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University of Minnesota Board of Regents approves changes to executive transition and compensation policies to ensure stronger oversight and transparency

Regents also take action on alcohol at TCF Bank Stadium, Eastcliff, President Kaler compensation

July 11, 2012

The University of Minnesota Board of Regents today strengthened the university’s executive transition and compensation policies, affirming recommendations by a Special Committee on Executive Compensation and Administrative Transitional Leaves.

“These are policy changes that will create greater transparency and accountability,” said Board Chair Linda A. Cohen. “They will make our policies clear and will require more Board oversight.”

Key components of the policy include:

  • Increased Board oversight – All initial appointments of senior leaders shall include the presentation of more robust information about the appointments to the Board for approval. While the new policy allows the president to set compensation, severance (not to exceed six months of salary) or sabbatical leaves for senior leaders, the new policy requires the president to submit to the Board chair and vice chair for approval any significant change from the initial appointment terms or a waiver of university policy.
  • Providing greater transparency – The president must now monitor and report annually to the Board on compensation and recognition programs for all employees, including senior leaders.
  • Eliminating administrative transitional leaves – Senior leaders who are tenured faculty members and who return to the faculty may now be granted a shorter, six-month sabbatical with pay at the lower faculty rate rather than their administrative salary. This is in keeping with the university sabbatical policy available to all faculty members.

All existing appointments and contracts will be honored by the university.

President Kaler donates raise to student scholarships

During her remarks, Cohen reminded Board members of her June report regarding President Kaler’s first-year performance. “He is an outstanding and highly skilled leader who inspires others to strive for excellence,” she said.

“The Board has worked hard to balance two competing objectives. We want to be extremely prudent and use restraint with university dollars,” she continued. “Given President Kaler’s superior performance, we also want to give him a salary increase, which shows the Board’s support for his work and the confidence that the Board has in his leadership.”

President Kaler thanked the Board for its confidence, but requested his compensation not be changed, but instead that the Chair’s recommended 3 percent salary increase be dedicated to undergraduate scholarships. The Board unanimously approved a motion that will dedicate approximately $18,300 to the university’s general scholarship fund.

Board approves alcohol sales at intercollegiate athletic events

The Board also approved a resolution and implementation plan to allow beer or beer and wine sales in the general and premium seating areas of TCF Bank Stadium, and in the premium seating areas of Williams and Mariucci arenas during intercollegiate athletic events. Regent Venora Hung voted against the resolution, based on her belief in the university’s autonomy on this issue.

The plan calls for beer or beer and wine only — no hard liquor will be sold. TCF Bank Stadium will have a single point of sale on the west end of the general seating area, in which trained servers will check IDs and limit sales to two beers per patron per transaction. Alcohol also will be available in the premium seats of the stadium and Williams and Mariucci arenas. University of Minnesota police and private security will increase their presence in the plaza area to ensure safety and minimize neighborhood disruptions, and a designated driver program will be offered. For more information, visit the Board meeting preview from July 9.

The plan was developed by a task force of staff from various university departments and offices. In addition, university leaders have consulted with students, veterans groups, neighborhood representatives and Shakopee Mdewakanton Sioux Community leadership.

“Our original vision for TCF Bank Stadium included sales in the premium seating areas, which is consistent with the expectations of fans and corporate clients who purchase premium-priced suites and seats,” said Amy Phenix, chief of staff to President Kaler. “However, legislation required us to also serve in the general seating area. Today's action is a compromise. While not the university’s first choice, it does restore sales in the premium areas and, in doing so, will make those areas more competitive and attractive. It's a step closer to our original intention.”

The university will collect proposals from distributors who can meet university policies, equip facilities and will help ensure safe alcohol sales in time for the 2012 football season. The RFP indicates that university trademarks, logos or any other official symbols of the university cannot be used to market, distribute or sell alcohol. It also requires vendors to offer at least one Minnesota-made product.

Eastcliff to receive much-needed roof replacement

The Board approved a capital budget amendment for replacing the roof of Eastcliff, home to university presidents and a host site for approximately 150 events and 7,500 visitors a year.

The roof project will replace deteriorating cedar shingles on the main house and adjacent carriage house, as well as repair metal flashing, gutters and downspouts. The project will also address repairs to chimney masonry, wood trim and electric heat tape. The Eastcliff Technical Advisory Committee – an independent group of experts responsible for guiding improvement, maintenance, operation and use of Eastcliff – studied roof conditions and found curling shingles and deteriorated staples before recommending the roof replacement. The estimated $285,763 cost is driven by the large square footage of buildings on the property, as well as higher labor and design costs associated with the use of cedar shingles, which are required to comply with National Historic Register guidelines.

The meeting also included:

  • Itasca Project Higher Education Task Force: Greg Page, Cargill CEO and chair of the task force, presented findings and a strategic vision for bringing together higher education institutions and Minnesota businesses to drive long-term prosperity for the state. According to President Kaler, who serves on the task force, “Our identified strategies have a single unifying theme—collaboration. A new wave of collaborations – among educational institutions and between those institutions and business – has the potential to create a fundamentally more powerful engine of learning, innovation and economic growth for the state of Minnesota. Without research and innovation, Minnesota’s economy will falter.” The task force report can be found at www.TheItascaProject.com.
  • Enterprise Systems Upgrade: The Finance and Operations Committee recommended the U move forward with an $83.5 million multi-year update to student, financial and human resources enterprise technology systems. The update is critical to the university’s operations; maintaining vendor support and ensuring regulatory compliance; and providing efficiencies and reducing risk. The full Board will review the issue at an upcoming meeting.
  • Executive Director of the Board of Regents: Brian Steeves was appointed executive director of the Board and corporate secretary of the university. In the position, Steeves will be a key adviser to the Board and senior leaders, coordinate Board planning, oversee policy review, and manage meeting logistics and Board operations. Steeves has served as deputy director for two years, and for the past six months has been acting executive director and corporate secretary. He replaces Ann Cieslak, who retired in June.

For more information about the Board of Regents, go to www.umn.edu/regents/.

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