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Governing Board’s Finance and Audit Committee
Meeting Notice and Agenda* Friday, June 14, 2019
9:00am Downtown Campus, RV-116
General Matters
1. Call to Order
Tracy Nuckolls
9:00am
Action Items 2. Approval of Minutes from April 12, 2019 and May 21, 2019
3. Approval of Proposed FY 2019-2020 Meeting Schedule
Tracy Nuckolls Tracy Nuckolls
10:30am
10:35am
Reports and Feedback
4. Downtown Campus Tour: Center of Excellence in Applied Technology
5. Workforce a. Strategic Partnerships with Business & Industry b. Holistic Workforce Development
6. CFO Update
a. Revenue Bonds b. FY20 Adopted Budget
Greg Wilson David Doré, Ian Roark, Greg Wilson David Bea
9:05am
9:30am
10:40am
Effectiveness Discussion
Information Items 7. Future Agenda Items
a. Financial Aid Update b. Competency-Based Education c. Athletics d. Review of Committee Charter e. Enterprise Risk Management and Compliance f. Health Plan Self-Insurance g. Employee Service Center h. Marketing i. Enrollment Management
Adjournment Next Meeting TBD District Office, D225
Finance and Audit Committee Agenda 06/14/19 Page 2
*Option to recess into executive session – Pursuant to A.R.S. 38-431.03(A)(2) the Committee may vote to go into executive session for discussion or consideration of records exempt by law from public inspection, including the receipt and discussion of information or testimony that is specifically required to be maintained as confidential by state or federal law. **Additional Information – Additional information about the above agenda items is available for review on the College’s website. **The Committee reserves the right to change the order of agenda items. **To request a reasonable accommodation for individuals with disabilities, a minimum of five (5) business days before the event is requested. Contact Phone: (520) 206-4539 Fax: (520) 206-4567. Members of the Committee may participate by telephone, video, or internet conferencing.
Governing Board’s Finance and Audit Committee
Friday, April 12, 2019
9:00am
District Office, D225
Meeting Minutes
In Attendance:
Tracy Nuckolls (Chair) [by phone], Demion Clinco, David Bea (Ex-Officio), Bert Landau, Marie Nemerguth,
Adrianne Regrutto (Chair-Elect), Daniel Soza (Ex-Officio), Maria Garcia, Agnes Maina (Ex-Officio)
Unable to Attend:
Jesus Manzanedo, Scott Odom, Clarence Vatne
Guests:
Scott Cabalka and John Utter, RBC Global Asset Management [by phone]; Bruce Moses, Associate
Provost; David Arellano, Dean; Lisa Brosky, Vice Chancellor
General Matters
1. Call to OrderChair Tracy Nuckolls called the meeting to order at 9:02am, noting a quorum was met.
Action Items
2. Approval of Minutes from March 1, 2019Chair Nuckolls asked if the Committee had any changes to the minutes. With no changes, a motion
was made to approve the minutes.
Motion No. 201904-01: Approve Minutes from March 1, 2019
First: Bert LandauSecond: Marie NemerguthVote: Motion passed unanimously (Nuckolls, Clinco, Landau, Nemerguth, Regrutto, Garcia
voting in favor)
Motion Carried.
3. Proposals for FY20 One-Time Funding (David Bea)The quorum ended with the departure of Ms. Marie Nemerguth and Mr. Bert Landau at 11:00am.
The majority of the discussion pertaining to this topic occurred during the Enrollment and Marketing
Updates.
Dr. Bea stated that the Chancellor’s Office will send an email to the internal College community
asking for proposals to immediately increase enrollment; a reserve will be set aside to fund these
Finance and Audit Committee Minutes 2
April 12, 2019
ideas as there is limited time to review prior to the Governing Board’s Study Session at the end of
the month. Chair Nuckolls noted the challenge with a one year increase to salaries and wages; Ms.
Garcia and Mr. Clinco agreed, as they are not supportive of using one-time funds for a larger
increase to employee salaries.
Dr. Bea noted that major initiatives include increased funding for marketing and student outreach.
Ms. Garcia would like to have a clear report on these efforts.
Reports and Feedback
4. Investment Update (Scott Cabalka, John Utter) Mr. Scott Cabalka and Mr. John Utter joined the meeting by phone. They began with an overview of
current trends in interest rates and an update on the federal reserve, providing a projection for
future market yields. Ms. Adrianne Regrutto inquired about the total cash balance, and Mr. Utter
provided an update on the work currently undertaken with Pima. Ms. Agnes Maina furthered the
conversation, noting Financial Services is working with Facilities on cash management as related to
the cash-flow schedule. Dr. David Bea stated that Ms. Maina has already made significant progress
on cash management strategies. The College’s current Investment Guidelines allow for a maximum
allocation of 20% in cash.
Mr. Cabalka continued the review with a look at the one- to three-year portfolio, noting the $20M
transfer that occurred last year. Chair Nuckolls inquired about the possibility of CD Laddering, and
Mr. Cabalka stated that statute in Arizona provides specific language with regards to
collateralization.
The duration of holdings and overall cash management of the portfolio were discussed. Ms.
Regrutto asked for a blended benchmark for review at the next discussion. Mr. Cabalka asked if
there was any interest in AA corporate investments; as the portfolio has been in transition, he will
look to implement blended benchmarks for the April 31 statements. The group is positive about
corporate AA, as well as mortgage securities. A maturity schedule would also be helpful, and Mr.
Cabalka will send additional information to share with this Committee.
5. Single Audit Update - Financial Aid and Registrar (Bruce Moses)
Dr. Bruce Moses began with a brief overview of the audit findings related to the College’s reporting
mechanisms and errors reported to the Clearinghouse. He has convened an A133 Working Group to
complete benchmarking, review data, and revise/develop processes to ensure accurate reporting to
the Clearinghouse moving forward. He shared some data about the number of errors and where
trends were identified; many were related to graduation and accurate identification of a student’s
program of study. Dr. Moses described the current process, as well as the changes that will be
made moving forward.
Chair Nuckolls inquired about the economic impact to the College. Dr. Moses stated the College is
an Attendance Taking Institution, which means that attendance must be accurately tracked to
ensure financial aid is appropriately disbursed. Mr. David Arellano also spoke to the impact to
Finance and Audit Committee Minutes 3
April 12, 2019
students with regards to the grace period. Dr. Bea noted that continued errors in reporting could
trigger a visit by Department of Education and lead to further implications for the College.
Chair Nuckolls asked about the handoff of the working group to the co-chairs. Dr. Moses anticipates
this happening at the end of the Spring semester; he will oversee the work of the Registrar and the
Executive Director of Financial Aid. The Committee requested an updated chart in the Fall semester
to see progress. Resources have been reallocated to assign three staff members to the Registrar’s
Office; these staff will focus specifically on this issue. Mr. Demion Clinco inquired about the next
year’s audit, and Dr. Moses is optimistic.
6. Enrollment Update (David Arellano)
Mr. Arellano introduced himself and described his role within the College. He provided an overview
of Enrollment Management and the various areas impacted. Many of the College’s students are
“stealth”, which means they have minimum in-person interactions with the College prior to
enrollment.
Mr. Bert Landau inquired as to the percentage of students coming to Pima that are direct graduates
from high schools, and Mr. Clinco noted the average age of a Pima student is 27. Mr. Arellano will
provide some information back to this Committee. Local trends also include declining state aid and
expenditure limitation. He continued with a description of national trends affecting enrollment,
including stigmas against loans, online enrollment, competition from four-year institutions, and
Clearinghouse data. There was an extensive conversation on competition and the College’s capacity
for certain programs.
Due to the 2009 Student Services redesign, which was about self-efficacy, and a subsequent
remodel of the facilities at all of the campuses, the College’s physical space does not reflect the
current approach to serving students. As a Hispanic Serving Institution, Mr. Arellano implores
employees to focus on service. Ms. Maria Garcia also talked about the limited offerings available
(hours and days of the week) when compared with other institutions.
Engagements with BlackBoard (the College’s vendor call center support) for reaching out to students
were also discussed, as well as the success of previous engagements. The new application for
admission will capture consent for the College to communicate by text messaging.
Mr. Clinco inquired about any proposals or targeting funding Mr. Arellano would be interested in
funding as a one-time expense in FY20. Mr. Arellano would use the funds to target specific
populations for a vendor to provide text messaging services, additional BlackBoard engagements,
and overtime pay for additional advising hours.
7. Marketing Update (Lisa Brosky)
Ms. Lisa Brosky discussed the recently launched marketing strategies, commercials, and placements,
as well as the student populations targeted. Mr. Clinco asked about the percentage of funding in
Finance and Audit Committee Minutes 4
April 12, 2019
relation to the population served. Mr. Clinco implored both Mr. Arellano and Ms. Brosky to think
big as far as one-time funding enhancements for next year.
Chair Nuckolls asked about an external group of students to review marketing messaging. Ms.
Brosky and her recruiters utilize this strategy. Mr. Arellano also noted that there is an engagement
with Noel Levitz for this same purpose.
8. CFO Update (David Bea)
Dr. Bea provided an update on the budget progress and the actions of the Governing Board to date.
Since the College is on target to meet the projected Expenditure Limit for FY21, there is additional
spending capacity available for the proposed FY20 budget. Mr Clinco inquired about two priorities
of this Committee - the classification/compensation study, and the performance-based pay model.
Dr. Bea stated the classification/compensation Request for Proposal is being finalized, and the
review will begin next year; the costs for the first phase of the study is included in the proposed
FY20 budget. The parameters for the study will need to be set up front as the outcomes may be
challenging and will likely require additional funding to implement fully. The performance-based
pay model can be folded into the classification/compensation study.
Dr. Bea also discussed updates to the monthly financial reports to provide better and more concise
information. The statement of net assets will be included in the Comprehensive Annual Financial
Report, but no longer will be included in the monthly financials as it is not very relevant for that
purpose.
Information Items
9. Future Agenda Items a. Health Plan Self-Insurance b. Update on Local Employers c. Competency-Based Education d. Enterprise-wide Risk Management e. Athletics f. Workforce
Adjournment
The meeting concluded at 11:29am.
Next Meeting:
June 14, 2019
District Office, D225
Governing Board’s Finance and Audit Committee
Tuesday, May 21, 2019
9:00am
District Office, D225, or by Phone
Meeting Minutes
In Attendance:
Tracy Nuckolls (Chair) [by phone], David Bea (Ex-Officio), Bert Landau [by phone], Scott Odom [by
phone], Marie Nemerguth [by phone], Clarence Vatne [by phone], Adrianne Regrutto (Chair-Elect) [by
phone], Maria Garcia [by phone], Daniel Soza (Ex-Officio)
Unable to Attend:
Demion Clinco, Jesus Manzanedo, Agnes Maina (Ex-Officio)
General Matters
1. Call to Order Chair Tracy Nuckolls called the meeting to order at 9:03am, noting a quorum was met.
Action Items
2. Vote to Recommend Ben Tuchi for Membership on the Governing Board’s Finance and Audit Committee Chair Nuckolls began with the purpose of the call, which was to discuss a possible recommendation
to the Governing Board to add Ben Tuchi as a Community Representative on this Committee. Chair
Nuckolls continued, stating he has also spoken with Mr. Bert Landau, who has expressed intent to
step down. Chair Nuckolls asked Mr. Landau if he would still be available as a resource to the
institution, and Mr. Landau replied in the affirmative.
Prior to serving on this Committee, Mr. Landau has had great experience with Pima as both an
Associate faculty member and as staff, and he has worked with Dr. Tuchi in the past. Mr. Landau
made a motion that Ben Tuchi be accepted as a member of the Committee.
Motion No. 201905-01: Recommendation for Ben Tuchi to serve as a Community
Representative on the Governing Board’s Finance and Audit Committee
First: Bert Landau
Second: Marie Nemerguth
Vote: Motion passed unanimously (Nuckolls, Landau, Odom, Nemerguth, Regrutto, Vatne,
Garcia voting in favor)
Motion Carried.
Finance and Audit Committee Minutes 2
April 12, 2019
Dr. David Bea thanked the Committee for their time. An action item will be submitted to the June
2019 Governing Board meeting to request approval for the Committee’s recommendation. Chair
Nuckolls will contact Mr. Tuchi.
Chair Nuckolls reminded the Committee to review the annual report to the Board, which will also be
submitted for the June meeting; any feedback should be sent directly to Dr. Bea’s office. Ms. Maria
Garcia expressed interest in adding some information related to advertising and marketing with
regards to underserved populations. Mr. Nuckolls noted that this may be better served through
another channel, and Dr. Bea’s Office will share this with Vice Chancellor Lisa Brosky as related to
the one-time funding projects for FY20.
Ms. Garcia expressed her regrets as to not working with Mr. Landau for very long on this
Committee, and she looks forward to meeting with him in the future.
Adjournment
The meeting adjourned at 9:11am.
Next Meeting:
June 14, 2019
Downtown Campus, RV-116
Governing Board’s Finance and Audit Committee
Annual Calendar of Meetings & Locations for Fiscal Year 2019-2020
9:00 a.m. August 23, 2019 Regular Meeting PCC - District Office Building D/Room D-225 4905 East Broadway Tucson, AZ 85709-1010 October 25, 2019 Regular Meetings PCC - District Office Building D/Room D-225 4905 East Broadway Tucson, AZ 85709-1010 December 13, 2019 Regular Meeting and Winter Jubilee PCC - District Office Building D/Room D-225 4905 East Broadway Tucson, AZ 85709-1010 February 14, 2020 Regular Meeting PCC - District Office Building D/Room D-225 4905 East Broadway Tucson, AZ 85709-1010 April 17, 2020 Regular Meeting PCC - District Office Building D/Room D-225 4905 East Broadway Tucson, AZ 85709-1010 June 19, 2020 Regular Meeting PCC - District Office Building D/Room D-225 4905 East Broadway Tucson, AZ 85709-1010 Special Meetings will be held as necessary.
6/11/2019
PIMA COMMUNITY COLLEGE – PUBLIC HEARING TRUTH IN TAXATION – NOTICE OF TAX INCREASE
ADOPTION OF FISCAL YEAR 2020 PROPOSED BUDGET
JUNE 12, 2019
PRESENTED BY: DR. DAVID BEA
TRUTH IN TAXATION NOTICE OF TAX INCREASE
1
6/11/2019
TRUTH IN TAXATION – NOTICE OF TAX INCREASE
PRIMARY PROPERTY TAX LEVY DETAIL – PROPOSED
FY 2019 FY 2020
Levy Neutral FY 2020
Proposed
Net Taxable Value Current Year ($100s) $ 83,338,929 $ 87,299,649 $ 87,299,649
Overall Change in Valuation 3.21% 4.75% 4.75%
Change from New Property 1.86% 1.05% 1.05%
Estimated Primary Tax Rate Authorization (per $100 net assessed valuation)
$ 1.3983 $ 1.3488 $ 1.3758
Primary Tax Levy $ 116,532,824 $ 117,749,767 $ 120,106,857
Change from previous fiscal year $ 1,216,943 $ 3,574,033
Truth in Taxation Levy Increase $ 2,357,090
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6/11/2019
PROPOSED AZ COMMUNITY COLLEGES PROPERTY TAX RATES FY 2020 (RATES PER $100 NET ASSESSED VALUATION)
$4.00
3.4322 $3.50
$3.00
2.5711 2.4516
$2.50 2.2132
$2.00 1.8408 1.8164
1.3758 $1.50 1.3255 1.3173
$1.00
0.4592 $0.50
$0.00 Eastern Western Cochise Central Yavapai Northland Pima Mohave Maricopa Coconino
Primary Tax Rate Secondary Tax Rate
PCC PRIMARY, SECONDARY, & COMBINED TAX RATES (FISCAL YEARS 2000-2020*)
1.7500
1.3696 Proposed 1.3758*
1.5000
1.2500
1.0000
0.7500
0.5000
0.2500
0.0000 FY 2000 FY 2001 FY 2002 FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020
Primary Property Tax Rate 1.1626 1.1709 1.1455 1.1530 1.1358 1.1143 1.0930 1.0570 1.0191 0.9787 0.9356 0.9755 1.0846 1.1484 1.2746 1.3344 1.3689 1.3733 1.3890 1.3983 1.3758
Secondary Property Tax Rate 0.2070 0.3865 0.4015 0.3803 0.3526 0.2285 0.2184 0.1945 0.1654 0.1502 0.1414 0.1093 0.0248 0.0257 0.0187 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000
Combined Primary + Secondary Tax Rates 1.3696 1.5574 1.5470 1.5333 1.4884 1.3428 1.3114 1.2515 1.1845 1.1289 1.0770 1.0848 1.1094 1.1741 1.2933 1.3344 1.3689 1.3733 1.3890 1.3983 1.3758
Levy Neutral 1.3488
* proposed
3
6/11/2019
QUESTIONS?
ADOPTION OF FISCAL YEAR 2020 PROPOSED BUDGET
4
FY2020 STRATEGIC PRIORITIES
6/11/2019
• Progress towards final year of FY 2018-2020 Budget Plan • Enrollment Revitalization • Enrollment Management • Scholarships • Marketing • Program Expansion • Professional Development
• Approved Tuition and Fees • $84.50 per credit in-state resident rate, +$900K • Differential Tuition change, +$700K
• Proposed Property Tax Levy increase of 2% (levy max), +$2.3M • State Appropriations • $15.0M for expansion of Aviation Technology Center • $400K for STEM/Workforce Development
• Proposed Revenues – All Funds $317.2M • Proposed Revenues – General Fund $170.9M
5
FY 2020 REVENUE SUMMARY
6/11/2019
KEY BUDGET COMPONENTS - EXPENDITURES
• Salaries and Wages • Make permanent the 2.5% increase to salaries and wages • Increase of 1.5% for salary pools • Increase of 1.5% for adjunct faculty load rate (increase to $832 per load hour)
• Capital Budget of $15.3M • Revenue Bond Debt of $4.4M • Lease Purchase Debt of $1.0M • Reserve for One-Time Budget Enhancements of $5.0M • Proposed Expenditures – All Funds $317.2M • Proposed Expenditures – General Fund $170.9M
FY 2020 PROPOSED BUDGET, $317.2M (ALL FUNDS, IN $ MILLIONS)
Contingency, $8.9 Debt Service - Other Long Term Debt, $5.4
Instruction, $61.9
Capital Assets, $90.3
Scholarships, $31.4
Academic Support, $31.5
Auxiliary Expense, $1.5
Student Services, $32.8
Institutional Support, $39.0Operation and Maintenance of Plant, $14.5
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6/11/2019
FY 2020 PROPOSED BUDGET EXPENDITURES, $317.2M (ALL FUNDS, IN $ MILLIONS)
Administrative Personnel, $6.1, 2%
Student Financial Aid, $30.9, 10%
Contingency and Reserves, $22.2, 7%
Additional Compensation-Faculty, $0.6, 0%
Other Expenditures, $7.0, 2%
Current Fixed Charges, $3.1, 1%
Classified Staff, $49.3, 16%
Supplies and Materials, $9.4, 3%
Contractual Services, $18.3, 6% Other Compensation, $5.0, 1%
Travel, $2.6, 1% Student Employment, $0.5, 0%
Communications and Utilities, $5.8, 2%
Faculty, $19.8, 6%
Adjunct Faculty, $14.8, 5%
Fringe Benefits, $30.0, 9%
Capital Equipment, $91.8, 29%
STATE BUDGET FORM – SCHEDULE A
7
6/11/2019
STATE BUDGET FORM – SCHEDULE B
STATE BUDGET FORM – SCHEDULE C
8
6/11/2019
THE FISCAL YEAR 2020 BUDGET WOULD NOT BE POSSIBLE WITHOUT:
FINANCE AND BUSINESS SERVICES STAFF
THANK YOU!
QUESTIONS?
9
6/11/2019
ADDITIONAL CHARTS, INFORMATION, & RESOURCES
Limit Actual EL expenses
10
EXPENDITURE LIMIT VS.ACTUAL AND PROJECTED EXPENSES, FY11 TO FY21 (IN $000S)
70,000
80,000
90,000
100,000
110,000
120,000
130,000
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
COMMUNICATION
6/11/2019
• May 24 and June 3, 2019 publication in the Arizona Daily Star • Proposed Budget • Truth in Taxation – Notice of Tax Increase
• May 24, 2019 Press Release on the proposed budget and Truth in Taxation • June 12, 2019 Public Hearing and Special Board
Meeting to adopt the FY 2020 budget and set property tax levies and rates
• 2017-2021 College Strategic Plan • Educational Master Plan • Facilities Master Plan • Diversity, Equity, and Inclusion Plan • Strategic Enrollment Management Plan • Chancellor’s Goals, Objectives, and Timelines,
2018-2019
11
STRATEGIC PRIORITIES
6/11/2019
COLLEGE BUDGET INFORMATION
• Fiscal Year 2019 Adopted Budget • Fiscal Year 2019 General Fund Budget Detail • Fiscal Year 2020 Budget Development Calendar • Fiscal Year 2020 Proposed Budget Presentation • Fiscal Year 2020 Proposed State Budget Forms • Fiscal Year 2020 Proposed Truth in Taxation Notification • Fiscal Year 2020 Proposed Capital Budget Plan
12
6/11/2019
ENROLLMENT REVITALIZATION PROPOSALS FOR FY20
JUNE 12, 2019
PRESENTED BY: DR. DAVID BEA
MARKETING, ENROLLMENT MANAGEMENT, AND PROFESSIONAL DEVELOPMENT
Proposal Return on Investment Budget
Marketing: Millions of views for advertisements and signage $1,391,000 Signage,Advertising, and Sponsorships
Sponsorships to target specialized populations (ex: TenWest, 100 Full Time Student Equivalents [FTSE])
Enrollment Management: Enrollment coaching and engagement campaigns for up $207,500 Blackboard for Enrollment Services to 17,000 student records.
Professional Development: Collocating the most current and high-quality $236,630 Teaching and Learning Center pedagogical methods and disseminating them to both
full- and part-time faculty
1
6/11/2019
SCHOLARSHIPS AND PROGRAM EXPANSION
Proposal Return on Investment Budget
Scholarships: Students Enrolled at the Arizona State Prison Complex on Wilmot
Increase of 109 FTSE over FY19 $303,030
Program Expansion: FANUC Robotics for Automated Industrial Technology
Increase of 21.6 FTSE over FY19 $515,000
Program Expansion: Dual Enrollment
Increase of 114 FTSE over FY19 $443,137
Program Expansion: PimaOnline
Increase of 34 FTSE over FY19 $109,910
Grand Total $3,206,207*
* Remaining funds are in a reserve for FY20, and additional projects approved by Administration will be submitted as Information to the Governing Board. Funds for one-time projects not expended during FY20 may not be rolled forward to future years; however, the Responsible Administrator(s) may resubmit a project for future funding.
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