May 8, 2017 MOREnet Council Meeting Agenda TIME: 11:30 a.m. – 2:00 p.m. PLACE: MOREnet Offices Tuesday, May 23, 2017 221 North Stadium, Suite 201 Rooms 204/205/206 A G E N D A Page Presentation by: I. Introduction 1. Call to Order Ginger King, Chair 2. Introduction of Council Members, Staff, Observers Ginger King, Chair 3. Call for Additional Agenda Items and Adoption of Agenda Ginger King, Chair II. Action Items 1. Minutes of the December 13, 2016 MOREnet Council 9 Ginger King, Chair Meeting – Approval 2. FY18 Original Budget – Endorsement 12 Lynn Burgan III. Discussion/Information Items 1. Projected FY17 Ending Operating Balance – Information 15 Lynn Burgan 2. Projected FY17-18 Plant Fund Balance – Information 16 Lynn Burgan 3. Education Super Highway/DESE/MOREnet/State Natasha Angell Working Group – Information 4. D.C. Visits to Federal Agencies, April 2017 – Information John Gillispie 5. Council Member Survey Results – Discussion 23 John Gillispie 6. Future Meeting Schedule* a. Aug. 24, 2017, 10:30 a.m.-Noon, audio b. Dec. 20, 2017, 11:30 a.m.-3 p.m., MOREnet offices IV. Open Time for the Public to Address the Council *Public may attend at 221 North Stadium, Suite 201, Rooms 204/205/206. 1
Transcript
May 8, 2017
MOREnet Council Meeting Agenda
TIME: 11:30 a.m. – 2:00 p.m. PLACE: MOREnet Offices Tuesday, May 23, 2017 221 North Stadium, Suite 201 Rooms 204/205/206
A G E N D A
Page Presentation by:
I. Introduction 1. Call to Order Ginger King, Chair
2. Introduction of Council Members, Staff, Observers Ginger King, Chair
3. Call for Additional Agenda Items and Adoption of Agenda Ginger King, Chair
II. Action Items 1. Minutes of the December 13, 2016 MOREnet Council 9 Ginger King, Chair
Meeting – Approval
2. FY18 Original Budget – Endorsement 12 Lynn Burgan
MOREnet Council Alternates (vote only when serving as proxy for their above Council member)
MOREnet Staff
Director Member Services and Development
Director of Fiscal & Contractual Services & Human Resources
* Chair** Vice Chair***Non-Voting
3/8/2017
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MODIFICATION TO THE MEMORANDUM OF UNDERSTANDING June 4, 2013 Meeting
Proposed Modification to the MOU – Approval
John Gillispie explained the proposed request to modify the Memorandum of Understanding (MOU) to a
calendar year officer rotation. Chair Palmer asked for a motion to approve the proposed modification to
the MOU. Jacque Cowherd moved to approve the MOU modifications of changing the fiscal year
rotation to a calendar year rotation starting with the nominations at the June 4, 2013 meeting. David
Doennig seconded the motion and it passed unanimously.
2.1.5. The MOREnet Council will be chaired by a voting, seated representative elected
annually, following the fiscal year calendar, by the MOREnet Council. A vice chair will be elected annually by the MOREnet Council to fulfill the duties of the chair in his or her absence. The current chair will appoint a nominating committee from which the MOREnet Council will elect both the chair and vice chair. The MOREnet Council reserves the right to propose the replacement election of any chair or vice chair that is unable or unwilling to fulfill his or her duties.
Proposed Modification:
2.1.5. The MOREnet Council will be chaired by a voting, seated representative elected annually, following a the fiscal calendar year calendar schedule, by the MOREnet Council. A vice chair will be elected annually by the MOREnet Council to fulfill the duties of the chair in his or her absence. The current chair will appoint a nominating committee from which the MOREnet Council will elect both the chair and vice chair. The MOREnet Council reserves the right to propose the replacement election of any chair or vice chair that is unable or unwilling to fulfill his or her duties.
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Updated December 23, 2016
DRAFT MOREnet Council Meeting Minutes
TIME: 10:30a.m. - Noon PLACE: MOREnet Offices Tuesday, December 13, 2016 Members present: Alternates present: MOREnet staff present: Al Stadler – Chair Debbie Musselman (phone) Natasha Angell John Bax Lynn Burgan Carrie Cline Chip Byers Michael Davis Public present: Sherry Loyd John Gillispie Jennifer Thompson, MOSL Hank Niederhelm Trey Katzer Nikki Witting Ginger King Steve Klotz Sue Lightfoot Donna Liss (phone) Barbara Reading (phone) Chair Stadler called the MOREnet Council meeting to order. Those who were in attendance are listed above. John Bax announced that he soon would be leaving University S&T and going to Lincoln University as their Chief Information Officer. Sue Lightfoot requested adding Tumblebooks as additional agenda item number 6. Chair Stadler called for a motion to approve the agenda as described. John Bax moved to approve, Scott Klotz seconded and all were in favor and it passed unanimously. ACTION ITEMS Minutes Chair Stadler called for a motion to approve the draft meeting minutes of the May 12, 2016 meeting. Lightfoot moved to approve the minutes as distributed. Bax seconded and all were in favor and they passed unanimously. Election of Officers – Endorsement Chair Stadler called for a motion to approve the slate of candidates as presented. Bax moved to approve, Michael Davis seconded and all were in favor and it passed unanimously. Ginger King will be the MOREnet Council Chair and Sue Lightfoot will be the Vice Chair for the calendar year 2017. FY18 Work in Progress Budget Projection – Information Lynn Burgan reviewed the material provided in the meeting packet. The budget is based on the FY17 membership levels and selection, current bandwidth connections using the FY18 member fees for all member groups and FY18 expense estimates. Revenue over expenses after the Plant Fund (PF) transfer is $21,483. FY18 Member Fees – Endorsement Burgan reported that staff has prepared the FY18 member fees for the Membership Service Packages (MSP), the Managed Connection Fee (MCF), and the Network Connectivity Fee (NCF). A great majority of the members who purchase both a MSP and connection will receive a reduction to service costs. There will not be a change to the FY18 MSP fees. 65% of members have a membership service package term that will expire June 30, 2017. Their pricing has been locked at the lower FY14 or FY15 pricing schedule so staff expect an increase in MSP revenue of $441,505 in FY18. The MCF will remain at $1,300 for all MOREnet-ordered connections and for FY18 the use of a MOREnet router and maintenance as a service will be added.
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Updated December 23, 2016
NCF total revenue will be reduced by 10.45% because of bandwidth growth and lower cost of backbone connections. Member discounts will be based on bandwidth and will range between 1.61%-35.32%. To encourage members to take advantage of their entire bandwidth the NCF tiers have changed slightly. 150 members out of 691 currently have their connection throttled. Chair Stadler expects that some throttling may be due to firewalls and asked that staff investigate virtual firewalls as a service. Bax is interested in the service for Lincoln University and offered to participate in a pilot project. Staff recommends the Council endorse the FY18 membership fees as presented. Steve Klotz moved to approve, Trey Katzer seconded and all were in favor and they passed unanimously. DISCUSSION/INFORMATION ITEMS Fiber Investment Projects Update – Information Hank Niederhelm reported that as of November 21, 77 members have authorized quotes for fiber connectivity to the MOREnet network. 65% of them have signed up for 20 years. Several members are also connecting their buildings together via the projects. Staff expect to see more interest next spring as members out grow their current connections. FY18 MOREnet State Appropriation Request – Information Natasha Angell shared that MOREnet submitted an appropriation request for $1M for infrastructure due to a new dedicated state match rule the FCC recently introduced. When a state appropriates funding for broadband infrastructure for eligible E-rate recipients, the FCC will provide an up to 10% additional discount for special construction charges based upon how much the State provides. In September, the Coordinating Board for Higher Education voted to share the request along with other non-mandatory items with the Governor, Governor-elect, and General Assembly. Staff are hopeful the Governor-elect will include the request in his official budget recommendation in January. MOREnet will be creating materials that members can use to educate their legislators about this request. MOREnet can also create area-specific reports for legislators that might be helpful. FY18 E-rate Filing Schedule – Information In previous years, staff took an educated guess around this time of year which usually resulted in having money left over. Members may be contacted this spring to see if they have an idea of what their bandwidth needs might be in the next year. Starting with members whose circuit terms are ending or if their bandwidth is consistently maxed. MOREnet is trying to ensure Missouri is putting forth the best numbers possible to USAC and FCC. Burgan reviewed the change to E-rate filing where MOREnet will begin only filing for E-rate services that are expected to be implemented that same year. This change is to ensure the funding committed to our application is more fully utilized. Strategic Long Range Planning Engagement – Information Gillispie reported that the MOREnet leadership team is trying to determine the strategies MOREnet needs to engage in going forward. The challenge is determining what the members need so staff will be asking them and talking further to the Council for their input. Chair Stadler just recently learned that there is a price break for getting Microsoft licenses through MOREnet. He suggested advertising again. He also suggested members running projects through MOREnet just in case there is a discount available. When Work Works Award - Information Gillispie shared that MOREnet applied and followed the rules for submission, an employee survey, and was recognized with the award. Gillispie reported that MOREnet has very low turnover rates and high engagement in the work place and believes that a Results Only Work Environment (ROWE) is contributing to those results. As a part of a presentation Gillispie gave at the College and Universities Professional Association for Human Resources professionals, staff put together a video where they describe the impact ROWE is having. It can be found at: https://www.more.net/rowe-basic.
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Additional Agenda Item Added: Tumblebooks Recently public library staff are seeing access to Tumblebooks denied if someone tries to use a license with an IP address tied to a school. Public libraries and the Missouri Public Library Directors (MPLD) are concerned with the restricted accounts and have started a taskforce to address the situation. They are hopeful that in the future licenses can be used at both the libraries and schools. Lightfoot requested that a Council K12 member join the taskforce or come and talk to the taskforce. 1:34 p.m. Respectfully Submitted by Sherry Loyd
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Created by Lynn Burgan May 5, 2017
AGENDA ITEM SUMMARY FY18 ORIGINAL BUDGET
AGENDA ITEM FY18 Original Budget DESCRIPTION The FY18 original operating budget is based on the FY18 member fee schedules, FY18 orders and expected expenses. For the FY18 original budget, revenue over expenses after the Plant Fund (PF) transfer is $16,588. REVENUE 1. K12, Higher Education, Affiliates, and Libraries Revenue
The budgeted revenue for each member group includes: Membership Service Package Revenue The budgeted amounts are based on FY18 quotes and orders, and the FY18 membership pricing schedule.
Network Connectivity Fee The budgeted amounts are based on FY18 pricing schedule and orders and includes an 8% revenue growth rate for higher education and K12 entities. The affiliates’ revenue includes a $850,000 payment for the Next Generation Network.
Managed Connection Fee The budgeted amounts are based on current connections and the FY18 managed connection fee of $1,299 per connection. For FY18, we expect to manage 691 connections.
Connection Revenue Connection revenue is based on FY18 tail circuit connection expenses.
2. REAL Program MOU
The budgeted amount for the FY18 House Bill 12 (HB12) appropriation is $2,000,000 and allocated based on the FY18 Draft REAL MOU budget which includes up to $427,227 for Online Resources. The REAL MOU reduces the revenue collected directly from participating public libraries.
3. E-rate Reimbursements
The E-rate reimbursements are based on the current circuits and FY18 E-rate discount rates. Also included is $1,127,326 for the E-rate reimbursements on the IRU, and maintenance and operations for the Backbone Extension –Southwest Missouri project.
4. Other Fees and Miscellaneous Revenues
Other fees and miscellaneous revenues are based on projected conference vendor and attendee revenue, and for-fee service revenues.
5. Sponsorship Revenue
Sponsorship revenues are based on projected support of the annual MOREnet Conference.
6. Revenue Transfers The revenue transfer is based on transferring $370,856 from reserves to cover the anticipated FY18 operating shortfall of the Backbone Extension –Southwest Missouri project.
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Created by Lynn Burgan May 5, 2017
EXPENSE 1. Network Related Expense
Internet access and aggregation circuit expenses are based on bandwidth projections, and circuit cost estimates. Backbone, Internet2, and other network expenses are based on equipment and software expenses related to the shared network and member connections, and other shared network expenses and includes additional $153,468 for core router processors/ports maintenance and an increase in the Fujitsu maintenance.
2. Total Connections Expense
The budgeted amount is based on current tail circuit connections. 3. Salaries and Benefits
Based on preliminary guidance from University of Missouri Budget and Planning, the original FY18 budget includes $370,113 for open positions, and 3.0% salary increase.
4. Operating Expenses
Operating expenses include marketing, business travel, professional development, UM Procurement MOU, office supplies & equipment, and utilities expenses. There were small increases for staff training and office equipment. The budget also includes $40,000 for a recruiter for the Executive Director position and $36,268 for customer relationship management and security software solutions.
5. Online Resources
Online resources estimates include expenses for EBSCO, HeritageQuest, and LearningExpress Library. 6. Other Expenses
Other expenses includes projected expenses for-fee service related activities, and an increase for online resources, and member related services.
FUND BALANCES, ENDING BALANCE TRANSFERS AND RESERVES BALANCES AND UNOBLIGATED RESERVES
Total Connection Expense 10,358,201 10,831,632 (473,431)
Member Training 38,645 38,645 - Conferences/Member Meetings 165,053 165,053 - Member Related Travel 27,550 27,550 - Online Resources 982,872 969,833 13,039 Member Related Services 527,519 484,310 43,209 Fee-For-Service Related 559,378 475,982 83,396
Total Other Expenses 2,301,017 2,161,373 139,644
Direct Salaries and benefits 4,607,399 4,586,138 21,261 Total Direct Expenses 22,111,451 22,465,225 (353,774)
G&A ExpensesStaff Dev., Travel and Meeting Expense 209,561 208,559 1,002 Member Outreach 19,641 19,641 - Telephone 56,201 56,201 - Office Supplies and Expense 79,731 79,731 - Equipment, Software and Accessories 38,242 34,428 3,814 Maintenance for Equipment and Software 114,769 78,501 36,268 Professional Services 136,986 96,987 39,999 Rent, Utilities, Janitorial, and Security 313,927 313,927 -
Total Operating Expenses 969,058 887,975 81,083
G&A Salaries and benefits 3,502,904 3,328,958 173,946
Total G&A Expenses 4,471,962 4,216,933 255,029
Total Expenses 26,583,413 26,682,158 (98,745)
Revenue over Expenses 1,247,266 1,252,161 (4,895) Fund Transfers (1,230,678) (1,230,678) -
AGENDA ITEM Projected FY17 Ending Operating Balance DESCRIPTION Calculation of the projected FY17 ending balance with use of surpluses. PROJECTED FY17 ENDING OPERATING BALANCE FY17 Beginning Balance $ 11,931,058 Additions: FY17 Projected Revenue Over Expenses $ 2,114,008 Subtracts: Plant Fund Transfer $ 1,688,292 Use of Surpluses EBS Project $ 100,000 Backbone Extension –Southeast Missouri project (remaining) $ 830,194 Backbone Extension –Southwest Missouri project (total) $ 2,237,000 Projected FY17 Ending Operating Balance $ 9,189,580 PROJECTED FY17 PLANT FUND BALANCE FY17 Beginning Balance $ 4,415,332 Additions: FY17 Interest Revenue $ 27,784 E-rate Reimbursement $ 122,186 Plant Fund Contribution Transfer $ 1,688,292 Subtracts: Plant Purchases $ 1,886,016 Projected FY17 Ending Plant Fund Balance $ 4,367,578 RECOMMEND ACTION None ATTACHMENT(S) None
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Created by Lynn Burgan May 7, 2017
AGENDA ITEM SUMMARY PROJECTED FY17-18 PLANT FUND BALANCE
PLAND FUND HISTORY MOREnet must establish a target for annual contributions to the Plant Fund (PF) in order to ensure that funds are available when capital replacements or upgrades are necessary. At the inception of the MOREnet consortium, one-time state appropriations funded the initial network, video, and other equipment purchases. As reviewed and approved at the July 30, 2009 Council meeting, MOREnet reviews information on capital assets provided by the University of Missouri Controller’s office on a semi-annual basis in order to establish a target for annual contributions. Assets used to support the Shared Network (including the fiber backbone), research, internal operating, member services and for-fee services (FFS) will be the basis of the calculation. The annual contribution target will be based on the original value of assets, divided by the estimated useful life of each category of asset. In cases where updated estimates of replacement cost and useful life are available, those estimates will be used in the calculation of the annual contribution rather than the original value of old assets. The PF replacement is built into the cost of all allocated activities and transfers will be made from appropriate fee areas. During the March 4, 2014 meeting, the Council approved designating a portion of the PF to new technologies and start-up purchases. MOREnet will transfer a 50% of any year-end operating surpluses to the PF. PF BALANCE UPDATE The projected beginning FY18 PF balance is $4,367,578. For FY18, PF purchases are expected to be $426,037 and includes video bridge hardware, and shared infrastructure equipment. MOREnet is recommending a FY18 PF contribution of $1,392,712 plus 50% of any year-end operating surpluses. The ending FY18 PF balance is projected to be $5,371,031. PROJECTED PF FY18 ENDING BALANCE PF Beginning Balance 4,367,578 FY18 Contribution 1,392,712 Investment Income 36,778 Less Budgeted FY18 Purchases:
Video bridge hardware (20,000) Shared Infrastructure (406,037) PROJECTED PF FY18 ENDING BALANCE 5,371,031 RECOMMENDATION Staff recommends the Council approve the FY18 PF transfer of $1,392,712 plus 50% of any year- end operating surpluses. ATTACHMENT(S) Annual Plant Fund (PF) Contribution Estimate Plant Fund (PF) Balance
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Annual Plant Fund Contribution Estimate
FY2018 Annual Plant Fund Contribution EstimateUpdated 4/13/2017
DescriptionAmount used for
Contribution Annual
Contribution Purchase
Year Useful Life
(Years) Replacement
Year Sun ZFS Storage Array Upgrade - ESX Building 48,000 9,600 14 5 19 28,800 Servers 48,000 9,600 28,800
AGENDA ITEM Council Member Survey DESCRIPTION MOREnet holds the highest regard for its Council members and we value your support and service as representatives of your respective communities to the larger group. MOREnet recently celebrated its 25th anniversary and we wish to further educate our Council members about the organization’s high-level successes and deliverables as both a member-driven consortium and one of several research and education networks in the country. In addition, we would like to learn more about the strengths its Council members believe they bring to the MOREnet consortium, both as individuals and as a group. To assist in these efforts, we ask that each Council member review the following documents and complete a brief online survey prior to May 18, 2017.
MOREnet Information: The Quilt, Quilt Circle 2017, MOREnet Article: http://www.thequilt.net/quilt-circle/
Fiscal Year 2016 MOREnet Annual Report: https://more.net/content/annual-report
Council Member Survey: Please complete the brief survey at (Qualtrics survey link). The following three questions are included in the survey:
1. What is it about MOREnet's mission and work that motivates you? 2. What specific experience or skills do you believe can best serve MOREnet through
your role as a Council member? 3. As a Council member, what do you want to help MOREnet accomplish during FY18?
At the May 23 Council meeting, MOREnet staff will share aggregate survey results and will guide a group discussion on select items offered in response to survey question #3. We look forward to this interactive session. RECOMMENDED ACTION None ATTACHMENT(S) None
