June 15, 2005
MOREnet Council Meeting Minutes
Council members in attendance: Sara Parker, Ralph Caruso, Susan Cole, Margaret Conroy, Robert Stein, Donald Doucette, Curt Fuchs, Bill Mitchell, Dan Ross, Cheryl Bielema, Tom Stokes (Representing Dan Ross), Annie Busch
Guests present: Dave Byland, Holly Fine, Deb Rodman, Eric Nicklas, Chip Byers, Hank Niederhelm, Natasha Angell, Barbara Reading, Mark Reading, Nathaniel Albers, James Tice
The MOREnet Council met on June 15, 2005, in the Secretary of State Conference Room - James C. Kirkpatrick State Information Center in Jefferson City, Mo.
Sara Parker called the meeting to order.
Parker announced the Missouri Arts Council has honored Sue Cole.
Parker said this would be the last meeting for Ralph Caruso and Sue Cole. They are both charter members of the Council and will take with them much institutional knowledge. Dr. King and Dr. Floyd will be making new appointments to the Council.
Parker spoke to the 2005 legislative session and its effects on MOREnet. A reduction in MOREnet's budget was apparent early in the session. The budget for FY05 was $14, 504,401. Governor Blunt recommended a new budget of $11,603.521. The House recommended a MOREnet budget of $11,603,521. In the Senate, the Appropriations Committee recommended a MOREnet budget of $10,153,081. This is the amount the Conference Committee agreed upon.
Parker told the Council much important work needs to be done before the next legislative session, especially by the private sector.
The Council will be working with the 30% reduction in MOREnet. In House Bill 12, the REAL appropriation for connectivity for public libraries and the electronic licenses is $2,959,250. This is at current level.
Council members reported on the discussions of customer input on services and priorities:
- Academic customers - Doucette reported MERC met on May 25th. The group was very complimentary of MOREnet because of the effective management and cost-saving measures. The MERC Board supports the external performance measure study and would fund $75,000 of the total cost of the study. The board believes the $1.7 million should be allocated through increased fees and distributed among the users.
- Library customers - Conroy distributed a handout to the Council. It detailed the funding discussion at the Missouri Public Library Directors (MPLD) meeting held on June 2. MOREnet services are the most important state funding concern of the public library directors. MOREnet training is also important to them. If necessary, most libraries could handle a 10-15% fee increase.
- School customers - Fuchs reported from the Library Coordinators of Large School Districts meeting. There is a lack of understanding of the types of services MOREnet offers. They have equipment update needs which need to be addressed. MOREnet is valued by the school districts and they are expecting fee increases.
Cole reported there have been meetings across the state to interpret the new school funding formula, which will in turn affect technology within the school districts. Keeping MOREnet is a top priority. The districts want to know if there would be fee increase and when to expect it.
Ross commented the Athletes and Entertainment dollars survived this year and libraries need to make it work.
Ross said the ability exists for MOREnet to raise prices and adjust services. The issue needs to be brought home to the legislators. Doucette said increasing user fees will be difficult for some libraries and schools. Bielema suggested grass roots negotiation to help legislators understand how it benefits them and how it will help to achieve their priorities.
Mitchell spoke to the MOREnet Customer Satisfaction Survey (Attachment 1). Vangel has completed their work on the project. There was a 26% response rate. On a scale of 1 - 10, MOREnet had a 9.1 on overall customer satisfaction. Stein suggested analyzing who responded, such as their size and sector. There were 533 respondents - 13% were from higher education; 64% were from schools (K-12), and 21% were from public libraries. Parker asked if it would be helpful for Vangel to come to the next meeting to answer questions. Doucette thought the report was good and it would not be necessary. Parker suggested different wording would be in order. Mitchell agreed some of the wording could be misconstrued.
Mitchell spoke to FY 06 budget preparation (Attachment 2). The estimated shortfall for the FY06 MOREnet budget is $2.7 million. MOREnet has devised some saving plans and cost reductions. This leaves a net amount of $1.7 million to be collected. MOREnet's recommendation is to have this allocated to the customer groups. Each sponsoring agency will then inform MOREnet on the allocation formula for their customers.
Busch made a motion for each group to determine their own allocation of how the fees will be passed on to their individual customers. Stein seconded. Motion carried.
Stein said each group should feel to free to contact the others for brainstorming, etc. Every customer should expect some increase and each group has free reign to formulate a plan. They should also be given a deadline to do this. MOREnet should not send out any form of communiqué on this issue. Cole said it is important for the groups to know the decision was made by the people selected to represent them. Stein said this meeting was a public meeting and the decisions being made at this meeting should be reported.
Doucette suggested adding a surcharge for previously funded service although not adding bandwidth or new membership. Parker said using the word "surcharge" gives the implication the charge will go away. The wording needs to be associated with the budget reductions. Ross pointed out the reduction in funding is the cause of the increase. Mitchell suggested using the wording "state funding shortfall." Stein said this needs to be made clear. Fuchs suggested sending a letter from the Council to the three agencies. Parker will draft language to the three agencies.
Ross spoke to the Office of Administration-Information Technology update. As of FY06, formal consolidations will be taking place. The Department of Revenue has been cooperating. It has been determined in FY07 the Department of Revenue will be included in the consolidation, they currently are not. In the FY07, the Governor's budget will reflect transfers of staff and equipment of the effected consolidated agencies into the Office of Administration. MoDOT and the Department of Conservation are not a part of the consolidation.
Through the IT consolidation plan, some agencies will be allowed to keep some of the funds saved through the consolidation. Although the staff will be a part of Office of Administration, some will be staying within the agencies. There will be service level agreements put into place with a focus on outcomes.
Ross spoke to the MoDOT fiber. MoDOT will still own the fiber. There are questions about who will manage it. MoDOT is considering having an outside party to manage this. The agreement with MoDOT is for bandwidth. A network will need to be built to reach all of the state entities and equipment purchased. The agreement could include incentives for pricing and managing both MoDOT's portion as well as OA's. This would also address sustaining the system and new equipment.
Parker asked Ross about the Governor's Reorganization Committee and if there had been particular IT testimony. Ross testified before the Committee and explained IT reorganization for FY06. The Committee seemed receptive to the consolidation. The goal of the consolidation is to save dollars and to provide efficient service. The Committee offered to consider assisting with any legislation needed for the consolidation.
Parker spoke to MOREnet services and asked the Council if items from the three main categories should be rearranged. Mitchell explained how the different categories were created. Stein said he felt MOREnet needed to reemphasize training in the field. Mitchell said it is more cost effective to bring in training to the MOREnet facility. Angell said regional training is advertised throughout the year.
Mitchell spoke to the FY07 Budget request (Attachment 3). It can be modified as the process continues.
The requests are:
- $185,000 for additional Internet connection
- Increased capacity to universities and public schools
Mitchell said MOREnet may not submit the $185,000 because SPRINT has offered to do more for the same cost. Mitchell said SPRINT has offered the following:
- Double capacity
- No increased cost
- To keep the revenue stream going to SPRINT through FY07
Ross asked if the Sprint proposal was looking ahead two years with a fixed price. Mitchell said yes. The agreement with Sprint, if it goes forward, will eliminate the need for new money in FY07.
Parker said the K-12 appropriation for bandwidth is very important. Mitchell said schools are on a waiting list for increased bandwidth. This item needs to be discussed and concluded in July.
Mitchell said MOREnet would like to move to a fiber optic network. The funding for MOREnet to move to a fiber optic network means the bid will need to be out in October. The costs would be for the next 20 years. MOREnet will be required to be in a fiber optic backbone by 2007. The current contracts will expire in 2007 and are non-renewable. Stein asked about the internal financing. Mitchell said MU could loan the money to MOREnet, which they would pay back. This request will be paid for up front and the cost will not increase. It will be a fixed cost for 20 years. Although needs might change, ongoing costs will not increase. Mitchell said MOREnet will revise the request as the process allows. Doucette suggested leaving the request in as it would be harder to add in at a later date. Parker said the consensus of the Council was to keep both request items.
Cole said she will make sure her successor understands the issue as far as DESE is concerned.
Stein said the reform recommendations from the Commission are due out by November or December. The Council could create fact sheets about MOREnet and the realities facing MOREnet. Parker and Mitchell will follow-up on this.
Mitchell spoke to the "External Performance: Logic Models of the Impact of MOREnet Report" (Attachment 4). The report showed MOREnet provides high quality connectivity, the consortium model works, provides cost-avoidance for small libraries and schools, is integral part of higher education institutions, and institutions have changed their business practices because of MOREnet. Doucette said MOREnet provides an opportunity for us to do things we wouldn't normally do. It provides better standards.
Parker asked for approval of the minutes of the February 4, 2005 MOREnet Council meeting. Minutes were approved.
The April 1, 2005 MOREnet Council minutes were approved with the following corrections (Attachment 6):
- Remove the word "the" from the sentence "Cole asked what would happen if the some of the obligated funds were not used."
- Add the words "it" and "additional" to the sentence "Stein asked if "it" was realistic to make the decision today, or should we off the customers "additional" to replace "need the" opportunity to be heard."
- Add the word "will" to the sentence "Mitchell said if the MoDOT arrangement is approved, this item becomes moot or "will" be substantially changed."
- Remove the sentence "MOREnet has until October to see what CBHE develops for MoDOT." And replace with "MOREnet has until October to see what the Chief Information Officer develops with MoDOT."
Cole gave the DESE agency report. The Commissioner said the superintendents and budget personnel are going to able to use the new formula in a much more flexible way than they have been required to do under the restrictions of the old formula. This is the time to make changes and talk with legislators while they are not in session.
Stein reported the CBHE will be seeing new faces. Commissioner Fitch took office on January 3. Five of the nine board members are new and will serve for six years. Three of the board members terms will expire in June 2006. A major focus at this time is the Reorganization Commission. There have been some budget cuts to CBHE.
Stein spoke on his recent trip to Panama regarding the National Guard Partnership Program. Forty states are involved in the program. There have been strategic defense activities and exchanges in operations since 1996. Missouri has an official partnership with Panama. Several agencies were represented. Stein said he is creating a database of linkages/relationships between Missouri and Panama. There is a need to understand the connections. He asked Council members to please send him any linkages/relationships they might know about between Missouri and Panama.
Busch asked about the Early Childhood Commission. Stein said one has not been appointed yet and may not be. A major grant was given to the Department of Health and Senior Services to develop a state plan on early childhood. A planning meeting is taking place this Friday at the Capital Plaza Hotel.
Parker said the Secretary of State's Office finished the legislative session with minor reductions. State Aid to public libraries was reduced by 25%. The REAL program was funded at the current level. The libraries will receive $100,000 from the Athletes and Entertainer's fund.
An important victory for public libraries in this session were the bills relating to property tax. The legislature addressed the question of business inventories and how they were valued. The legislature gave authority to the Tax Commission to issue Administrative Rules. This will make a financial difference for schools districts, libraries, and community colleges, helping these organizations.
Secretary Carnahan appointed new members to the Secretary's Council. Senator Joan Bray, Representative Kathlyn Fares, Representative Paul LeVota, and Senator Robert Mayer are the new legislative members of the Council. Melissa Carr, the Director of the Daniel Boone Regional Library will chair the Council.
Stein wanted to recognize Caruso and Cole for their service to the Council. The Council stood for applause. Caruso thanked the group and commented on how far the Council has come.
Mitchell thanked the Council for their support throughout the legislative session.
The next meeting is scheduled for July 15th. Parker asked if a meeting in July was needed. Stein reminded the Council they need to ask their constituents about the MOREnet costs. Mitchell said the group could meet through video conference or through CENTRA. Parker said the Council would have a video conference on July 15th which should be a short meeting.
Doucette asked if there was anything of priority and if the Council should meet before November 18th. Parker said work needs to be done on the budget request for the REAL appropriation. Stein said the Council will need to develop strategy regarding the legislature and MOREnet.
Parker said the Council would be open to another meeting before November. It was left open to meet in September or October.
Parker adjourned the meeting at 2:30 p.m.