September 25, 2020 Minutes SSE Board of Directors
Minutes
SONOMA STATE ENTERPRISES, INC.
Minutes
September 25, 2020MEMBERS PRESENT:
Ms. Melissa Kadar
Dr. John Kunat
Dr. Kyuho Lee
Ms. Joyce Lopes
Mr. Neil Markley, Ex-Officio
Mr. Robert Martinez
Dr. Karen Moranski
Dr. Mario Perez
Ms. Emily Lusk Porter
Dr. Judy K. Sakaki
Dr. Gregory Sawyer
Dr. John Urbanski
Ms. Amanda Visser, Ex-Officio
Mr. Fred Vaske
MEMBERS ABSENT:
Mr. Jonathan Juarez Dominguez
OTHERS PRESENT:
Ms. Jill Crenshaw
Dr. Jerlena Griffin-Desta
Ms. Nancy Keller
Mr. Bobby LaCour
Mr. Jeremy Olsan
Ms. Jessica Way
20.00 Call to Order
Ms. Lopes called the meeting to order at 1:02pm.
20.01 Seating of the Board and Introductions
20.02 Committee Appointments
Committees were seated with no objections.
20.03 Approval of the May 5, 2020 and May 7, 2020 Minutes
The minutes from May 5, 2020 and May 7, 2020 were provided to the Board via email prior to the meeting. The minutes were approved unanimously with no changes.
20.04 President’s Report
Dr. Sakaki shared that Sonoma State University will be offering primarily remote instruction in Spring 2021. She also discussed the appointment of the new chancellor, Joseph Castro, by the Board of Trustees. An SSU student, Therese Azevedo, was recognized by the Board of Trustees with the Trustee’s award for outstanding achievement for 2020.
20.05 University Report
Dr. Moranski shared that the Office of the Provost is currently gathering a list of spring classes that may require an in-person component with the goal of having 4 to 5% of all course offerings be in-person in Spring 2021. Her office is also working on social justice initiatives. We are well on our way, as a system, to reaching the Graduation Initiative 2025 goal. The system has seen a 30% increase in 4-year degree graduation rates thus far.
20.06 Vice President for Student Affairs Report
Dr. Sawyer talked about food being distributed to students on and off campus for those in need. Flu vaccines for students have been delivered to campus. His office is developing programs and opportunities for our students surrounding social justice.
20.07 Associated Students Report
Ms. Kadar shared a number of initiatives and projects that have been completed by the Associated Students this fiscal year. The organization has had to figure out how to provide their regular services remotely. Their initiatives center around the college experience, basic needs, and student budget advocacy.
20.08 Report from SSU Vice President for Administration and Finance/Chief Financial Officer and Chair of SSE Board of Directors
Ms. Lopes stated that, due to COVID-19 complications, this is an unprecedented year for both the campus and SSE. The campus is facing a $20 million deficit along with millions more from self-support funds. Due to virtual operations, we were unable to open culinary venues, resulting in the layoff and non-retention of employees. COVID-19 cases on campus are very low and the campus conducts its own contact tracing to ensure the community’s safety.
20.09 Chief Operating Officer’s Report
Mr. Markley reported that the University store is closed, but it continues to serve students online. Learning material remains available and is shipped from the store. Physical drop-off for book returns is available. However, there has been a significant drop in sales of both non-learning and learning material. Our decrease in sales has led to a contract revision with Barnes and Noble in which all commission rates remain the same, but the minimum payment guarantee has been temporarily suspended. We will likely see a $100,000 reduction in commission revenue compared to the previous year. We are working with the Senate Diversity Committee to address concerns related to the visibility of less expensive or no-cost learning material.
All culinary venues are closed for Fall 2020 and will likely remain closed for Spring 2021. Vending has been redeployed to the residential community. There are currently approximately 400 students living on campus, all in apartments with kitchens. Major expense reductions have been initiated: all non-essential expenses have been reduced or cancelled, most capital expenditures have been curtailed, expense contracts have been renegotiated. Our Pepsi contract guarantee has been renegotiated to a payment of $20,000, as opposed to the typical $60,000. Part-time, student labor costs have been reduced from $2,200,000 to $10,000 and full-time labor has been reduced from $5,000,000 to $2,100,000. Thirty-three staff received lay-off notices, with twelve redeployed to SSU. Thirteen managers were non-retained, with one redeployed to SSU. The remaining four managers and one staff member provided assistance with the Sonoma County Shelter. Overall, we have estimated a $15,000,000 reduction in culinary revenue.
Significant challenges and opportunities remain going forward. Some challenges include the ongoing impact of COVID-19, addressing liquidity concerns, continued enrollment declines, and planning for Summer and Fall 2021. Potential opportunities include negotiating with the University on rent and/or cost recovery reductions, additional government recovery funds, the Payroll Protection Program loan to grant conversion, exploring different operating models, and the sale of the Petaluma Hill Road land.
20.10 Chief Financial Officer’s Report
Ms. Visser shared that the Finance Committee approved the reserve calculations and budget. She also discussed the status of the Payroll Protection Program loan forgiveness and thanked the Associated Students Vice President of Finance for their assistance and attention to SSE’s finances.
20.11 Conflict of Interest Presentation Non-Profit Integrity Act, Compliance, and Insurance
SSE Counsel Mr. Olsan reviewed the non-profit integrity act.
20.12 ACTION ITEM: Review and Acceptance of the 2019/2020 Audited Financial Statements
Dr. Urbanski introduced the 2019/2020 audited financial statements. Bobby LaCour, one of the auditors from Aldrich, reiterated that we received a clean (unmodified) opinion on the audit. Ms. Lopes asked for a motion to accept the 2019/2020 audited financial statements. Dr. Urbanski moved and Dr. Perez seconded the motion. The Board unanimously improved.
20.13 ACTION ITEM: 2020/2021 Budget Approval
Mr. Markley reviewed the 2020/2021 budget. Dr. Moranski moved to approve the budget and Dr. Sawyer seconded. The budget was approved unanimously.
20.14 Other Non-Action Items
None.
Meeting was adjourned at 2:48pm.