President Eichberg called the 2002 Fall Faculty Assembly and October 16 Faculty Senate Meeting to order in the Farish Hall Kiva at 12:00 noon.

MEMBERS PRESENT: [42]
BUS: S. Khumawala, M. Parks, D. Rude
CLASS: B. Breitmeyer, K. Brown, S. Craig, P. Gingiss, D. Jacobs, A. Jacobson, B. Johnsen, D. Judkins, J. Kotarba, B. Lange, R. Murray, G. San Miguel
EDU: M. Connell, J. Freiberg, S. McNeil, A. Warner, C. White
ENGR: S. Kleis, O. Ghazzaly, R. Metcalfe, G. Paskusz, D. Shattuck
HRM:  K. Titz
LAW: S. Huber, P. Linzer
LIB: J. Myers
NSM: G. Auchmuty, P. Copeland, J. Eichberg, G. Etgen, A. Ignatiev, K. Kadish, E. Leiss, D. Wells
OPT: R. Manny, S. Quintero
PHA: C. Pedemonte
TECH: K. Greenwood
GSSW: H. Karger
 
MEMBERS ABSENT: [8]
ARCH: B. Price
BUS: W. Chin
CLASS: G. Jowett, J. Middents, T. Tillery
ENGR: T. Cleveland
NSM: D. Blecher
TECH: C. Goodson
 
MEMBERS AWAITING REPLACEMENT: [3]
CLASS: J. Antel, V. Brady
LIB:  M. Jones

VISITORS:    Arthur Smith (UHS Chancellor and UH President), Edward Sheridan (UHS Senior Vice Chancellor and UH Senior Vice President for Academic Affairs/Provost), John Rudley (UHS Vice Chancellor and UH Vice President for Administration & Finance), Grover Campbell (UHS Vice Chancellor and UH VP for Governmental Relations), Charles Shomper (UHS Vice Chancellor and UH Vice President for Information Technology), Art Vailas (UHS Vice Chancellor and UH Vice President for Research and Intellectual Property Management), Elwyn Lee (UHS Vice Chancellor and UH Vice President for Student Affairs), Dona Hamilton (UHS General Counsel); Elaine Charlson (UHS Associate Vice Chancellor for Academic Affairs and UH Associate Vice President for Academic and Faculty Affairs), Marco Mariotto (Dean of Graduate & Professional Studies)

APPROVAL OF THE MINUTES:  The September 18, 2002, minutes were approved as revised (corrections were made on the official print copy and on the Web version).

ANNOUNCEMENTS:
     The Faculty Senate will hold a Symposium on “Models of Shared Governance” on Wednesday, November 6, 2002 from 8:30 a.m. to 12:00 p.m. in the Waldorf-Astoria Ballroom, UH Hilton Hotel.  There will be a Keynote Address on “Governing Badly: Theory and Practice of Bad Ideas in College Decision Making – A non-UH Case Study” by Michael A. Olivas, William B. Bates Distinguished Chair of Law and Director of the Institute of Higher Education Law & Governance.  This will be followed by two panel discussions, including:  Shared Governance at the University Level and Shared Governance within Academic Units.  A continental breakfast will be served.  This symposium is free, but please call the Faculty Senate office at (713) 743-9181 or e-mail the Faculty Senate Office (MBBrantley@central.uh.edu) to reserve a seat.

KUDOS:
     Special kudos go to Benjamin Ostrofsky, Professor of Industrial Engineering, who recently accepted the President’s Award for Merit from the Society of Logistics Engineers.  This award recognizes him as a Fellow who has made particularly significant contributions to the Society.  Dr. Ostrofsky also holds the distinction of being one of only two members in the Society's thirty-year history to be honored with all three of its most prestigious awards, having accepted the Armitage Medal in 1978, the Eccles Medal in 1988, and the Founder's Medal in 1993.
     Kudos go to Michael W. O'Neill, UH Cullen Distinguished Professor of Civil Engineering, has received the 2002 Distinguished Service Award from the Deep Foundations Institute.
     Kudos also go to Dr. Gopal Reddy, Associate Professor of Mechanical Technology, who has won the 2001 Computers in Education Harden-Simons Prize for "the outstanding paper on computational methods".

REPORT ON FACULTY SENATE ACTIVITIES: Joseph Eichberg
   Over the past six months, the Senate met three times and held its semi-annual retreat last month.  During this time, a number of significant developments have occurred.  First, the FS Executive Committee has continued to critically monitor the implementation of PeopleSoft.  In addition to discussing this issue on a regular basis with the central administration, particularly with President Smith, Provost Sheridan and UH Vice President Chuck Shomper, I met in May with Jim McShan, Craig Ness and Jenine Bogrand to express faculty concerns.  These contacts and the open consultative process that was followed have, I think, produced a greater awareness of the faculty stake in having a successful operating PeopleSoft system.  My impression is that existing technical problems are gradually and for the most part successfully being addressed in the financial and human resources areas.  Our future challenge will be to phase in perhaps the most complex component, namely that of student records, a process which will evidently be more costly and take more time than originally anticipated.
     Second, at the time of my last report, the document outlining the "Roles and Responsibilities of UH Department Chairs", initiated by Provost Sheridan, was under development.  After its presentation and discussion at two Senate meetings, the document was modified and jointly adopted by the Senate and the central administration.  This outcome was in my view a successful exercise of shared governance.
       Third, soon after the last Faculty Assembly, preparation of the 2002 Faculty Climate Survey was completed and it was distributed to the faculty who were allowed nearly four weeks to respond.  As has been said before, the Survey was conceived by the Faculty Senate as the first in a series to measure faculty perceptions of the campus environment, to establish a baseline with which the results of future surveys could be compared and to provide the central administration on which it focused with feedback regarding its performance in the view of faculty.  It took several months to analyze the survey and the results were released last month.  After vigorous discussion at its last meeting, the Senate voted to accept the report and directed that the complete survey be sent to members of the Board of Regents, which was done.  The Senate also directed that a delegation of Senators meet with the President, Provost and subsequently with the Board of Regents to discuss the survey outcome.  To date, Anne Jacobson, Jerry Freiberg and myself have met separately with the President Smith and Provost Sheridan.
     Time limitations are such that I am not going to discuss the survey in any detail. However, I believe that the high response rate, in comparison with most surveys of this type, mandates that the results be taken seriously and that the issues identified be addressed constructively and jointly by the Senate and the central administration.  Although it is still early, discussions to date have had positive aspects and have borne some fruit.  For one thing, it has been decided that the Faculty Affairs Committee, with the cooperation of the central administration, will be undertaking a follow up study of how the equity policy instituted three years ago by the provost's office has impacted salaries, especially the phenomenon of salary compression/inversion.  For another, it was agreed that broadened faculty input and advice in deciding upon future research directions would be explored, most likely by utilizing the Research Council, again with participation by the administration.  I would like to make one further comment: There is little doubt that the survey has served to highlight internal problems that must not be ignored.  However, it is imperative that these be addressed in an orderly manner.  It is not in the long term interest of any constituency to foster or perpetuate a mood on campus that will harm the UH in its quest for external resources and an improved reputation as a high quality public research urban university.
     I would like to mention briefly some, but by no means all, of the other rather considerable activities in which either the Senate or its standing Committees has been involved in recent months:

1.  The Senate heard reports from Vice President Elwyn Lee on activities in his area, particularly enrollment management.
 
2. The Senate was introduced to the new Athletic Director, Dave Maggard, who gave a thoughtful report and engaged in a stimulating discussion with Senators concerning athlete graduation rates and the Athletics financial situation.
 
3. Members of the Executive Committee participated in interviewing candidates for the positions of Vice President for Administration and Finance, for which Dr. John Rudley was chosen, and for the Assistant Vice President for Faculty Affairs, a position now occupied by Jane Ollinger.
 
4. Revision of the Faculty Handbook is well underway.  The Executive Committee met with Associate Vice President Elaine Charlson to discuss modifications in exiting promotion and tenure policies.  An ad hoc Committee composed of faculty and administration has been appointed that will soon begin meeting to finalize the changes.  While this is a necessarily lengthy process, we hope to complete it within the next few months.
 
5. The Committee on Committees, under the leadership of Jerry Freiberg, has initiated an ongoing series of meetings with the Chairs (or contact persons) of a number of standing campus Committees for which the Senate nominates members.  The purpose is to better acquaint the Senate with committee activities and to ask what kind of faculty input might be beneficial to committee function.  A partial list of meetings held thus far includes those with the University Promotion and Tenure Committee, the Grievance Committee, the Athletics Advisory Committee and the UH Fringe Benefits Committee.  These meetings have been extremely informative and useful for both Senators and standing Committee Chairs and will continue.
 
6. Two ad hoc drafting Committees have also been active.  The Status of Women Drafting Committee was formed by the Committee on Committees to assist in the proposed merger of the Committee on the Status of Women and the Presidential Commission on the Status of Women.  This process is ongoing. I appointed a Principles of Shared Governance committee.  This group has developed a document that will be proposed as a preamble to the Senate constitution and, although delayed, will be presented to the Senate and to the administration by the end of the year.  In addition, this committee has assisted me in formulating the program for the forthcoming symposium on Models of Shared Governance, to which all members of the campus community are invited.  As previously announced to the Senate, this event will take place on Wednesday morning, November 6.  I will say more about the symposium during the Senate meeting following the Assembly.

“State of the University” Address:  Arthur K. Smith
     It is always my pleasure each year to continue the tradition of informing you about the state of the University.  Let me extend my sincere appreciation to the Faculty Senate for affording me this opportunity once again to tell this body and all of our faculty, our students and staff, our alumni around the world, and the Houston community the great things your University is doing, and to highlight some of our achievements.
     This is my sixth year as Chancellor of the University of Houston System and President of the University of Houston, and I can tell you without hesitation that the state of this great University has never been stronger, nor has it ever been better prepared to take advantage of the opportunities, or to confront the challenges, that lie ahead.

     We are fortunate to have at this University a climate that nurtures outstanding scholarship, which helps us attract a diverse student body from all across Texas and the United States, and from 126 other countries.  World-renowned professors, many at the top of their fields, teach in our classrooms and perform the research that discovers the new knowledge for the next generation of students to learn.
     Your University has established a climate that also promotes community service through programs such as the annual State Employee Charitable Campaign now underway, to which our faculty and staff have contributed more than $900,000 during the 14 years of the campaign.  I encourage all of our eligible faculty and staff to participate once again in this important program.
     The Houston area also benefits from our community service in a multitude of other ways.  A few examples would be the free legal assistance provided by scholars and students at the UH Law Center; eye and vision screenings from the only College of Optometry in the southwest, now in its 50th year; and the increase in the number of social workers specially trained to work with older people in Houston and across the nation.
     Success in our areas of excellence has not been easy, nor did it suddenly spring forth fully formed like some Athena of academe.  Our success is the result of determination and focus, and of our commitment to be among the best in everything we do.  Benjamin Disraeli said, “The secret of success is constancy to purpose.”  In other words, making the commitment to stick to your goal – to adhere to your raison d’être -- when times are tough or when it seems as if everyone around you tells you to give up and to walk away.
      Thanks in part to our ongoing branding campaign, now well into its third year, people outside the academy are taking note of our faculty and their commitment to success in teaching, research, and community service.
      Top-performing undergraduate and graduate students choose to attend here because they know they will learn from some of the best professors in their fields of study.
     Scholars and scientists from among the best universities in the country and around the world are choosing to teach and conduct research here because they know they will be among other leaders in their fields at an institution committed to their success.
     Our friends and benefactors choose to continue their support because they know they play vital and irreplaceable roles in our ability to provide the teaching and research expected of the state’s largest urban research university.

     The investments, improvements, and innovations we have implemented over the past six years are now paying off.  Enrollment this semester is approximately 34,440, the highest in our history.  This record enrollment is the direct result of new recruitment policies, improved retention programs, expanded course availability, and better financial aid packages.
     Our admissions criteria are more selective.  For several years now we have sought to hold our first-time-in-college freshmen enrollment at no more than 3,400; this fall’s class came in at 3,378.  However, it could have been considerably higher.  We are holding at or close to the 3,400 level in order to make each freshman class better prepared and better motivated than the class before it.  We especially want to enroll students who have completed a college preparatory curriculum in high school.
     And this strategy is paying off for us.  This year, for example, 20 percent of those First-Time-In-College students come from among the top 10 percent of their high school graduating class, and more than half of them ranked in the top quartile.
     Five years ago, we did not really have a deadline for fall freshman applications.  A minimally qualified applicant could walk in here even after fall classes had begun, and still obtain admission.  No longer.  Our fall freshman admissions deadlines are moving up, from June 1 in the year 2001 to May 1 this year, and we’re planning to go to April 2 in 2003 (for obvious reasons, we didn’t want to make it April 1!).
     Because our incoming freshmen are better prepared academically, they need fewer remedial courses, and many more of them are making the grades needed to stay in school.
     Six years ago, at the start of the 1996 academic year, the University of Houston’s retention rate was 72 percent.  Many reasons, and more than a few excuses, explained this relatively low rate.  Among them were the fact that we were an urban university with a highly non-traditional, commuting student population that was older and working, and that included many members of economically and educationally disadvantaged minority groups.  Many of our students stopped out, leaving school to work or to raise families, only to return after several years to complete their education.
 The demographics of our student body have changed very little between 1997 and today, yet our retention rate has improved to 79 percent.  This substantial improvement is the result of many programs and individual efforts within the institution.
     The Scholars Community, for example, plays a vital role in these higher retention rates by addressing the challenges faced by our non-traditional students.  The Scholars Community offers a home base for commuting students, providing specially designed class schedules, small group advising and registration, and a virtual community on the Internet.  This year’s record freshman enrollment in the Scholars Community is 1,200, up from 400 only three years ago, and bringing to more than 3,000 the total enrollment in this highly successful program--another record.
      I would add that the retention rate for freshman students in the Scholars Community is 83 percent, compared to 79 percent for the campus-wide rate.
     Despite our holding the fall entering freshman class level in size from year to year, our enrollments grew by 4.3 percent from just a year ago.  The growth is largely attributable to more freshmen staying with us to become sophomores, more sophomores moving on to become juniors, and more juniors moving on to become seniors.  And as a result, we expect to see a sharp improvement in our six-year graduation rate in the years ahead.
      I remember that five years ago, here in the Faculty Senate, a major concern was funding for the core curriculum.  Many new freshman students could not get into the entry-level courses they needed, especially in English and Mathematics.  Related to this problem was the fact that departments and colleges were not getting their budgets for graduate teaching assistants and fellows until mid-August.
     Well, we have successfully addressed those problems.  Departments and colleges now know their base budgets for TAs and Teaching Fellows in March, when they need to compete for their best applicants for graduate study.  And as far as I can determine, there were plenty of course sections available this fall in English and Mathematics to meet the demand.  My compliments and thanks, by the way, to department chairmen John McNamara and Bill Fitzgibbon, and to the deans’ and Provost’s offices, for their great work in making this achievement possible.
 But that achievement did not come about without our putting resources behind it.  We have invested more than $400,000 to provide increased core course sections in these and other high-demand areas.  Also, over the past four years, we have annually invested more than $500,000 in general purpose classroom renovations and technology upgrades, and our investment this year is projected to be about $900,000.
     Funding for merit-based scholarships has been another important element in our efforts to enhance the undergraduate experience here.  Most of our scholarship funding is distributed on the basis of financial need eligibility, and that is as it should be for a public university.  But merit-based scholarships also have an important role, and they are now allowing us to compete more effectively for students who formerly might have gone to UT, or Texas A&M, or Rice.
     We have therefore invested $1.8 million of our increased state funding over the past two biennia in base funding for scholarships.  These new resources have allowed our Undergraduate Scholarship Committee to approve more than $2 million in Academic Excellence Scholarships and more than $800,000 in one-time scholarships for students in the top ten percent of their high school classes who failed to qualify for other UH scholarships.
     The Houston Alumni Organization is in the middle of its Life Membership Campaign to increase the number of $1,000 Life Members whose contributions help fund the Legacy Scholarships Endowment.  Legacy Scholarships have been given to 65 students. These are $1,000, four-year renewable scholarships, for a total of $260,000, over the 14 year life of the program.
     The Presidential Endowed Scholarship is another recent addition to our financial aid programs.  This past year was the first time we awarded these merit-based scholarships for freshmen or first-year students in professional studies.   Under this program, a donor provides $20,000, and we provide a match of $10,000 from our non-endowed private funds.  The resulting $30,000 endowment allows a merit-based scholarship of $1,500 a year for an exceptionally high ability student.
     Along with our own financial aid resources, we help our students through the TEXAS Grant Program, funded by the Legislature through the leadership of State Senator Rodney Ellis of Houston.  This program is both need- and merit-based.  It recognizes and rewards Texas students whose families make less than $40,000 a year and who successfully completed a college preparatory curriculum in high school.  We lead the state in taking advantage of this outstanding program.  Last year, for example, about $7.5 million from the TEXAS Grant program was provided to some 1,750 qualified UH students.
     Nearly 60 percent of our students receive some form of financial aid through the University this year, totaling almost $134 million.  Scholarships account for almost $15.7 million of this total.
     Speaking of financial aid, there is a nugget of important information in this year’s U.S. News & World Report’s annual ranking of colleges and universities that is often overlooked.  That magazine has a unique formula for calculating what an institution’s six-year graduation rate ought to be, and then compares that calculated number to the actual reported rate.  The formula doesn’t fit urban universities at all well, and for the University of Houston, there is an 18 percent gap.  But elsewhere in the magazine, U.S. News has a table that ranks national doctoral universities according to the percentage of students who graduate with outstanding student loans.  Thanks to our various financial aid options, the University of Houston’s Class of 2001 had the second-lowest percentage of graduates in the country who finished their degrees with debt burdens.  Only 27 percent of our students graduated with student loans outstanding.  These days, that’s pretty remarkable.
     But the relationship between these two measures ought to be clear, even to U.S. News:  Finishing their degrees within an arbitrary six-year time frame is not seen as very important by our students.  But not saddling themselves with heavy debt burdens is obviously very important to them.
     Because of the amount of financial assistance we offer, and because we work closely with our students to find the best packages available, high school guidance counselors across the country named UH in a recent survey as one of the top two universities in the nation in terms of responsiveness to student financial aid needs.

     I want to share with you a letter I received recently from a freshman student.  As you can imagine, I get a lot of letters and email from students, their families, and from members of the community commenting on various aspects of the University.  This letter stood out because it underscored the fact that the University is moving in the right direction.
 The letter is from Shane Pennington, a freshman member of the Honors College, majoring in Philosophy.
      “I am on a waiting list for Rice,” he writes, “and until only recently was hoping very much that Rice would accept me.  However, now that I have spent a couple of weeks with UH, I am pleased to say that even if Rice paid me, I would not leave here.  I love my professors, the campus life is diverse and encourages personal growth and learning, and there are seemingly endless opportunities to become acquainted more intimately with the unique culture we have in Houston.  I cannot imagine an environment more conducive to learning.  I know you work hard for people like me, and I appreciate what you do.”
     Shane, let me say that we appreciate you and all of our students, and we wish you great success in your academic and professional careers.
     We have many remarkable students here at UH who also excel beyond the classroom, sometimes in the international arena.
     For example, six students in the Gerald D. Hines College of Architecture received awards in the International Competition of Ideas at Bocconi University.  Ruth Plascencia and Hanna Ruppel received first prize, which included a cash award and a trip to the awards ceremony in Italy.  There were only eight awards given, out of the 110 entries submitted from more than 50 countries.  The University of Houston was the only institution to receive multiple honors.
     In athletics, Olympic champion and UH student Yulia Pakhalina continued her domination of international diving with gold and silver medals in the European Championships in Berlin, and gold and silver medals in the NCAA championships.
 Shane Pennington’s letter referred to our diversity, which others outside the campus also recognize. We remain the most ethnically diverse research university in the nation, and our diversity increases along with our enrollment.  This year, minorities and international students account for more than 59 percent of our student body, up from 51 percent during my first year here in 1997.  Anglos are still the largest group at nearly 41 percent.  The second largest ethnic group on campus is Asian-American at 18.4 percent, followed by Hispanic with 17.7 percent, and African-American with 13.3 percent.  Inter-national students, now totaling more than 2,700 from 126 countries, make up about 7.3 percent of our student body.

     Diversity, however, is not limited to race.  We have diversity in religions and beliefs, in politics, in gender, in our music, and in our social preferences. And, there is diversity among our students in their abilities to access fully all that the University of Houston has to offer in academics and extra-curricular activities.
     Our goal is very simple in this matter, and that is to ensure that every student has an equal opportunity to a high-quality education.  Our new Center for Students with DisABILITIES will help us do this.  This $1 million, 6,000-square foot facility more than doubles the Center’s current space, and it is on schedule to open in January 2003.
 It is just one part of our ambitious $222 million construction and renovation program.  The most visible of our projects at this moment is the $53 million Campus Recreation and Wellness Center, scheduled to open in January, and which Sports Illustrated describes as “spiffy.”  For those of you keeping score, the climbing wall in the new center will be taller than similar walls at Baylor and Texas A&M.
     Among the other projects are the $15 million student residential project that we have now christened Bayou Oaks, which includes the Greek Park, and is scheduled to open in August 2003; the $45 million M.D. Anderson Library and Honors College expansion; and the $51 million Science, Engineering, and Classroom building, designed by world-famous architect Cesar Pelli.  Mr. Pelli designed the Petronas Towers in Malaysia, the world’s tallest buildings, and St. Luke’s Medical Tower here in Houston.
     During the last fiscal year we invested $4.26 million of our new Tier I, or Texas Excellence Fund money for ten, one-time facilities renovations and equipment purchases to enhance our research infrastructure.  These projects are in the Colleges of Liberal Arts and Social Sciences, Education, Engineering, Natural Sciences and Mathematics, and Optometry.  We will pursue additional one-time initiatives during the current fiscal year, with Tier I and other funds.
     We are also using Tier I funds to provide distributive visualization support for research initiatives, with installation scheduled before the end of the calendar year.  By the end of the current fiscal year next August 31, most of the high-priority academic buildings will have their network upgrades, which began three years ago.
     Earlier this year, we dedicated and opened the Texas Learning & Computation Center in Philip G. Hoffman Hall.  This facility connects UH researchers with scientists around the world and provides the latest tools for environmental studies, biochemical and biomedical research, and the development of energy exploration technologies.  TLC2 exists because of the extraordinary support we have mobilized from federal grants, state special item funding, and private industry gifts and contracts.
     All of these projects were planned, but as you know, we have been doing some facilities work that had not been planned, at least not before Tropical Storm Allison hammered us in June 2001.  I am happy to tell you today that our reconstruction from the devastation of that storm is nearly completed.
     Major restoration of much of our campus, along with the replacement of mechanical, electrical, and other building systems, has been a monumental–and costly– undertaking.  In all, we incurred more than $103 million in damage.  We’ve covered all but $25 million of this total from a combination of FEMA and insurance, and we are seeking to recover our $25 million out-of-pocket costs from the state Legislature next year.
     The largest of the rebuilding projects was the roofing of 26 buildings, scheduled for completion by the first part of November.  Several portions of the University Center Satellite, including the Game Room and Convenience Store, opened last month, and other areas of the Satellite will open in the coming weeks.  Then in December, we expect the Satellite’s new Food Court and Starbucks to be open for business.
     The lower level of the John O’Quinn Law Library at the UH Law Center is no longer being used as a library.  It is now the Student Organization and Study Center.  The actual library will be housed on a higher level when it fully reopens toward the end of the fall semester.
      In the meantime, work continues around campus on the final mitigation measures, including the installation and strengthening of storm doors in the utility tunnels, additional emergency generators, auxiliary power improvements, improved drainage systems, and mold treatment.  The early part of next year is the expected completion date of this final phase.
      The tropical storm interrupted our plans to redress more of deficiencies in our physical plant discovered during a Facilities Condition Audit conducted in FY95.  That, in fact, was the source of the $25 million we diverted to overcome the storm damage.  But work on our long-term Capital Renewal and Deferred Maintenance projects will resume this year, with the focus on Life Safety projects and on projects most critical to our support of academic programs.
     I want to thank all of our students, staff, and particularly our faculty for your patience during this long rebuilding and remediation project.  It has been difficult and frustrating at times, but it is almost over.

     Each year, new faculty members join the University, bringing their talents and energies to the campus and increasing our stature as a great University.
     Thanks to the new excellence funding provided by the 77th Texas Legislature, we budgeted $2.5 million for 32 new faculty positions, starting in September 2002.  These were in addition to some 44 faculty searches that had previously been authorized to fill vacancies resulting from retirements and resignations.  National searches for outstanding faculty candidates began a year ago.  Of the 32 new faculty slots funded from the Tier I excellence money, 20 were completed by the beginning of this fall semester.  The remaining 12 searches are continuing.
     Of the 65 new ranked faculty colleagues this year, 41, or 66 percent, were female and/or minorities.  Amongst all ranked faculty, the percentage of females has now increased to almost 25 percent, and the percentage of minority faculty increased to more than 18 percent.  Yes, the diversity of our faculty is still not close to matching the diversity of our students.  We understand that, but as our hiring this year demonstrates, we are moving in that direction.
     Let me take just a moment to tell you about four of our new faculty colleagues.
     Novelist Coleman Whitehead is a 2002 MacArthur Fellow, one of 24 “genius grant” recipients this year.  He will be leading fiction workshops through our Creative Writing Program, which is one of the top two creative writing programs in the nation.  He also is the third of our Creative Writing professors to hold the prestigious MacArthur Award honor, including Richard Howard and Edward Hirsch.
     James Conyers, Sr., is our new Director of African-American Studies.  Professor Conyers comes to us from the University of Nebraska-Omaha where he was the Chair of the Department of Black Studies.  He continues a tradition of leadership excellence in this important program.
     Environmental Law author and activist Victor B. Flatt has been appointed to hold the A. L. O’Quinn Chair in Environmental Law.  He comes to UH from Georgia State University where he was active in environmental protection, and in Gay, Lesbian, Bisexual, and Transgender issues.
     Sunny Ohia is the new Dean of the College of Pharmacy.  Sunny was previously the Associate Dean for Administration for the Creighton University School of Pharmacy and Allied Health Professions.  He brings an international scope to the College and a wealth of experience in the interactions between academic research and medical practice.  As with all of our dean searches, we chose Professor Ohia upon the recommendation of a faculty search committee.
     These outstanding individuals join the ranks of our many other internationally respected teachers and researchers here at the University of Houston.

     Strong, nationally competitive doctoral programs support both faculty research and undergraduate teaching.  Three years ago, we initiated the Graduate Tuition Fellowship program to add coverage of basic tuition for teaching assistants, teaching fellows, and research assistants.  This program has allowed us to be much more competitive in recruiting and retaining top graduate students.  By the way, we were the first public research university in Texas to do this, and the others are now following our lead.  We will invest $350,000 during the current fiscal year to accommodate both tuition increases and the growing number of students in the program, especially research assistants supported by faculty on grants and contracts.  This investment brings our total annual budget for Graduate Tuition Fellowships to $3.6 million.
     Outstanding research programs also require state-of-the-art research facilities and equipment, and seed funding for new research initiatives.  We are investing approximately $14 million during this biennium to continue our development of research programs and infrastructure.
      And our investments are providing tremendous returns.  We ended FY02 with a record $72.1 million in external funding, a 35 percent increase over the previous fiscal year, and considerably higher than the $40.3 million received in FY97, my first year at the University.
     As part of our strategy for growth and development as a research university, we invest resources to develop new centers of research excellence.  This year we will support the development of an Air Quality Center, the Sun Center for High Performance Computing, bio-engineering programs, nano-technology initiatives, and a Digital Informatics Center.  We are also supporting new centers of excellence in the social sciences and education, focusing on new research initiatives in educational diversity, family violence, and drug abuse.
     We established a new Office of Intellectual Property Management in 1997 to support our researchers and their projects by providing a way to integrate invention disclosures, patent and copyright protection, marketing, and licensing.  In return for obtaining licensing agreements from us, our industry partners pay us fees, reimbursement of expenses, and royalties.  The royalty income is then shared with faculty inventors and their departments.
      At this point, let me share a bit of news.  The Association of University Technology Managers released its annual licensing survey last month, along with its rankings of the nation’s colleges and universities receiving money from technology they developed.  These figures are from the year 2000 and they rank the University of Houston as 53rd in the nation.  UT-Austin came in at number 64.
      Several companies, with UH technology as their bases, have been spun out of the University with our faculty researchers playing significant roles.  For example, faculty members in the Space Vacuum Epitaxy Center formed Applied Optoelectronics, Inc.  AOI received more than $20 million in venture capital funding and opened its new facility in Sugar Land two years ago.
      We are very proud of our contributions and of our participation in the decennial World Space Congress now underway here in Houston and on our campus.  UH is the Official Education and Program Sponsor and Organizing Host for the World Space Congress, with most of the education events taking place on our campus.  Tomorrow is the Finals of the Manfred Lachs Space Law Moot Court Competition being held in Wortham Theatre and sponsored by the UH Law Center’s Blakely Advocacy Institute.  On Friday we expect several thousand area students for two events in Yeoman Fieldhouse.
      The University has been a vital and innovative partner in the history of space exploration, and we will continue that tradition and take the lead in educating the new scientists and the future explorers of what is known as “the final frontier.”
    We will also continue to create the new knowledge that will help us understand this world and the worlds we will visit in the years to come.

     Our growth and accomplishments as a University over the past six years have been possible because of the support of our UH family and our many community friends and partners, and certainly because of growth in our State funding.  I’ve now been here for all or part of three biennial sessions of the Texas Legislature, and all three of them began with a revenue surplus.  That’s not going to be the case when the 78th Texas Legislature convenes in January, three months from now.
     There is early talk of a budget shortfall of between $5 and $12 billion for the next biennium.
     This comes at a time when the University of Houston has developed a great deal of forward momentum, and at a time when virtually all of the state’s public colleges and universities need additional state investments to meet the ever-increasing and constantly changing expectations of our students, faculty, staff, and the stakeholders who depend on our teaching, research, and community service.
     For the current fiscal year 2003, the University’s operating budget of $520 million includes $198 million of state appropriations.  Since FY97, our state appropriations have grown by about 28 percent, from $154 million that year to the $198 million I just mentioned.  While we certainly appreciate these state funds, their growth has not kept up with our needs or our expenses.  State appropriations were 46 percent of our total operating budget sources in FY97; they account for only about 38 percent today.  The result is a greater reliance on outside sources of funding and a continuance of the trend, both here in Texas and nationally, that is shifting the costs of public higher education to students and their families.
     I know this is a matter of importance and concern to the Faculty Senate and to all of our faculty and staff, just as it is a matter of importance and concern to the University administration.  I will be counting on your strong and active support as we work to address these important issues with our local legislators.
     Another matter of importance to each of you is compensation.
     This year’s merit and merit-based equity increases for faculty continue our policy, in place since I came here in 1997, of rewarding excellence in teaching, research, and public service.  Each September 1 for the past six years, we have provided as much funding for faculty salary increases as we possibly could, and it has all been merit-based.  The amount has varied each year, but on a compounded basis the total average increase for faculty salaries over these six years amounts to slightly more than 24 percent, or about four percent per year.
     Now, I can see some of you mentally doing the math:  You are asking yourself if your own salary has increased by 24 percent since 1996.
     Well, that has indeed been the average increase, but the range for individual faculty members has been fairly wide.  Some faculty who are considered by their colleagues and deans to be stars have received merit and equity salary increases totaling well over 50 percent during this period.  At the other end of the curve, some may have received cumulative raises of only six percent or so.
 It is important to keep in mind, however, that the judgments of relative merit among faculty are made overwhelmingly by the faculty themselves, working with their department chairpersons and deans.
     The upper administration finds the money and establishes the guidelines for faculty salary increases, but decisions about which faculty actually receive those increases really are made in the colleges.
      Through these cumulative merit and merit-based equity increases over the past six years, we have made considerable headway in addressing the problem of salary compression and inversion.   But our progress has admittedly been uneven.  We have dealt successfully with the salary compression problem for some faculty members, but by no means for all.
     The more productive half of the faculty has done fairly well, and our average salaries by rank now compare very well to those at other public universities, whether here in Texas or across the nation.  And our record of retaining top performing faculty members at all ranks over the past four or five years has been excellent.  While occasionally someone may leave to accept a position elsewhere, in recent years it has not been because we have failed to compete with an attractive counter-offer.
     Without question, salary compression and inversion remain a problem for the relatively less productive half of the faculty, that is, those for whom their colleagues and deans have recommended raises year after year that are markedly less than average.  And there is no ready answer to this problem, absent what would have to be a truly major increase in our appropriations from the Legislature.
     One of our top priorities in the coming legislative session is an increase of formula funding that will allow us to better compensate our faculty and staff, and that will allow us to compete with the private sector in terms of recruiting and retaining exceptional professionals.

     The complex issue of faculty and staff salaries is only one aspect of an educational environment undergoing significant changes, marked by limited resources, shifting teaching and learning paradigms, and information technologies that are reshaping the ways we deliver education and the ways people learn and work.
     Successful universities are creative and resourceful in their generation of revenues and their uses of funds.  They also embrace the benefits that new technology holds for education.
     We address these issues in part by adopting collaborative methods of delivering education opportunities beyond this campus.  The results are the UH System at Sugar Land, the UH System at Cinco Ranch, and the UH System Distance Education/CampusNet, in all of which the University of Houston and the other three UH System universities participate.  As these programs grow, they are serving as models for other universities in Texas and the nation.
      We are also exploring opportunities to participate in a new multi-institution teaching center in Northwest Harris County in collaboration with the North Harris County/Montgomery Community College District.   Working with the community college system, we would offer programs leading to undergraduate and graduate degrees in high-demand areas such as business, education, engineering, technology, and computer science.
     We will continue to develop these and other collaborative initiatives during this fiscal year and beyond, thereby enabling us to capture new markets, serve our students better, and improve the quality and availability of educational resources through technology.

     When the Legislature convenes in January, we will support several issues critical to the University of Houston and to Texas higher education.
     As I have mentioned, we will certainly support increased formula funding for the state’s general academic institutions.  Formula funding is the core of our state appropriations.  It is essential for meeting enrollment growth; the increased costs of goods and services; increased insurance premiums; and competitive faculty and staff salaries.
     We will also ask for an increase in the Higher Education Assistance Fund, or HEAF, from the present $175 million statewide to $200 million.  Our share of this increase would help to support enrollment growth, start-up costs for new faculty hires, deferred maintenance, Fire Marshal compliance, and other life/safety issues.
     And as our highest priority, we also will revisit the issue of Tier I Excellence Funding.
     The Legislature took a bold and visionary step last year toward the goal of securing our future economic strength and competitiveness with the adoption of House Bill 1839.  The creation of this funding source recognized the need for Texas to develop and support more nationally comprehensive public research universities than just the traditional two:  The University of Texas at Austin and Texas A&M University.
     The original intent of the legislation was to enhance funding for a very small number of additional research-intensive institutions, especially UH and Texas Tech--in other words, universities that already have comprehensive arrays of doctoral and research programs, with proven track records of attracting federal research funds.   The concept was to provide this very limited number of universities with access to excellence funding, and thus give them the critically needed infrastructure to compete on a national level.
     Somewhere along the way during the last legislative session, this intent was lost.  Instead of concentrating new excellence funding on only a handful of universities, the Legislature created two separate but unequal funds that spread excellence funding more thinly among a much larger array of general academic, but not necessarily research-intensive institutions.
     The Texas Excellence Fund for HEF schools and the University Research Fund for PUF schools other than UT and A&M will each receive nearly $34.8 million each during this biennium.  Although the separate funds are equal in the amount of dollars received, they are unequal in all other categories.  The HEF schools’ aggregate enrollment is three times greater than the regional PUF schools, which means the PUF schools receive three times more funding per student.
     Dramatic examples of the unequal distribution are found at the institution level, where funding per student is $369 at the University of Houston and $783 at the University of Texas at Dallas, and where funding as a percent of sponsored research at Texas Tech is 44 percent, while at UT Arlington it is 134 percent.
     But while the bill has some obvious flaws and inequities, it is important for us to keep one thing in mind:  Texas legislators have now recognized the necessity of supporting more nationally competitive public universities through excellence funding.  That was a truly major step forward.  It is now important to convince them to acknowledge the merits of establishing a single fund for both HEF and PUF institutions, using a single set of criteria, and getting back to the original public policy purpose of moving a few more Texas universities as rapidly as possible into the ranks of Tier I.

     UH is the largest university in the nation’s fourth largest city.  We have much in common with this great urban setting, particularly in terms of diversity.  Houston’s rich diversity encompasses the way its vibrant population lives, the manner in which its people conduct business, the various skills they possess, and their unique dreams and aspirations.
     We have a responsibility to return to the people of our city the benefits of our intellectual and academic resources, the resources that they have helped us to acquire.  As I have said on many occasions, the University of Houston is not just in the community, we are of the community.  I am pleased to note that we are demonstrating that unity through a number of new partnership initiatives.  A few examples:
     The Workforce Skills Enhancement Project funded by the “Great Cities, Great Universities” consortium is narrowing the gap in the skill levels of the urban high-tech workforce.  Our College of Technology is taking the lead, in partnership with Houston businesses and corporations, to build the training model that will help women, minorities, and other members of the urban high-tech workforces of Houston and of the nation to take advantage of the new economies of the 21st century.
     The Millennium Neighborhood Project is part of the national Homeland Security initiative.  UH, through the Graduate School of Social Work, is a partner with the UT Health Sciences Center, Texas Southern University, Rice, the Houston Community College System, and city and county agencies in creating a model for neighborhood security.  We are developing ways neighborhoods can take care of themselves in the event of a national disaster or a local calamity, such as a flood or a storm.
     We are supplying the East Side Village Learning Center with the educational and technical expertise to develop a learning process in an urban center.  We are helping the Center improve the education process through the use of technology, we are helping to set up computer networks with the assistance of our Information Technology staff, and we are helping them to write grant applications.  Our work with the East Side Village Learning Center is one of the best examples of UH students, faculty, and staff combining their talents and expertise for the benefit of the community.

     This great University has never been stronger, nor has it ever been better prepared to take advantage of the opportunities ahead, for one overriding reason:  Commitment.
     We are, first of all, committed to the success of our students.  They are why we are here.
     We are committed to the success of our academic programs, and we show it by recruiting outstanding teachers and researchers, by rewarding and retaining our most productive faculty members, and by investing in the facilities and the resources they need to succeed in their fields.
     We are committed to the success of our community and to our stakeholders.  Scores of programs throughout the University demonstrate that we are serious about fulfilling our aspiration to be recognized as the model metropolitan university system in the country.  We are not just an urban university, but we are committed to the urban mission.
     The University of Houston does accomplish great things, but we do not do them on our own.  Our success depends upon the commitment of many individuals and groups:  Our students, our staff members, our alumni, our corporate and community partners, and particularly our faculty.
     In short, the “State of the University” today is very strong, certainly by most objective standards.  When compared to the conditions currently prevailing at most other public universities around the country, where draconian budget reductions, little or no money for salary increases, and skyrocketing tuition and fee increases are the order of the day, conditions at the University of Houston are very good indeed.
     But the state of the University is not perfect, and of course it never will be.  No university president can aspire to present such a report to his or her faculty.
     Some problems are simply intractable.  Parking, for example, is an issue we cannot resolve, but only try to manage.  People want parking to be cheap, abundant, and convenient, and we can give you any two, but not all three.  Building one or two parking garages would be nice, but the funding needed to construct and operate them within the laws of the state of Texas, and within the tolerance of our campus community for high parking fees, is difficult to find.
     Providing fair and equitable salaries to all members of the University faculty and staff is equally elusive.  Especially for the faculty, a university is a meritocracy, and most people would agree that is how it should be.  But resources to fund raises have been and are likely to remain limited.  The more we succeed in rewarding merit and building excellence, the more the gap widens for those affected by the phenomena of salary compression and inversion.
     And similarly, there is nowhere near enough money available to us to elevate all academic departments, colleges, and programs to national quality standards.  In allocating new faculty lines and in providing research support, we must therefore be selective.  We must give first priority to preserving and building on our strengths, investing new resources in some programs but not in others.
      In allocating the University’s scarce resources year after year, we must make difficult choices.  Do we put more money into salary increases, or into new faculty lines?  Do we improve stipend levels and tuition support for doctoral students, or do we fund more undergraduate scholarships?  Do we improve library holdings and services, or do we invest instead in improving campus access to high bandwidth internet services, or improved support for administrative computing?  When disaster strikes, do we give priority to the Law Center’s library or to a satellite site that provides food service and recreation opportunities to students?  I could go on, but you get the idea.
     Whenever these choices are made, and by whatever process of governance we utilize to arrive at them, some members of the University community will be pleased, and some others will be disappointed, sometimes even to the point of alienation and long-term, simmering anger.
     We certainly cannot please everyone, and intellectually, if not emotionally, I think that we all understand and accept that reality.
     But the objective fact is that the University of Houston is, on balance, a University very much on the move.   Our academic reputation is growing.  The excellence of our faculty is much better known today than just a few years ago.  External funding for research is burgeoning.  The presence of women and minorities among our faculty and staff is expanding rapidly, even within the ranks of the senior administration.  The arts are flourishing, from creative writing to music to theatre.  Our enrollments are growing but through a controlled strategy, and the quality of our students has improved at all levels.  The services we provide to our students, in academic advising, housing, financial aid, recreation, and classroom ambiance, have all improved markedly.  The physical appearance of the campus is far better than it was six years ago, and the construction of exciting new academic buildings is underway.  Again, I could go on, but I think you get the idea.
     When I came to our University more than five and a half years ago, I was given a list of goals from the Board of Regents.  The Regents wanted a higher level of cooperation among all the components of the University.  They wanted more relevance to the communities we serve.  They wanted this University to be more responsive to student needs.  They wanted efficiency and effectiveness in our management of the public funds placed at our disposal.  And most important, they wanted enhanced teaching and research productivity—academic excellence, in other words.
     The University is stronger and better prepared today because we are succeeding in our pursuit of all these goals, and we will continue to succeed and to exceed in them.  That is my commitment, that is the commitment of each member of my senior administrative team and of the academic deans, and I truly believe it is the commitment of the faculty and staff of this great University.
     Thank you.

Questions and Answers:
     Sen. Pedemonte asked if the University of Houston had dropped its priority to put a building in the medical center.  Dr. Smith said it hasn’t been dropped, but it is among those choices he had to make.  In the last legislative session UH had to establish priorities.  For example, what is most important to this campus, a new Engineering-Science-Research and Classroom building or a new building that would enable the University to enhance its programs in the Texas Medical Center.  Both are important but a choice had to be made.  UH will continue to try to get expanded space for Pharmacy and for research space for other faculty in the medical center. There are a lot of programs that UH could offer there but he couldn’t make it the number one priority ahead of the Engineering Science and classroom building.
     Dr. Maria Gonzalez asked if the priorities in terms of Tier 1 funding are science and engineering.  Dr. Smith said to answer that question one must look at where the 32 new faculty positions were put and where the money was invested in the ten facilities’ renovations and equipment projects.  They are heavily in science and engineering.  This is where the major opportunities for UH to enhance its competitiveness for federal funding exist. But they are by no means exclusively in those areas.
     Dr. Gonzalez asked in identifying those priorities was there a lot of opportunities for faculty to provide feedback and discussion the priorities?  Dr. Smith said budget making is primarily an administrative process.  It is done at the beginning with budget hearings in the colleges between the department chairs and deans.  The deans then refine and make their budget presentations to the Provost.  The Provost then refines requests, and within the constraints that he thinks he will be operating under, makes a budget presentation to the President.  Dr. Smith said he hears budget presentations from Art Vailas, VP for Research; Chuck Shomper, VP for Information Technology; John Rudley, VP for Administration and Finance; the General Counsel; and all of the vice presidents.  Out of this process, he has to confront the reality of scarce resources and to make those difficulty choices.
     Dr. Gonzalez said, in terms of scarce resources, she would like an update about how much UH has spent on and when will it be done with PeopleSoft.  Dr. Smith said Mr. Shomper is present and will be happy to talk with you at the end of this meeting.  Dr. Smith added that when UH started with PeopleSoft in 1998 it had a five year program to move over to financial resources, human resources and student and academic services systems.  Part of the software that had not yet been written by PeopleSoft, so UH was making a leap of faith.  How much has been spent?   There is a difference between what was spent on the original project back in 1998 and how much UH has really being spent on new projects like the impending conversion to Version 8.  When will PeopleSoft  be finished?  Not in this lifetime.  Changes are going to be made to administrative computing on this campus for as long as one can foresee.
      Dr. Gonzalez said the current report is that once the student administration system is in place UH will lose 60% or 70% of its information .  Is that accurate?  Dr. Smith said that is inaccurate.  Mr. Shomper said that is not correct.  The current system, the way it is out of box for PeopleSoft, meets about 1/3 of the current requirements so some modifications have to be made and some additional reports have to be written.
     Dr. Gonzalez asked so what does PeopleSoft give UH over what is currently in place?  Dr. Smith said the current system is something that has been cobbled together over the decades, adding a piece at a time.  It has become increasingly expensive to maintain.  The technology that it uses t is outmoded, but it has a lot of nice things.  UH doesn't want to lose the nice things, but one must look at the long term future.  What UH needs is a member supported system where annually the vendor will be investing the resources necessary to keep it current so that annually UH can get upgrades along with other universities that are part of that system.  One has to compare that cost to UH trying to maintain its increasingly outmoded, increasingly expensive and increasingly dysfunctional system.  Dr. Smith added that UH is  not going to cut over to a new student information system that does not provide the level of service needed for the faculty or academic programs.  If it takes longer to get there, it will take longer.
     Dr. Gonzalez said one of the biggest challenges is that UH has not put in enough resources to upgrade PeopleSoft.  She cautioned the group, saying that the University of Michigan has already spent $200 million on their PeopleSoft and Cal State system has spent $400 million.  UH has gone beyond $40 million currently without going to the student system.
     Sen. Huber asked if there is a chance for excellence funding in the next legislative session?  Dr. Smith said the legislature is going to start with a base budget bill in January that has the Tier I funding in it.  So the question is can it be maintained?  Can higher education funding at its current level be defended against the threat of budget reductions.  All the universities really need to work together to make the case that the needs of the State, the momentum that higher education institutions have established, the closing the gaps service to deliver education to members of ethnic minority groups, are priorities.  Universities have a certain momentum that will be lost if the legislature can't find a way to deal with the budget problem.  They will set the state back much further than two years or four years or ten years if they cut higher education, so that the cost of not dealing with these problems is a story that universities have to tell.  They have to make it plain that Texas needs a strong, responsive, higher education system that provides access to its citizens.  That is going to be major challenge.  There will be a lot of competition.  Only about 15% of the state budget  is actually controlled by the legislature.  The rest has to do with things like federal programs that if the legislature doesn't come up with the cash it loses the federal match.  There will be some opportunities to work with the legislature, to raise revenues through increased flexibility and universities need to persuade legislators that they will be responsible and accountable if given that flexibility.

BUDGET AND FACILITIES COMMITTEE REPORT:  Saleha Khumawala, Chair
     The Faculty Senate Budget and Facilities Committee met on September 30, 2002 with the new VC/VP for Administration and Finance, Dr. John Rudley; Assoc. VC/VP Finance Jim McShan; and Executive Director, Budget, Tom Ehardt.  In advance of the meeting, Dr. Rudley distributed the UH Executive Budget Summary and a description of the UH fund groups.  Two memoranda that were previously distributed by President Smith were distributed at this meeting.  These were the March 26 "Faculty and Staff Increase Guidelines for Fiscal Year 2003" and the July 11 "Budget Allocation Plan for FY2003."
     Following introductions and a brief review of Dr. Rudley's experience and expectations, Dr. Rudley noted that this is a base year and UH's enrollment of approximately 34,100 is higher than was expected when the Executive Budget was developed -- the budget was based on an estimate of 33,029.  How this translates into actual dollars won't be known until after the legislative session.  He added that according to the Budget the majority of the new money is going to salary and benefits.  In response to questions, Dr. Rudley said that the System has nearly $54 million in academic scholarship funds, and that insurance premiums have increased from $300,000 to approximately $5 million.
     With regard to Tropical Storm Allison, Dr. Rudely reported that the expectation was that insurance payments would be $40 million, FEMA $40 million, with $20 million to be covered in other ways.  To date, insurance has paid approximately $35 million and is expected to complete the anticipated payments.  FEMA has paid approximately $5 million.  Storm repairs had to be made.  The result is that the University is at present behind by approximately $25 million on deferred maintenance, such as mold in Roy Cullen, because the money was spent on Allison.  UH has asked the Legislature for a $25 million Special Appropriation, but will have to get in line with everyone else.
     Deferred maintenance and other capital projects are typically funded by $12.1 of the $25 million annual HEAF monies.  Dr. Rudley noted that a survey had indicated that the University has over $300 million in deferred maintenance needs, and that seems very high.  A committee member noted that for the M.D. Anderson Library, all of the items listed are needed, though there may be a question about what the work would cost.
     Dr. Rudley said that UH has just sold $130 million in bonds at 4.16% for the Science Building, Library addition/renovation and some projects at Clear Lake.
     One of the main topics for this meeting was the Budget, with all sources and uses of funds.  Questions from the Committee began to clarify some of the budgets and expenditures that are not on the report  received, which is actually the Operating Budget.  For example, the FEMA payments do not show up on the Operating Budget.  They are in the Capital Assets Budget.  In addition to the Operating Budget, there are three plant funds, agency funds, and endowment principal.  The endowment is currently approximately $400 million, and the University expects to make approximately $20 million on this.  The Committee still has a lot to learn about these budgets.
     The Athletic deficit, and a plan for its reduction, were also on the agenda.  The Committee asked to have the Athletic budget from all funds for this year, and the expenditures from all funds including the Foundation, for at least the past two years, or three years if the data is comparable.  The Committee noted that the previous CFO had said any data older than this would not be comparable.  There was a general discussion on the difficulty of reducing the athletic deficit by any means other that making sure the Athletic Director is making the best possible use of the money by advance planning and cost comparison, where these are possible.
     A question was asked about the need to transfer funds to units whose teaching demands increase.  Dr. Rudley agreed that this needs to be done, although these allocations are not the responsibility of his division.  Dr. Rudley noted that, first, subjects that become popular can also become less popular, and when that happens UH may not want to close the department or college.  Business and Engineering were noted as two programs that tend to be cyclical.  Dr. Rudley said that when they are "up," they need additional funding, but they shouldn't be given all that they generate, because other programs will be "down" at the same time and will need more support compared to what they generate when they are up.  Committee members noted that the feedback loop does not operate well, and UH misses opportunity income because it is not prepared to add students when programs become popular.
     Dr. Rudley's second point on this topic was that UH needs to prepare for managed growth. The SREB Web site says that Texas will have a 7% increase in high school seniors every year for the next eight years. The college-going rate in Texas is 38%, the lowest among the Southern states.

COMMITTEE ON COMMITTEES REPORT:  Jerome Freiberg, Chair
     The Committee on Committees (COC) has been conducting a series of meetings with the chairs (or contact persons in the event that a committee is currently without an elected chair) of University of Houston Standing Committees to improve communications within the faculty governance.  In the past the COC would appoint faculty to committees, but have no other contact.  Occasional surveys of committees were conducted to determine if the committee was active, but this series of meeting has instituted face-to-face meetings.  Individuals are asked how their committees are functioning, what have the committees accomplished, and what challenges or problems the committees have experienced that might require the intervention of the Faculty Senate or its COC.
     To date the Committee on Committees has met with nine chairs of the committees listed below.  Minutes of each meeting are available in the Faculty Senate Office.
     April 10, 2002:  David Jacobs, Chair of the University Promotion & Tenure Committee.  It was suggested that CLASS, being so large, should have two positions on the University Committee.
     April 29, 2002:  Laura Oren, Chair of the Grievance Committee.  The committee is still concerned about acquiring sufficient representation from the smaller colleges.  It would like to get feedback from the Provost Office, not only about the outcome of cases, but the reasons behind them.  The COC also recommended the Grievance Committee compile statistics about past cases.
     April 29, 2002:  Kathy Sheridan, Chair of the Athletics Advisory Committee.  The committee is concerned about Academic Status of Student Athletes, Financial Status of the Department, and Gender Equity Issues.  The AAC praised Claudia Schleyer, who was hired by the former Athletics Director to raise graduation rates, which are projected to rise for entering freshman from 25% last year to 39% this year.  The AAC feels UH does a good job making its case for equity sports, which don’t fit the traditional model.  The problem with the financial situation in Athletics is the lack of revenue.
     May 13, 2002:  Dennis Adams, Chair of the Information Technology & Computing Committee.  The ITCC is concerned about limited resources and duplication of efforts, academic freedom in computing, and the importance of IT to UH faculty.  The COC requested that the ITCC send it information on IT budget comparisons to peer institutions.
     May 13, 2002:  Robert Herrington, Jr., Chair of the UH System Fringe Benefits Committee.  One area of concern that the FBC has been trying to address is getting the state to reactivate the Group Benefits Advisory Committee (GBAC).  Now ERS is overseen by legislators and the retirement program, which means it is more concerned with budgets than with benefits.  The COC requested the FBC to get a reading on how many cases have exceeded or come close to the $1 million maximum lifetime coverage; prepare a summary of Optional Retirement Plans that compares the different providers to try to de-mystify the process of basic investment; and poll the faculty to see how they rate the service from their ORP providers.
     June 3, 2002:  Kathy Anzivino, Chair/Contact, Campus Recreation Advisory Committee.  The COC was briefed on the progress of the new Recreation and Wellness Center.  It then discussed and agreed that the ad hoc Recreation Committee should be formalized into a University Standing Committee as the Recreation Advisory Committee.  The Committee would take effect on September 1 and that there would be three representatives from the faculty on the committee.
     July 1, 2002:  Keith Hollingsworth, Chair, Teaching Excellence Awards Committee.  The TEAC makes the decision on which faculty will receive the 4 faculty Teaching Excellence Awards and the 2 TA Teaching Excellence Awards and the Core Course Award.  The committee also decides the Distance Education Award, although one was not awarded this year due to a lack of candidates.  There is also the El Paso Awards that the TEAC has been trying to coordinate.  The COC recommended the TEAC consider instituting a Faculty Service Award.
     Aug. 28, 2002:  Robert B. Wilson, Jr., UHPD Chief & Contact for the Safety & Security Cm.  Chief Wilson said he co-chairs the Safety & Security Committee with Rob Schneller, Executive Director of Safety and Risk Management.  The work last year was to prepare a Emergency Preparedness Plan, which is in the process of being formalized into a M.A. P. P. (document in the Manual of Administrative Policies and Procedures).  This document is to update procedures post-Tropical Storm Allison.  Chief Wilson will send a comparison of UH's safety record with its peer institutions as soon as the information is available (in early November).
     Oct. 9, 2002:  Nancy Hixon, Contact for the UH Art Acquisition Cm.  The COC and the Senate can assist the Art Acquisition Committee by informing the University Community, especially Deans, that the ArtAC won’t dictate what art to accept from donors; however, there are strict criteria for art to be used to build the UH collection.  There are two ways to accept art, one is for the art collection and the other as property.  There is a process for accepting art works and any art donation should be channeled through the committee.  Dr. Freiberg suggested that the committee develop a one-page description of the process for the University Community to follow.
     The meetings have been viewed by all the participants as beneficial as well as informative.
     The Committee on Committees has also been working with representatives of the Committee on the Status of Women and the Presidential Commission on the Status of Women to help facilitate the proposed merger of the two groups.  A Drafting Committee was set up with two members of each group empowered to work on the details of the merger.  This work appears to be close to a resolution.

EDUCATIONAL POLICIES & STUDENT AFFAIRS COMMITTEE REPORT ñ Katy Greenwood, Chair
     The committee met on September 25, 2002 in the Senate Office conference room.  Special guest was Nancy Graves, Chair of the Undergraduate Council.  She updated the Committee on issues of mutual concern, including the status of a "Q" grade proposal that had originated from faculty on the Committee, was endorsed by the Student Government Association, and was being recommended at the undergraduate level by the Council to the Provost for acceptance.  Two other items addressed by Prof. Graves of interest to the committee were:  (1) the role of the Core Committee of the Undergraduate Council as an oversight group to make sure that new core courses meet the prescribed standards and regulations of the State, and (2) the status of new degree programs being brought through the committee.
     The Committee continued their dialog regarding the need for a stated policy in the Faculty Handbook regarding the changing of grades, when that occurs.  Formal wording is still being revised for recommendation to the Handbook committee.
     The Committee continued their discussion regarding the procedures in place to address academic dishonesty.  The Committee wanted more information on a recent incident where the decisions of a faculty panel were overturned at the Provost level, prior to the case going to Federal Court.  This topic will be addressed again at the next meeting.

FACULTY AFFAIRS COMMITTEE REPORT: Giles Auchmuty, Chair
   The Faculty Affairs Committee met on October 3.  The first topic was a discussion of some proposed changes to the promotion and tenure guidelines.  A subgroup of the Committee agreed to look at the changes proposed by the Provost's office and will return comments.
    Much of the meeting concerned issues arising out of the responses to the faculty survey conducted in the spring.  In particular a subcommittee was created to further see what can be done to identify cases of salary inversion around the University.
     Another issue was the e-mail circulated by the UHS General Counsel concerning the possible contents of faculty web-pages and the UH System contract with Barnes and Noble.  This will be further discussed with the central administration.
    The Committee discussed the possible representation of research, clinical and other non-tenure track faculty on the Faculty Senate.  The Committee agreed to first arrange some meetings with such faculty, to see what their preference might be.

FOLLOW-UP DISCUSSION:  2002 Faculty Climate Survey Report
     Pres. Eichberg said there were two issues raised in his memo to the senators.  The first had to do with response to the motions that were passed at the last meeting.  He reviewed the motion that was passed to request a meeting with the Board of Regents, its chair or a subcommittee.  After consulting with the administration and General Counsel it appears that a closed meeting is not in accordance with the Texas Open Meetings Act, so it was his decision to bring this issue back to the Senate to ask again what its wishes might be.   The report has been communicated to the Board but as yet there has not been any direct contact with them.  Pres. Eichberg informed the Senate that there would be subcommittee meetings of the Board on November 5 and a full Board meeting on November 21.  The entire Board participates on each subcommittee.  One possibility is to ask for an open meeting with the Academic and Student Affairs subcommittee.  This request goes through Dr. Smith.  The second alternative is for the Senate through its President or another representative to address the Board during the Open Forum period at its regular meeting.  There is a 30-minute window, during which one may have five minutes to address the Board.  One wouldn't expect a response, but it would be an opportunity to make a statement about the Faculty Senate related to the survey and some of the issues that it would like to see addressed.
      Sen. Jacobs asked at what point can the Senate expect a response from Dr. Smith to the survey?  It seems that this group is waiting for a response from Dr. Smith and any action should follow his response.  Dr. Sheridan said he and Dr. Smith have discussed a number of things with the Executive Committee of the Faculty Senate.
     Sen. Jacobs said he talked about the issue of salary compression but the survey itself was never addressed.  Dr. Sheridan said that he was picking up on things like the salary compression because he wants to be sure and try to present it.
     Sen. Huber said to Pres. Eichberg, call the Chair of the Board of Regents and tell him that you will buy him lunch and see if he will go.
     Sen. Leiss asked if there was any communication from any of the members of the Board to the President of the Faculty Senate.  After all the Faculty Senate sent this report to them.
     Pres. Eichberg said he has not received any communication.  He has had an informal conversation with a member but no formal response.
     Sen. Linzer said the suggestion of going to a subcommittee has merit and sounds like an interesting way to go.  That is a way to simultaneously defuse the matter and still get some attention.  The comments that he heard from the chairman of the Board of Regents and from what he read in the press is "I know how to deal with employees."  It sounded very harsh and very disdainful of the faculty.   He added that he didn't want to be kissed off.  He is willing to give it one more chance.  It seems to me somebody should say to the Board and then to Dr. Smith that if they don't listen to the Faculty Senate and give it some respect, you are going to read about it in the Chronicle. This point has got to made.  The people in this room and the 800 plus faculty members have about 10,000 times more invested in this University than the Board because most of us have invested 20 plus years of our lives here and that should get some response.
     Sen. Myers asked if there might be some discussion and questions from the Board if Pres. Eichberg went to the subcommittee meeting?  The ideal thing would be to have two-way communication.   Pres. Eichberg said in theory there would be an opportunity for exchange if the subcommittee was willing.
     Pres. Eichberg said obviously if the Senate wants a response from them it has to give them something to which they can respond.
     Sen. Pedemonte said it is not very clear what should be interpreted from the survey.   Perhaps the Senate should consider discussing the survey and vote on what should be presented.
     Sen. Craig said the climate survey was not meant to be a complete list of all the University's problems.  Senators are interested in knowing that the Board is engaged in what is going on at the University.  The survey was sent to the Board, so they have it.  The question is do they care.  He would find it most satisfying something if the central administration, whether that is the Board or Dr. Smith's office or Dr. Sheridan's office, would say they are going to go forward in the following ways -- that they are worried about some of these problems and if they feel like they need more information then they are going to get more information or they are going to write some plan.  The survey was not a one-shot document and it should not be treated that way.  In a sense what the Senate wants to know is that the institution is working to making itself a better place and the survey showed that not all of the problems are being currently addressed.
     Pres. Eichberg said from what he read, it seems the Chairman of the Board feels that internal problems should be worked out internally.  He said he didn't know whether they would be receptive to an open meeting as opposed to some other kind of communication.
     Sen. Pedemonte said he doesn't want the Board to start interfering with UH or micromanaging the University.
     Sen. Warner said he voted in favor of the motion made by Sen. Ignatiev at the last meeting.  His memory of the prior discussion was to make sure the Board didn't get any big surprises.  So as Sen. Huber said that is a far different motivation than expecting a formal response from the Board.  He added that he was under the assumption that the Senate and administration were going to work out the issues that needed to be worked out.
     Sen. Auchmuty said when the survey was proposed, the idea was to find out what faculty felt about the various issues at UH.  The Senate could take this to a subcommittee of the Board with a description of what the results were.  It is not as though the Senate is going in with any particular agenda.  It is just sharing information about the state of the University, as the faculty perceive it.  A subcommittee of the Board would be the right group with which to share it.  Tell the subcommittee that this is what happened and the Senate is going to work with the administration to try alleviate some of the issues.  The Board should have an opportunity to discuss it with the Senate if they want.
     Sen. Johnsen asked if the Senate asked for a formal written response from the President and the Provost.   Pres. Eichberg said no, there was no discussion of a formal response; there was discussion to have a meeting with them.  Sen. Johnsen said it would be crazy to think about approaching the Board before having asked for a formal response from the administration.
     Sen. Linzer said the question is what does the Senate do beyond this point?  It seems that the ideal way to deal with this is to have an essentially off-the-record discussion with the President, talking concretely.  Is he willing to sit down and talk?
     Pres. Eichberg said there has been a request to have an additional meeting of the Senate to discuss the survey.  One might combine that meeting with an indication to the President to attend.  Sen. Linzer said that turns into a state visit and that is not what the Senate wants.
     Sen. Leiss said he is somewhat disturbed by the fact that the Board is unwilling to engage in a discussion.  From his vantage point as a former president of the Senate, he interacted with the Board on a regular basis.  His successors interacted with the Board on a regular basis.  There was not any micromanaging involved but there was a gauging of a position that wasn't necessarily always the position that the administration was representing to the Board.  He said he finds it very distressing that the Board has not felt it necessary, in view of the opinion expressed by the faculty, to contact Pres. Eichberg as the President of the elected body of this University's faculty to talk about what this all means.  It is rather disturbing, in fact, and at some point it will have to be pointed out that boards have a certain fiduciary duty to this University.  In Houston, there are in the business community a number of boards that have not in any way conformed to those expectations and those boards are now in trouble.
     Sen. Auchmuty moved that:
 
  "the Faculty Senate try to arrange a meeting with a subcommittee of the Board of Regents."
 
Sen. Paskusz provided the second.
     Sen. Metcalfe said he thought in the e-mail response that Pres. Eichberg indicated that there was some progress being made in contact with the President and the Provost.  Why not pursue that before going to people outside?  The next step is going to the Board.  Sen. Metcalfe said he is concerned about too much of this going outside.  The Senate should try to see what it can do inside first because there are some very significant potential negative impacts of going public.
     Sen. San Miguel asked for a clarification of the purpose of meeting with the Board subcommittee.  What is it that the Senate really wants?  Is it just to present the results or to ask for a response?  If so what kind of a response does this group want?  The Faculty Senate has not discussed the kinds of things it wants out of that survey.  There are all kinds of concerns that haven't been discussed.  Sen. San Miguel said he recalls reading the article in the press and there are misconceptions among the Board and others of what shared governance is.  It is too murky at this point to discuss the idea of meeting with the Board when the Senate hasn't discussed the survey and its results.
     Pres. Eichberg said he shares these concerns.  He said he is not sure what would be accomplished except to make sure that all Board members are aware of the faculty's concerns.
     Sen. Paskusz said the reason why he seconded the motion is because there is a challenge to having open communication between the Board and the Faculty Senate.  This is one way to establish a channel of communication.
     Sen. Greenwood asked if the Senate had invited the Regents to the forum on faculty governance on November 6?  Has the administration been put on the agenda?   Pres. Eichberg said the Board would be invited to the November 6 Symposium.
     Sen. Craig moved that the motion to meet with a subcommittee of the Board of Regents be tabled. The motion to table passed by majority vote (13 For, 7 Against).
     Pres. Eichberg said it is the sense of the Senate that an additional meeting to discuss the survey should be called.  He said he would schedule such a meeting.

REPORT FROM AND DISCUSSION WITH UNIVERSITY OF HOUSTON SYSTEM SENIOR VICE CHANCELLOR & UH SENIOR VICE PRESIDENT FOR ACADEMIC AFFAIRS/PROVOST:  Edward P. Sheridan
     Dr. Gonzalez asked whether there is going to be a dean search in CLASS this year?  Dr. Sheridan said, no, there will not be.  The elected body of representatives in CLASS, chaired by Dr. Cathy Patterson, was the group asked for recommendations for people to be on the search committee.  Dr. Patterson sent him a nice list but said that group had unanimously recommended that the search be put off for a year.  At the same time all the CLASS chairs sent him a memo indicating that they unanimously were requesting that the search be put off for a year.  Dr. Sheridan said he has written to both of those groups saying that he will put the search off for a year in response to their very strong, unanimous request to do so.  There will not be a search until next fall.
     Dr. Gonzalez asked if Interim Dean Antel will have all the privileges and prerogatives of the other deans on campus?  Dr. Sheridan said the language just used is the actual language he used in his memo to the chairs saying that Dean Antel has all the privileges and prerogatives of deans.  Dr. Gonzalez asked does that include identifying searches, making recommendations for tenure and items like that?  Dr. Sheridan said yes.  He added that he has been made acutely aware of how many people were concerned that he would freeze searches.  He said no; he is not going to freeze any of the searches in CLASS.  Whatever searches are ongoing will continue.
     Sen. Johnsen asked if he was the only one who thinks it would be appropriate to ask the President whether he would respond in writing to the survey report to tell the Senate what he thinks?  Pres. Eichberg said one could certainly ask.
     Sen. Jacobson said she is going to oppose that, the reason being that the survey raises opportunities for negotiation and therefore to ask people to form their position makes negotiation more difficult.
     Sen. Linzer said he is concerned that the meeting seems to be drifting away without promise of some communication.  The best thing is simply face to face communication in as informal and frank a way as possible, but that requires the President to be able and willing to do that.  He can't be forced to do it.  If that doesn't happen, then the Senate should request something in writing to at least get some communication.
     Sen. Warner said Pres. Eichberg made it clear in his e-mail statement and in his comments today that there are some meetings going on.  There are movements that are taking place.  There are different levels on which to communicate.  If one is asked to put something in writing, and something is put in writing, there is not going to be any movement off that.  Sen. Linzer agreed, but said he hasn't seen any movement.
     Sen. Jacobson said there should be a closed meeting of the Senate.  Sen. Linzer asked if the Senate is subject to the open meetings law.  Sen. Jacobson said the Senate could have a closed meeting.  Sen. Leiss said the Board typically has closed meetings whenever it is talking about personnel matters.
     Sen. Huber said the Board is the University of Houston.  They make decisions that bind the UH.  The Senate is a group of individual faculty members who, while elected, do not make decisions that bind the University in any way.
     Sen. Linzer asked whether that is the way the statute works?  Sen. Leiss said yes.
     Pres. Eichberg said at this point there will be an additional meeting of the Senate to discuss the survey report further as well as contacts and/or negotiations that have been initiated by the Executive Committee.
     Dr. Sheridan said he thought most of the people don't know how much interaction there is.  For the President of the Senate, he figured out that in an average month there are 14 hours that the President of the Senate has contact with the President and Provost.  The Executive Committee has another hour and a half to an hour an 45 minutes of contact and then the President and President-elect also have a meeting with the President, Provost and Chief Financial Officer.  Dr. Sheridan said he doubted that people were aware of how much interaction does go on and how often issues can be raised.  The other thing that he is struck by is how difficult it is to bring up difficult feedback.  The issue of compression is such an intense issue.  It has come up a number of times in meetings.  Dr. Sheridan said he has pointed out that it can be solved.  But nobody wants to take him up on the solution because the obvious solution is to take the raise pool and make as the priority all people whose salaries fall below the average based on time in rank and national norms.  This would mean that the entire top faculty probably would not get raises.  And it would mean perhaps some of the people that departments have not been giving raises to, for whatever reasons, would get the biggest raises.  Dr. Sheridan said .no one wants to accept that idea.  The other solution requires an unusually large pool of money and the President made reference to that today, saying it is not going to happen.  Dr. Sheridan said if one looks nationally, UH is doing well.  Many really fine public universities in this country have not given raises in the last two years.  Some have added furloughs.  It is a desperate time at state universities.  Dr. Sheridan added that raises have nothing to do with him.  Departments decide raises.  Any unit could solve it.  Any discipline could sit down and simply say these are the norms.  This is what full professors who have been full professors for a certain amount of time make.  This is what associates make, etc., and then take the raise pool and ask how to make up these inequities.  That is a very unpopular idea.  It is a serious issue.  The solution is painful in all kinds of ways but it is not that this hasn't been discussed.  However, he noticed that the discussions have not come back to this larger body because the proposals are not proposals people want to hear.
     Sen. Jacobson said there is a proposal to work with the upper administration to investigate how the actual merit system is worked out and how the equity system has impacted salary compression.  Dr. Sheridan said he has agreed to work with the Senate on this study and he will provide all the data that any faculty committee wants in order to study what has really happened with raises over the last several years.  Dr. Sheridan said he put the system in to try to deal with people whose salaries were out of line.  The idea was to try to provide a pool of money to begin to address inequities, but the raises are determined by the chairs who work with the deans.  The Provost doesn't overrule college and departmental recommendations.  Dr. Sheridan said he is willing to put all that data out so the Senate can examine it and see whether any progress is being made and find out if UH is any better now than it was four years ago.
     Sen. Freiberg said one of the more challenging issues is that sometimes the policies set up at the Provost level don't get translated at the other levels.  For example, if the Provost provides enough money to have equity raises for eight faculty per college, some deans might spread that evenly across the whole college, even though one department might have ten faculty who should be getting raises and another department only five.  Other deans might send thirty-five faculty a note saying that they have been put in for an equity raise, even though the Provost has said eight and funds only eight.  The rest are disappointed and blame the Provost, so policies that impact faculty directly should be communicated to them as well as the deans.
     Dr. Sheridan said he was sure that was correct.
     Pres. Eichberg said one of the points that the survey comments did make was the importance of faculty influence, not just at the top level, but at the college level and the department level.

NEW BUSINESS:  None.
 
The meeting adjourned at 2:40 p.m.