No student trustee report.
President report: I don’t have a presentation. Thanks to retired professor David McGrath and English professor Jackie McGrath, former student and award winning author Bill Hillman has agreed to come and talk to us at the next meeting about his wonderful experience at COD. He will also be read as part of the COD Writers Read series on June 24th at 7pm in SSC 1200. Bill Hillman at COD Writers Read.
Item 9: retention of firm Alix Partners for financial services. Motion that the Board approve this.
Mazzochi: I’d like to amend the motion so the 2 people hired, Mr Dischner and Mr Beckman be given same signatory authority as previous signature holders.
Roll Call vote on the amendment: all yes except Birt, Wozniak, and McGuire
Hamilton: let’s go to the main motion. Moved and seconded.
Hamilton: I’d like everybody to make a comment on this motion. I will go through all the trustees. Starting with Joe Wozniak, do you have a comment:
Wozniak: the fees are way too high, that they want to have on retainer. I don’t think it should be the way to go because money is flying out the window.
Roark (student trustee): no comment
Bernstein: I think we are in a difficult position. We need to take this step. At the radio station, there were problems with the controls. I can assure you this is not the only area of the College that have these problems. We need this firm.
McGuire: I’m going to not support this motion for a number of reasons. When I had conversation with the chair on Tuesday, she indicated it could be from 3 to 6 months, it could be as much as a million dollars. I looked at the IMET, 12 million dollars were invested. I was on the BOT, we were thrilled to find an investment that had this return. That’s an issue that we exceeded our board policy. There was intimation that BOT was not informed but we were, including chair Hamilton and myself, and trustee Wozniak. We saw the money move. When these prop tax proceeds are sent to the taxing bodies, we got our tax receipts in June, and then in September. IMET was paying 34 basis points as opposed to 1 basis point in the money market mutual funds. We treat those like checkbooks. IMET is very much like that. Those monies were taken out of IMET. We saw it every single month. There was nothing hidden and none of us asked any questions. With all the FOIA requests, perhaps this investment was looked at like a checkbook. There’s a rush to judgment here. The investment policy we adopted for the first time. It was too restrictive. The new policy changed these limits. There was never an attempt to cover the policies. For these reasons, I’d like to review what happened with our comptroller and our CFO.
Birt: I’ll be brief. Some of the things that would have been helpful is if the board had considered 2 or 3 firms. I heard through the grapevine that the attorney and Collins had consulted with others. I would have loved more than one firm and less than 24 hours. I have concerns about the cost. Is the contract we saw in the board packet really the contract? So, I don’t even have the actual contract that the college is going to be signing. I am not in favor of the motion.
Napolitano: we heard that IMET and the Illinois fund were essentially the same. They are not. When there is a speed limit, it’s not for you to say it should be higher or I’m going to drive faster because that’s what I thought it should be. If the policy for investment was too constraining, the proper procedure would be to go to the Board. I don’t like the idea of money flying out the window. We need to close the window.
Mazzochi: we have a situation here where we have a treasurer and comptroller on leave by the president. To ensure that the school functions effectively, we need to retain this firm. Dr Collins did in fact interview multiple individuals. Board members had the opportunity to talk to Dr Collins if you had questions about his methodology. We have given you and the public background information on the firm he has selected. He’s asked us to approve this before incurring any expenses. This is the proper course of action and procedural process he should be following. And I appreciate that you did that Dr Collins. Had the previous board done its job, we would not be in this situation today. It’s wrong of you to raise issues of money. The cost we have to incur on Alix Partners is a cost that is on the prior board. It’s your fault that we have to do this and fix your mess. Because of this failure, it’s unfortunate that this bill is going to be put on the taxpayer but we have to stop violating board policy and the public trust. And ensure that people are going to implement these procedures and are going to do it properly. I thank Dr Collins for finding someone who he thinks is going to do that work.
Trustee Birt, you were invited to talk to Dr Collins about this and you declined.
Birt: that did not happen.
Hamilton: we’re going to let board vice chairman finish; we’ll have the presentation, and then, we’ll go around again.
Mazzochi: ultimately, I want to hear what Alix Partners has to say and I want to hear that someone is going be responsible.