February 19, 2014

MINUTES OF THE EXECUTIVE COMMITTEE

OF THE BOARD OF GOVERNORS

MISSOURI STATE UNIVERSITY

February 19, 2014

1. Roll Call:

Present - Mr. Peter Hofherr, Governor (by conference call)

Mr. Steve Hoven, Vice Chair of the Board (by conference call)

Ms. Beverly Miller, Chair of the Board (by conference call)

Absent - Ms. Carrie Tergin, Governor

Also Present - Mr. Clifton Smart, President (by conference call)

Mr. Joe Carmichael, Governor (by conference call)

Ms. Paige Jenkins, Student Governor

Dr. Frank Einhellig, Provost

Mr. Ken McClure, Vice President for Administrative and Information Services

Mr. Steve Foucart, Chief Financial Officer

Ms. Penni Groves, General Counsel

Mr. Paul Kincaid, Chief of Staff

Ms. Donna Christian, Director of Internal Audit & Compliance

Dr. Drew Bennett, Chancellor of the West Plains Campus (by conference call)

Dr. Dee Siscoe, Vice President for Student Affairs

Dr. Jason Jolley, Department Head of Modern & Classical Languages

Dr. Victor Matthews, Dean of the College of Humanities and Public Affairs

Mr. Matt Morris, Associate Vice President for Administrative and Information Services

Ms. Tina McManus, Controller

Mr. Jeff Morrissey, Chief Information Officer

Mr. Doug Sampson, University Architect and Director of Planning, Design, and Construction

Mr. Rick Wright, Gilmore & Bell, PC (by conference call)

Mr. Bill Burns, Gilmore & Bell, PC (by conference call)

Mr. John McAlear, Secretary of the Board

2. Presiding – Ms. Beverly Miller, Chair of the Board of Governors, called the Executive Committee conference-call meeting to order at 4:00 p.m. in Room 203 of Carrington Hall on the campus of Missouri State University in Springfield, Missouri.

3. Approval of Minutes – Ms. Miller mentioned that the first item of business was the approval of the minutes for the open meeting of January 15, 2014. Mr. Hoven so moved, receiving the second of Mr. Hofherr.

Motion passed 3-0.

4. Provost – Dr. Frank Einhellig, Provost, next presented the following resolutions for the Board’s consideration:

Approval of new program – Bachelor of Science in Modern Language (Comprehensive and Non-comprehensive) (Item III.A.).

Approval of new program for Master of Science in Applied Behavior Analysis (Item III.B.)

Approval of new program for Master of Applied Second Language Acquisition (Item III.C.)

Moved and seconded, respectively, by Mr. Hofherr and Mr. Hoven.

Motion passed 3-0.

5. Procurement and Financial – Mr. Steve Foucart, Chief Financial Officer, presented a resolution summarizing Procurement Services’ Office activities from January 11, 2014, through February 14, 2014 (Item IV.A.). The report has one item for approval and one informational item:

The informational item relates to establishing a bank account for the bond proceeds. We are required to set up a separate account and all interest income will be used towards the bond projects. A Request for Proposal was issued to six local financial institutions. Recommend award to UMB Bank, N.A., as the sole respondent.

The one item needing approval relates to hiring a third-party grant program evaluator for services on the West Plains Campus. This is a requirement under our $2.5 million Community College and Career Training Grant. Up to 10% of the grant can be used to fund the third-party evaluator. A key criterion for selecting a program evaluator was experience in evaluating this specific grant with other universities. While not the lowest cost for the proposed third-party evaluator, McREL International has conducted six specific evaluations and their cost of $248,560 is within the required parameters of the grant. Recommend awarding the contract to McREL International.

Mr. Hofherr so moved, receiving a second from Mr. Hoven.

Motion passed 3-0.

Mr. Foucart next presented Item IV.B. – RESOLUTION AUTHORIZING AND DIRECTING THE ISSUANCE OF $39,405,000 PRINCIPAL AMOUNT OF AUXILIARY ENTERPRISE SYSTEM REVENUE BONDS, SERIES 2014A, TO PROVIDE FUNDS TO FINANCE ADDITIONS, RENOVATIONS, EXTENSIONS AND IMPROVEMENTS TO THE FACILITIES OF THE AUXILIARY ENTERPRISE SYSTEM OF THE UNIVERSITY; PRESCRIBING THE FORM AND DETAILS OF SAID BONDS AND THE COVENANTS AND AGREEMENTS MADE BY THE UNIVERSITY TO PROVIDE FOR THE PAYMENT AND SECURITY THEREOF; AND PRESCRIBING OTHER MATTERS RELATING THERETO.

He reminded everyone that during the February 7, 2014, Board of Governors’ meeting, authority was given to the Executive Committee of the Board to set the final terms of the Bonds and the final terms of the Bond Purchase Agreement in a manner consistent with the terms of the Bonds set forth in Section 203 of the February 7 resolution. We have met the parameters set forth in Section 203:

The principal amount of the bonds was not to exceed $42,000,000 and today’s resolution is authorizing $39,405,000.

The true interest cost was not to exceed 4.5% and ended up being 3.64%

The final maturity was to be no later than April 1, 2041, and ended up being April 1, 2036

The weighted average maturity was to be between 11-14 years and ended up being 12.301 years.

Mr. Foucart added that we have seen favorable downward movement in interest rates and Edward Jones’ final pricing is approximately 15 basis points lower than just prior to our February 7 board meeting, which has reduced total bond payments over the term of the bonds by approximately $980,000. Moved and seconded, respectively, by Mr. Hoven and Mr. Hofherr

Motion passed 3-0.

President Clif Smart recognized and thanked Mr. Foucart for an outstanding job over the past several months in preparing for this bond issuance.

6. Facilities and Equipment --- Mr. Ken McClure, Vice President for Administrative and Information Services, next presented the following resolution for the Committee’s consideration:

The pool bulkhead and window replacement at Hammons Student Center (Item V.A.); Oke-Thomas & Associates, low bid of $163,746 for the base bid plus alternate 1; total project budget set at $184,000.

He indicated that there is an error in the first paragraph of the actual resolution – it states that the construction contract was for the amount of $149,996; but, that amount does not include the cost of the alternate - $13,750. The construction cost listed in the project budget shown on the resolution does show the correct amount of $163,746. He asked for approval of this resolution with a correction to the first paragraph showing the correct construction cost - $163,746. Mr. Hoven moved for approval with the stated correction. Mr. Hofherr provided the second to the motion.

Motion passed 3-0.

Mr. McClure then presented the following resolutions:

The inside plant wiring contract for Computer Services – Networking and Telecommunications (Item V.B.); TSI Technology Solutions, LLC. The total expenditure for projects under this contract shall not exceed $150,000 during the initial term of this contract (through February 28, 2015) or during any one-year contract renewal period. The contract includes the option to renew the contract for five additional consecutive one-year periods.

Approval of Deed of Lease with BCSP Hunters Branch Lessee, LLC (Hunters Branch) for 5,776 sq. ft. at $34 per sq. ft. in an office building known as Hunters Branch, Building 2, located at 9302 Lee Highway, Fairfax, Virginia, commencing on July 1, 2015 (Item V.C.). He explained that the MSU Defense and Strategic Studies (DSS) Department has been leasing space in this same building since 2005 under a sublease with National Institute for Public Policy, Inc., (NIPP) which expires March 31, 2015. The University desires to stay in the same location with a direct lease with Hunters Branch, effective July 1, 2015. NIPP will assign its interest in their original lease agreement with regards to 5,776 sq. ft., to allow for the University’s direct lease. NIPP and MSU will amend their current sublease from March 31, 2015, until June 30, 2015, to coincide with the expiration of NIPP’s lease agreement with Hunters Branch. The new five-year lease with Hunters Branch expires on June 30, 2020, and there is one five-year renewal option. Dr. Victor Matthews, Dean of the College of Humanities and Public Affairs, added that the department currently has 75 students, the largest graduate program in the College. They have developed a very good reputation in the Washington, D.C., area and most DSS graduates find employment in the field prior to or shortly after graduation.

Approval of a resolution (Item VI.D.) to increase the project budget for the modifications to Printing Services at the Robert W. Plaster Center for Free Enterprise and Business Development. This $30,000 increase brings the new total project budget to $50,000. The low humidity in Printing Services has had an impact on the printer and the quality of the printed materials. This additional amount will allow for a new humidifier to be installed.

Moved by Mr. Hofherr and seconded by Mr. Hoven.

Ms. Miller asked if there were any questions before their vote. Mr. Hoven asked how the DSS program was marketed. Dr. Matthews responded that it is marketed through its website and they target the Washington, D.C., area. He added that it is a graduate program only and they have grown from 35 students ten years ago to 75 students today. President Smart added that DSS revenues from tuition and private dollars cover its expenses.

Motion passed 3-0.

7. New Business --- President Smart next gave an update from Jefferson City. The House Appropriations – Education Committee passed a proposed budget this morning that included a 5% increase for higher education. Performance measures will still be used in allotting individual appropriations making our core increase about 5.2%. They include additional money for STEM initiatives as well as increases for various scholarship programs. We are very appreciative of our legislators. This is a very good first step…now on to the Budget Committee, then the House floor, and then to the Senate.

8. Adjournment — Ms. Miller adjourned the conference-call meeting at 4:35 p.m., on the motion of Mr. Hofherr, the second of Mr. Hoven, and the unanimous vote of the committee.

John W. McAlear

Secretary of the Board