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Board of Trustees
www.nmc.edu/trustees
1701 East Front Street
Northwestern Michigan College provides lifelong learning Traverse City, MI 49686
opportunities to our communities.
(231) 995-1010
trustees@nmc.edu
Meeting Agenda
Monday, April 24, 2017
at NMC Oleson Center, 1881 College Drive

5:30 p.m. Regular Meeting

I. GENERAL BUSINESS
A. Call to Order
B. Roll Call
C. Pledge of Allegiance
D. Review of Agenda and Approval of Additions, Deletions, or Rearrangements

II. REPORTS (Most reports are also provided to the Board in their materials packet, which can be
accessed on the nmc.edu Board of Trustees website.)
E. Program FocusWest Hall Capital Outlay Project UpdateVicki Cook, Vice President
of Finance and Administration
F. Faculty ReportWSI400 Marine Technology Capstone ProjectKeith E. Kelly,
Technical Instructor, Hans VanSumeren, Director of Great Lakes Water Studies Institute,
and Student Team
G. Enrollment ReportTodd Neibauer, Vice President for Student Services & Technologies
H. Financial ReportVicki Cook, Vice President of Finance and Administration
I. Foundation ReportRebecca Teahen, Executive Director for Resource Development and
Foundation
J. BBQ ReportDiana Fairbanks, Executive Director of Public Relations, Marketing and
Communications
K. Building and Site Committee ReportRoss Childs, Committee Chair
L. Policy Committee ReportRoss Childs, Committee Chair
M. Legislative Issues ReportTimothy Nelson, President (via video conference)

III. PUBLIC INPUT


Request forms for public input are available at the meeting location. Any individual of the
public may speak for up to three (3) minutes. The Board will not receive public input from
individuals unless they are present at the meeting. The Board will take public remarks into
consideration, but will not comment at time of input.

IV. UPDATES
N. Presidents UpdateTimothy Nelson, President (via video conference)
O. Board Chair UpdateKennard Weaver, Chair
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Board of Trustees
http://www.nmc.edu/trustees/
1701 East Front Street April 24, 2017 Meeting Agenda
Traverse City, MI 49686 Page 2
(231) 995-1010
trustees@nmc.edu

V. DISCUSSION ITEMS
P. FY18 BudgetVicki Cook, Vice President of Finance and Administration

VI. CONSENT ITEMS (Pursuant to Policy A-105.00 Consent Agenda Items)


These items will be adopted as a group without specific discussion. When approving the
meeting agenda, any Board member may request that a consent agenda item be moved to the
regular agenda for discussion or questions.
Recommend that the following items be approved:
Q. Minutes of the March 20, 2017, regular meeting

VII. ACTION ITEMS


R. Board Policies (Pursuant to Policy A-106.00 Other)
Recommend adoption of the following Board Policies on a first-reading basis:
Amended Board Policy B-100.00 Board of Trustees Delegation to the President
Board Policy B-101.00 Presidents Role and Job Description with no changes
after review
Board Policy B-102.00 Monitoring Presidential Performance with no changes
after review
Amended Board Policy B-103.00 Communication and Counsel to the Board
S. Network Switch Replacement (Pursuant to Policy A-106.00 Finance)
Recommend authorization for administration to enter into a contract with Secant
Technologies for the replacement of network switch equipment in the amount of
$413,980, plus a 5% contingency, for a total project budget of $434,679, to be funded by
the Technology Plant Fund.
T. Easement to Traverse City Light and Power (Pursuant to Policy A-106.00 Facilities)
Recommend authorization for administration to grant an easement request to Traverse
City Light and Power for 2200 Dendrinos Drive after legal review.

VIII. REVIEW OF FOLLOW-UP REQUESTS


Confirm requests made by the Board that require administrative follow-up for information to be
provided to the Board at a later date.

IX. ADJOURNMENT

Posted Friday, April 21, 2017, 9:00 a.m.


3

Board of Trustees
http://www.nmc.edu/trustees/
1701 East Front Street April 24, 2017 Meeting Agenda
Traverse City, MI 49686 Page 3
(231) 995-1010
trustees@nmc.edu

Upcoming Board Meeting Dates:


All board meetings are open to the public.
May 11, 2017 Budget Study Session Founders Hall, 1701 E. Front Street
May 22, 2017 - Oleson Center Room A/B, 1881 College Drive
June 26, 2017 - Great Lakes Campus, Room 112, 715 E. Front Street
July 24, 2017 - Great Lakes Campus, Room 112, 715 E. Front Street
August 28, 2017 - Great Lakes Campus, Room 112, 715 E. Front Street
September 18, 2017 - Oleson Center Room A/B, 1881 College Drive (3rd Monday)
October 23, 2017 - Oleson Center Room A/B, 1881 College Drive
November 20, 2017 - Oleson Center Room A/B, 1881 College Drive (3rd Monday)
December 18, 2017 - Oleson Center Room A/B, 1881 College Drive (3rd Monday)
January 22, 2018 - Oleson Center Room A/B, 1881 College Drive
February 26, 2018 - Oleson Center Room A/B, 1881 College Drive
March 19, 2018 - NMC Hagerty Center, Great Lakes Campus, 715 E. Front Street (3rd Monday)
April 23, 2018 - Oleson Center Room A/B, 1881 College Drive
May 21, 2018 - Oleson Center Room A/B, 1881 College Drive (3rd Monday)
June 25, 2018 - Great Lakes Campus, Room 112, 715 E. Front Street

Posted Friday, April 21, 2017, 9:00 a.m.


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West Hall Innovation Center

Northwestern Michigan College


20170417
Guiding Principles
5

Complement all NMC facilities, replicate none.


Be agile.
Encourage curiosity, experimentation, thoughtful risk-taking
and creativity.
Support focus, connection, exchange and storytelling.
Provide access to resources, mentorship and learning support.
Be welcoming.
Operate Effectively and Efficiently.
6

Level 00 Level 01 Level 02


7

Existing
8

Demolition
9

Option 3 two story Library & Project Center with 1 story classroom wing
parking
10

lounge meet
dining servery

entry kitchen

office

housing
open to below
classes

Level 01 demolition
parking
11

outdoor

learning environments
prefunction / lobby
outdoor

servery
cdining
store kitchen
& dining

housing
classes

project center SSC library

Level 01
outdoor
natural light

parking
12

small small small


cr cr cr
outdoor

outdoor large

lobby / seating / exhibition


natural light
classroom

natural light

dining / study
large cstore servery
classroom
kitchen

seating campus kitchen


coats storage security office

housing
stair stair
elev stair

ask

toilets

toilets
welcome desk welcome
open to below & above

resource
project consult

storage
room hotel stair ask tutoring
project table area

prep area
classes

seating

seating
project
room
project center library periodicals

collaboration
project seminar seminar
Level 01 room break out rooms hot desks sit workspace

outdoor
13

stair storage elev stair


study

toilets

toilets
seating open to below seating

locker
office
seating stair

seating seating

work area
stacks
quiet staff work
reading stations and
room workspace

Level 02 seating computer seating seating


14

natural light

medium
classroom

medium
mechanical classroom bookstore

break break break study


tables
mechanical out out out

content creation lab


stair
elev stair
study

computers
study tables storage

pres pres study study


practice practice

Level 00
15

Option 3 two story Library & Project Center with 1 story classroom wing
16

Option 3 two story Library & Project Center with 1 story classroom wing
17

Option 3 two story Library & Project Center with 1 story classroom wing
18

NMC & DTMB


Captivating quote, stat, description, etc.
that explains the new section.
19

NMC

DTMB

Level 00
20

servery

NMC kitchen

DTMB
Level 01
21

NMC
Level 02
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WSI400 Marine Technology Capstone Project Presentation


NMC Board of Trustees Presentation Monday, April 24, 2017

Student Team:
Brendan Hunter
Jordan Krakowski
Matthew Moss
Kyle Pattison

Team Mentors:
Keith E. Kelly
Hans VanSumeren

Context
The Bachelors of Science in Maritime Technology (BSMT) Marine Technology major was launched in
fall of 2015. This was the third bachelors offering at NMC. This degree focuses on the applied use of
marine technology and sensors for collection, interpretation and analysis of data in multiple industries
across a wide range of environments.

Unique to the United States, this degree capitalizes on the assets and people at NMC along with our
strategic location on Lake Michigan. The degree is built upon an associates degree in Engineering
Technology Marine Technology that emphasizes the core technical skills required to be successful in
the marine industry. Building upon these core technical skills, the Marine Technology BSMT then
focuses on the advanced training in equipment operation, data processing and analysis, and project
management.

The capstone course, WSI400, pulls together all these competencies in a student designed and student
executed project. It is this capstone project that becomes the students academic portfolio centerpiece
when seeking employment opportunities.

Pedagogy
Project- Based Learning (PBL)
The WSI400 Marine Technology Capstone course is designed as a Project-Based Learning (PBL)
experience including the following essential elements:

Challenging Problem or Questions


Sustained Inquiry
Authenticity
Student Voice & Choice
Reflection
Critique & Revision
Public Product

Additional information on PBL is available at http://bit.ly/2oCV1ZV . PBL courses support NMCs


Experiential Learning Action Project.
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Agile Project Management/Scrum


Traditional project management consists of a planning stage followed by an execution stage. While this
strategy works for complicated projects, it is not suitable for complex solutions where requirements
emerge and are refined as the service or product is developed. Technology-based solutions are typically
complex, and many teams apply an agile framework referred to as Scrum.

Scrum is an iterative and incremental project management process where the team and product owner
work as a unit to reach the design goal. Requirements are communicated as themes, epics, and stories
which are continually refined as product development evolves. Requirements and tasks are pulled into a
work cycle known as a sprint, and progress is tracked on a Kanban board. Deliverables for each sprint
are defined and demonstrated to the product owner at sprint completion. The team completes sprint
retrospectives where they reflect on the team performance and identify improvement. Additional
information on Scrum is available at http://bit.ly/2oaYICw

Teamwork
Teamwork is a foundation to success. The Engineering Technology curriculum integrates a teamwork
model based the work of Patrick Lencioni. In this model, highly functional teams start with building
trust. This enables open and honest communication while managing productive conflict, resulting in
commitment and accountability. Additional information on the Lencioni model is available at
http://bit.ly/2ovJV8V
24

MEMO
Enrollment Services
_________________________________________________________________________________________

To: Timothy J. Nelson, President


Todd Neibauer, VP for Student Services & Technologies
From: Pamela Palermo, Associate Dean of Enrollment Services
Date: April 17, 2017
Subject: Enrollment Services Update Summer/Fall Semester 2017
_________________________________________________________________________________________

Summer 2017

We are still accepting registrations for Summer 2017. As of April 17, 2017, we have 417 new
admits for summer and 164 of those students have registered for classes. Admissions has been
calling students and encouraging them to register for summer courses.

Summer 2017 Statistics


(Resources: Digital Dashboard Same Date Comparison SU2014-2017)
Summer 2014 2015 2016 2017
New Students Registered 152 170 163 164
Prior Admits Registered 5 6 6 12
Retained from Spring 825 754 789 790
Re-Admitted Students 144 94 96 96
Average Contact Hours 5.64 5.80 5.74 5.66
Total Headcount 1126 1024 1054 1062
Total Contact Hours 6347 5944 6049 6013
Tuition 948,018 928,385 1,014,716 1,026,814

Fall 2017

Fall 2017 registration began March 15 for continuing NMC students. The first Orientation was
April 7th for new NMC students. 236 students attended 4 orientation sessions. This was the first
of thirteen New Student Orientation sessions to be held through the end of August.

Admissions and Advising have been meeting with returning Early College and Dual Enrolled
students to prepare them for registration. New students in these programs have special
orientation sessions devoted to them in the month of May.
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Fall 2017 Statistics


(Resources: Digital Dashboard Same Date Comparison FA2014-2017)
Summer 2014 2015 2016 2017
New Students Registered 179 283 232 345
Prior Admits Registered 26 15 13 11
Retained from Spring 1494 1428 1450 1394
Re-Admitted Students 129 112 110 108
Average Contact Hours 12.13 11.92 11.88 11.75
Total Headcount 1829 1838 1805 1858
Total Contact Hours 22,177 21,906 21,449 21,840
Tuition 3,431,700 3,581,187 3,725,390 4,006,294*

*16/17 tuition rates to be adjusted July 1, 2017.


26

MEMO
Administrative Services

______________________________________________________________________________

To: Timothy J. Nelson, President

From: Vicki Cook, VP Finance and Administration

Date: April 11, 2017

Subject: Summary Report for the General Fund as of March 31, 2017

The attached reports summarize the financial results for the General Fund as of March 31 2017.
The ninth month represents 75% of the year.

Month End Results


The month end reports are interim and not a reflection of actual year-end results. The timing
of revenue and expenses fluctuates throughout the year and will affect year end results. The
general fund ended the month with an excess of revenue over expenses in the amount of
$4,759,040. Revenue increased by 2% when comparing March 2017 to March 2016. There was
no increase to expenses when comparing March 2017 to March 2016.

Revenue (letters refer to the attached General Fund summary)


A. Tuition and Fees revenue: Tuition and fees represent a 1% increase from those of March
2016. The increase is reflective of GLMA cruise fees, fall tuition, workshops/training and
health fees. For Spring 2017, the budget was set at 39,615 billing hours for budgeted revenue
of $6,826,369. Actual billing hours are at 38,923 hours for total tuition revenue of
$6,727,780. This is a shortfall of $98,589. The projection report identifies savings in other
areas to offset the revenue reduction.
B. Property Taxes: Tax revenue is recorded as payments are received. We budgeted for an
increase over the previous fiscal year.
C. State Sources began in October with receipt of the first state aid payment. State payments
include $130,000 for personal property tax reimbursements.
D. Federal Sources consist primarily of the MARAD grants. NMC has received partial payment
for operations and fuel reimbursement. We should receive another payment in May.
E. Actual year-to-date investment income recorded for fiscal year 2017 reflects interest income
and realized gain.
F. Both Private Sources and Other Sources are timing and event dependent.
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Expenses
G. Salary and benefits are higher than budgeted due to the Faculty collective bargaining
agreement. Projections for FY2017 still estimate an overall net gain.
H. Professional development is above budget due to timing of events and membership
payments. All other expenses are under budget at this time.
I. Capital outlay is timing related. Capital Outlay reflects expenditures budgeted through the
allocation of COAT dollars, BBQ funds and Culinary Capital fund.
28

Northwestern Michigan College


Unaudited
Month end reports are interim and not a reflection of final year end results.

Summary Report for General Fund Accounts


Fiscal Year 2017, Period 09
2016-2017 YTD % of
Funds Accounts Adjusted Budget Activity Annual Budget

TOTAL GENERAL FUND


50 Revenues
Tuition and Fees 23,364,192 19,413,738 83.09% A
Property Taxes 9,929,134 9,684,709 97.54% B
Other Local 0 0 *
Local Sources 33,293,326 29,098,447 87.40%
State Sources 9,318,088 6,394,082 68.62% C
Federal Sources 524,000 584,761 111.60% D
Private Sources 375,000 225,848 60.23% F
Investment Income 274,000 215,337 78.59% E
Other Sources 392,270 378,340 96.45% F
Total Revenues 44,176,684 36,896,815 83.52%
60 Labor
Salaries & Wages 21,456,217 16,978,761 79.13% G
Benefits 9,226,173 7,318,332 79.32% G
Total Labor 30,682,390 24,297,094 79.19%
70 Expenses
Purchased Services 2,408,324 1,694,751 70.37% H
Supplies & Materials 3,114,383 2,003,260 64.32% H
Internal Services 80,895 47,842 59.14% H
Other Expenses 1,669,103 1,135,592 68.04% H
Institutional Expenses 1,766,374 1,176,751 66.62% H
Maintenance & Renovation 1,541,540 955,587 61.99% H
Prof Develop, Travel & Events 580,149 455,876 78.58% H
Capital Outlay 65,570 148,939 227.14% I
Total Expenses 11,226,338 7,618,597 67.86%
Total Expenditures 41,908,728 31,915,691 76.16%
80 Transfers
Transfers 2,263,782 222,085 9.81%
Total Transfers 2,263,782 222,085 9.81%
Total Expenditures and Transfers 44,172,510 32,137,775 72.76%
Net Revenues over (under) Expenditures 4,174 4,759,040
Summ Gen Fund_Mar_2017
for internal use only 4/12/2017 9:50 AM Page 1 of 1
Northwestern Michigan College
29
Comparative Statement
March 2017 to February 2017
General Fund Activity Only

Month end reports are interim and not a reflection of final year end results.
Difference between current month and previous month

Revenue Yr. To Date Yr. To Date Month of Month of Explanation


31-Mar-17 28-Feb-17 31-Mar-17 28-Feb-17

Tuition and Fees 19,413,738 17,367,807 2,045,931 2,135,608 Training less in March partially offset by higher Flight fees

Property Taxes 9,684,709 9,226,744 457,965 1,823,262 Timing of winter tax collections

State Sources 6,394,082 5,358,748 1,035,334 1,169,415 Personal property tax reimbursement from state in February

Federal Sources 584,761 584,761 - 286,860 Timing of MARAD support

Private Sources 225,848 225,848 - 385 Timing of Foundation support

Investment Income 215,337 190,459 24,878 24,243 Consistent with prior month
March higher for purchasing card rebate $40,000 ; Pell Administrative fee
Other Sources 378,340 276,651 101,689 32,500 $7,000 and NCHERM $9,000

Total Revenue 36,896,815 33,231,019 3,665,796 5,472,274

Expenses
Salaries and Wages 16,978,761 14,119,615 2,859,146 1,876,662 3 pays in March 2017, 2 pays in February 2017
Benefits 7,318,332 6,216,743 1,101,589 725,345 3 pays in March 2017, 2 pays in February 2017
March higher for advertising costs and purchased services for NW Regional
Purchased Services 1,694,751 1,478,758 215,993 168,567 Fire Training
March higher for software purchases and classroom supplies, partially offset
Supplies & Material 2,003,260 1,727,041 276,219 230,589 by lower deposit payments for International trips
March includes charges for several internal events; Jobs for Vets, Career
Internal Services 47,842 38,441 9,401 (2,578) Fair, Alumni reception, Stantec meeting
Other Expenses 1,135,592 997,022 138,570 145,019 February higher for non-professional development travel/events

Institutional Expenses 1,176,751 1,027,896 148,855 143,169 Consistent with prior month

Maintenance & Renovation 955,587 831,432 124,155 83,913 Timing of software contracts

Prof Develp, Travel, & Events 455,876 402,110 53,766 21,780 Timing of professional development events and memberships
$1,500 GL Maritime deposit on fire curtain installation, $1,521 GL Maritime
Capital Outlay 148,939 145,918 3,021 21,153 mooring project (both paid for from MARAD funds)
Total Expenditures 31,915,691 26,984,977 4,930,714 3,413,620

Transfers 222,085 150,901 71,184 - Quarterly Aviation transfer in March

Net Revenues over/(under) 4,759,040 6,095,141 (1,336,102) 2,058,654

Month end reports are interim and not a reflection of final year end results.
Northwestern Michigan College
30
Comparative Statement
March 2017 and March 2016
General Fund Activity Only

Month end reports are interim and not a reflection of final year end results.
Difference between March 2017 and March 2016 (GENERAL FUND)

Revenue Yr. To Date Yr. To Date INCRE/DECRE. Percentage Explanation


31-Mar-17 31-Mar-16 Difference
FY17 higher for GLMA cruise fees, fall tuition, workshops/training, and health
Tuition & Fees 19,413,738 19,192,273 221,465 1% fees. Offset in part by lower spring tuition revenue.

Property Taxes 9,684,709 9,458,338 226,371 2% Budgeted increase in property tax revenue and timing of tax collections
Budgeted increase in annual appropriations and personal property tax
State Sources 6,394,082 6,179,867 214,215 3% reimbursement from the state of Michigan
Federal Sources 584,761 326,669 258,092 79% Timing of spring MARAD payment
Private Sources 225,848 316,210 (90,362) -29% Timing of Foundation support/recording of transfers
Investment Income 215,337 309,607 (94,270) -30% FY16 had large $97,623 realized gain on bond
Reimbursements received in Sept 2015 from MARAD for shipyard drydock
hotel & per diems; NJTP grant administrative fees and prior year write-off
Other Sources 378,340 383,688 (5,348) -1% collections higher in FY17

Total Revenue 36,896,815 36,166,652 730,163 2%

Expenses

Salaries and Wages 16,978,761 15,949,181 1,029,580 6% Three pays in March 2017, two pays in March 2016

Benefits 7,318,332 6,942,079 376,253 5% Three pays in March 2017, two pays in March 2016

Purchased Services 1,694,751 1,598,865 95,886 6% Higher in FY17 for food services for GLMA vessels and Aviation staffing

Timing of course fee related expense for trip deposits. Less for fuel and
electronic resources due to timing. Additional expense in supplies from change
Supplies & Material 2,003,260 1,945,132 58,128 3% in capitalization of library books (reduction in capital expense to offset this)

Internal Services 47,842 22,726 25,116 111% FY2017 less for Training Services - internal revenue for Lean program
Savings in Aviation helicopter rentals, finance charges, property tax refunds and
non-professional development travel & events offset in part by higher
Other Expenses 1,135,592 1,382,819 (247,227) -18% promotional expenses

Institutional Expenses 1,176,751 1,288,178 (111,427) -9% Timing of utility and Aviation insurance payments
Maintenance & Renovation 955,587 939,796 15,791 2% Timing of contractual payments
Pro. Develop, Travel & Events 455,876 426,594 29,282 7% Timing of professional development events and travel
Savings in COAT capital expenses and library books (change in capitalization
Capital Outlay 148,939 244,284 (95,345) -39% policy for library books)
Total Expenditures 31,915,691 30,739,653 1,176,037 4%

Transfers 222,085 187,467 34,618 Loan fund and aviation transfers; grant indirect revenue

Net Revenues over/(under) 4,759,040 5,239,532 (480,492)

Month end reports are interim and not a reflection of final year end results.
31

Summary by Program
March 2017
General Fund Activity

Month end reports are interim and not a reflection of final year end results.

Revenue Percent 2016-17 Yr. To Date Percent of


of Total Annual Budget 31-Mar-17 Total Spent Definition

Tuition & Fees 53% 23,364,192 19,413,738


Property Taxes 22% 9,929,134 9,684,709
State Sources 21% 9,318,088 6,394,082
Federal Sources 1% 524,000 584,761
Private Sources 1% 375,000 225,848
Investment Income 1% 274,000 215,337
Other Sources 1% 392,270 378,340
Total Revenue 100% 44,176,684 36,896,815

Expenses
Instruction 31% 13,078,252 13,712,173 43% Produce educational change in a learner or group of learners; includes both credit and non-credit offerings
Information Technology 7% 2,963,607 2,036,547 6% Provide technology to benefit instructional activities and the institution as a whole

Public Service 1% 229,162 167,527 1% Provide public with unique resources and respond to community needs or solve community problem
Instructional Support 17% 7,034,632 5,106,438 16% Support instructional programs
Student Services 13% 5,469,414 3,630,765 11% Contribute to well-being of students and their intellectual, cultural, & social development

Institutional Administration 20% 8,356,303 3,990,829 13% Provide for organizational effectiveness and continuity; day-to-day functioning and long-range viability
Plant Operations and Maintenance 11% 4,777,357 3,271,412 10% Maintain existing facilities, provide utility and safety services, and plan/design future facilities
Total Expenditures 100% 41,908,728 31,915,691 100%

Transfers 2,263,782 222,085


Net Revenues over/(under) 4,174 4,759,040

Month end reports are interim and not a reflection of final year end results.
Northwestern Michigan College
Fiscal Year 2016-2017 32
Year-End Projections
As of April 10, 2017

FY2017 Acual
FY16 FY17 FY17 Projected Over/(Under)
Actual Budget @3/31/17 @3/31/17 Projected Comments
Revenue
Local Sources

Tuition & Fees 51 23,044,782 23,364,192.46 19,413,738 23,680,062 315,870 Fall tuition, vessel housing, workshops/training

Property Taxes 51 9,817,952 9,929,134 9,684,709 9,929,134 -


Total Local Sources 32,862,734 33,293,326 29,098,447 33,609,196 315,870
Add'l retirement payment and personal property tax refund from
State Sources 53 9,246,700 9,318,088 6,394,082 9,500,170 182,082 state

Federal Sources 54 718,298 524,000 584,761 687,101 163,101 MARAD fuel

Private Sources 55 515,824 375,000 225,848 399,820 24,820 BBQ funded items

Investment and Interest Income 57 386,175 274,000 215,337 274,000 -


Unrealized gain/(loss) on investments 57 340,638 - - - -

Other Sources 59 513,275 392,270 378,340 484,906 92,636 Lobdell's, NJTP administrative fees, pcard rebate

Total Revenue 44,583,644 44,176,684 36,896,815 44,955,193 778,509

Expenses

Salaries 61 21,915,598 21,456,217 16,978,761 21,900,794 444,577 Faculty salaries, adjunct, and supplemental wages

Benefits 65 9,434,142 9,226,173 7,318,332 9,371,327 145,154 Taxes/retirement on salaries overage

Increase for Aviation staffing, Munson Surgical Technology


Purchased Services 71 2,347,170 2,408,324 1,694,751 2,502,934 94,610 program, Philosphy staffing

GLMA fuel offset in federal funding, library book expense


Supplies & Materials 72 2,895,797 3,114,383 2,003,260 3,146,760 32,377 moved from capital expese, savings in facilities fuel

Internal Services 73 66,274 80,895 47,842 80,895 -


Reduction of finance charges and non-professional
Other Expenses 74 1,826,556 1,669,103 1,135,592 1,695,903 26,800 development travel, increase in bad debt expenses

Institutional Expenses 75 1,674,021 1,766,374 1,176,751 1,671,440 (94,934) Savings in snowplowing and heating fuel

Maintenance & Renovation 76 1,313,425 1,541,540 955,587 1,541,540 -


Professional Development 77 653,823 580,149 455,876 580,149 -

BBQ funded item (offset in private sources, Culinary specific


program expense (offset in transfers), secure cloud access,
offset in part by movement of library book expense to supplies
Capital Outlay- small expenditures 79 321,881 65,570 148,939 148,939 83,369 expense

Total Expenses 42,448,689 41,908,728 31,915,691 42,640,680 731,952

Transfers
Plant Fund 1,499,647 1,199,647 1,199,647 -
GLMA Equipment Fund (93,326) (31,035) (31,035)
Technology Fund 400,000 400,000 400,000 -
Facility Fee 40,000 40,000 40,000 -
Aviation Plant Transfer for Tach hours 362,722 340,000 281,246 340,000 -
Loan Funds transfer (4,520) - (55,058) - -
Strategic projects 250,000 250,000 250,000 -
Funds for Transformation 50,000 50,000 50,000 -
GLMA fuel reserves (184,110) - - -
GLMA equipment reserve transfer (25,000) - - -
Alumni transfer (16,500) - - -
Indirect Grant Revenue & Program support (21,661) (115,865) (4,104) (115,865) -

Funds Reserved for Specific Programs (246,356) 100,000 - 71,086 (28,914) Transfer for Culinary equipment and AutoTech car fund
Total Transfers 2,010,896 2,263,782 222,085 2,203,834 (59,949)
Total Expenses & Transfers 44,459,585 44,172,510 32,137,776 44,844,514 672,004

Net Revenue 124,058 4,174 4,759,040 110,679 106,505

NMC definition of the term "Projection" is a forecast of year-end revenues & expenses (not accounting definition)
33

MEMO

To: Vicki Cook, VP Finance and Administration

From: Cheryl Sullivan, Controller

Date: April 13, 2017

Subject: Realized and Unrealized Investment Gains & Losses for FY17 Third Quarter

Historically, the colleges investments have balanced receiving the highest investment returns with
maximum security while also meeting cash flow needs. The college is also limited to the investments it
may make under the Michigan Community College Act No. 331. For many years, the college has
invested in Fannie Mae and Freddy Mac bonds as their debt is secured by the federal government. While
the market value of the bond holdings can fluctuate, the college opts instead to hold them until maturity or
until the bonds are called by the issuer, therefore always receiving par value of the bonds back. The only
time the college would sell a bond would be to lock in and realize a gain. As an additional hedge against
rising interest rates, many of the bonds that the college currently invests in are step-bonds, which means
the interest rates steps up over the duration of the bonds life.

While fiscal year 2016 had some large fluctuations during the year on bond market values, the college
ended the year with $340,638 of unrealized gains on their bond portfolio. Please note that all of these
gains during fiscal 2016 were unrealized, paper gains.

Some of the volatility from the prior fiscal year is still present in the current bond market for fiscal year
2017 with the first nine months resulting in unrealized losses of $282,741. The decrease in the market
value of the bonds on the colleges books is a required accounting entry only, and does not reflect the par
value that the college will receive at maturity or call of the bonds.

As the college holds its bonds until the bonds are called by the issuer or the bonds mature, these
unrealized gains and losses will not impact the colleges bond portfolio.

During fiscal year 2016, a Federal Home Loan Bank bond was called resulting in a realized gain of
$97,623. The bond had been purchased during July 2013 at a significant discount. Total realized gains
for fiscal year 2016 were $99,921. For the first nine months of fiscal year 2017, realized gains were
$2,000.
34

NMC
Bonds Held
3/31/2017

Date Maturity Amount Bond interest Interest


Purch Date Name Paid Amount paid at purch Rate Notes
5/3 Bank
3/1/2016 2/26/2021 FNMA $ 1,000,000 $ 1,000,000 $ 139 1.000% steps up to 1.25% 2/2017; 2% 2/2018; 2.75% 2/2019; 3.5% 2/2020
4/28/2016 4/28/2021 FHLM $ 1,000,000 $ 1,000,000 1.000% steps up to 1.125% 4/2017; 1.25% 10/2017; 1.50% 4/2018; 2% 10/2018; 2.50% 4/2019; 3% 10/2019; 4% 4/2020; 5% 10/2020
4/28/2016 4/28/2031 FNMA $ 2,000,000 $ 2,000,000 2.250% steps up to 2.75% 4/2020; 3% 4/2023; 3.50% 4/2025; 4% 4/2027; 4.50% 4/2029
5/25/2016 5/25/2021 FHLB $ 1,500,000 $ 1,500,000 1.000% steps up to 1.25% 5/2018; 1.75% 11/2018; 2.25% 5/2019; 2.75% 11/2019; 3.75% 5/2020; 4.75% 11/2020
8/15/2016 8/15/2031 FHLB $ 1,500,000 $ 1,500,000 2.000% steps up to 2.25% 8/2021; 2.75% 8/2024; 3.50% 8/2026; 4.25% 8/2027; 5% 8/2028; 6% 8/2029; 7% 8/2030
8/24/2016 8/24/2028 FHLB $ 1,000,000 $ 1,000,000 1.500% steps up to 2% 8/2019; 3% 8/2022; 4% 8/2025
9/20/2016 9/20/2021 FHLB $ 1,000,000 $ 1,000,000 1.000% steps up to 1.25% 9/2018; 1.75% 3/2019; 2.25% 9/2019; 3% 3/2020; 3.75% 9/2020; 4.50% 3/2021
10/25/2016 10/25/2024 FHLB $ 1,000,000 $ 1,000,000 1.250% steps up to 1.50% 10/2019; 2% 10/2020; 2.50% 10/2021; 3% 10/2022; 4% 4/2023; 6% 10/2023; 8% 4/2024
10/27/2016 10/27/2028 FHLB $ 1,000,000 $ 1,000,000 1.500% steps up to 2% 10/2019; 2.50% 10/2022; 3% 10/2025; 4% 4/2026; 6% 10/2026; 8% 4/2027; 10% 10/2027
11/23/2016 11/23/2020 FHLM $ 1,300,000 $ 1,300,000 1.000% steps up to 1.125% 11/17; 1.25% 2/18; 1.375% 5/18; 1.5% 8/18; 1.625% 11/18; 1.75% 2/19; 2% 5/19; 2.25% 8/19; 2.5% 11/19; 2.75% 2/20; 3% 5/20; 3.25% 8/20
3/10/2017 2/15/2022 FHLM $ 2,000,000 $ 2,000,000 $ 1,736 1.250% steps up to 1.50% 8/17; 1.75% 2/18; 2% 8/18; 2.50% 2/19; 3% 8/19; 3.50% 2/20; 4.25% 8/20; 5% 2/21; 6% 8/21

Totals $ 14,300,000 $ 14,300,000 $ 1,875


35

MEMO
Resource Development

To: The Board of Trustees and President Timothy J. Nelson


From: Rebecca Teahen, Executive Director for Resource Development
Date: April 17, 2017
Subject: Foundation Update

Fund Raising a check on FY17 goals


To date, $472,748 has been raised for the Annual Fund; our goal is $275,000! To date, 502
donors have supported the annual fund, 9.37% above FY16 in terms of number of donors.
FY17 total dollars raised are as follows:
$ 4,641,916 Total received (including Annual Fund, pledges, and documented
planned gift intentions) raised toward goal of $3,350,000
+ $ 268,410 Gross event revenue vs goal of $250,000
$ 4,910,326 Total of gifts + events Over goal!
Foundation Initiatives
Staff and the Campaign Steering Committee, are finalizing recognition opportunities for
consideration by the Board.
Conversations are underway with prospective funders as we seek support for scholarships,
programs, and facilities.
The annual Scholarship Luncheon will be held Friday, April 21 to celebrate donor support of
student success at NMC.
The NMC Scholarship Open Committee is hard at work to recruit sponsors and golfers for
this years outing to be held August 3rd.
The WNMC On-Air campaign is off to a great start. Visit www.nmc.edu/wnmc then support
WNMC to make a gift during this 50th anniversary year!
Wei Cao and Hon. Kevin Elsenheimer have been selected as this years Outstanding NMC
Alumni. NMC, and our alumni have much to be proud of and these OA recipients are a great
example!
Meetings and Events for your calendars:
Foundation Finance & Audit Committee meeting Wed., 4/19/17 at 7:30 am, Founders Hall
Foundation Board meeting Wed., 4/26/17 at 7:30 am (breakfast at 7:00), Oleson Center.

1701 East Front Street, Traverse City, MI 49686 231-995-1021


36

To: The NMC Board of Trustees and President Tim Nelson


From: Diana Fairbanks, Executive Director of Public Relations
Date: April 19, 2017
Subject: NMC Barbecue Report

The sixty-second annual NMC Barbecue will be held on Sunday, May 21, 2017 from 11 a.m. to
5 p.m. at the main campus. Tickets prices are $6 in advance and $8 day of, and may be
purchased now online at nmc.edu/bbq. Tickets will also be available soon at most local financial
institutions, from members of the BBQ Board, the NMC University Center, the Traverse City
Visitors Bureau, both Olesons Food Store locations and also through sales by representatives
of this years funded projects.

This year the BBQ Board has approved more than $38,000 in funds towards NMC projects
including a new 3D printer for the Engineering Club, news gathering equipment for WNMC, and
NMC Foundation scholarship endowment funding.

Returning attractions from last year include the car show and the Tae Kwon Do Club
demonstrations, musical performances through WNMC and local bands and choirs, expanded
alumni tent and activities, cake and cupcake walk and more. Featured this year will be a special
expanded dedication to honor NMC Aviations 50th anniversary.

As always, there will be games for the kids, a chance to have your photo taken with Chip the
faux buffalo, exhibits from NMC programs, open classroom exhibits, and of course great food,
continuous entertainment and much, much more.

See you at the NMC Barbecue: Sunday, May 21!


37

Northwestern Michigan College


Board of Trustees
Building and Site Committee Minutes
April 10, 2017
West Hall Conference Room, 1701 E. Front Street, Traverse City, MI 49686

Committee Chair Ross Childs called the meeting to order at 2:30 p.m.

Members present Ross Childs, Kennard Weaver


Members absent: Chris Bott

Others Present: President Timothy Nelson, Vicki Cook, Holly Gorton, Todd Neibauer,
Pat Podges

Student Housing Project


Program Manager Pat Podges reviewed the budget update on the Student Housing project, and
noted the project was moving forward within budget and on schedule. He reviewed Spence
Brothers monthly construction managers report, highlighting that in-wall and above ceiling
mechanical systems installations are continuing along with drywall, painting and flooring
throughout the building. The exterior is being prepared for siding installation and the first
delivery of casework arrived on site today.

A question was asked about the projected regional low-income housing demand over the next
few years as future NMC housing plans are made. This topic will be further researched by
college administration with appropriate regional agencies before any NMC future housing
projects.

Dennos Museum Project


Pat Podges noted this was the first day of the museum being shut down to the public as the VAV
replacement work, along with other interior renovations within the building, occurs. Work
scheduled in the Milliken Auditorium and Sculpture Court is coordinated with scheduled events
being hosted by the College in May and will remain closed until early June.

Podges reviewed the Dennos Museum project budget update, indicating there were no concerns
as the project is progressing in line with targets. As he reviewed the Dennos construction
managers report, it was determined that a floor diagram labeled with the corresponding A, B, C,
D project areas would be helpful and Podges will provide for the next meeting. The group also
reviewed and discussed the 3-week look ahead schedule, including the road closure off College
Drive to install the new storm line drain from the relocated loading dock. Signs will be placed to
direct traffic to the north lot entrance and the Fire Department has also been notified.

West Hall Innovation Center/New Library


The West Hall draft project schedule was reviewed and it was noted that the design firm Stantec,
is working toward completing the requirements for submittal of the programming and schematic
38
Board Building and Site Committee April 10, 2017

design for review by the DTMB in Lansing. President Nelson explained that he continues to
communicate with legislators so they anticipate receiving the proposal.

The meeting adjourned at 3:04 p.m. and members of the committee walked over to the North
Hall housing project for a tour.

Recorded by Holly Gorton, Executive Assistant to the President and Board of Trustees.

2
39

Northwestern Michigan College


Board of Trustees
Policy Committee Minutes
April 19, 2017
Presidents Office Conference Room, Tanis Building
1701 E. Front Street, Traverse City, MI

Committee Chair Ross Childs called the meeting to order at 2:06 p.m.

Members present: Doug Bishop, Ross Childs


Members absent: Michael Estes
Others present: President Timothy Nelson, Vicki Cook, Holly Gorton, Kyle Kaminski

The committee reviewed Board policies per the NMC Board Policies Review Schedule that included
the following:

B-100.00 Board of Trustees Delegation to the President


Board policy B-100.00 was reviewed and discussed with a suggested wording change to the second
sentence of item 1. of the policy changing the word will to may. There were no other
recommended revisions.

B-101.00 Presidents Role and Job Description


Board policy B-101.00 was discussed and it was determined that no revisions were necessary.

B-102.00 Monitoring Presidential Performance


Board policy B-102.00 was reviewed and discussed with no revisions being required.

B-103.00 Communication and Counsel to the Board


Board policy B-103.00 was reviewed and discussed with a recommendation to add an item 7 as
follows:
7. Provide information as requested by any individual board member per Board
Policy B-100.00 Delegation to the President.

The above recommendations will go to the full Board for approval.

Review of Board Policy Review Schedule


The list of Board policies scheduled for review in 2017 was reviewed and it was determined that the
following policies would be reviewed at the next Board Policy Committee meeting and Vice
President Stephen Siciliano will be invited to provide recommendations.
D-100.00 Learning Outcomes
D-200.00 Enrichment
D-202.00 Public School Academies

Other Items for Discussion


There was a brief discussion pertaining to the continual demand for low income housing in the
region, providing justification for additional housing at NMC.

The meeting adjourned at 2:30 p.m.

Recorded by Holly Gorton, Executive Assistant to the President and Board of Trustees.
40

MCCA MONTHLY UPDATE TO


BOARDS OF TRUSTEES
[Report #44 April 5, 2017]

Community College Day: Please join us on Thursday, April 20 from 11:30am to 1:30pm in Lansing for the
annual Community College Day celebration (Capitol Building, North & West Wings). This is a great event
and an opportunity to informally connect with colleagues, legislators and staff. Please contact Kathy Taskey
to let us know how many plan to attend from your college (kathy@mcca.org; 517.372.4350).

MCCA Accepting Nominations for Outstanding Alumnus Award and Outstanding Faculty Award: Each
year at the MCCA Summer Conference Awards Banquet, we recognize and award an outstanding
Community College Alumna and an Outstanding Community College Faculty member as selected by the
MCCA Executive Committee. Please consider nominating candidate(s) for each of these awards and submit
to Kathy Taskey (kathy@mcca.org) by April 30. See the nomination forms for the outstanding alumnus and
outstanding faculty awards.

Registration for Community College Leadership Week Events: This years


Community College Leadership Week will take place in Mackinac Island from July 26-
28, 2017. Registration for the main events (Trustee Summer Institute, Presidents
Summer Institute, and the Summer Conference) is available on the MCCA website at
www.mcca.org. You can register by clicking on the appropriate logo on the main
page; please see the tabs across the top for important information to make your
stay at Mackinac Island as enjoyable as possible. If you have any questions
regarding registration, please dont hesitate to give Kathy Taskey a call at 517-372-
4350 or email at kathy@mcca.org.

Deadline Extended for Nominations to the Michigan Community College


Leadership Academy: Building on the success of the inaugural 2016-17 class, the
MCCA is accepting nominations for next year's class. The Academy is designed
for faculty and mid- to senior-level community college administrators who are
ready to move into a higher level of leadership. Participants must be nominated
by their president or chancellor. Please send the nomination form to Adriana Phelan by April 28
(aphelan@mcca.org). Please see the program flyer and MCCA website for more information.

STATE LEGISLATIVE HIGHLIGHTS

Budget Recommendations Advance: On March 22, the Senate Appropriations Subcommittee on


Community Colleges reported its budget recommendations for the 2017-2018 fiscal year. Community
colleges would see a 1% increase, totaling $3.2 million. Of that amount, $1.8 million was put through the
traditional funding formula, benefitting all 28 colleges. The remaining $1.4 million was split among 11
colleges to ensure that every college sees at least a 2.5% increase from the current year when combining
the funds resulting from the Personal Property Tax situation and the funds the subcommittee added in the
budget. The Senate Subcommittee concurred with the Governors recommendation to reinstate funding for
1
41

the Independent Part Time Student Grant, and with the funding recommended for upgrades to the
Michigan Transfer Network. Meanwhile, the House Appropriations Subcommittee on Community Colleges
reported their version of House Bill 4236 (Afendoulis) on March 30. The bill concurs with Governor Snyders
recommendation to leave Fiscal Year 2017-2018 funding for community at the same level currently
appropriated. HB 4236 as reported does not include funding for either the Michigan Transfer Network
upgrades or the Independent Part Time Student Grants. The MCCA Board of Directors voted to support
the Senate bill at the March 24, 2017 meeting at Jackson College.
Whats Next? The Legislature is on Spring Break recess for the coming two weeks, and then
budgets will be before the full House and Senate Appropriations Committees. Ultimately, the two
chambers will meet after the May revenue estimating conference to iron out their differences.

Merit Curriculum Changes Pass House: On March 30, the full House of Representatives voted to support
several bills that would make changes to the Michigan Merit Curriculum. House Bills 4315 (Griffin) and 4316
(VanderWall) would revise the current foreign language and visual or performing arts requirement to
instead require three credits of 21st Century Skills. House Bill 4317 (Hauck) would allow 30 hours of OSHA
training to fill the health education requirement for graduation. Finally, House Bill 4318 (Howell) would
allow a student to take a statistics course in place of the current Algebra 2 requirement. The bills now go to
the Senate for consideration.

Business Tax Incentive Clears Senate: The Senate in late March passed a three-bill package allowing large
employers to keep a portion of the income tax generated by new employees if they meet certain job
creation goals. Under the bills, (SB 242, SB 243 and SB 244), eligible businesses creating at least 500 new
qualified jobs that pay the average wage or higher for the prosperity region in which the business is located
would receive up to a five-year, 50 percent abatement on the personal income tax withholdings of new
employees. Companies creating at least 250 qualified new jobs paying wages at 125% or more of the
prosperity region average wage would be eligible to receive up to a 10-year, 100% abatement. The bills
now go the House Tax Policy Committee.

Governors Education and Talent Summit: The theme for the April 25/26 Summit at the Lansing Center is
Bridging the Gap for Employers, Educators, and Communities. Click here to register.

Bills to Watch: A quick reference of all the bills relevant to community colleges is available here. Please
contact Mike Hansen or Erin Schor with questions.

FEDERAL LEGISLATIVE HIGHLIGHTS

MCCA Michigan Delegation Breakfast: For those attending the American Association of Community
Colleges (AACC) convention in New Orleans on April 22-25, we would like to invite you to attend the MCCA
Michigan Delegation Breakfast on Sunday, April 23 from 7:00-8:30 am in the Canal Room on the Third Floor
of the Hilton New Orleans Riverside (the convention hotel). Please RSVP to Kathy Taskey (kathy@mcca.org
or 517-372-4350).

Administration Proposes Pell Cut: The White House has sent a request to Capitol Hill outlining $18 billion
in cuts to nondefense discretionary programs including a $1.3 billion cut to the Pell Grant surplus. The
$18 billion in cuts are designed to offset part of the cost of the Administrations $33 billion supplemental
funding request to boost military and homeland security spending for fiscal year 2017. According to the

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42

Congressional Budget Offices January estimates, the Pell Grant program currently has a $10.5 billion
surplus. Community colleges continue to advocate for using surplus funds for the reinstatement of the
year-round Pell Grant, as well as bolstering of the program. A $1.3 billion cut to the surplus would not
impact award levels or eligibility for students for the upcoming year. However, those funds would no longer
be available to reinvest in the Pell Grant program, and could impact long-term budgetary projections.

Whats next? It will ultimately be up to Congressional appropriators to enact any of these requested
funding changes. The government is currently being funded for fiscal year 2017 under a continuing
resolution (which expires on April 28). Before that deadline, Congress will have to either pass
another continuing resolution or a final funding bill for 2017. The Administration is proposing that
the recommended cuts and increases be enacted for fiscal year 2017.

MCCA CENTERS OF EXCELLENCE

MICHIGAN CENTER FOR STUDENT SUCCESS (MCSS)

Successful Guided Pathways Institute and MSSN Meetings:


The MCSS hosted the Guided Pathways Institute and Michigan
Student Success Network meetings on March 30-31 at Lake Michigan
College. Roughly 70 participants from colleges across the state
heard from national presenters and engaged in cross-institution dialogue.

CMVE Spring Workshop Series: The Consortium of Michigan Veterans Educators (CMVE) is hosting regional
workshops around the state with nearly 100 educators participating (or planning to participate in mid-
April). More details about the workshops are available on the CMVE website.

MCSS Events: Please see the MCSSs Upcoming Events page for a listing and more details about all
upcoming events, including MCSSs Regional Faculty Conversations (May 23-25), CMVEs MI-litary
Equivalency Project Campus Workgroup Seminar (June 2), the Mathematics Pathways Summit (June 28),
the ALP Faculty Development Institute (Aug. 10-11).

MICHIGAN COLLEGES ONLINE (MCO)

Open Educational Resources (OER) Update: MCO has been tracking OER
usage for the past year to gauge both instructor uses and student
savings. Open textbooks are written by professors, are peer reviewed,
and have an open copyright license that allows other faculty to use the
textbooks at no cost. These free textbooks and resources are used for ALL classes including face-to-face,
hybrid/blended and online classes. For the 2016-17 academic year (Fall 2016 and Winter/Spring 2017)
Michigan community colleges have saved students and estimated $2,721,000 in textbook costs! For the
full report click here.

Collaborative Programs Update: In March, two new programs were approved to move forward for shared
programming offered via Michigan Colleges Online. The first is Computed Tomography (CT). This program
will be a certificate program offered to Radiographers, Nuclear Medical Technicians, and Radiation
Therapists. The second is Electroencephalogram Technology (EEG). This program will start as a certificate

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with the option to complete an Associate degree. If your college would like to explore shared programming
opportunities, please contact Amy Lee, the MCCA's Director of Collaborative Programs, at 269-830-7662 or
alee@mcca.org.

MICHIGAN NEW JOBS TRAINING PROGRAM (MNJTP)

MNJTP by The Numbers: MNJTP is an economic development program which


authorizes community colleges to temporarily capture the state income tax
withholding associated with newly hired workers to pay for training. Contact
Adriana Phelan with any questions.
16,995 projected new jobs are being supported by MNJTP agreements.
143 participating employers.
21 community colleges participate in the program.

4
44

Board of Trustees Budget Update

April 2017

1
45

TABLE OF CONTENTS
FISCAL YEAR 2018 WORKING BUDGET UPDATE

REVENUE ASSUMPTIONS
ENROLLMENT CONTACT HOURS ....................................................................................... 3
STATE REVENUE ............................................................................................................... 4
PROPERTY TAX ................................................................................................................. 4
REVENUE BY SOURCE ....................................................................................................... 6
IN-DISTRICT TUITION COMPARISON ................................................................................. 7
IN-DISTRICT TUITION COMPARISON AND ALL FEES COMPARISON .................................... 8
OUT-OF-DISTRICT TUITION COMPARISON ........................................................................ 9
OUT-OF-STATE TUITION COMPARISON ........................................................................... 10
EXPENSE COMPARISON
EXPENDITURE COMPARISON ACS REPORTS .............................................................. 12-15
RESERVES
RESERVES MEMORANDUM AND MATERIALS............................................................... 16-22

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46

Revenue Assumptions for FY 2018 Budget


Contact Hours
Recruitment, admissions and retention at community colleges has changed dramatically in the past 5-10
years, now mirroring strategies found at private two and four year colleges and universities. Efforts
have expanded to encourage completion of college credits prior to high school graduation through early
college, concurrent enrollment and dual enrollment. State and regional demographics and economic
conditions can influence NMCs enrollment. Contact hours is the driver to determine tuition revenue.
Class size can also influence our net return on tuition. Tuition is billed on contact hours.

(a) (b) ('c) (d) (e) (f) (g) (h)


FY13 FY14 FY 14 FY15 FY 15 FY 16 FY 16 FY 17 FY 17 FY 18
Semester Actual Budget Actual Budget Actual Budget Actual Budget Actual Budget

Fall 52,499 52,623 51,042 50,085 48,175 49,292 45,561 42,682 43,398 41,922

Spring 49,007 50,290 46,623 46,450 44,494 44,687 41,116 40,297 39,045 37,329
Summer
(1) 7,398 9,092 7,300 7,295 6,931 6,204 6,207 6,090 6,090 5,582

Total 108,904 112,005 104,965 103,830 99,600 100,183 92,884 89,069 88,533 84,833
(1) summer 2017 is estimate

Percentage changes

FY14 Budget (b); compared to FY13 Actual (a) 2.85%

FY14 Budget (b); compared to FY14 Actual (c) -6.29%

FY14 Actual (c); compared to FY15 Budget (d) -1.08%

FY15 Budget (d); compared to FY14 Actual (c) -1.08%

FY16 Budget (f); compared to FY15 Actual (e) 0.59%

FY16 Budget (f); compared to FY15 Budget (d) -3.51%

FY17 Budget to FY16 Actuals 4.28%


FY15 Budget to FY16 Budget -3.51%

FY 17 Budget to FY 16 Actuals -4.11%


FY 17 Budget to FY 16 Budget -11.09%

FY 18 Budget to FY 17 Actual -4.18%


FY 18 Budget to FY17 Budget -4.76%

3
47

State Revenue
Fiscal year 2018 draft budget currently has a 1% increase for state appropriations. The Governors
budget, the Senate and House have each presented different scenarios. There has been a range between
zero to a two percentage increase. We will continue to monitor the progress of the bills.

Property Tax Revenue


The current draft FY 2018 budget is built with a 1.7% increase in property tax revenue. Historically,
we have not seen significant increases in property tax revenue due to the Headlee rollback. Each 1%
change in equalized value provides an additonal $100,000.

% Change % Change % Change in


Year Taxable Value in TV Millage in Millage Budget Actual Difference Budget Amt
2005 $3,582,498,474 7.18% 2.21 -0.89% 7,335,233 7,328,760 -6,473 -0.09%
2006 $3,899,168,734 8.84% 2.18 -1.31% 7,734,322 7,732,958 -1,364 -0.02%
2007 $4,186,312,845 7.36% 2.17 -0.64% 8,362,268 8,292,868 -69,400 -0.84%
2008 $4,324,888,638 3.31% 2.17 0.00% 8,864,004 8,841,503 -22,501 -0.25%
2009 $4,478,431,081 3.55% 2.17 0.00% 9,218,564 9,197,900 -20,664 4.00%
2010 $4,392,056,777 1.50% 2.17 0.00% 9,437,988 9,512,115 74,127 2.38%
2011 $4,349,332,629 1.50% 2.17 0.00% 9,346,057 9,340,301 -5,756 -0.97%
2012 $4,285,384,931 -1.00% 2.17 0.00% 9,309,846 9,120,000 -189,846 -0.39%
2013 $4,188,963,770 -2.25% 2.17 0.00% 9,090,051 9,178,683 88,632 -2.36%
2014 $4,283,215,455 2.25% 2.17 0.00% 9,294,578 9,346,990 52,412 2.25%
2015 $4,354,745,153 1.67% 2.17 0.00% 9,449,797 9,517,435 67,638 1.67%
2016 $4,492,355,100 3.16% 2.17 0.00% 9,806,150 9,831,150 25,000 3.77%
FY17-budget $4,568,725,137 1.70% 2.17 0.00% 9,914,134 1.10%
FY18-budget $4,646,393,464 1.70% 2.17 0.00% 10,082,674 1.70%
FY19-budget $4,692,857,398 1.00% 2.17 0.00% 10,183,501 1.00%
FY20-Budget $4,739,785,972 1.00% 2.17 0.00% 10,285,336
FY21 Budget $4,787,183,832 1.00% 2.17 0.00% 10,388,189

Penalties Budget Actual Difference


2005 13,500 7,157 -6,343 -88.64%
2006 14,243 12,371 -1,871 -15.13%
2007 0 15,995 15,995 100.00%
2008 13,000 19,429 6,429 33.09%
2009 13,000 18,073 5,073 28.07%
2010 13,000 18,103 5,103 28.19%
2011 15,000 9,401 -5,599 -59.55%
2012 15,000 19,800 4,800 24.24%
2013 15,000 17,368 2,368 13.63%
2014 15,000 5,715 -9,285 -162.47%
2015 15,000 13,214 -1,786 -13.52%
2016 15,000 11,803 -3,197 -27.09%
FY17-Budget 15,000
FY18-Budget 15,000
FY19-Budget 15,000
FY20-Budget 15,000
FY21-Budget 15,000

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48

Northwestern Michigan Colleges revenue comparison


to the other community colleges

By Sources
In-District
In-District with fees
Out of District
Out of State

5
49

Revenue Sources
College Tuition & Fees Property Tax State Aid Other
Mid-Michigan 71% 9% 19% 1%
Henry Ford 56% 17% 26% 1%
Jackson 53% 11% 27% 9%
NMC 52% 22% 21% 5%
Grand Rapids 50% 28% 17% 5%
Schoolcraft 50% 28% 15% 7%
Delta 44% 33% 21% 2%
Southwestern 44% 24% 30% 2%
North Central 43% 34% 19% 4%
Kellogg* 42% 27% 27% 4%
Macomb 42% 26% 24% 8%
Gogebic* 41% 14% 44% 1%
Kalamazoo 41% 34% 22% 3%
Alpena 40% 19% 40% 1%
Muskegon 40% 27% 23% 10%
Lansing 39% 32% 26% 3%
St. Clair 39% 34% 25% 2%
Bay-de-Noc* 38% 21% 29% 12%
Mott 38% 28% 17% 17%
Kirtland 35% 43% 20% 2%
Monroe 34% 44% 21% 1%
Washtenaw 32% 49% 13% 6%
Lake Michigan 31% 43% 15% 11%
Oakland 31% 54% 15% 0%
Montcalm 30% 35% 20% 15%
Wayne 29% 56% 13% 2%
Glen Oaks 26% 50% 23% 1%
Westshore* 17% 51% 14% 18%

State Average 41% 34% 20% 5%

*building and site millage


Sorted by tuition & fees
Revenue source data from ACS 2016\ Fiscal year
Table 22
6 03.07.17
50

In District Tuition History


Sorted highest to lowest Fall 2016 tuition
All Community Colleges
For Years 2012-2016

Tuition Fall % of Fall % of Fall % of Fall % of Average % change


College Basis 2012 2013 Change 2014 Change 2015 Change 2016 Change Since 2012
Jackson Community College Contact 106.00 111.00 4.72% 117.00 5.41% 125.00 6.84% 135.00 8.00% 6.24%
Mott Community College Contact 112.64 119.87 6.42% 122.50 2.19% 126.30 3.10% 130.90 3.64% 3.84%
Alpena Community College Contact 106.00 111.00 4.72% 115.00 3.60% 120.00 4.35% 125.00 4.17% 4.21%
Bay De Noc Community College Contact 99.00 103.00 4.04% 107.00 3.88% 110.00 2.80% 116.00 5.45% 4.05%
Southwestern Michigan College Credit 104.25 109.50 5.04% 111.25 1.60% 113.00 1.57% 115.25 1.99% 2.55%
North Central Michigan College Credit 77.50 87.00 12.26% 96.00 10.34% 102.75 7.03% 113.00 9.98% 9.90%
Grand Rapids Community College Contact 98.00 103.00 5.10% 106.00 2.91% 108.00 1.89% 111.00 2.78% 3.17%
Glen Oaks Community College Contact 90.00 95.00 5.56% 95.00 0.00% 103.00 8.42% 109.00 5.83% 4.95%
Kirtland Community College Credit 92.00 96.00 4.35% 99.00 3.13% 105.00 6.06% 109.00 3.81% 4.34%
Mid-Michigan Community College Contact 92.50 98.50 6.49% 101.00 2.54% 104.00 2.97% 108.00 3.85% 3.96%
Wayne County Community College Credit 99.00 102.00 3.03% 105.00 2.94% 105.00 0.00% 107.10 2.00% 1.99%
Monroe County Community College Credit 84.00 92.00 9.52% 95.00 3.26% 102.00 7.37% 107.00 4.90% 6.26%
Gogebic Community College Credit 99.00 102.00 3.03% 102.00 0.00% 106.00 3.92% 106.00 0.00% 1.74%
Montcalm Community College Contact 87.00 91.00 4.60% 96.00 5.49% 100.00 4.17% 105.00 5.00% 4.81%
St. Clair County Community College Contact 94.50 96.00 1.59% 99.00 3.13% 102.00 3.03% 105.00 2.94% 2.67%
Northwestern Michigan College Contact 84.60 86.30 2.01% 90.90 5.33% 96.35 6.00% 103.70 7.63% 5.24%
Kellogg Community College Credit 84.50 90.50 7.10% 96.50 6.63% 99.50 3.11% 103.50 4.02% 5.21%
Muskegon Community College Credit 85.50 89.50 4.68% 96.00 7.26% 99.00 3.13% 102.00 3.03% 4.52%
Schoolcraft College Credit 87.00 90.00 3.45% 93.00 3.33% 96.00 3.23% 102.00 6.25% 4.06%
Kalamazoo Valley Community College Credit 83.50 88.00 5.39% 91.00 3.41% 95.00 4.40% 100.00 5.26% 4.61%
Delta College Credit 86.00 88.50 2.91% 91.70 3.62% 96.50 5.23% 99.50 3.11% 3.72%
Lansing Community College Credit 81.00 83.00 2.47% 85.00 2.41% 88.00 3.53% 99.00 12.50% 5.23%
Lake Michigan College Credit 83.00 87.00 4.82% 89.50 2.87% 94.00 5.03% 97.00 3.19% 3.98%
Macomb Community College Credit 89.00 89.00 0.00% 91.50 2.81% 94.00 2.73% 97.00 3.19% 2.18%
West Shore Community College Credit 83.00 86.00 3.61% 88.75 3.20% 91.00 2.54% 96.00 5.49% 3.71%
Washtenaw Community College Credit 89.00 91.00 2.25% 93.00 2.20% 94.00 1.08% 94.00 0.00% 1.38%
Henry Ford Community College Credit 75.00 82.00 9.33% 87.00 6.10% 92.00 5.75% 93.00 1.09% 5.57%
Oakland Community College Credit 71.40 76.40 7.00% 82.00 7.33% 88.00 7.32% 88.00 0.00% 5.41%

03.08.17

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51

MCCBOA
Fall 2016 In District Tuition and Fees Comparison
Fall 2016 Fall 2015
Cost per Cost per % Cost over
College Tuition Rate (a) Survey Cost Credits Credit Credit increase Tuition
Jackson 135.00 2,956.00 15 197.07 182.87 7.8% 146.0%
Southwestern 115.25 2,608.00 16 186.29 181.43 2.7% 161.6%
Mott 130.34 2,165.34 14 180.45 176.54 2.2% 138.4%
Montcalm 105.00 2,463.00 16 175.93 137.71 27.8% 167.6%
Muskegon 99.00 2,370.00 18 169.29 169.29 0.0% 171.0%
Henry Ford 93.00 2,230.00 14 159.29 128.86 23.6% 171.3%
Monroe 107.00 2,035.00 15 156.54 150.77 3.8% 146.3%
Alpena 125.00 2,145.00 14 153.21 147.86 3.6% 122.6%
Lake Michigan 97.00 2,145.00 14 153.21 148.93 2.9% 157.9%
Schoolcraft 102.00 2,296.00 15 153.07 142.00 7.8% 150.1%
Glen Oaks 109.00 2,273.00 15 151.53 150.60 0.6% 139.0%
Kirtland 109.00 2,055.00 14 146.79 141.79 3.5% 134.7%
St. Clair 105.00 2,011.00 16 143.64 138.93 3.4% 136.8%
North Central 108.00 1,999.00 15 142.79 137.16 4.1% 132.2%
Northwestern 103.70 2,121.80 16 141.45 132.55 6.7% 136.4%
Gogebic 106.00 1,956.00 14 139.71 139.71 0.0% 131.8%
Mid Michigan 108.00 1,805.00 14 138.85 132.38 4.9% 128.6%
Grand Rapids 111.00 1,906.50 14 136.18 132.96 2.4% 122.7%
Kellogg 103.50 1,817.20 14 129.80 123.51 5.1% 125.4%
Delta 99.50 1,919.50 15 127.97 123.30 3.8% 128.6%
Kalamazoo 100.00 1,710.00 14 122.14 116.07 5.2% 122.1%
Lansing 99.00 1,930.00 16 120.63 108.94 10.7% 121.8%
West Shore 96.00 1,653.00 15 118.07 110.43 6.9% 123.0%
Macomb 97.00 1,701.00 15 113.40 109.73 3.3% 116.9%
Washtenaw 94.00 1,665.00 15 111.00 111.00 0.0% 118.1%
Oakland 88.00 1,420.00 14 101.43 93.71 8.2% 115.3%
Bay De Noc (did not report) 14
Wayne (did not report) 13

Average $105.59 $2,052.17 $144.99 $137.27 5.6%


High $135.00 $2,956.00 $197.07 $182.87 7.8%

a) Survey cost was based on the following courses:


Introduction to Biology, Introduction to Psychology, Intermediate Algebra, English Comp
Sorted by Fall 2016 per credit cost
8
4/12/2017
52

Out of District Tuition History


All Community Colleges
For Years 2012-2016
(Sorted highest to lowest on 2016 tuition)

Tuition Fall % of Fall % of Fall % of Fall % of Average % change


Basis 2012 2013 Change 2014 Change 2015 Change 2016 Change Since 2012
Grand Rapids Community College Contact 215.00 222.00 3.26% 228.00 2.70% 232.00 1.75% 238.00 2.59% 2.57%
Northwestern Michigan College Contact 165.90 170.90 3.01% 180.00 5.32% 190.80 6.00% 205.30 7.60% 5.48%
St. Clair County Community College Contact 184.00 187.00 1.63% 192.00 2.67% 198.00 3.13% 204.00 3.03% 2.61%
Bay De Noc Community College Contact 177.00 183.00 3.39% 188.00 2.73% 191.00 1.60% 199.00 4.19% 2.98%
Montcalm Community College Contact 164.00 171.00 4.27% 180.00 5.26% 187.00 3.89% 199.00 6.42% 4.96%
Lansing Community College Credit 162.00 166.00 2.47% 170.00 2.41% 176.00 3.53% 198.00 12.50% 5.23%
Alpena Community College Contact 166.00 175.00 5.42% 181.00 3.43% 181.00 0.00% 197.00 8.84% 4.42%
Mid-Michigan Community College Contact 172.00 182.00 5.81% 185.00 1.65% 188.00 1.62% 196.00 4.26% 3.33%
Jackson Community College Contact 159.00 161.00 1.26% 161.00 0.00% 172.00 6.83% 195.00 13.37% 5.37%
Muskegon Community College Credit 153.00 160.00 4.58% 178.00 11.25% 184.00 3.37% 190.00 3.26% 5.61%
North Central Michigan College Credit 128.00 144.00 12.50% 158.75 10.24% 170.00 7.09% 188.00 10.59% 10.10%
Monroe County Community College Credit 144.00 158.00 9.72% 175.00 10.76% 177.00 1.14% 186.00 5.08% 6.68%
Mott Community College Contact 166.34 174.00 4.61% 183.48 5.45% 183.48 0.00% 183.44 -0.02% 2.51%
Macomb Community College Credit 136.00 136.00 0.00% 140.00 2.94% 160.00 14.29% 180.00 12.50% 7.43%
Delta College Credit 135.00 142.00 5.19% 154.00 8.45% 159.00 3.25% 172.00 8.18% 6.26%
Glen Oaks Community College Contact 138.00 153.00 10.87% 158.00 3.27% 166.00 5.06% 172.00 3.61% 5.70%
Kalamazoo Valley Community College Credit 136.00 151.00 11.03% 156.00 3.31% 163.00 4.49% 172.00 5.52% 6.09%
Oakland Community College Credit 125.30 139.00 10.93% 154.00 10.79% 171.00 11.04% 171.00 0.00% 8.19%
Kellogg Community College Credit 137.12 147.00 7.21% 162.50 10.54% 174.25 7.23% 169.37 -2.80% 5.54%
Henry Ford Community College Credit 135.00 142.00 5.19% 149.25 5.11% 158.00 5.86% 161.00 1.90% 4.51%
West Shore Community College Credit 150.00 155.00 3.33% 160.00 3.23% 160.00 0.00% 160.00 0.00% 1.64%
Kirtland Community College Credit 128.00 134.00 4.69% 137.00 2.24% 146.00 6.57% 158.00 8.22% 5.43%
Gogebic Community College Credit 134.00 140.00 4.48% 144.00 2.86% 150.00 4.17% 156.00 4.00% 3.88%
Washtenaw Community College Credit 149.00 146.00 -2.01% 149.00 2.05% 152.00 2.01% 155.00 1.97% 1.01%
Southwestern Michigan College Credit 134.75 142.00 5.38% 144.25 1.58% 146.75 1.73% 150.25 2.39% 2.77%
Lake Michigan College Credit 128.00 134.00 4.69% 138.40 3.28% 145.50 5.13% 150.00 3.09% 4.05%
Schoolcraft College Credit 127.00 131.00 3.15% 135.00 3.05% 139.00 2.96% 148.00 6.47% 3.91%
Wayne County Community College Credit 110.00 113.00 2.73% 116.00 2.65% 118.30 1.98% 118.30 0.00% 1.84%

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Out of State Tuition History


All Community Colleges
For Years 2012-2016
(Sorted highest to lowest on 2016 tuition)

Tuition Fall % of Fall % of Fall % of Fall % of


College Basis 2012 2013 Change 2014 Change 2015 Change 2016 Change

Bay De Noc Community College Contact 297.00 315.00 6.06% 330.00 4.76% 350.00 6.06% 362.00 3.43%
Grand Rapids Community College Contact 322.00 328.50 2.02% 338.00 2.89% 344.00 1.78% 353.00 2.62%
Montcalm Community College Contact 244.00 254.00 4.10% 267.00 5.12% 278.00 4.12% 325.00 16.91%
Delta College Credit 200.00 275.00 37.50% 299.00 8.73% 309.00 3.34% 320.00 3.56%
St. Clair County Community College Contact 268.00 272.00 1.49% 281.00 3.31% 290.00 3.20% 298.00 2.76%
Lansing Community College Credit 243.00 249.00 2.47% 255.00 2.41% 264.00 3.53% 297.00 12.50%
Jackson Community College Contact 212.00 216.00 1.89% 234.00 8.33% 250.00 6.84% 270.00 8.00%
Northwestern Michigan College Contact 212.45 218.85 3.01% 234.65 7.22% 248.75 6.01% 267.65 7.60%
Muskegon Community College Credit 210.00 220.00 4.76% 244.00 10.91% 256.00 4.92% 265.00 3.52%
Mott Community College Contact 243.00 254.00 4.53% 261.40 2.91% 261.40 0.00% 261.40 0.00%
Kirtland Community College Credit 212.00 221.00 4.25% 227.00 2.71% 235.00 3.52% 245.00 4.26%
North Central Michigan College Credit 206.50 220.50 6.78% 237.00 7.48% 243.75 2.85% 244.75 0.41%
Kellogg Community College Credit 165.25 185.50 12.25% 204.75 10.38% 219.00 6.96% 244.00 11.42%
Kalamazoo Valley Community College Credit 184.00 204.00 10.87% 211.00 3.43% 220.00 4.27% 231.00 5.00%
Henry Ford Community College Credit 140.00 154.25 10.18% 178.00 15.40% 225.00 26.40% 230.00 2.22%
Macomb Community College Credit 176.00 176.00 0.00% 181.00 2.84% 206.00 13.81% 230.00 11.65%
West Shore Community College Credit 200.00 205.00 2.50% 210.00 2.44% 215.00 2.38% 220.00 2.33%
Lake Michigan College Credit 169.00 179.50 6.21% 184.70 2.90% 194.00 5.04% 219.50 13.14%
Schoolcraft College Credit 188.00 195.00 3.72% 199.00 2.05% 205.00 3.02% 218.00 6.34%
Washtenaw Community College Credit 194.00 194.00 0.00% 197.00 1.55% 202.00 2.54% 208.00 2.97%
Monroe County Community College Credit 160.00 176.00 10.00% 193.00 9.66% 197.00 2.07% 207.00 5.08%
Glen Oaks Community College Contact 176.00 185.00 5.11% 191.00 3.24% 200.00 4.71% 206.00 3.00%
Alpena Community College Contact 166.00 175.00 5.42% 181.00 3.43% 181.00 0.00% 197.00 8.84%
Mid-Michigan Community College Contact 196.00 196.00 0.00% 196.00 0.00% 196.00 0.00% 196.00 0.00%
Gogebic Community College Credit 165.00 171.00 3.64% 173.00 1.17% 179.00 3.47% 185.00 3.35%
Oakland Community College Credit 171.00 171.00 0.00% 171.00 0.00% 171.00 0.00% 171.00 0.00%
Southwestern Michigan College Credit 146.75 154.00 4.94% 157.00 1.95% 159.75 1.75% 164.00 2.66%
Wayne County Community College Credit 140.00 143.00 2.14% 146.00 2.10% 148.90 1.99% 148.90 0.00%

03.08.17
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54

Northwestern Michigan College


Expenditure Comparison to
Colleges in the same ACS Group

11
55

A) Instructional costs: All activities carried out for the express purpose of eliciting some
measure of educational change in a learner.

Direct Instructional costs


per contact hour
2016 ACS Report
$12.00 $11.35 $11.36
$10.70 $10.99
$9.32 $9.61
$10.00 $9.13

$8.00 $7.51

$6.00

$4.00

$2.00

$0.00

Five year comparison


Instructional costs per contact hour
$12.00
$10.99 $10.35

$10.00 $9.61 $9.25


$9.12 $8.45
$8.31
$8.00 $7.66 $7.66
$7.22

$6.00 NMC
State Average
$4.00

$2.00

$-
2016 2015 2014 2013 2012

Data source: ACS table 32

12
56

B) Instructional support: Those activities that carried out in support of the instructional
program. Examples of activities under this classification are library service, educational media
technology, academic offices, faculty release for curriculum development, CIE.

Instructional Support costs


per headcount
2016 ACS Report
$700 $626
$593 $596 $583
$600 $528 $548 $550
$500
$400
$400
$300
$200
$100
$0

Five year comparison


Instructional Support costs
unduplicated headcount
$700 $626
$600 $583 $554 $551
$520
$502 $487 $490
$500 $469 NMC
$437
$400
$300 State
Average
$200
$100
$0
2016 2015 2014 2013 2012

Data source: ACS table 33

13
57

C) Student services: Those activities carried out with the objective of contributing to the
emotional and physical well-being of the student, as well as intellectual, cultural, and social
activities. Services include financial aid, counseling, advising, admissions, registrar, student
records, school catalog, and health services.

Student Services costs per headcount


2016 ACS Report
$1,000 $872
$800 $673 $690 $711
$635
$600 $454 $499
$369
$400
$200
$0

2016 the unduplicated headcount for each college


College Unduplicated headcount
Jackson 7,782
Kellogg 10,477
Muskegon 7,201
Lake Michigan 5,816
Monroe 6,615
NMC 11,762
St. Clair 5,167
State average 13,476

Five year comparison


Student services costs per headcount
$700 $635
$603
$600 $549
$499 $509
$500 $442 $457
$429
$400 $361
NMC costs
$287
$300 State average
$200

$100

$0
2016 2015 2014 2013 2012
Data source: ACS table 34

14
58

D) Administrative costs: Those activities carried out to provide for both the day-to-day
functioning and long-range viability of the institution as an organization. These costs include
business office, cashiers, human resources, presidents office, strategic planning, purchasing
and receiving, public relations, institutional research, alumni. This category can be higher than
other schools due to the way we have designed some of our academic office areas.

Administrative cost per headcount


2016 ACS report
$1,000
$870
$900
$770
$800
$700 $637
$600 $552
$487 $514 $502
$500
$398
$400
$300
$200
$100
$0

Five year comparison


Administrative Costs
$600 $552
$502 $487
$500 $465 $449
$420 $426
$381 $384 NMC
$400 $364

$300

$200

$100

$-
2016 2015 2014 2013 2012

Date source: ACS table 27

15
59

MEMO
Administrative Services

____________________________________________________________________________

To: Timothy J. Nelson, President

From: Vicki Cook, Vice President of Finance and Administration

Date: April 11, 2017

Subject: Recommendation for Net Asset Reserve Balance


Attachments: (a) Staff Policy D-504.01, (b) Resource Guidelines
____________________________________________________________________________
This document provides a review of the Colleges net asset (reserve) balance.

Background
Net assets are the Colleges savings. They are non-recurring sources of funding. The role of net
assets in budgeting and operation include:
Roles specified in Staff Policy D-504.01 Operations; Financial Reserves (attached) and
Resource Guidelines approved annually by the Board of Trustees.
Allow the College to meet unexpected changes in revenue or expense levels.
Allow the College to invest in itself for the development of programs, products or
services. An investment in either programs or facilities should include a plan to replenish
reserves.

As a general rule, net assets should not be used:


To substitute for operating revenues when a shortfall is known or predictable until all
other reasonable remedies have been reviewed.
As an ongoing portion of the revenue mix required to provide a balanced budget
Without a plan for how the assets will be replenished.
As an organization reviews its overall financial position the Administration and Board of
Trustees should ask these questions:
Is the institution financially healthy?
Is the institution financially better off at the end of the fiscal year than it was at the
beginning?
Are financial resources managed strategically to advance the mission?

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FINANCIAL RESERVES

Actual Reserve @ 6/30/16 (draft-


Required Reserves Resource Guidelines Calculated Reserves * not audited) Over/(Under)

A. Working Capital Reserves $ 1,689,958 $ 1,889,654 $ 199,696

B. Reserve for MPSERS Retirement Plans 556,030 651,000 94,970

C. Reserve for Unexpected Medical/Non-Medical Costs 512,276 506,000 (6,276)

D. Fund for Transformation 857,543 1,305,910 448,368

E. Physical Plant Major Maintenance 3,891,056 8,606,558 4,715,502

F. Reserve for Unexpected Energy Costs 124,450 200,000 75,550

G. Reserve for State Aid 2,329,522 2,329,522 -

Total Required Reserves $ 9,960,835 $ 15,488,645 $ 5,527,810

Additional Reserves
Professional Development -
Unemployment $ 108,082
Insurance Liability 69,000
Strategic Projects 608,929
Total Additional Reserves $ 786,012

Total Reserves $ 9,960,835 $ 16,274,657 $ 6,313,822

Notes on calculated reserves: *

A. Used FY16 budgeted expenses (all funds) of $50,875,420 times 15% less reserves B-F

B. 30% of State of Michigan's Contribution to MPSERS. FY16 contributions were $1,853,434

C. Per calculation difference of estimated maximum aggregate and estimated expected claims and 3 months term life, long term disability, and wk. comp
Medical information provided by Ballard (email backup), life-disability-wk comp. based on annual budget

D. Formula: FY16 Budgeted expenses general funds of $42,877,128 times 2%

E. Formula: Bldg & Content value per 15/16 insurance renewal - $194,552,796 times 2%

F. Electric and Fuel costs budgeted for FY16 (all funds) $1,244,500 times 10%

G. Current budgeted state aid $9,318,088 times 25%

17
S:\Administrative Services\Board of Trustees\FY2017\04.24.17\April 1 BOT FY18 Budget update\04.11.17 Net_asset_reserves
61

Staff Policy D-504.01


Institutional Effectiveness Criterion: Operations
Financial Reserves

The Board of Trustees of Northwestern Michigan College deems the establishment of certain
financial reserves to be both prudent and appropriate. In addition to those currently in existence
or those required to be in compliance with generally accepted accounting principles and State of
Michigan Activities Classification Structure (ACS) requirements for community colleges,
reserves will be established as follows:

1. Insurance Runoff
An insurance runoff reserve will be established and maintained for that duration of time that
NMC self-funds its employee health and dental insurance coverage. This reserve shall, as soon
as possible following adoption of this policy, be established and maintained in an amount equal
to three months (one-quarter) of the total annual budget for health and dental coverage.

The purpose of this policy is twofold. The first is to ensure, in the event that the College should
eventually shift to a conventional carrier, dollars be available to pay charges incurred but not
paid during the period of self-insurance. The second is to serve as a non-general-fund source for
higher-than-expected annual health and dental care costs. Dollars from this reserve will not be
expended for any other reason without separate, specific and public action of the NMC Board of
Trustees.
2. Reserve for Working Capital
At the conclusion of each fiscal year and following annual service of the insurance runoff
reserve, any unexpended general fund dollars shall by action of the Board of Trustees be
transferred to the reserve for working capital. At optimum said reserve should equal six to eight
weeks of current general fund expenditures at any given point in time.

The purpose of this reserve is to provide financial stability in times of uncertain revenue sources
and, through return on investment, to provide an ongoing source of supplemental income for
reserve enhancement or for annual operations.

No expenditure of the corpus of this reserve shall occur without separate, specific and public
action of the NMC Board of Trustees.
3. Auxiliary Facilities Reserve
This reserve is to consist of 1990-91 fund balances and annual unexpended revenues from all
facilities owned by the College which are auxiliary to the instructional program. This reserve
will also include the balances of all restricted funds of the College and the NMC Foundation
which, prior to the adoption of this policy, were utilized to service facilities debt. This reserve
will also include dollars pledged for the debt service of any auxiliary facilities and other non-
general-fund revenues so designated by the Board of Trustees.

The purpose of this reserve shall be to provide for the annual debt service of auxiliary facilities
and for the ongoing maintenance and operation of said facilities. Auxiliary facilities for the

18
62

purpose of this policy are those which are College-owned, but the primary purpose of which is
supplemental to rather than primarily for instructional purposes.

Auxiliary facilities include, but are not limited to: East Hall, West Hall, the Student Center, the
Museum Center, student apartments and the marina.

The Vice President of Finance and Administration, in conjunction with the appropriate faculty
and staff, is responsible for the development and publication of any procedures or guidelines that
may be necessary to administer this policy effectively.

If any provisions(s) of this policy or set of bylaws conflicts with laws applicable to Northwestern
Michigan College, including the Community College Act of 1966, the Freedom of Information
Act, or the Open Meetings Act, as each may be amended from time to time, such laws shall
control and supersede such provisions(s).
Initially adopted as D-111.01 December 12, 1996
Renumbered D-504.01 December 20, 2006

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63

NMC RESOURCE GUIDELINES


2016-2017

1 Strategic and Financial Planning


The budget is a financial plan for the priorities of the institution. The budget proposed to the Board of
Trustees for adoption should reflect the Strategic Plan and the area operational plans.

2 Tuition and Fees


Tuition and fees should be considered within the context of the most reasonable estimates of State, local,
and private support, and projected expenses to support the Colleges plans, and projected enrollment and
unique program characteristics. Tuition should balance the goal of affordable access to learning
opportunities with the goal of high quality service levels for NMC offerings. Regular tuition increases
should be considered as a means to sustain this portion of the revenue mix, while minimizing the year-
to-year increases. Fees should be reviewed regularly and increases considered when the cost elements
to which they contribute increase. Our in-district students will pay less than out-of district students
because the College receives local tax support from Grand Traverse County residents. For some
programs, the College uses differential tuition and fees in excess of the general rates.

3 Salaries and Benefits Equity


Northwestern Michigan College is committed to attracting and retaining a quality workforce. Equity in
salary and benefits is part of the NMC culture and should be expressed within a total compensation
package. As part of that package, salary and benefits for faculty, administrative/professional,
technical/paraprofessional and support staff should be equitable when compared to the appropriate peer
group of community colleges and/or service area employers, in accordance with NMCs compensation
policies.

4 Professional Development
Maintaining and improving the knowledge and skills of the faculty and staff is an investment in the
future. Funds should be appropriated annually in the budget for that purpose. Approximately 2.25% of
general fund salaries and wages should be appropriated annually in the budget for that purpose.

5 Faculty and Staff Composition


The college should balance the full-time and part-time composition of faculty and staff to assure
continuity and commitment while maintaining flexibility to implement strategic directions and complete
its strategic initiatives in a timely and effective manner. To enhance smooth transition of personnel, the
college has established a contingency for implementing succession decisions.

6 Technology, Capital Equipment, Maintenance and Renovation


Providing a quality education requires investment in classroom equipment, facilities, and infrastructure.
The annual budget should provide for regular maintenance, replacement/upgrade, growth and
contingency funding.

7 Debt Service
Debt Service obligations must be included in the budgeting process at 100% of their current costs.

20
64

8 Reserves
The budget should include an appropriate allocation for reserves. The following reserves should be
monitored annually. The Board will approve transfers to the appropriate reserve fund balances.

A Working Capital Reserves


A fiscally sound organization should have adequate reserves for emergencies and unanticipated
cash flow needs. Northwestern Michigan College funds should maintain a Working Capital
Reserve of 10 - 15% of annual budgeted expenditures not included in reserves B through G.

B Reserve For Any Future Reduction in State Appropriation Related to Retirement Plans
This is a reserve for any future reduction in State appropriation related to retirement plans. The
amount to maintain is 30% of annual State appropriations for retirement plans.

C Reserve For Unexpected Medical and Non-Medical Costs


This is a reserve for dramatic fluctuations in medical, and non-medical costs (e.g. term life
insurance, long term disability, and workers compensation) that are significantly beyond prudent
predictions. The College should maintain funds equal to the difference between the calculated
maximum aggregate claims and expected claims plus three (3) months of non-medical costs.

D Fund for Transformation


The Fund for Transformation was established for the purpose of responding to emerging
opportunities and changes. A fund balance equal to approximately 2% of General Fund budgeted
expenses should be maintained.

E Physical Plant Major Maintenance and Future Buildings


Two percent of the appraised replacement value-new of the Colleges physical assets, including
buildings, building equipment, and built-in fixtures, should be invested or maintained in a fund
for major maintenance, renovation, or replacement of those assets. This should be calculated as
the total of major plant maintenance expenditures, operating budget maintenance expenditures
on physical plant, and the Plant Fund balance. Reserves above 2% will be designated for future
buildings.

F Reserve For Unexpected Fluctuation In Energy Costs


This is a reserve for dramatic fluctuations in energy costs that are significantly beyond prudent
predictions. The reserve is equal to 10% of the Colleges annual budget for the total energy bill.

G Reserve For Any Future Reduction in State Appropriation Revenue


This is a reserve for any future reduction in State appropriation revenue. The amount to maintain
is 25% of annual State Appropriation.
September 2015

21
65

NorthwesternMichiganCollege
BoardofTrustees
2018WorkingBudget
Update
April2017
66

BudgetUpdate
NationalTrends

Reviewmajorrevenueassumptions

Revenuecomparisons

Allocationofresources

Reviewscenarios

QuestionsandFeedbackonscenarios
67

NationalTrends
Studentenrollmentinthe24andolderage
grouphasdeclinedbymorethan250,000

Michiganrankedthirdhighestinlargest
decline

*datasourceCommunityCollegeWeek
68

Spendingchangesanticipatedin
2017comparedto2016Spe
Increase Increase Decrease Decrease
Expense significantly modestly Staythesame modestly significantly
StaffSalary 0% 70% 25% 3% 2%
HealthBenefit 24% 38% 28% 10% 0%
Pension 16% 27% 51% 5% 2%
Technology 10% 57% 29% 3% 2%
Facility 8% 45% 27% 11% 8%
Athletics 10% 39% 49% 2% 0%

69

Revenuechangesanticipatedin
2017comparedto2016Spe
Increase Increase Decrease Decrease
Revenue significantly modestly Staythesame modestly Significantly
Tuition 6% 52% 23% 17% 2%
Studentfees 6% 63% 22% 9% 0%
State/federal 0% 15% 52% 26% 8%
Endowment 9% 42% 36% 11% 2%
Income
Advancement 3% 46% 35% 16% 0%
income

70

RevenueSources
College Tuition&Fees PropertyTax StateAid Other
MidMichigan 71% 9% 19% 1%
HenryFord 56% 17% 26% 1%
Jackson 53% 11% 27% 9%
NMC 52% 22% 21% 5%
GrandRapids 50% 28% 17% 5%
Schoolcraft 50% 28% 15% 7%
Delta 44% 33% 21% 2%
Southwestern 44% 24% 30% 2%
NorthCentral 43% 34% 19% 4%
Kellogg* 42% 27% 27% 4%
Macomb 42% 26% 24% 8%
Gogebic* 41% 14% 44% 1%
Kalamazoo 41% 34% 22% 3%
Alpena 40% 19% 40% 1%
Muskegon 40% 27% 23% 10%
Lansing 39% 32% 26% 3%
St.Clair 39% 34% 25% 2%
BaydeNoc* 38% 21% 29% 12%
Mott 38% 28% 17% 17%
Kirtland 35% 43% 20% 2%
Monroe 34% 44% 21% 1%
Washtenaw 32% 49% 13% 6%
LakeMichigan 31% 43% 15% 11%
Oakland 31% 54% 15% 0%
Montcalm 30% 35% 20% 15%
Wayne 29% 56% 13% 2%
GlenOaks 26% 50% 23% 1%
Westshore* 17% 51% 14% 18%

StateAverage 41% 34% 20% 5%

Source:ACS2016table22
71

2016AllocationofResourcesasa
percentageofexpense
ACS State
Category NMC Group Average
DirectInstructionalCosts 43.4% 46.4% 45.8%
InstructionalSupport 16.6% 13.2% 13.7%
DirectInstruction+Support 60.0% 59.6% 59.5%

StudentServices 13.2% 13.7% 13.5%


Administrative 14.7% 13.8% 13.5%
PublicService 00.8% 1.0% 1.4%
PhysicalPlant 11.2% 11.8% 12.2%
Source:ACStable28(2015/2016)
72
73
74
75
76

Summaryofcostallocation
Activity NMC ACSGroup State
Average Average

Instruction Percontact hour $10.99 $10.05 $9.61

*InstructionalSupport $626 $549 $583

*StudentServices $499 $610 $683

*Administration $552 $604 $502

*Perheadcount
77

StateTrendsthatwill
ImpactFutureYears

Continuetoseelimitedpropertytaxincreases
basedonHeadlee

Minimalstateappropriationincreases

Declininghighschoolstudentpopulationin
Michigan
78

Contacthourcomparison
140,000

118,432
120,000
108,904
104,965
99,600
100,000
92,884
88,533
84,833

80,000

60,000

40,000

20,000


2012 2013 2014 2015 2016 2017 2018
79

2018RevenueAssumptions
Limitedpropertytaxincreases tiedtorateof
inflation(1.6%)

Minimalstateappropriationincreases(1%)

Decreaseincontacthoursof4.18%compared
toFY2017actuals
80

Structuralchanges

2017employeereductions
Throughattritioneliminated5FTES(2faculty
positionsand3staff/administrationpositions)for
atotalof$339,000insalarycosts

20142016reductions
Throughattritionandconsolidationofservices
eliminated15.75FTES(staffpositions)
81

GeneralRateTuitionChanges


Scenario TuitionCategory Increasepercontacthour AnnualAverageincrease

1 InDistrict $0.00 $0.00


OutofDistrict $0.00 $0.00
OutofState $0.00 $0.00

2 InDistrict $3.60 $86.40
OutofDistrict $7.20 $172.80
OutofState $9.35 $224.40

3 InDistrict $4.65 $111.60
OutofDistrict $9.25 $222.00
OutofState $12.00 $288.00

4 InDistrict $5.20 $124.80
OutofDistrict $10.25 $246.00
OutofState $13.35 $320.40

5 InDistrict $5.20 $124.80
OutofDistrict $10.25 $246.00
OutofState $13.35 $320.40

Averageannualcoststostudentbasedon24contacthoursfortheacademicyear
82

SummaryofScenarios
#1
nochangesintuitionrates
E&Gchanges
SalaryincreasesbasedonCBA
Increaseincapitalspending(reducedlastyear)
Increaseintransfertotechnologyfund

#2&#3
Changeintuitionrates
Expensessameas#1
#4
Changeintuitionrates
Increaseinstaffsalaries

#5
Changeintuitionrate
Changeingeneralfee
ReductioninemployeeFTES
Expensessameas#4
83

Shiftsinrevenueorexpense
Revenueimpact
Changeinactualcontacthours
Changeinstateappropriation
Changeinmixofstudents(i.e.Indistrict,
differentialtuition)
Expenseimpact
Courseefficiency
Classsizes
Salarychanges
84

nochanges 2 3 4 5
4,174
Changeinflightfees (39,602) (39,602) (39,602) (39,602) (39,602)
ChangeinTrainingRevenue
EESrevenue 2,450 2,450 2,450 2,450 2,450
TuitionRevenue/CHANGEINENROLLMENT (599,679) (599,679) (599,679) (599,679) (599,679)
OtherSources 129,000 129,000 129,000 129,000 129,000
Stateappropriation(1%) 121,145 121,145 121,145 121,145 121,145
Propertytax(1.7%) 168,540 168,540 168,540 168,540 168,540
FeechangeGeneralFee,TechFee,FacilityFee 229,054
Tuitionchange 470,162 577,799 629,530 629,530
Incomechanges (218,146) 252,016 359,653 411,384 640,438


E&Gother 278,663 278,663 278,663 278,663 278,663
Capitalequipmentspending 200,000 200,000 200,000 200,000 200,000

Expensechange 478,663 478,663 478,663 478,663 478,663
NetGain(loss) (692,635) (226,647) (119,010) (67,279) 161,775

Changeinadjunctcontracts 160,175 160,175 160,175 160,175 160,175


ReductioninStaffing(Salary&Benefits) (866,420)
Allocationforstaffsalaryincreases 200,000 200,000
Openpositionsthataredelayedincludingbenefits (208,000) (208,000) (208,000) (208,000) (208,000)
Changeinsalarycostsbasedsalarychanges
awardedlastyearforfacultyandstaff 494,100 494,100 494,100 494,100 494,100
Changeinpercentagebasedbenefitcosts 231,338 231,338 231,338 231,338 231,338
Healthcarecosts 50,000 50,000 50,000 50,000 50,000

Compensation&Personnelchanges 727,613 727,613 727,613 927,613 61,193
Transfersincreasefortechnologyfund 100,000 100,000 100,000 100,000 100,000

NetGain(loss) (1,520,248) (1,054,260) (946,623) (1,094,892) 582


85

NMCFutureStrategies
ForRevenueGrowth

Increasedrecruitmenteffortsinlocaland
regionalarea
Strengthenareasofexpertise torecruit
outsidetheregionandcountry
Executeonselectareasforportfoliob&c
InvestmentinFoundation
86

Collegeemployeesnextsteps
April&May
PlanningandBudgettoreviewscenarios
Reviewoffeestructureandrecommendchanges
Understandhowexpenditurereductionseffectgrowthandservicelevels
Prioritizeresources

VPtoreviewexpendituredetailsandpositions
Recommendareasofconsolidation
Areasthatcandelayemployeehires
Recommendareasforemployeereductions

Collegewidesmallgroupmeetings
Allowindividualstounderstandbudgetproposals
Allowforindividualfeedback:areasthatcanrealizesavingsoradditional
revenuestreams
87

May June
BoardretreatMay11,2017
Gatherfeedbackonproposals
Understandservicelevelchanges
GatherfeedbackonNMCpriorities
Newinitiatives
Investmentsforfuturegrowth

JuneBoardofTrusteesmeeting
PresentrecommendedbalancedbudgetforFY2018
88

Questions
89

NORTHWESTERN MICHIGAN COLLEGE


BOARD OF TRUSTEES
MINUTES
Monday, March 20, 2017
at NMC Hagerty Center, Room C, Great Lakes Campus
715. E. Front Street, Traverse city, MI 49686

The Board had dinner with Student Government Association students at 4:45 p.m. in room D of the
NMC Hagerty Center prior to Board meeting.

CALL TO ORDERChair Kennard R. Weaver called the regular meeting to order at 5:31 p.m.

ROLL CALL
Trustees present: Chris M. Bott, K. Ross Childs, Michael Estes, Rachel Johnson, Kennard R.
Weaver
Trustees absent: Douglas S. Bishop, Marilyn Gordon Dresser
Also present: Sarah Cai, Vicki Cook, Mark DeLonge, Joy Evans, Diana Fairbanks, Tom
Gordon, Holly Gorton, Nancy Gray, Lori Hodek, Colin Kreh, Fred Laughlin,
Mark Liebling, Chetra Lieng, Pia Lu, Deanna Luton, Kyle Morrison, Todd
Neibauer, Deb Pharo, Paul Perry, Linda Racine, Steve Rice, Charles Schneider,
Stephen Siciliano, Mike Surgalski, Rebecca Teahen, Lisa Thomas, Sihao Zheng

REVIEW OF AGENDAThe agenda was accepted as presented, on a motion by Ross Childs,


seconded by Michael Estes, with a unanimous vote.

REPORTS
Student Government Association PresentationSGA Advisor Lisa Thomas introduced the
Student Government Association (SGA) members present. SGA officers Prajakta Nivargi and
Meghen Beger presented on behalf of the group providing the Board with information about the
various student groups that have received funding from SGA, and many of the events and projects of
the group. They highlighted the NMScare event sponsored by SGA partnered with the NMC
Residence Life Council. SGA members also shared about the new Community Grant project that
fosters greater relationships between student groups who collaborate to receive grants.

Faculty Report Perceptual Learning MethodsTom Gordon, Humanities Instructor, and Mark
DeLonge, Instructional Technology Specialist/Adjunct Faculty, presented on the Perceptual
Learning Method (PLM) to create and experience intuitive learning. They demonstrated a PLM
module and the positive results obtained by students using this learning method. The PLM has been
shared with other instructors, interns, and independent study students who have also been building
additional PLM modules.

AQIP Talent Project Final ReportLinda Racine, Director of Program Advancement and one of
the facilitators of the Talent AQIP Project, reviewed the report provided in the Board meeting
materials and addressed questions of the Board. The AQIP Project has been one of the many
projects required by the HLC accreditation process that has concluded, resulting in ongoing
operational processes.
90
Northwestern Michigan College March 20, 2017

Enrollment ReportTodd Neibauer, Vice President for Student Services and Technology,
provided the enrollment report and he reviewed highlights. He also noted that applications for
summer 2017 were still being accepted, and that fall registration began the prior Wednesday and
there will be metrics for fall to share at the April Board meeting. Neibauer shared that new student
orientation sessions begin on April 7, with some high schools bussing students to NMC for
orientation. Early College advising and registration has also been occurring at the high schools, and
special sessions at NMC for new dual enrolled students. In response to a question, Neibauer
explained that special orientations were conducted for first-time students with consideration to
family first-time students. He also addressed questions pertaining to average number of contact
hours per student.

Financial ReportVicki Cook, Vice President of Finance and Administration, reviewed the
financial report for the period ending February 28, 2017. She noted that reimbursement for personal
property tax had been received and reported in the state appropriation line item, and that property
taxes were projected to be at budget for the year. Current year end projections indicate a positive
revenue over expenses figure of $136,000. Cook shared some assumptions being considered for the
development of the FY18 budget and stated that an analysis of the FY18 budget would be shared at
the April Board meeting.

Foundation ReportRebecca Teahen, Executive Director for Resource Development and


Foundation, provided the Foundation update and noted that Annual Fund dollars raised were
tracking ahead of projections, and the number of donors has increased by over 9% above FY16.
Teahen recognized the success of the recent Taste for Success event that benefits the Great Lakes
Culinary Institute and noted the upcoming Scholarship Luncheon on April 21.

BBQ ReportDiana Fairbanks, Executive Director of Public Relations, Marketing and


Communications, provided the NMC BBQ Report. She shared that preparations were occurring for
the 62nd annual NMC BBQ on May 21, noting that six projects had been approved by the BBQ
Board to be funded by more than $38,000 of NMC BBQ funds. She also explained that the BBQ has
partnered with MyNorth Tickets for online ticket sales this year to increase awareness and
availability. Fairbanks indicated she would continue to provide status reports at each meeting
leading up to the May 21 event.

Building and Site Committee ReportCommittee Chair Ross Childs provided an update on the
work of the Board Building and Site Committee, noting that the minutes of the last meeting were
included in the meeting materials. Childs shared that the committee had approved the
recommendation for upgrades to the Dennos Museum included in an action item later on this
meetings agenda.

Audit Committee ReportCommittee Chair Chris Bott shared that the Audit Committee had met
on March 15, 2017, to review two proposals submitted for financial audit services for 5 years for the
College and have made a recommendation to the full Board to approve an auditing firm that follows
in the action items for this meeting. Bott noted that an annual audit is required by state and federal
law for students to receive federal aid and college state funding; and that industry practice and
recommendation is to change audit firms on a regular basis.

2
91
Northwestern Michigan College March 20, 2017

Legislative Issues ReportIn the absence of President Timothy Nelson, Vice President Stephen
Siciliano shared highlights of the recent MCCA legislative update. He noted that, fortunately, the
recent legislative discussion on the income tax rollback was defeated, giving the House more time to
consider. Siciliano also shared that the Governors budget includes a proposal for a $1 million
allocation for the Michigan Transfer Network, which will create an accurate, comprehensive, up-to-
date system of state-wide college credit transferability between colleges and universities that will
greatly help our students.

PUBLIC INPUTThere was no public input offered.

UPDATES
Presidents UpdateThere was no verbal update given in the absence of President Nelson.

Board Chair UpdateChair Kennard Weaver shared that he had viewed a recent webinar by
MCCA that provided a good explanation on state pensions and retirement, including MPSERS, and
the potential impact of last years proposed legislation to terminate the defined benefit plan. It is
anticipated that the legislation will probably be proposed again this year, and MCCA will be taking a
position in the event that occurs. Weaver encouraged all NMC trustees to view the webinar, which
is available on the MCCA website.

DISCUSSION ITEMSNone

CONSENT ITEMSOn a motion by Rachel Johnson, seconded by Michael Estes, the following
items were approved by a unanimous vote as a group without discussion:
Minutes of the February 27, 2017, regular meeting

ACTION ITEMS
Financial Audit ServicesOn a motion by Michael Estes, seconded by Chris Bott, the Board
authorized administration to enter into a contract with Plante Moran as Northwestern Michigan
Colleges auditing firm for the upcoming five-year period, for a five-year total amount of $351,000,
based on satisfactory completion of each fiscal year audit. The motion passed with a unanimous
vote.

Dennos Museum Upgrade ProjectsOn a motion by Ross Childs, seconded by Rachel Johnson,
the Board authorized administration to enter into contracts for the following Dennos Museum Center
upgrades, to be funded by 2016 bond funds:
Floor Covering Brokers Traverse City, MI Carpet and wood flooring $60,900
National Coatings Traverse City, MI Painting $10,500
The motion passed with a unanimous vote.

Line of Credit RenewOn a motion by Michael Estes, seconded by Chris Bott, the Board
authorized the renewal of the $2 million line-of-credit with Fifth Third Bank. The motion passed
with a unanimous vote.

3
92
Northwestern Michigan College March 20, 2017

Computer PurchaseOn a motion by Rachel Johnson, seconded by Ross Childs, the Board
authorized administration to enter into a contract with Dell Computer for the purchase of 230
replacement desktop computers in the amount of $118,400, to be funded by the Technology Plant
Fund. The motion passed with a unanimous vote.

Culinary Arts Certificate ProgramOn a motion by Michael Estes, seconded by Chris Bott, the
Board approval of a new Culinary Arts Baking Level I Certificate of Achievement as presented,
effective Fall 2017 semester. The motion passed with a unanimous vote.

REVIEW OF FOLLOW-UP REQUESTSConfirmed requests made by the Board that require


administrative follow-up for information to be provided to the Board at a later date.

ADJOURNMENTThe meeting adjourned at 6:52 p.m. on a motion by Michael Estes, seconded


by Ross Childs, by unanimous vote.

Recorded by Holly Gorton, Executive Assistant to the President and Board of Trustees.

SIGNED
Kennard R. Weaver, Chair

ATTESTED
Rachel A. Johnson, Secretary

4
93

Board Policy B-100.00


Board-President Relationship

Delegation to the President


All board authority delegated to staff is delegated to the president, so that all authority and
accountability of staffas far as the board is concernedis considered to be the authority and
accountability of the president.

1. The board will direct the president to achieve certain results through the establishment of
Ends policies. The board will may limit the latitude the president may exercise in
practices, methods, and conduct in achievement of the ends through establishment of
Parameters policies.
2. As long as the president uses any reasonable interpretation of the board's Ends and
Parameters policies, the president is authorized to establish all staff policies and
procedures.
3. The board may change its Ends and Parameters policies, thereby shifting the boundary
between board and president domains. By so doing, the board changes the latitude
choices given to the president. But so long as any particular delegation is in place, the
board and its members will respect and support the president's decisions. This does not
prevent the board from obtaining information in the delegated areas except where laws of
confidentiality prohibit disclosure.
4. Only decisions of the board acting as a body are binding upon the president.
a. Decisions or instructions of individual board members, officers, or committees are
not binding on the president except in rare instances when the board has
specifically authorized such exercise of authority.
b. Individual board members may request information or assistance from the
president. Requests that require (in the president's judgment) a material amount
of staff time or funds or are disruptive may be referred to the board for
determination.

If any provisions(s) of this policy or set of bylaws conflicts with laws applicable to Northwestern
Michigan College, including the Community College Act of 1966, the Freedom of Information
Act, or the Open Meetings Act, as each may be amended from time to time, such laws shall
control and supersede such provisions(s).

Adopted by the Northwestern Michigan College Board of Trustees October 23, 1995
Reviewed without revision January 23, 2006
94

Board Policy B-101.00


Board-President Relationship

President's Role and Job Description


1. The president is accountable to the board acting as a body. The board will instruct the
president through written policies, delegating implementation to the president.
2. As the board's official link to the operating organization, the president's job performance
will be considered to be synonymous with organizational performance as a whole, as
reflected in an annual evaluation conducted by the Board.
3. Consequently, the president's job contributions can be stated as performance in only two
areas:
a. Organizational accomplishment of the provisions of board policies on Ends
b. Organization operation within the boundaries of prudence and ethics established
in board policies on Parameters
4. Notwithstanding the above, the president serves at the pleasure of the board and
contractual understandings will apply.

If any provisions(s) of this policy or set of bylaws conflicts with laws applicable to Northwestern
Michigan College, including the Community College Act of 1966, the Freedom of Information
Act, or the Open Meetings Act, as each may be amended from time to time, such laws shall
control and supersede such provisions(s).

Adopted by the Northwestern Michigan College Board of Trustees October 23, 1995
Revised January 23, 2006

95

Board Policy B-102.00


Board-President Relationship

Monitoring Presidential Performance


Monitoring executive performance is synonymous with monitoring organizational performance
against board policies on Ends and on Parameters. Evaluation of presidential performance,
formal or informal, shall be derived from these monitoring data.

1. The purpose of monitoring is to determine the degree to which board policies are being
fulfilled.
2. A given policy may be monitored in one or more of three ways:
a. Internal report: disclosure of compliance information to the board from the
president.
b. External report: discovery of compliance information by a disinterested, external
auditor or third party who is selected by and reports directly to the board. Such
reports will assess presidential performance against policies of the board, unless
the board has previously indicated that the third party's opinion will be the
standard.
c. Direct board inspection: discovery of compliance information by a board
member, a committee, or the board as a whole. This is a board inspection of
documents, activities, or circumstances directed by the board which allows a
"reasonable person" test of policy compliance.
3. Upon the choice of the board, any policy can be monitored by any of the above methods
at any time. The board may establish a regular schedule and method for monitoring Ends
and Parameters policies.

If any provisions(s) of this policy or set of bylaws conflicts with laws applicable to Northwestern
Michigan College, including the Community College Act of 1966, the Freedom of Information
Act, or the Open Meetings Act, as each may be amended from time to time, such laws shall
control and supersede such provisions(s).

Adopted by the Northwestern Michigan College Board of Trustees October 23, 1995
Reviewed without revision February 27, 2006

96

Board Policy B-103.00


Board-President Relationship

Communication and Counsel to the Board


With respect to providing information and counsel to the board, the president shall inform the
board regarding matters of importance. Accordingly, the president shall:

1. Inform the board of relevant trends, anticipated adverse media coverage, or material
external and internal changes.
2. Submit required monitoring data to the board regarding accomplishment of the ends
policies and conformance to the means policies in a timely, accurate, and understandable
fashion.
3. Obtain for the board adequate internal and external points of view, facts, issues, and
options as may be needed to make fully informed board decisions.
4. Provide a mechanism for official board, officer, board committee, and president
communications.
5. Report in a timely manner an actual or anticipated noncompliance with any policy of the
board.
6. Keep the board informed regarding progress on major strategic initiatives.
7. Provide information as requested by any individual board member per Board Policy
B-100.00 Delegation to the President.

If any provisions(s) of this policy or set of bylaws conflicts with laws applicable to Northwestern
Michigan College, including the Community College Act of 1966, the Freedom of Information
Act, or the Open Meetings Act, as each may be amended from time to time, such laws shall
control and supersede such provisions(s).

Adopted by the Northwestern Michigan College Board of Trustees October 23, 1995
Revised February 27, 2006

97

MEMO

To: Timothy J. Nelson, President


From: Todd Neibauer, Vice President Student Services and Technologies
Date: April 24, 2017
Subject: Network Switch Replacement

Board Authorization Requested


Authorize the administration to enter into contract with Secant Technologies for the replacement of
Network Switch equipment in the amount of $413,980.00, plus a 5% contingency, for a total project
budget of $434,679.00.

Background
The College operates and maintains a technology infrastructure system that includes network switches in
each building and at the core of the network. These switches provide network connections between our
classroom and office computers and our network servers as well as the internet. The current switches
have reached the end of their lifecycle, and vendor will no longer be providing security patches and
updates for them.

Bid Summary
NMC has selected to continue with Cisco switches to maintain continuity with our Cisco wireless
network and Cisco firewall system. Utilizing a single manufacturer for these three sets of equipment
allows for a more seamless configuration and management of the network as well as allowing us to
maintain technical expertise with a single manufacturer. This in turn helps us to contain technical support
costs.

NMC received bids from 5 different companies. We have selected to purchase the Cisco equipment from
Secant Technologies (Kalamazoo). The total bid for their solution is $413,979.32. Other bids were
received from ISC (Traverse City) at $460,881.35, Presidio Networked Solutions (Grand Rapids) at
$478,692.73, SafetyNet (Traverse City) at $482,382.69 and Clearpath (Reston, VA) partnering with
Frontier Computer (Traverse City) at $556, 108.00.

Funding Source
The funding source is the Technology Plant Fund.
98

MEMO
Administrative Services

______________________________________________________________________________

To: Timothy J. Nelson, President

From: Vicki Cook, VP Finance and Administration

Date: April 18, 2017

Subject: Traverse City Light and Power Easement Request

This memorandum is intended to provide information regarding a request for an easement for
underground utilities near the Northwestern Michigan College University Center entrance at
2200 Dendrinos Drive, Traverse City.

Board Recommendation
Authorize the Northwestern Michigan College administration to grant an easement request to
Traverse City Light and Power for 2200 Dendrinos Drive after legal review.

Scope of Work
Traverse City Light and Power has requested an easement on behalf of Skilled Manufacturing
Incorporated located at 3680 Cass Road, Traverse City, Michigan. Skilled Manufacturing Inc.
needs an electrical upgrade for their business. Granting this easement request allows Traverse
City Light and Power, its successors and assigns, forever, an easement for public and private
electric and communication utility purposes and the right to enter upon the parcel of land
hereinafter described and to lay, construct, operate, maintain, repair, inspect, replace, improve,
enlarge and remove electric transmission and distribution facilities, in, under, over and across a
strip of land 10 feet in width, together with lateral lines outside of said strip of land where
hereinafter indicated, said strip of land being located within a parcel of land which is in the City
of Traverse City , County of Grand Traverse and State of Michigan and described as:

PRT OF E 1/2 SEC 15 T27N R11W COM N'LY ROW SYBRANDT RD & E'LY ROW C&O RR TH N 89
DEG 56' E 276.49' TH N'LY ALG SHORE BOARDMAN LK TO N SEC LN TH N 89 DEG 49' W 91.24' TH
S'LY ALG E'LY ROW C&O RR TO POB ALSO INCL COM INTRS W LINE C&O RR ROW & E/W 1/4
LINE SEC 15 TH N 8 DEG 45' E 1169.44' TO POB TH N 79 DEG 34' W 77.16' TH N 85 DEG 53' W 163.34'
TH S 77 DEG 39' W 218.16' TH N 53 DEG 49' W 5.55' TH S 70 DEG 23' W 6.17' TH S 21 DEG1' W 5.32' TH
S 68 DEG2' W 64.4' TH S 58DEG59' W 34.52' TH N 81 DEG27' W 48.42' TH N 62 DEG 42' W 82.74' TH N
27 DEG 17' E 187.32' TH S 89 DEG 48' E 612.83' M/L TO W ROW C&O RR TH S 8 DEG 45' W TO POB.
99

PIN# 05-015-071-00
NORTHWESTERN MI COMM COLLEGE
2200 DENDRINOS DR
TRAVERSE CITY MI 49684
1655

EASEMENT AREA IS
10' IN WIDTH AS CONSTRUCTED

LEGEND EXHIBIT 'A'

ROAD CENTER LINE

PARCEL LINE

EASEMENT ROUTE