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Adopted Meeting Minutes
November 8, 2002
Special Board Meeting

Call to Order

The meeting was called to order at 4:02 p.m.

Roll Call

Present: Canady, Heywood, Holden, Jeffries, Patterson (present telephonically), Pelleran, Rasmusson
Absent: None

Limited Public Comment Regarding Agenda Items

There were no comments from the public.

Purchasing Investigators? Contract Extension

Trustee Canady stated that the reviewers have indicated they're in the process of reviewing approximately 1,700 pages of documents and have interviewed 17 individuals. Both have used their allotted time of 60 hours. Trustee Canady said that they have indicated that they are halfway through with their review and that authorization of 100 hours each would be sufficient, if not more than sufficient, for them to complete their review. Total additional costs would be approximately $30,000.

IT WAS MOVED by Trustee Canady and supported by Trustee Pelleran to authorize 100 additional hours to the purchasing reviewers? contract.

Trustee Holden was concerned about authorizing additional hours for an investigation that has begun on hearsay and allegations. She said that the Board authorized 60 hours to each of the reviewers at which time the Board was to receive some type of report. It is her understanding, which she?s heard from at least two or three members, that there is no evidence of any wrongdoing. Trustee Holden is concerned that very key staff members are under a great deal of stress right now. She felt that we would be prolonging the investigation for these people.

Trustee Rasmusson stated that he would call that a victory if no evidence of wrongdoing has surfaced.

Trustee Holden asked that if 200 additional hours is needed to confirm that.

Trustee Canady said that the scope of what they're doing in the review is a procedural and policy review. It goes beyond the scope of whether or not there was wrongdoing. It's a question as to the ethicacy of the College's policies, whether the policies are being adhered to and to this point they have not completed reviewing the 1900 pages. He said that the fact that they're not completed it is not surprising to him. He believes that the resolution stated that periodic reports would be given to the Chair and that has taken place. He thinks it would be premature to have a public report at this time until the review is complete because it would be based upon incomplete information, in many respects rumor and hearsay, without having the review completed. Trustee Canady said he thinks it's relatively safe to say that there has been no suggestion of anything illegal at this point, but no one is in a position to say more than that.

Trustee Holden asked President Cunningham how long does the financial audit take.

President Cunningham stated that she believes that Maner, Costerisan & Ellis used approximately 100 or 140 hours for the financial audit, but referred to Ms. Beckie Beard to answer that question.

Ms. Beard responded that the last audit took 160 hours.

Trustee Canady responded that this is not an audit. An audit cannot tell you if whether or not procedures are being adhered to or whether policies are being followed. An audit is designed to tell you where all the money is. This review is looking at the entire policy with respect to the Board's dealings on financial issues and to provide guidance, which should have been done in the absence of any allegations. He felt that it was the appropriate thing to do in order for the board to have a firmer grip on what the policies actually mean in practice and whether or not they are being adhered to.

Trustee Holden said that from the beginning she opposed the Board hiring outside auditors until the President had a chance to do her own review. The majority of the Board supported that and good governance would suggest and would command that she cooperate with the decision and go along with it, which she did. Trustee Holden would be satisfied if the reviewers gave an exact amount of hours they need to do a report so the Board has something to go by. However, when she sees another possible $30,000, with the $18,000 spent so far, this money could go towards a faculty member position. She will not be supporting that number of hours. Trustee Holden said that she could support something different to receive a report.

Chairperson Jeffries asked Mr. Kenneth McIntyre how many Trustees had he interviewed.

Mr. McIntyre stated he had not met Trustees Holden or Pelleran prior to today. He responded that they have not met with Chairperson Jeffries, which was purposely planned to meet with him last. Ms. Lazar is responsible to meet with the Trustees because she has been charged with making broad recommendations with respect to policies, purchasing policies specifically, and possibly Board policies. Mr. McIntyre stated that what he?s doing is talking with all of the people that whose names have come up with respect to the 8 or 9 different problems that Trustee Rasmusson identified in his letter to Mr. Covert back in June. He said that he?s asking them for their version of all of the events that are apparently troubling one person or another. He?s also asking for documents to support whatever it is they view from their perspective to be important. They?ve received over 1,700 pages the first day they met with the committee, which was October 18 and now they are up to over 1,900 pages of documents they?ve received from various people. To do what he?s been asked to do, he feels that he has to read them for content, cross-reference them and ask questions based upon the different versions of events. He said that is time consuming.

Mr. McIntyre said that he and Ms. Lazar are looking at, from beginning to end, the Oracle purchase back in February and the Hewlett Packard purchase in May.

Chairperson Jeffries asked if this is a process that's going to keep feeding itself, that as more allegations are raised, they will be investigated and they're never going to see the end of this. He is concerned with that.

Mr. McIntyre responded, no. He said that the ninth allegation dealt with a contract that was entered into subsequent to a prior contract and it was closely tied to one of the eight allegations. Mr. McIntyre stated that he and Ms. Lazar couldn?t run down every possible argument having to do with these eight allegations.

Chairperson Jeffries asked if there's a point in which they can, after doing some review, establish a preliminary report that this Board can review that will say, yes, it's worth further investment. He said that there was some expectation throughout this process that there?d be an initial review with some indication that would lead to conclude that maybe more money should be spent to further investigate.

Mr. McIntyre said that he would be glad to write a two or three page report of his general impressions. He stated that he is reluctant to do that because it becomes public, the warring factions, for a lack a better term, with people from different perspectives might add fuel to that fire.

Chairperson Jeffries stated that he is trying to balance the concerns that have been raised. He would like to know if they at some point could say this has substance or it doesn?t, and recommend if this should be pursued further.

Mr. McIntyre asked if there is a timeline that people expect this to be completed. He said that Chairperson Jeffries? request is possible, but he?s not sure if it would speed up the time at which the final product is going to be available. He said that he has preliminary conclusions, but does not feel he should share those yet because that could potentially detract from the validity of this process.

Trustee Canady said that he understood that the reviewers are halfway through. He said that he recommended the 100 hours as an outside limit with the expectation that everything would be concluded, and it may only take 60 hours. He said that he did not want to hamstring them and have them come back again to the Board. Trustee Canady said that closure is very important and the real danger is that if there is a preliminary report that is written, and not having any finality could do far more damage than good. What he is trying to do is ensure that Mr. McIntyre and Ms. Lazar have the opportunity to review all of the information that's available and provide a final report.

Trustee Holden asked President Cunningham when she thought her report would be completed and if it would be coordinated with the Board's report.

President Cunningham said that there was never any intent to coordinate the two reports. She expects it would be completed sometime in November. President Cunningham said that she is not in constant contact with the investigator because from the beginning she stated that she wanted to stay out of it. He is working primarily through Miller Canfield. She said that Mr. Fred Todd has interviewed most of the Board members and he?s trying to schedule an interview with Trustee Patterson.

Trustee Patterson stated that he spoke with him the day prior.

President Cunningham stated that she didn?t believe that Mr. Todd spoke with Trustee Patterson about this issue. She stated that Mr. Todd has interviewed all of the Board members face to face and gathering documents they have, but has yet to interview Trustee Patterson. President Cunningham said that she knew that Trustee Patterson spoke with Mr. Todd yesterday at her request, but that was about another issue separate from his own investigation.

Trustee Holden asked if the report from the President's investigator and the second report could contradict each other.

President Cunningham said that has always been possible.

There was continued discussion regarding the merits of a preliminary report.

President Cunningham stated that the scope of Mr. Todd?s investigation is slightly different. She said that she spoke with Mr. Todd yesterday and he was waiting for Trustee Patterson to return from California to interview him. He also wants to speak with Chairperson Jeffries as well, but is planning to interview him at the end of the investigation. President Cunningham stated that she wasn't sure when his report would be completed, but it would be sometime in November.

Trustee Canady said that it might not be too far off from when the Board's report would be completed.

Trustee Patterson said that the allegations that have been brought forth are very important and the Board has a responsibility to investigate, on its own, those allegations. He supports the review going forward and is exactly what should be done to clear the air so everyone can move forward on firm ground. Allowing them to go on with independence and no interference.

Chairperson Jeffries asked Mr. McIntyre if he?s encountered any interference.

Mr. McIntyre responded, no, he has not encountered interference, but just the opposite has occurred.

Trustee Patterson said that the issuance of a report could potentially interfere, which is what he meant.

Chairperson Jeffries addressed Trustee Patterson. He said that Trustee Patterson has repeatedly stated that he has a fiduciary responsibility to the taxpayers to ensure that the taxpayer dollars are being wisely spent. The only thing being asked for is a preliminary report to make sure that further monies spent on this are worthwhile. Chairperson Jeffries said that Mr. McIntyre has said that he has some preliminary conclusions, but it seems to Chairperson Jeffries that there was an expectation that a report would be given to merit continuing the investigation.

Trustee Canady said that if the Board were to receive a written report at this point in time, then the $18,000 already spent would have been spent unwisely. He felt a report at this time would be incomplete, it would be divisive, and at that time would become public record. Trustee Canady said that would be what Chairperson Jeffries is asking of Mr. McIntyre today.

Chairperson Jeffries said that is not what he?s asking for. He would like to have some indication if the investigation warrants spending more money. He said that from the discussions he has had, a number of the allegations have no merit. To the public body, it would be a good thing to have out there.

Trustee Canady said he disagrees because if it were said that these allegations have no merit, the ones that are not mentioned by definition would have merit.

Trustee Pelleran said that where we came from was an independent Board review. When the Board decided on this, then they ended up with two reviews. She said that she respects the standpoint of the independent Board review professionals. They are telling the Board what they need and what the Board needs is to ensure that everything is clear in order to move forward as an institution. Trustee Pelleran does not feel the Board is being fiduciary irresponsible.

President Cunningham said that this issue was first brought to the Board, when she asked for a meeting to bring the letter to the Board that had been written by Trustee Rasmusson. It was a meeting to share information about how she would proceed and that she had been in contact with the College's attorneys. President Cunningham clarified that the first time this was brought forward was not for an independent Board review, but rather she was actually informing the Board what had transpired and that the College was going to do a review. The direction changed in the meeting and she wanted the record to correctly show the first time this issue was brought forward.

Trustee Pelleran responded that in closed session it was different and the Board asked for an independent review.

Trustee Canady asked Mr. McIntyre if he thought he should write a report.

Mr. McIntyre responded, yes, if there are concerns that this review is costing too much and an objective statement of where they are at and where they should go would help allay some of those fears, he thinks he should and would be glad to write a report.

Trustee Heywood clarified for the record that the reviewers did not request the 100 hours rather it was designed by Trustee Canady. He asked Mr. McIntyre how much time would they need to continue the review.

Trustee Canady denied that he designed the 100 hours. He said that it was his suggestion after meeting with the reviewers.

Mr. McIntyre said that when he and Ms. Lazar met with Trustees Canady, Jeffries, and Rasmusson he remembers having stated the he was almost at 60 hours and he thought he could probably complete the review within another 60 hours. He said that Ms. Lazar was at about 45 hours, and the question came up if they were certain they could complete the review within that period of time. They responded, no, at which point Trustee Canady said to be safe, let?s recommend 100 hours. It was Trustee Canady who mentioned the 100 hours, but it wasn't with the idea that was what they would ask for. Nobody in the room concluded that would be an absolute minimum.

Trustee Holden clarified to Mr. McIntyre that her objections has nothing to do with his level of competence and talent. He was highly recommended by those who know him on the board.

Mr. McIntyre said that everyone he?s contacted and talked to have been very helpful. He doesn?t see any effort on anyone?s part to dissemble, hold, or break appointments. It has been a pleasure to do this.

Trustee Heywood asked if the Board authorizes an additional 60 hours each, did Mr. McIntyre think he could come back with a report.

Mr. McIntyre said that he could, but he is already up to 90 hours. He has spent nearly all of his time on this issue.

Trustee Canady said that is the reason for the 100 hours so that if they cannot finish their review in 60 hours and they needed 65, that way they do not need to return to the Board for approval of the five hours. He said that they both were very sure they could complete their review in 100 hours and they may not use the entire amount. Trustee Canady asked Mr. McIntyre if he were to write something right now, did he believe that more work was necessary.

Mr. McIntyre responded, yes. He asked if it would be helpful to the Board if they knew where they were now focusing their review.

Trustee Holden said, yes. She said that she has done some consulting work and would have never gone to a client without having some type of documentation justifying the need to go further. That is primarily what she is looking for. Trustee Holden stated she couldn?t support authorizing more hours.

Mr. McIntyre stated that it might help if he told the Board that he is focusing on two allegations now.

Trustee Holden stated that there are two people sitting in the room who are outstanding employees and she can imagine they go home at night with a knot in their stomach wondering what is going on and what are they looking for. She said this is just natural, and it seems to her that if they can come to some conclusion on this issue especially when she has heard that there is no evidence of wrongdoing, that may help.

Mr. McIntyre said that if by wrongdoing is equated with criminal or potentially criminal activity, he has not found any.

Trustee Pelleran said there are three Trustees that have met with the independent review panel. The reviewers have said they need more hours and the Trustees have met with them and understand the rationale. She thinks that is comforting to know that. Trustee Pelleran said that in other cases the Board has taken the suggestion of their colleagues that serve on a subcommittee under the greatest advisement and have followed their suggestions. (Added per Trustee Pelleran from November 18, 2002 meeting.)

Roll call vote:
Ayes: Canady, Heywood, Jeffries, Patterson, Pelleran, Rasmusson
Nays: Holden
Absent: None

Motion carried.

President Cunningham stated that they have appreciated the professional way that Ms. Lazar and Mr. McIntyre have conducted their review. She said that everyone at the college wants it to be over, but they want it to be completed with accuracy and thoroughness.

Trustee Rasmusson said that he has talked to many businessmen and businesswomen since this controversy has started and has heard nothing negative except from Paul Covert, and he doesn?t think there is any substance to these allegations; however, it is useful to dispel any rumors.

Public Comment

There were no comments from the public.

Adjournment

The meeting was adjourned at 4:44 p.m.


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