Columbia, MO Memorial Union

MOREnet Council Meeting Minutes - July 30, 2010

TIME: 10:00 a.m. – 4:00 p.m.
Friday
July 30, 2010

PLACE: Room 204, Cornell Hall
University of Missouri Campus
Columbia, MO

Members present:
Tim Gallimore, Chair, Gary Allen, Russ Brock, Margaret Conroy, John Gillispie, Leigh Ann Grant-Engle (by phone), Rita Gulstad, Debbie Hughes, Craig Klimczak, Waller McGuire, Doug Young

Alternates present:
Barbara Reading, Deborah Sutton

MOREnet staff present:
Natasha Angell, Chip Byers, Sherry Loyd, Hank Niederhelm, Debbie Rodman, Greg Silvey

Guests:
Mark Johnson, Tim Lance, Paul Schopis, Gay Albright

Chair Tim Gallimore called the MOREnet Council meeting to order. Those who were in attendance are listed above.

DISCUSSION/INFORMATION ITEMS

FY12 Appropriations Request – Information

Debbie Rodman reported that a FY12 appropriation request for $6.8M will be submitted. John Gillispie added that MOREnet, in conjunction with the University of Missouri, decided to submit the request since the withhold received for FY11 wasn’t a line item veto. MOREnet staff will also assist the Missouri State Library (MOSL) with the HB12 appropriation request where needed.

FY11 Appropriations

State Library HB12 Request

Margaret Conroy reported that the REAL appropriation in HB12 was fully funded in the amount of $3.1M. Of that amount, $1M is used for content which represents approximately 10% of MOREnet’s funding resources. MOSL and MOREnet are in the process of finalizing the REAL contract for FY11 with no major changes to the services in the contract. MOSL intends to request the REAL program be fully funded in FY12. In addition, they plan to request restoration of funds that were cut in FY11 from the Athletes and Entertainer’s tax.

DESE HB2 Request

Leigh Ann Grant-Engle reported that DESE is looking at all budget situations and that Commissioner Nicastro is interested in the outcome of the upcoming strategic planning discussion. DESE is being advised not to request any new items to be paid for out of state revenues beyond expected federal appropriations. Deborah Sutton added that the K-12 Policy Analyst contract will be continued. This contract is for the E-rate consulting services previously provided by Rebecca Miller. She has resigned and the consulting is now being handled by Lynn Burgan and Chris Schneider.

Member Reports

Barbara Reading reported that MOSL has started the process to rebid the contract for the suite of databases that is currently awarded to Gale. There have been significant changes in the market place that they feel warrant an investigation as to whether any changes should be made. There will be an announcement from MOREnet early next week with an evaluation panel to begin work in late August to review the content functionality elements that will go into the RFP. Once bids are received, the panel will then review the vendor responses so a decision can be made in January as to whether a change should take place.

Doug Young reported that the Office of Administration continues to struggle with the budget crisis as well. OA received a 25% reduction in general revenue and is struggling to keep everything running.

Rita Gulstad reported that she is aware of several institutions in the independent sector that will be changing their affiliation with MOREnet to a minimum connection and getting the majority of their connectivity from a third party. She’s concerned and would like to see some decisions on how to mitigate this membership shift.

Chair Gallimore reported that the Missouri Department of Higher Education has named David Russell as Interim Commissioner. MDHE is engaging with sister state agencies in regards to a P-20 approach to education planning and delivery of instruction in the state. The Coordinating Board of Higher Education is having a planning retreat next week due to the new interim commissioner, new board members and the looming budget situation. MDHE has identified some federal funding possibilities and has facilitated many proposals that were submitted in hopes of receiving additional funding. A consortium of 17 community colleges submitted a BTOP proposal to NTIA for approximately $4.5M in funding with $1M in matching funds. That proposal is receiving extensive due diligence from NTIA and Gallimore is hopeful that it will be funded.

Brock asked what reaction is being received regarding the new member fees. Natasha Angell reported that as of today less than ten K-12 institutions are considering leaving the consortium. Gillispie reminded everyone of the two simultaneous assumptions used in the rate setting: 1) the loss of 20% of the K-12 members, and 2) in addition MOREnet would be successful in finding an additional $1.5M in savings beyond the budget changes identified. However, even if 20% of the members don’t leave, some will and the budget will need $685K to achieve the membership rates announced. The intent is to keep rates flat through FY12 and to help K-12 school districts in their planning efforts.

Meeting Schedule

  • October 22, 2010
  • December 14, 2010

The Council agreed that meetings should be conducted via TelePresence or videoconference when possible.

ACTION ITEMS/INFORMATION ITEMS

Minutes of the April 30, 2010 and June 18, 2010 MOREnet Council Meetings – Approval

Chair Gallimore asked for a motion to approve the meeting minutes. Brock moved to approve the April 30, 2010 and June 18, 2010 minutes as distributed. Klimczak seconded the motion and it passed unanimously.

FY11 Budget – Endorsement

Rodman reviewed the FY11 budget that was used to set K-12 member fees. It includes the assumed 20% K-12 member departure rate.

An E-rate accruals update was given by Gillispie. He reported that MOREnet is still protesting USF decisions related to the FY07 filing as there is still $1M outstanding from legitimate claims in some phase of the collection process. Also outstanding is $40K from FY08 and $12K from FY10. The total receivable is $6.6M.

Gulstad moved to endorse the FY11 budget. Conroy seconded the motion and it passed unanimously.

Strategic Planning

Chair Gallimore asked that the strategic planning activity be an open and frank discussion regarding how MOREnet could/should operate in the future. He reminded the Council that they are in an advisory capacity to help MOREnet determine its future.

MOREnet engaged the services of a professional facilitator to lead the strategic planning exercise. The facilitator set out goals for the session and asked members to examine the mission/vision statement of the organization for accuracy and relevance given the present membership structure and funding environment.

To get the Council on the same page, Gillispie gave the following funding source breakdown:

Funding Source Past Now
Appropriations (HB3, HB12) 50% 10%
E-rate 25% 30%
Member fees 25% 60%

He added that the use of funds is approximately 60% for telecommunication expenses and 40% for providing member services.

Council members identified the following reasons for being a MOREnet member:

  1. Consortium provides opportunities for collaboration
  2. Capture synergies
  3. Dedicated, state-wide network
  4. Quality services – dedicated network meets the special needs
  5. Expertise in contracting services for the members

Gary Allen shared that the UM System strongly supports MOREnet’s mission both for its needs and its vested interest in the advances of education in the state. UM System also received budget cuts in FY11; however he assured the Council that UM will be paying for the MOREnet services that it consumes.

Mark Johnson (NCREN), Tim Lance (NYSERNet) and Paul Schopis (OARnet) gave an overview of what the Quilt Peer Review of MOREnet is to accomplish and described how their respective organizations operate.

Gillispie then asked Angell to relay what staff is hearing from the members who are contemplating leaving the consortium. She stated that those members are indicating that they must have Internet connectivity but are having to make difficult choices elsewhere in order to keep that connectivity and that they would like to see the service bundles revisited.

There was discussion around a member / non-member approach and how there could be a tiered membership approach instead. Gillispie shared a thought on how to retain current members by offering a non-member, connected-only option. He sees the non-member, connected-only offering as necessary to keep the backbone funded. He is concerned that if members leave they will end up in a 3 or 5 year contract that doesn’t provide the service they need and they won’t be able to return to MOREnet because of penalties for breaking the contract.

Below were some thoughts on a possible starting point for a tiered approach:

Base Membership Includes:
Connectivity, Basic tech support/help desk, Security (notification)

Services tiered to deal with usage:
Base level of training, Online resources, Base level of video

Discussion ensued regarding the possibility of obtaining new member types such as parochial schools, private schools, private research companies and municipalities. It was decided that allowing new member types should be investigated with agreement that the new member needs should fit into MOREnet’s mission and vision.

The Council members agree that the Council representation today may need to look different in the future. They would like to see a larger representation of members if the Council remains.

MOREnet staff were directed to convene a Council subcommittee to review the following in preparation for a full Council meeting, via conference call, in mid-September:

  • Revised mission and vision statements
  • Membership options - non-member/connected-only, tiered membership, participation agreements, service policies, etc.
  • Unbundling of services ‚Äì ala carte, tiered
  • Develop options for a simplified financial reporting structure

The Quilt reviewer feedback will be shared with the Council prior to the October 22, 2010 meeting.

At 3:20p.m. Gulstad moved to adjourn. Russell Brock seconded and the motion passed unanimously.

Respectfully Submitted by Sherry Loyd