December 6, 1999

SUBJECT: Consideration of Proposed New Policy on Economic Analyses 

PROPOSED ACTION:
That trustees consider, and potentially adopt after any desired amendments, the proposed new policy.

RELATED BOARD POLICY OR RESOLUTION:
This is a policy-development topic, and is being handled in accordance with Policy B-5, Policy Development.

RATIONALE:
Several Board policies call for economic analyses, and other analyses are done for evaluation of activities or justification of proposals such as facilities purchases. The proposed policy would mandate that all such analyses (not just the cases now mentioned in specific policies) follow basic economic principles and be based on assumptions and methodology that would be applied systematically across the College. It would also require that analyses provided to the Board list their assumptions and identify the administrator who takes responsibility.

The proposed policy does not itself mandate any particular analyses, and it provides that the level of detail and sophistication of an analysis can be adapted to the economic size and sensitivity of its subject.

The preamble of the policy specifically points out that most College decisions are not (and should not be) made with the purpose of economic gain for the College. The purpose of these analyses is to avoid waste and identify opportunities for needed expansion.

This version omits an earlier provision calling for an annual assessment of the quality of the College's system of economic analysis by an outside citizen's committee chosen by the Board. That provision will be considered in the context of the development of a general policy on advisory committees, or possibly as a monitoring issue in the overall policy review.

Adoption of this general statement of principles would permit the deletion of similar references in four current policies (A-4[4], A-5, A-6[h], and E-2[6]) that address specific situations. This cleanup would be handled during the policy review scheduled for next semester.

BUDGETARY CONSIDERATIONS:
This item does not have a significant direct budgetary impact, although it is intended to improve planning and reduce waste in the long term.

RESOURCE PERSONNEL:
Beverly Davis, Board Chair

Hunter Ellinger, Board Secretary

ATTACHMENTS:
Draft of Proposed Policy