decreased as a proportion of total revenues over the past 10 years from 36% in to 24.4% in The proposed budget includes a $250 thousand increase in the spendable state aid appropriation, inclusive of the Renaissance Zone reimbursement and totals approximately $15.9 million. The above three major revenue sources represent 95.0% of the total budget.

29 Budget Proposal Page 2 Ballenger Trust, and Grants and Other revenue sources contribute the remaining 5% of the proposed budget. This category includes investment earnings from the Ballenger Trust fund, which is forecast to increase approximately $51 thousand for Exact distribution figures will be calculated by First Merit Bank as trust administrator in July This endowment fund is budgeted to bring approximately $1.9 million in unrestricted revenue to the College for , some of which will fund the Ballenger Speaker Series and the Ballenger Chair activities. A $400,000 contribution, which represents a $35,000 increase from the Foundation for Mott Community College (FMCC) is also budgeted here. This is the fifth consecutive year the FMCC has made a general fund contribution to the college. Other income sources such as facilities rentals, indirect cost recovery, and educational-related sales are projected to be flat. Salaries and Wages are about 50% of the total expenditure budget. The Table of Approved Positions provides information as to the departments where the authorized positions reside. Fringe Benefits as an expenditure category is about 23.4% of the total expense budget, excluding the Unfunded Actuarial Accrued Liability (UAAL) pass-through from the State of Michigan. Total Salaries, Wages and Fringe Benefits in total is 73.4% of the expenditure budget, within the 77% target set by Board Policy. In the budget year, all employee groups across the college, with the exception of the Administrative Support group, who gave up cash-in-lieu for its members and used that savings for a wage increase, will receive a zero percent salary increase. The budget impact of this along with anticipated savings in part-time, adjunct and overload faculty salaries from continued course section management, changes in steps, holds on vacant positions and funding accrued vacation and retirement liabilities is anticipated to be the same as to, therefore there is no budgeted increase. Fringe Benefits are projected to decrease by about $120 thousand or.6% from the final budget. This decrease is comprised of a medical insurance increases, a slight increase to the Michigan Public School Employees Retirement System (MPSERS) rates and a decrease in the number of open positions budgeted. Contracted Services as an expenditure category is about 7.25% of the budget and is reduced $680 thousand from the previous year through strategic targeted reductions. Materials and Supplies is about 3.0% of the total expenditure budget and represents a decrease of $84 thousand compared to the final amended budget, due mainly to the budgeted decrease in enrollment. Utilities and Insurance as an expenditure category is about 3.8% of the total expense budget. The proposed budget includes an increase of about $68 thousand or 2.5% as compared to the latest amended budget. The budgeted increase accounts for expected continuing rate increases for gas, electricity and water coupled with anticipated energy savings from the work with Cenergistics. Operations/Communications as an expenditure category is about 7% of the total expense budget. This represents an increase of about $100 thousand as compared to the final amended budget. Major areas in this category include: AQIP key strategic initiatives, contingency funds for potential legal settlements, debt write-off, interest costs, collection agency fees, telephone, marketing, printing, and professional development, as well as, amounts for potential unknown contingencies. Transfers as an expenditure category includes the planned annual transfer to the Maintenance and Replacement Fund, as well as other transfers, the largest of which is for board designated scholarships. The increase of $317 thousand is due largely to funding of a portion of the repairs and maintenance needs being restored in this budget year. 104

30 Budget Proposal Page 3 Equipment and Improvements as an expenditure category is generally budgeted and charged to the Building and Site Funds with the exception of minor purchases. The ending General Fund Net Assets at June 30, 2015 is projected to be $6.9 million or 9.4% of General Fund expenditures within the Board Policy requiring 5-10%. Designated Fund (02) This fund includes board designated funding sources for specified activities including Scholarships to students, Paid Parking and Student Copy Machine Operations, Campus Life Enrichment Fund (CLEF), Student Clubs and Designated Projects. In the Scholarships category, we do not anticipate any significant changes from the levels. Paid Parking and Student Copiers, CLEF and Student Clubs, Instructional Technology Fee, and Designated Projects budget assumptions for are consistent with those of after factoring in the projected enrollment and contact hour decrease. Auxiliary Fund (03) Major activities in Auxiliary Fund are food service, catering, bookstore, and vending, which together net a positive return to supplement general fund revenues. The proposed budget includes a net revenue transfer from Auxiliary Fund (03) to General Fund (01) of $587,500, an increase of $5,200 from the amended budget. Maintenance and Replacement Fund (72) This fund is supported with two main sources of revenues annual transfers of operating dollars from the general fund; and transfers from the designated (02) fund of all revenues received from the Instructional Technology Fee, approved by the Board in February The proposed amounts are $996 thousand from the general fund for fixed outlays such as copiers and Perkins match; investment income of $4 thousand; and $1.4 million from the designated fund from the Technology Fee. The Instructional Technology Fee helps to cover costs for instructional computers, support for student computer labs, and audio-visual equipment on a life-cycle replacement and upgrade basis. Debt Retirement Fund (73) Principal and interest payments from all existing and new voted bond debt are expected to be $7.81 million in the fiscal year A millage rate of.87 is required to make these payments. Property tax revenues for from the debt levy are budgeted at $7.4 million. Building and Site Funds (78) and (83) Fund 78 accounts for the capital reserve funds specified in Board Policy #3930 Fiscal/Budget Reserves. The target balance for this reserve is between $935 thousand and $2.8 million. The balance in the proposed budget will be approximately $1.2 million. The installment purchase agreement for the Lapeer property is funded from this reserve account with the 3 rd $232,958 payment of 5 due in December of Fund 83 accounts for the 2014 series bonds issued in March of All projects identified to be completed with this bond series is scheduled to be completed in the fiscal year ended June 30, 2016 totaling $3.3 million. 105

31 106 MOTT COMMUNITY COLLEGE General Fund (Fund 01) Original Budget Fiscal Year Current Budget Original Budget $ Change % Change Tuition and Fees 35,847,600 34,598,876 (1,248,724) -3.48% Property Taxes 17,438,093 17,663, , % State Appropriations 18,427,215 18,575, , % Ballenger Trust 1,891,446 1,942,482 51, % Grants and Other 1,957,828 1,822,979 (134,849) -6.89% Total $ 75,562,182 $ 74,602,968 $ (959,214) -1.27% Salaries and Wages $ 37,523,332 $ 37,191,013 $ (332,319) -0.89% Fringe Benefits 19,535,677 19,415,434 (120,243) -0.62% Contracted Services 6,071,368 5,390,893 (680,475) % Materials and Supplies 2,350,175 2,266,365 (83,810) -3.57% Facilities Rent 172, ,625 2, % Utilities and Insurance 2,734,635 2,802,800 68, % Operations/Communications 5,120,026 5,221, , % Transfers Out 1,492,117 1,659, , % Equipment and Improvements 306, ,500 (75,637) % Total $ 75,305,519 $ 74,352,968 $ (952,551) -1.26% Surplus/(Deficit): $ 256,663 $ 250,000 $ (6,663) -2.60% Budgeted Increase in Fund Balance $ (250,000) $ (250,000) Final Surplus/(Deficit): $ 6,663 $ - Ending Net Assets: $ 6,544,540 $ 6,794,540 $ 250, % LAPEER* Tuition and Fees $ 1,826,063 $ 1,743,090 $ (82,973) -4.54% Grants and Other 84,291 84,291 - Total $ 1,910,354 $ 1,827,381 $ (82,973) -4.34% Salaries and Wages $ 579,208 $ 720,774 $ 141, % Fringe Benefits 230, ,103 64, % Contracted Services 30,000 25,000 (5,000) % Materials and Supplies 5,500 7,500 2, % Operations/Communications 39,520 33,700 (5,820) % Transfers to Building & Site 75,000 50,000 (25,000) % Equipment and Improvements 12,500 5,000 (7,500) -6 Total $ 971,854 $ 1,137,077 $ 165, % Surplus/(Deficit): $ 938,500 $ 690,304 $ (248,196) %

32 107 (continued) Current Budget Original Budget $ Change % Change LIVINGSTON REGIONAL M-TEC* Tuition and Fees $ 636,154 $ 799,675 $ 163, % Grants and Other 98,993 94,950 (4,043) -4.08% Total $ 735,147 $ 894,625 $ 159, % Salaries and Wages $ 174,671 $ 177,248 $ 2, % Fringe Benefits 82,975 84,799 1, % Contracted Services 339, ,890 10, % Materials and Supplies 91, ,000 10, % Operations/Communications 24,624 29,050 4, % Capital Outlay 18,637 - (18,637) -10 Total $ 731,817 $ 742,987 $ 11, % Surplus/(Deficit): $ 3,330 $ 151,638 $ 148, % Ending Net Assets: $ 3,330 $ 151,638 $ 148, % LAPEER CORPORATE SERVICES * Tuition and Fees $ 136,299 $ 212,900 $ 76, % Grants and Other 5,127 10,000 4, % Total $ 141,426 $ 222,900 $ 81, % Salaries and Wages $ 36,181 $ 27,170 $ (9,011) % Fringe Benefits 10,574 9,083 (1,491) % Contracted Services 82, ,915 23, % Materials and Supplies 10,382 15,240 4, % Operations/Communications 6,483 10,250 3, % Total $ 145,722 $ 167,658 $ 21, % Surplus/(Deficit): $ (4,296) $ 55,242 $ 59, % Ending Net Assets: $ (4,296) $ 55,242 $ 59, % * Lapeer, Livingston, and Lapeer Corporate Services budgets are parts of the General Fund budget

33 108 Mott Community College General Fund (Fund 01) Summary of Table of Approved Positions For Fiscal Year DEPARTMENT TOTALS Office of the President and Direct Reports Academic Affairs Student and Administrative Services College Totals

34 109 MOTT COMMUNITY COLLEGE Designated Fund (Fund 02) Initial Budget Fiscal Year Amended Budget Initial Budget $ Change % Change Scholarships: Mott Memorial Building Rentals $ 74,000 $ 75,850 $ 1, % Transfers from General Fund 496, ,650 11, % Total $ 570,917 $ 584,500 $ 13, % Athletic Scholarships $ 209,000 $ 209,000 $ - Trustee Scholarships 276, ,000 - Senior Citizens Scholarships 51,000 51,000 - Presidential Scholarships 8,500 8,500 - Honors Scholarships 40,000 40,000 - Total $ 584,500 $ 584,500 $ - Surplus/(Deficit): $ (13,583) $ - $ 13, Ending Net Assets: $ - $ - $ - Paid Parking and Student Copy machines: Paid Parking Fees $ 90,500 $ 86,880 $ (3,620) -4.00% Student copy machine fees 1, (100) -1 Total $ 91,500 $ 87,780 $ (3,720) -4.07% Capital Outlay $ 100,000 $ 100,000 $ - Total $ 100,000 $ 100,000 $ - Surplus/(Deficit): $ (8,500) $ (12,220) $ (3,720) 43.76% Ending Net Assets: $ 188,063 $ 175,843 $ (12,220) -6.50% Campus Life Enrichment Fund (CLEF) and Student Clubs: Student Activity Fees $ 109,005 $ 115,273 $ 6, % CLEF Allocation Transfers 185, ,000 - Miscellaneous Revenues 29,349 29,000 (349) -1.19% Total $ 323,354 $ 329,273 $ 5, % CLEF Allocations $ 185,000 $ 185,000 $ - Club Activities 135, ,000 - Total $ 320,000 $ 320,000 $ - Surplus/(Deficit): $ 3,354 $ 9,273 $ 5, % Ending Net Assets: $ 271,198 $ 280,471 $ 9, %