Phase 5

Document Sample
Phase 5 Powered By Docstoc
					              FINAL REPORT
   1999-2000 FUNDING MODEL STUDIES
            NORTH CAROLINA
     COMMUNITY COLLEGE SYSTEM




          Submitted to:

State Board of Community Colleges
       200 West Jones Street
   Raleigh, North Carolina 27603




          Submitted by:


      MGT of America, Inc.
  2123 Centre Pointe Boulevard
   Tallahassee, Florida 32308




         March 17, 2000
TABLE OF CONTENTS


                                                                                                             PAGE
1.0   INTRODUCTION AND BACKGROUND ........................................................ 1-1

      1.1       Scope of Current Studies................................................................... 1-1
      1.2       Other Recent Funding Studies........................................................... 1-1
      1.3       Approach to Studies .......................................................................... 1-2
      1.4       Overview of Report ............................................................................ 1-5

2.0   FACULTY SALARIES AND CONTRACT LENGTH ....................................... 2-1

      2.1       Special Provision ............................................................................... 2-1
      2.2       Origin of Salary-Related Concerns .................................................... 2-2
      2.3       Potential Factors Affecting Faculty Salary Averages.......................... 2-3
      2.4       Analysis of Faculty Contract Length................................................... 2-4
      2.5       Summary of Findings and Recommendations.................................. 2-12

3.0   FUNDING FOR SUMMER TERM CURRICULUM INSTRUCTION................ 3-1

      3.1       Enrollment Patterns by Term ............................................................. 3-1
      3.2       Funding Policy for Summer Term ...................................................... 3-3
      3.3       Comparison to Summer Enrollment Funding Policies Elsewhere....... 3-4
      3.4       Recommended Approach for Summer Term Funding........................ 3-5
      3.5       Projected Cost of Revised Summer Funding Model........................... 3-6

4.0   REFINEMENTS FOR NEW CONSTRUCTION FORMULA ........................... 4-1

      4.1       Background ....................................................................................... 4-1
      4.2       Previous New Construction Model ..................................................... 4-2
      4.3       Goals for 1999 Funding Model for New Construction......................... 4-3
      4.4       Description of 1999 Funding Model for New Construction.................. 4-4
      4.5       General Assembly Response to 1999 Proposal................................. 4-6
      4.6       Issues to Address in 1999-2000 Refinements.................................... 4-8
      4.7       Recommended Revisions to Model ................................................. 4-18
      4.8       Simulation of Refined New Construction Model ............................... 4-19

5.0   SUMMARY.................................................................................................... 5-1

      5.1       Context of Recommendations............................................................ 5-1
      5.2       Summary of Findings and Recommendations.................................... 5-1
.     5.3       Further Issues for Consideration........................................................ 5-3
1.0 INTRODUCTION AND
         BACKGROUND
                 1.0 INTRODUCTION AND BACKGROUND

1.1   Scope of Current Studies

      During the 1999-2000 academic year, the North Carolina Community College

System undertook studies of three issues related to its funding model. These issues had

been identified as priority concerns through ongoing discussions among the General

Assembly, the Presidents Association, and System leadership. The issues are:

      !   Faculty Salaries and Contract Length – an examination of factors
          that cause average faculty salaries in the System to trail those in
          other states in the region;

      !   Summer Term Funding – an examination of whether the workload
          imposed by students enrolled during the summer months should be
          recognized in the funding model; and

      !   New Construction Formula – consideration of refinements to the
          recently revised formula for calculating capital funding requirements
          to address shortcomings that had been identified during the 1999
          session of the General Assembly.

This report summarizes various analyses related to these three issues and offers

recommendations for changes in specific components of the System’s funding models.



1.2   Other Recent Funding Studies

      Over the past several years, the North Carolina Community College System has

engaged in a systematic review of the overall approach for funding the colleges. This

review has considered procedures for requesting state appropriations for the System

and for distributing available funds among the 58 colleges.

      Beginning in the fall of 1996, the System Office, with assistance from MGT of

America, Inc., consulted with leaders from each of the colleges to identify issues related

to the adequacy of funding for the System and the equity in the distribution of funds

among the colleges. These issues were prioritized and several have been addressed


MGT of America, Inc.                                                              Page 1-1
                                                              Introduction and Background


each year since 1966 for presentation to the State Board and for consideration by the

General Assembly. As seen in Exhibit 1-1, the cumulative result of this effort over the

first four phases totals nearly $150 million in additional funding for the System.



1.3   Approach to Studies

      For each phase of the study, the System has followed a similar approach. This

approach can be characterized by detailed analysis of the current situation,

consideration of best practices found in other states, the open participation and

consideration of alternatives by affected parties, and support from an external

consultant. This overall strategy, which had proven successful in earlier phases, was

continued during the 1999-2000 phase of the study.

      A Legislative Issues Study Group was appointed to oversee the efforts of the

external consultant and System staff. The Study Group included representatives of the

Presidents Association, the business officers, the Trustees Association, the faculty, and

the General Assembly staff. A roster of the members of the Study Group is included as

Exhibit 1-2.




MGT of America, Inc.                                                                 Page 1-2
                                                                                                                                                 Introduction and Background




                                                                    EXHIBIT 1-1
                                                     OVERVIEW OF FUNDING STUDY ISSUES BY PHASE

                                           Pha se 1                   Pha se 2                 Pha se 3                  Pha se 4             Pha se 5      Fina l      Amount of Funds
                                       Fina l   Furthe r          Fina l   Furthe r        Fina l   Furthe r         Fina l   Furthe r        Curre nt      Action        Provide d
              Issue s                  Action    Study            Action    Study          Action    Study           Action    Study           Study
Adequacy of Funding                                    X
Occupational Extension                    X                                                   X                                                                 X       $        10,000,000
Basic Skills Instruction                  X                                                                                                                     X
Sliding Scale (1)                                      X             X                                                                                          X       $        20,481,165
Program-Based Funding                                  X                         X
New Program Development                   X                                                                                                                     X
Equipment (2)                                          X                         X            X                                                                 X       $        74,000,000
Budget Stability                                       X                         X            X                                                                 X
Base Funding - Support (3)                             X             X           X                                                                              X       $        16,000,000
Flexibility                               X                                                                                                                     X
Simplicity (4)                            X                                                                                                                     X
Multiple Locations                                                               X                                                                                      $         1,650,000
Repair and Renovation                                                                         X                                                                 X       $        14,500,000
Instructional Resources (5)                                                                                             X                                       X       $        10,000,000
Capital Outlay                                                                                                                       X             X
Performance Funding                                                                                                                  X             X                    Retain Reversions
Summer Term Funding                                                                                                                                X
Length of Contracts                                                                                                                                X
                                                                                                                                                            TOTAL       $      146,631,165
(1) Sliding Scale includes 2 years of adjusting f aculty/student ratios dow nw ard; cumulatively f rom 17.8/1 to 16.52/1 and 21.55/1 to 20.1 (curriculum), f rom 23.1/1 to the same break
   points as Curriculum (Occupational)
(2) Equipment includes $21 mil Eqiuipment Reserve, $5 mil Overrealized Receipts, and $48 mil f rom HB 275
(3) Base Funding - Support includes adding 116 positions to the Base A llotment and 203 to the Enrollment A llotment
(4) Simplicity is Scheduled f or Implementation by July 1, 2000
(5) Instructional Resources includes $10 mil of "Other Cost" Funds




MGT of America, Inc.                                                                                                                                                            Page 1-3
                                                              Introduction and Background


                                     EXHIBIT 1-2
                                MEMBERSHIP ROSTER
                          LEGISLATIVE ISSUES STUDY GROUP

     Me m be r, Sta te Boa rd of Com m unity Colle ge s
     Mr. James W oody              Finance and Capital Needs Committee


     Pre side nts, North Ca rolina Com m unity Colle ge Syste m
     Mr. Ray Bailey                Asheville-Buncombe Technical Community College
     Dr. Marvin Joyner             Central Carolina Community College
     Dr. Desna W allin             Forsyth Technical Community College
     Dr. Bryan Brooks              Davidson County Community College
     Dr. Gordon G. Burns, Jr.      W ilkes Community College
     Dr. Ed W ilson                W ayne Community College
     Dr. Eric McKeithan            Cape Fear Community College


     Busine ss Office rs, North Ca rolina Com munity Colle ge Syste m
     Mr. Colin Shaw                Rowan-Cabarrus Community College
     Mr. David W hitson            Haywood Community College


     North Ca rolina Associa tion of Com munity Colle ge Truste e s
     Mr. Hal M. Miller             Associate Executive Director


     North Ca rolina Com m unity Colle ge Fa culty Associa tion

     Mr. Jim Davies                President


     Syste m Office Sta ff, North Ca rolina Com m unity Colle ge Syste m
     Mr. Kennon Briggs             Vice President, Business and Finance
     Dr. Brenda Rogers             Vice President, Administration
     Mr. Phil Albano               Director, Administrative and Facility Services
     Ms. Kim Langdon               Systems Accountant, Office of the Vice President
                                     for Business and Finance
     Mr. John Malia                Systems Accountant, Office of the Vice President
                                     for Business and Finance
     Mr. Larry Morgan              Director, Budgeting and Accounting




MGT of America, Inc.                                                                  Page 1-4
                                                            Introduction and Background


1.4   Overview of Report

      In the remainder of this report, a separate chapter is devoted to each of the three

issues studied during 1999-2000. Chapter 2 addresses the faculty salary and contract

length issue, Chapter 3 concerns summer term funding, and Chapter 4 reviews the

recently adopted new construction formula. Chapter 5 is a brief summary of the report

and its recommendations.




MGT of America, Inc.                                                             Page 1-5
2.0 FACULTY SALARIES AND
        CONTRACT LENGTH
         2.0 FACULTY SALARIES AND CONTRACT LENGTH

2.1   Special Provision

      During its 1999 session the North Carolina General Assembly considered issues

related to “the employment of community college faculty.” In particular, members wished

to explore the relationships between faculty contract length (i.e., the number of months

per year a faculty members works and is paid) and the competitiveness of faculty

salaries paid by the state’s community colleges with those elsewhere in the region.

      To gain a fuller understanding of the various facets of the issue, the General

Assembly enacted a special provision that directed the State Board of Community

Colleges to conduct a study as described in Exhibit 2-1.

                                   EXHIBIT 2-1
                       SPECIAL PROVISION REQUESTING STUDY


       PART IX. COMMUNITY COLLEGES

       EMPLOYMENT OF COMMUNITY COLLEGE FACULTY (STUDY)

       Section 9. The State Board of Community Colleges shall contract with an
       outside consultant to study the issue of whether the Community College
       System should employ faculty members for less than 12 months instead of
       on a 12-month basis since the Community College System now operates
       on a semester system instead of a quarter system. The consultant also
       shall consider how much additional supplemental funding for summer term
       would be required if the Community College System employed faculty
       members for less than 12 months and needed to employ a portion of the
       faculty for the summer term.

       The State Board shall use funds from the State Board Reserve to
       implement this section.

       The State Board shall report to the Joint Legislative Appropriations
       Subcommittees on Education and the Fiscal Research Division prior to
       April 30, 2000, on the results of this study. It is the intent of the General
       Assembly, in considering the results of this study and other
       recommendations regarding community college faculty salaries, to provide
       for changes in the salary of community college faculty that result in an
       enhancement of salary for community college faculty.




MGT of America, Inc.                                                               Page 2-1
                                                     Faculty Salaries and Contract Length


2.2   Origin of Salary-Related Concerns

      A recurring budget issue over the past decade (or longer) has been the level of

faculty salaries in the Community College System as compared to those found in similar

systems in other states in the region and nation.       Periodic data from the Southern

Regional Education Board (SREB) suggest that North Carolina typically ranks relatively

low among the 15 participating states in the average salary of its community college

faculty. For each of the past four years, the System’s rank has been last among the

SREB member states, as shown in Exhibit 2-2. Long-time observers report this last

place ranking has existed for an even longer period of time.

                               EXHIBIT 2-2
            COMPARISON OF AVERAGE FACULTY SALARIES BY STATE
              SOUTHERN REGIONAL EDUCATION BOARD, 1996-1999
               PUBLIC TWO-YEAR COLLEGES, NINE-MONTH BASIS

                      FY 1996          FY 1997          FY 1998          FY 1999
State            Avg. Salary Rank Avg. Salary Rank Avg. Salary Rank Avg. Salary Rank
Alabama               38,169    2      38,243    4      38,679    5      43,136    2
Arkansas              30,596   14      32,119   13      32,880   14      34,276   13
Florida               37,792    4      38,199    5      39,148    4      40,114    5
Georgia               36,567    6      38,473    3      39,437    3      41,005    4
Kentucky              33,250   10      35,767    7      36,709    9      39,299    7
Louisiana             32,685   11      31,428   14      34,276   12      33,528   14
Maryland              45,234    1      46,551    1      46,681    1      48,918    1
Mississippi           35,161    7      35,668    8      36,879    8      37,854    9
North Carolina        29,544   15      30,124   15      32,206   15      33,027   15
Oklahoma              34,407    8      34,111   11      36,633   10      37,569   10
South Carolina        32,221   13      33,183   12      33,752   13      35,065   11
Tennessee             32,639   12      34,197   10      34,968   11      35,055   12
Texas                 36,654    5      37,415    6      38,276    6      39,748    6
Virginia              38,114    3      38,904    2      40,601    2      42,389    3
W est Virginia        34,126    9      35,346    9      36,906    7      38,293    8
Regional Average      32,961           33,852           35,001           38,806

NC as % of
Regional Average        90%                89%               92%                85%
Note: The seven percent increase for FY 2000 has not yet been reflected in SREB reports.



      The validity of this ranking has been challenged by some given that North Carolina

usually ranks among the top several states in the region in terms of state appropriations


MGT of America, Inc.                                                               Page 2-2
                                                     Faculty Salaries and Contract Length


per student. When the state’s historic low tuition policy and the limited role of local

government in supporting the community colleges are taken into account, however, a

somewhat different picture emerges about total per-student funding.



2.3   Potential Factors Affecting Faculty Salary Averages

      A number of factors have been hypothesized as potential explanations for the low

ranking on faculty salaries in light of more competitive per-student funding rates. Most of

these hypotheses, however, do not appear to be supported by the evidence while a few

contribute to understanding the situation. For instance:

      Hypothesis: Due to the comparatively small size of many colleges, the
      System probably spends a greater than average portion of its personnel
      budget on administrators and staff and, thus, has a less than average
      amount remaining available for faculty salaries.

            Evidence: The System reports that its FTE faculty comprise 54.6
            percent of its FTE staff as compared to the national average for public
            two-year colleges of 47.2 percent. That is, the administrative staff in
            the colleges is comparatively lean.

      Hypothesis: Due to the intense workforce mission of the System and the
      small size of many colleges, the System has smaller class sizes than
      provided by the student-to-faculty ratios in the curricula instruction formula.
      This results in available faculty salary dollars being spread over more faculty
      than intended.

            Evidence: As compared to the formula’s student-to-faculty ratio of
            20:1, the System’s average class size of 15.5 is considerably lower.

      Hypothesis: The System uses a higher proportion of its compensation
      dollars for fringe benefits and a lesser proportion on direct salaries than do
      other systems.

            Evidence: Based on national comparisons, the System ranks as
            poorly in total compensation (salaries plus fringe benefits) as in direct
            salaries.

      Hypothesis: Many of the colleges are in rural areas with a less than average
      opportunity to use lower paid part-time faculty who are not included in
      reports on regional average salaries.

            Evidence: Based on national comparisons, the System relies to a
            much greater degree than community colleges elsewhere on part-time
            faculty.


MGT of America, Inc.                                                               Page 2-3
                                                          Faculty Salaries and Contract Length


Summary evidence related to these hypotheses is listed in Exhibit 2-3.

                                EXHIBIT 2-3
                         ANALYSIS OF FACTORS THAT
                   POTENTIALLY AFFECT FACULTY SALARIES
                 NORTH CAROLINA COMMUNITY COLLEGE SYSTEM

                                    NCCCS       Com pa rison
             Fa ctor              Obse rva tion Obse rva tion                 Ana lysis

FTE Faculty as Percent of FTE        54.6%         47.2%        The System devotes a higher
Staff                                                           portion of its positions to faculty
                                                                roles than the national average

FTE Student to FTE Faculty            15.5           20         The System has a significantly
Ratio                                                           lower average class size than
                                                                provided by the formula, most
                                                                likely due to the relatively strong
                                                                technical orientation of
                                                                instructional programs

Fringe Benefits as Percent of        22.5%         28.4%        Not only are direct salaries lower
Direct Salary                                                   than the national average, fringe
                                                                benefits in the System also are
                                                                significantly lower

Part-Time Faculty as Percent of      73.1%         64.2%        The System relies more on part-
Total Faculty                                                   time faculty than any other state in
                                                                the region




2.4   Analysis of Faculty Contract Length
      During the past year, another hypothesis has surfaced that seeks to reconcile the

disparity between the comparatively high funding levels and low salary rates using the

number of months employed as an explanatory factor. That is, average faculty salaries,

which are reported and compared on a nine-month equivalent contractual basis, are

thought to appear artificially low because the same total dollar amount is spread over

contract periods of 11 or 12 months instead of nine months. As shown in Exhibit 2-4,

this hypothesis has strong appeal since the System is much more reliant on the longer

11-12 month contracts than other systems.




MGT of America, Inc.                                                                         Page 2-4
                                                          Faculty Salaries and Contract Length


                             EXHIBIT 2-4
      LENGTH OF COMMUNITY COLLEGE FACULTY CONTRACTS BY STATE
                        (1997-98 IPEDS DATA)


                            Number of Faculty    Number of       Total    11/12 Month
                              on 9/10 Month   Faculty on 11/12 Number of as Percent of
             State               Contract     Month Contract    Faculty      Total
             Alabama                    1,445              302     1,747         17.3%
             Alaska                         3              -            3         0.0%
             Arizona                    1,686              147     1,833          8.0%
             Arkansas                     646               70       716          9.8%
             California                12,970              889    13,859          6.4%
             Colorado                     880              415     1,295         32.0%
             Connecticut                  625                4       629          0.6%
             Delaware                     193              102       295         34.6%
             Florida                    4,097              827     4,924         16.8%
             Georgia                    1,239              678     1,917         35.4%
             Hawaii                       592               79       671         11.8%
             Idaho                        540               50       590          8.5%
             Illinois                   4,386              252     4,638          5.4%
             Indiana                      988               53     1,041          5.1%
             Iowa                       1,107              524     1,631         32.1%
             Kansas                     1,218               76     1,294          5.9%
             Kentucky                     930              154     1,084         14.2%
             Louisiana                    545               89       634         14.0%
             Maine                        334               32       366          8.7%
             Maryland                   1,756               77     1,833          4.2%
             Massachusetts              1,731              109     1,840          5.9%
             Michigan                   2,478              452     2,930         15.4%
             Minnesota                  1,566              155     1,721          9.0%
             Mississippi                1,782              403     2,185         18.4%
             Missouri                   1,168              276     1,444         19.1%
             Montana                      150               19       169         11.2%
             Nebraska                     439              355       794         44.7%
             Nevada                       500               37       537          6.9%
             New Hampshire                239               64       303         21.1%
             New Jersey                 1,823              270     2,093         12.9%
             New Mexico                   480              333       813         41.0%
             New York                   6,126              570     6,696          8.5%
             North Carolina             1,172            3,305     4,477         73.8%
             North Dakota                 222               10       232          4.3%
             Ohio                       2,693              402     3,095         13.0%
             Oklahoma                     992              253     1,245         20.3%
             Oregon                     1,762               39     1,801          2.2%
             Pennsylvania               2,090              753     2,843         26.5%
             Rhode Island                 265               99       364         27.2%
             South Carolina             1,649               50     1,699          2.9%
             South Dakota                 198               38       236         16.1%
             Tennessee                  1,374              303     1,677         18.1%
             Texas                      6,635            1,914     8,549         22.4%
             Utah                         786               47       833          5.6%
             Vermont                      160               79       239         33.1%
             Virginia                   1,805              136     1,941          7.0%
             Washington                 2,645              108     2,753          3.9%
             West Virginia                247               68       315         21.6%
             Wisconsin                  3,235              236     3,471          6.8%
             Wyoming                      503               50       553          9.0%


MGT of America, Inc.                                                                     Page 2-5
                                                    Faculty Salaries and Contract Length


      For this hypothesis to be valid, however, a further assumption would need to be

made that any faculty employment periods which were longer than nine months came

with no expectation of commensurate extra workload. Otherwise, a new issue would be

related to how to pay for summer term instruction and/or additional summer

responsibilities.

      In reviewing this issue, we closely examined practices related to faculty

employment in the System, seeking to understand the factors that might explain the

heavy reliance on longer-term employment periods.         We found that considerable

variation exists across the 58 colleges in faculty employment practices. We also learned

that, as a result of re-engineering efforts and conversion to the semester system

calendar, some colleges have begun to implement faculty contracts of shorter duration.

      In general, it appears that longer employment periods are strongly associated with

faculty who teach in the Associate Degree in Applied Sciences, represented by such

courses of instruction as allied health, tool and die making, etc., wherein instruction

during the summer term is more common. In fact, based upon data analysis from the

Fall 1998 staff file, 78 percent of full-time faculty in the applied sciences area were

employed for 12 months, while only 55 percent of the full-time faculty who teach in the

Associate in Arts areas, represented by liberal arts/college transfer programs, were

employed for the same period. When considering the actual numbers of faculty by

program, there are approximately 1,300 more faculty in applied sciences instruction than

in general education.    Therefore, the system average length of employment has

historically been slightly over 11 months. These data are summarized in Exhibit 2-5.




MGT of America, Inc.                                                            Page 2-6
                                                                                                                  Faculty Salaries and Contract Length


                                                         EXHIBIT 2-5
                                      PERCENT DISTRIBUTION OF FACULTY MONTHS EMPLOYED
                                      BY PROGRAM TYPE AND NUMBER OF MONTHS BY COLLEGE

                             Ge ne ra l Educa tion Fa culty       Othe r Educa tion Fa culty                    All Fa culty          Ave ra ge
                                    % of Contracts that Are :           % of Contracts that Are :                                     Contra ct
                                                                                                               % of Contracts that Are :
                           Total    09     10     11     12    Total    09     10     11     12    Total    09     10     11     12    Le ngth
     Colle ge Nam e       Faculty M onth M onth M onth M onth Faculty M onth M onth M onth M onth Faculty M onth M onth M onth M onth (Months)

A LA MA NCE CC                20                           100    56      2       2       0         96    76     1       1       0         97   11.9
A SHEV ILLE-BUNCOMBE TC       31     45                     55    64     11       0       0         89    95    22       0       0         78   11.3
BEA UFORT COUNTY CC           17     47       6             47    38     18       5       0         76    55    27       5       0         67   11.1
BLA DEN CC                     8     13                     88    19      0      11       0         89    27     4       7       0         89   11.7
BLUE RIDGE CC                 15     13                     87    35     14       0       0         86    50    14       0       0         86   11.6
BRUNSWICK CC                   7                           100    18     22       0       0         78    25    16       0       0         84   11.5
CA LDWELL CC & TI             34     56       3       6     35    47     23      13       6         57    81    37       9       6         48   10.7
CA PE FEA R CC                42     81       2             17    70     34       0       0         66   112    52       1       0         47   10.4
CA RTERET CC                  10             60             40    32      3      22       0         75    42     2      31       0         67   11.3
CA TA WBA V A LLEY CC         32     13       3             84    62     10       2       0         89    94    11       2       0         87   11.6
CENTRA L CA ROLINA CC         26             69             31    80      0      34       1         65   106     0      42       1         57   11.1
CENTRA L PIEDMONT CC         100     38       6             56   134     19       2       0         78   234    27       4       0         69   11.1
CLEV ELA ND CC                13     46                     54    35     20       0       0         80    48    27       0       0         73   11.2
COA STA L CA ROLINA CC        46     33       2             65    53     26      21       0         53    99    29      12       0         59   10.9
COLLEGE OF A LBEMA RLE        29     31              21     48    31     13      13      13         61    60    22       7      17         55   11.1
CRA V EN CC                   23     48      26             26    34     18      18       0         65    57    30      21       0         49   10.7
DA V IDSON COUNTY CC          22     77                     23    41     46       2       0         51    63    57       2       0         41   10.3
DURHA M TCC                   44     80       2       2     16    67     33       0       0         67   111    51       1       1         47   10.4
EDGECOMBE CC                  19                     16     84    55      0       9       9         82    74     0       7      11         82   11.8
FA Y ETTEV ILLE TCC           67             24             76   128      0      13       0         88   195     0      16       0         84   11.7
FORSY TH TCC                  47     60       2             38    92     14       2       0         84   139    29       2       0         68   11.1
GA STON COLLEGE               46     28       4             67    58     19       2       0         79   104    23       3       0         74   11.3
GUILFORD TCC                  65     74                     26   122     28       0       0         72   187    44       0       0         56   10.7
HA LIFA X CC                  19     58                     42    34      9       0       0         91    53    26       0       0         74   11.2
HA Y WOOD CC                  13     23                     77    48      6       4       0         90    61    10       3       0         87   11.6
ISOTHERMA L CC                19     53              11     37    33     21       0       6         73    52    33       0       8         60   10.9
JA MES SPRUNT CC              12                           100    33      0       6       0         94    45     0       4       0         96   11.9




MGT of America, Inc.                                                                                                                                   Page 2-7
                                                                                                                      Faculty Salaries and Contract Length


                                                      EXHIBIT 2-5 (Continued)
                                       PERCENT DISTRIBUTION OF FACULTY MONTHS EMPLOYED
                                       BY PROGRAM TYPE AND NUMBER OF MONTHS BY COLLEGE

                                     Gene ral Education Fa culty            Other Educa tion Faculty                   All Fa culty                 Avera ge
                                            % of Contracts that Ar e :           % of Contracts that Ar e :           % of Contracts that Ar e :    Contract
                                   Total    09     10     11     12    Total    09     10     11     12    Total    09     10     11     12          Le ngth
              Colle ge Nam e      Faculty M onth M onth M onth M onth Faculty M onth M onth M onth M onth Faculty M onth M onth M onth M onth       (Months)
         JOHNSTON CC                 23       9        9             83     87     0       8       0      92    110     2       8       0      90        11.8
         LENOIR CC                   29       7        7             86     46     0       2       0      98     75     3       4       0      93        11.8
         MA RTIN CC                  11                      64      36     16     0       0      19      81     27     0       0      37      63        11.6
         MA Y LA ND CC               10      40                      60     17    24       0       0      76     27    30       0       0      70        11.1
         MCDOWELL TCC                11                9             91     26     4       0       8      88     37     3       3       5      89        11.8
         MITCHELL CC                 22       9                      91     26    15       0       0      85     48    13       0       0      88        11.6
         MONTGOMERY CC                4                             100     22     0       5       0      95     26     0       4       0      96        11.9
         NA SH CC                    22      32      14              55     34    12       3       3      82     56    20       7       2      71        11.3
         PA MLICO CC                  3     100                             11    36       0       0      64     14    50       0       0      50        10.5
         PIEDMONT CC                  7      57                      43     41    20      24       0      56     48    25      21       0      54        10.8
         PITT CC                     36      42        8             50     79     6       6       1      86    115    17       7       1      75        11.3
         RA NDOLPH CC                10               60             40     35     0      14       6      80     45     0      24       4      71        11.5
         RICHMOND CC                 16      88                      13     23    52       0       0      48     39    67       0       0      33        10.0
         ROA NOKE-CHOWA N CC          8                             100     24     0       8       4      88     32     0       6       3      91        11.8
         ROBESON CC                  14               36     14      50     32     0      19       0      81     46     0      24       4      72        11.5
         ROCKINGHA M CC              26      50                      50     33    18       0       0      82     59    32       0       0      68        11.0
         ROWA N-CA BA RRUS CC        27      33      48              19     50    24      28       2      46     77    27      35       1      36        10.5
         SA MPSON CC                 10      30                      70     31    13       0      13      74     41    17       0      10      73        11.4
         SA NDHILLS CC               43      16      35              49     53    11      13       2      74     96    14      23       1      63        11.1
         SOUTH PIEDMONT CC           10      60              10      30     27    48       0       0      52     37    51       0       3      46        10.4
         SOUTHEA STERN CC            21      10                      90     35     6       0       0      94     56     7       0       0      93        11.8
         SOUTHWESTERN CC             12      42      50               8     38    37      42       0      21     50    38      44       0      18        10.0
         STA NLY CC                  13      69                      31     32    34       0       0      66     45    44       0       0      56        10.7
         SURRY CC                    32      22        6     22      50     44    16       2       7      75     76    18       4      13      64        11.2
         TRI-COUNTY CC                9               44             56     15     0       7       7      87     24     0      21       4      75        11.5
         V A NCE-GRA NV ILLE CC      23      26                      74     56    13       0       0      88     79    16       0       0      84        11.5
         WA KE TCC                   70      40        7             53    141    10       1       0      89    211    20       3       0      77        11.3
         WA Y NE CC                  35      34        6             60     56    16       5       4      75     91    23       5       2      69        11.2
         WESTERN PIEDMONT CC         25                             100     39     0       0       0     100     64     0       0       0     100        12.0
         WILKES CC                   26      27        8             65     30    27       3       0      70     56    27       5       0      68        11.1
         WILSON TCC                  12                8             92     37     5       3       3      89     49     4       4       2      90        11.8
         SYSTEM TOTALS             1446      34        9       2     55   2755    14       7       1      78   4201    21       7       2      70        11.2




MGT of America, Inc.                                                                                                                                            Page 2-8
                                                     Faculty Salaries and Contract Length


      Because there is so much variation in the length of faculty employment periods

across the system, a detailed examination of faculty contracting practices was

conducted at a sample of seven community colleges. The sample was selected to

provide a cross-section of colleges according to their size, program mix, and

employment practices. In particular, the detailed examination sought to learn more about

those factors, in addition to instructional programs, that contribute to faculty employment

periods of more than nine months.

      The detailed analysis consisted of two major activities. First, we sought to identify

policies and practices that serve to influence the number of months covered in each

faculty member’s contract. Second, we asked campus administrators to verify a listing

of their faculty (including respective salary amounts and number of months employed)

who were included in the System’s faculty salary report to SREB.

      The policies and practices portion of the special survey asked for information

about the types of factors that contributed to the need for faculty employment of greater

than nine months length. All seven colleges reported that one factor for their institution

was the need for instructors for summer courses.        Additionally, all but one college

reported that longer employment periods were associated with additional duties such as

program management and development. Another common reason, with five colleges

reporting, was the requirement to make faculty salaries more competitive with local

public school systems and the private sector. In addition to ongoing 12-month contracts,

five of the seven colleges reported that some of their individual faculty contracts were

extended during the year from the nine to ten month terms to longer terms to

accommodate summer teaching workload. Exhibit 2-6 details the responses by college.




MGT of America, Inc.                                                               Page 2-9
                                                                      Faculty Salaries and Contract Length


                                         EXHIBIT 2-6
                 POLICIES AND PRACTICES AFFECTING FACULTY CONTRACT LENGTH
                        SELECTED NORTH CAROLINA COMMUNITY COLLEGES

Fa ctors tha t influe nce le ngth                                   Colle ge
of fa culty contra cts            Cape Fear Davidson Fayetteville   Forsyth    Montogomery   W ake   W ilkes     Total

Length of instructional program       X        X           X           X            X          X        X         7

Additional duties or assignments      X        X           X           X            X                   X         6

Faculty member request                                                                                            0

Ability to recruit                    X                    X           X                       X        X         5

Other                                          X                       X            X          X                  4

Contract extensions for summer        X        X                       X            X          X                  5



                     Upon examination of the specific factors that influenced the months of

         employment for each faculty member, we found that the most common reason reported

         by the sample colleges related to program length.                    That is, faculty who teach in

         programs (principally those programs leading to the Associate Degree in Applied

         Science) that last longer than nine months have longer employment periods that

         correspond to program length. A second, closely related factor was the need to extend

         the contract length of faculty in college transfer programs to respond to course demand

         in the summer term. Time required for program coordination was also a frequently

         reported, significant, factor. Reported factors, by college, are listed in Exhibit 2-7.

                     Since the sample colleges reported that longer-term contracts were often due to

         summer teaching assignments, we sought to analyze this finding through further

         statistical analysis.       That is, we examined whether those colleges with greater

         proportions of their faculty on longer-term employment periods also were the colleges

         with greater proportions of summer teaching production. As seen in Exhibit 2-8, we

         found only a weak relationship between summer faculty appointments and summer

         enrollment of students.


         MGT of America, Inc.                                                                        Page 2-10
                                                                                           Faculty Salaries and Contract Length




                                                     EXHIBIT 2-7
                                  REASONS FOR CONTRACTS GREATER THAN NINE MONTHS
                                    SELECTED NORTH CAROLINA COMMUNITY COLLEGES


                                                        Ca pe
Re ason for Contra ct Gre ater tha n 9 months           Fea r   Da vidson Faye tte ville Forsyth Montgome ry W a ke W ilke s
 Department Chair/Program Coordinator/Lead Instructor     13.3%     18.9%       23.8%     43.9%        11.1% 25.3%    4.3%
 12-month Program/Program Length                          86.7%     49.1%         6.8%    43.0%               56.7%
 Recruited Faculty at Competitive Salaries                                      17.5%      0.9%
 Summer School                                                      20.8%         5.3%                 70.4%   5.1% 80.4%
 Summer School and Program Coordinator/Division Chair                                                                13.0%
 Convert 12-month to 9-month                                         1.9%
 Convert 9-month to 12-month                                         3.8%
 Professional Development and Class Preparation                                 21.8%
 Program Start-up/Coordination                                       3.8%
 Program Coordination and Length                                     1.9%
 Remedial and Tutorial W ork                                                                           18.5% 12.9%
 Historical Contracting Practices                                               24.8%
 Seniority                                                                                 9.3%
 Additional Duties above current job description                                           2.8%
 Lab Coordinator                                                                                                      2.2%
Total                                                    100.0%   100.0%      100.0% 100.0%           100.0% 100.0% 100.0%
Sources :
 (1) NCCCS Office, October 1999
 (2) Provided by each s chool




MGT of America, Inc.                                                                                                   Page 2-11
                                                                          Faculty Salaries and Contract Length


                                                   EXHIBIT 2-8
                               ANALYSIS OF SUMMER ENROLLMENT AND SUMMER STAFFING


                           1.35



                           1.30
   Contract Length Index




                           1.25



                           1.20



                           1.15



                           1.10



                           1.05
                                   0            0.05            0.1           0.15            0.2           0.25

                                                       Summer FTE Enrollment as % of Annual




2.5                        Summary of Findings and Recommendations

                           The directive from the General Assembly asked the State Board to examine

whether the colleges could typically employ faculty for less than 12 months as one

means of increasing effective monthly compensation. Our findings do not provide strong

support for this approach since extra duties, mostly involving direct instruction, appear to

account for most of the summer employment of faculty. This approach would become

more viable, however, if an alternative source of summer funding were provided.

                           Two major factors that appear to cause salaries to be lower than regional and

national comparative averages derive from the strong vocational-technical emphasis of

the System:

                           !      The System has a lower average class size than provided by the
                                  instructional staffing formula. The large number of occupational
                                  programs, which require close student supervision by faculty, is
                                  undoubtedly a major factor in this staffing pattern.

MGT of America, Inc.                                                                                 Page 2-12
                                                       Faculty Salaries and Contract Length


      !   The System makes significantly greater use of longer term contracts
          than other states. The incidence of longer contracts is especially
          evident among technical programs, which typically last longer than
          nine months.

A related factor, as reported by the colleges, is the need to offer longer contracts to

faculty in the technical programs in order to remain competitive with salaries available in

private sector positions.

      In effect, the instructional staffing formula -- and especially the associated

enrollment recognition procedure – are not well suited for the program offerings of the

System.    That is, the colleges must spread faculty compensation resources in the

technical programs over a greater number of faculty than provided by the staffing

guidelines in the formula. More importantly, the colleges are now expected to provide

instructional staff for the summer term by diverting salary resources that are determined

by enrollments in the nine-month term. Alternative methods for funding summer-term

enrollment, in order to enable current formula dollars to be available for enhancing nine-

month faculty contracts, is the topic of the next chapter.




MGT of America, Inc.                                                              Page 2-13
3.0 FUNDING FOR SUMMER TERM
     CURRICULUM INSTRUCTION
           3.0 FUNDING FOR SUMMER TERM CURRICULUM
                         INSTRUCTION

3.1   Enrollment Patterns by Term

      Traditionally, colleges and universities in the United States have operated on a

nine-month academic calendar.      These nine months were divided either into three

quarters or two semesters, according to local custom.      In addition to these primary

academic terms, most colleges had limited – often very limited – program offerings in the

summer term.       This curricular pattern was similar to that which was common in

elementary-secondary schools where most students and faculty/staff were free during

the summer, presumably to support the agrarian economy.

      Over time, the summer session has become an increasingly important part of the

academic program of colleges and universities across the nation. The North Carolina

Community College System has experienced the same pattern, with the summer term

now being over one-fourth as large as the nine-month term. As shown in Exhibit 3-1,

several colleges are now approaching the point where they have nearly one quarter as

many curriculum students present in the summer as in the fall or spring.

      A number of factors are now converging that collectively serve to create an even

greater future demand for educational opportunities at North Carolina community

colleges in the summer term. They include:

      !   the need to accommodate and respond to working adults whose
          lifestyle and schedules do not follow the traditional academic
          schedule or calendar;

      !   the demand to serve University students who desire to take
          transferable liberal arts or science courses during the summer term
          in their local communities, thereby facilitating baccalaureate degree
          completion;




MGT of America, Inc.                                                              Page 3-1
                                         Funding for Summer Term Curriculum Instruction


                              EXHIBIT 3-1
          ANALYSIS OF SUMMER TERM CURRICULUM FTE ENROLLMENT
              NORTH CAROLINA COMMUNITY COLLEGE SYSTEM

                                             Annualized FTE                       Summer
                                      Fall      Spring       Total     Summer     as Percent
           College                    1998       1999       1998-99     1999       of Total
           ALAMANCE CC                 1,102          999      2,101       267       12.71%
           ASHEVILLE-BUNCOMBE T        1,601        1,455      3,056       447       14.63%
           BEAUFORT COUNTY CC            600          594      1,194       160       13.40%
           BLADEN CC                     367          324        691        94       13.60%
           BLUE RIDGE CC                 643          602      1,245       197       15.82%
           BRUNSW ICK CC                 333          307        640        55        8.59%
           CALDW ELL CC & TI           1,161        1,112      2,273       237       10.43%
           CAPE FEAR CC                1,761        1,753      3,514       466       13.26%
           CARTERET CC                   546          513      1,059       158       14.92%
           CATAW BA VALLEY CC          1,342        1,224      2,566       468       18.24%
           CENTRAL CAROLINA CC         1,444        1,330      2,774       288       10.38%
           CENTRAL PIEDMONT CC         4,275        3,956      8,231       938       11.40%
           CLEVELAND CC                  726          684      1,410       211       14.96%
           COASTAL CAROLINA CC         1,388        1,317      2,705       564       20.85%
           COLLEGE OF THE ALBEMARLE      773          675      1,448       138        9.53%
           CRAVEN CC                     826          886      1,712       285       16.65%
           DAVIDSON COUNTY CC            938          818      1,756       193       10.99%
           DURHAM TCC                  1,475        1,440      2,915       459       15.75%
           EDGECOMBE CC                  667          672      1,339       214       15.98%
           FAYETTEVILLE TCC            2,789        2,846      5,635       838       14.87%
           FORSYTH TCC                 1,709        1,580      3,289       534       16.24%
           GASTON COLLEGE              1,386        1,320      2,706       342       12.64%
           GUILFORD TCC                2,593        2,423      5,016       487        9.71%
           HALIFAX CC                    600          658      1,258        92        7.31%
           HAYW OOD CC                   706          638      1,344       231       17.19%
           ISOTHERMAL CC                 699          667      1,366       239       17.50%
           JAMES SPRUNT CC               501          493        994       130       13.08%
           JOHNSTON CC                 1,142        1,142      2,284       309       13.53%
           LENOIR CC                     900          852      1,752       178       10.16%
           MARTIN CC                     267          266        533        62       11.63%
           MAYLAND CC                    274          355        629        93       14.79%
           MCDOW ELL TCC                 413          380        793       151       19.04%
           MITCHELL CC                   632          602      1,234       186       15.07%
           MONTGOMERY CC                 252          276        528        85       16.10%
           NASH CC                       727          671      1,398       139        9.94%
           PAMLICO CC                     86          122        208        18        8.65%
           PIEDMONT CC                   613          638      1,251       103        8.23%
           PITT CC                     1,755        1,711      3,466       552       15.93%
           RANDOLPH CC                   606          591      1,197       247       20.63%
           RICHMOND CC                   560          551      1,111       152       13.68%
           ROANOKE-CHOW AN CC            351          365        716        97       13.55%
           ROBESON CC                    731          694      1,425        61        4.28%
           ROCKINGHAM CC                 722          641      1,363       178       13.06%
           ROW AN-CABARRUS CC          1,331        1,241      2,572       348       13.53%
           SAMPSON CC                    490          461        951       123       12.93%
           SANDHILLS CC                1,181        1,143      2,324       364       15.66%
           SOUTH PIEDMONT CC             619          486      1,105       124       11.22%
           SOUTHEASTERN CC               790          794      1,584       243       15.34%
           SOUTHW ESTERN CC              676          698      1,374       162       11.79%
           STANLY CC                     642          628      1,270       141       11.10%
           SURRY CC                    1,124        1,057      2,181       327       14.99%
           TRI-COUNTY CC                 344          345        689       115       16.69%
           VANCE-GRANVILLE CC          1,235        1,132      2,367       307       12.97%
           W AKE TCC                   2,830        2,716      5,546       875       15.78%
           W AYNE CC                   1,181        1,158      2,339       342       14.62%
           W ESTERN PIEDMONT CC          830          803      1,633       260       15.92%
           W ILKES CC                    772          732      1,504       137        9.11%
           W ILSON TCC                   551          556      1,107       237       21.41%
           TOTAL FTE                  57,578       55,093    112,671     15,448      13.71%




MGT of America, Inc.                                                                           Page 3-2
                                         Funding for Summer Term Curriculum Instruction


      !   the need to make better utilization of specialized facilities, equipment
          and staff in a traditionally slow period; and

      !   the opportunity to enable students to reach their educational goals
          more quickly, thereby preparing them to enter the work force.

      Another emerging factor could have a significant impact upon enrollments in post-

secondary educational institutions over the next decade. Based on DPI “Statistical

Profile” information for the period 1999-2008, the number of public high school

graduates in North Carolina is projected to grow by at least 17,800 students by 2008.

Such growth will undoubtedly create demand on the community colleges to train these

students for good jobs or to provide an inexpensive way to complete their first two years

of college. The Community College System has the capacity to assist these students,

especially during the summer, if appropriate funding is made available.



3.2   Funding Policy for Summer Term

      As mentioned in the preceding chapter, the second portion of the special provision

directing the study of faculty salaries required an examination of summer term funding.

For at least the past decade, summer term curriculum enrollments have not been

considered in calculating the funding requirements for community colleges. Instead,

fundable enrollment is calculated on a two-semester basis.      This means that any state

funding that can be made available by the colleges for summer term instruction must

come from resources that were provided to fund the workload in the two regular

semesters. In effect, the colleges must divert funds that were generated by fall and

spring students to support their summer instructional programs.

      As a result of limited funding, course offerings and faculty employment in the non-

applied science areas, which are not on a two-year track for completion, drop off. As

seen above, overall summer enrollment is typically about 25-30 percent of regular term



MGT of America, Inc.                                                                 Page 3-3
                                         Funding for Summer Term Curriculum Instruction


levels. While generally acknowledging that summer is likely to remain a lighter term than

fall or spring, college presidents report that part of this drop in enrollment is because

colleges do not receive identifiable FTE funding for the summer.            That is, they

experience more enrollment demand than they can handle with available funds.

      The current funding policy results in under-utilization of existing facilities and

faculty. It also means that colleges are not able to place on track either developmental

students or students who could be prepared to enroll in specialized programs (allied

health, shop/lab intensive programs, etc.).    A major impediment for the colleges at

present in planning a broader array of courses in the summer is the lack of targeted

funding.



3.3   Comparison to Summer Enrollment Funding Policies Elsewhere

      We examined how other states approach the problem of providing funding for

summer term instruction.    At least five generic approaches are used in the funding

models of other states to recognize the funding requirements created by summer term

instruction:

      1. Self-Supporting. There are no specific provisions in the state funding
         model to recognize summer term enrollments. Nonetheless, certain
         central administrative and support positions are funded on a 12-month
         basis (e.g., president, librarian). Otherwise, summer instruction is
         assumed to be self-supporting from the tuition and fees charged to
         students who enroll in the summer.

      2. Self-Supporting with Overhead Contribution. Similar to the above,
         the summer term is considered to be self-supporting but with the further
         obligation to pay for additional overhead services presumably created by
         summer operations. In Arizona, for instance, 10 percent of the summer
         term tuition is used to offset the state funding requirement for the regular
         appropriation.

      3. Regular Term Average Treatment.        The summer term and its
         enrollment are recognized in the same manner as enrollment for the
         other nine months. That is, enrollments over all terms would be
         averaged as if summer were a regular term (e.g., sum of 4 quarters

MGT of America, Inc.                                                               Page 3-4
                                         Funding for Summer Term Curriculum Instruction


           divided by 4, or sum of 2 semesters and summer divided by 21/2). This
           approach was used by the NCCCS until the early 1990s.

      4. Summer Term Overload Basis. Enrollment in the summer term is
         counted along with that for the other terms, but then converted to a nine-
         month basis. That is, student credit hours for a 12-month period would
         be divided by 30 (the FTE definition for two semesters) to derive an
         annualized FTE count. The resulting FTE number is then used in all
         subsequent formula calculations.

      5. Selective Recognition of Summer Enrollment. Summer enrollment is
         recognized in a separate calculation of the formula apart from regular
         term enrollment. Regular term enrollment is used to drive regular term
         instruction and year-round administrative levels.        Then, summer
         enrollment is used to calculate only the direct instructional costs (i.e.,
         incremental costs) of summer.

Clearly, a variety of techniques are used by the states to fund (or not to fund) their

colleges and universities in the summer term. The trend, however, is to recognize that

summer instruction is an integral part of the overall program of the institutions and

provides a cost-effective way for states to accommodate more students.



3.4   Recommended Approach for Summer Term Funding

      Given the overall structure of the current NCCCS funding model, we believe that

the fifth alternative described above – selective recognition – is best suited for enabling

the System to respond to unmet current and future enrollment demand during the

summer.

      More specifically, we recommend that a separate formula calculation be created in

the funding model for summer term curriculum instruction. This formula would use the

same instructional staffing ratios as the regular term formula.      Summer enrollment,

however, would be staffed at the top level of the sliding scale.

      The other formula components of the funding model would not need to be

changed.     The provisions for instructional and administrative support, instructional

resources, and other support programs would appear to already be funded on a 12-

MGT of America, Inc.                                                               Page 3-5
                                        Funding for Summer Term Curriculum Instruction


month basis. For example, the library collection and equipment already funded for the

regular term should be adequate for the summer term.



3.5    Projected Cost of Revised Summer Funding Model

       How much will summer term funding cost the State? A portion of the special

provision directs the consultant to “consider how much additional supplemental funding

for summer term would be required if the Community College employed faculty members

for less than 12 months instead of on a 12 month basis.”

       Based upon estimates developed by the System Office, the full cost of funding

direct instruction for the summer term is estimated to be approximately $43 million. This

estimate is based on the average summer enrollment over the past four years. Exhibit

3-2 illustrates the calculation of the recommended formula.

       We believe that such a significant change in the funding model should be

approached with caution. Immediate implementation might provide funds more rapidly

than they could be effectively deployed. Therefore, we suggest a three-year phase-in

period.

       Due to the fact that the summer term spans two fiscal years, the cost to the state

of adopting this recommendation would be less than one-third the full cost illustrated

above during the first year of implementation. Assuming the support of the Governor

and General Assembly for this approach, one-third of the funding in the 2000-01 budget

would be needed for the first half of the 2001 summer term. The remainder of that

summer term would be funded in the 2001-02 state appropriation at the two-thirds

implementation rate. Details of the phased implementation plan are provided in Exhibit

3-3.




MGT of America, Inc.                                                             Page 3-6
                                          Funding for Summer Term Curriculum Instruction


                              EXHIBIT 3-2
           ESTIMATION OF SUMMER TERM FUNDING REQUIREMENTS
                FOR CURRICULUM INSTRUCTION PROGRAMS
         BASED ON FULL IMPLEMENTATION OF RECOMMENDED MODEL


   Fundable Enrollment

         Actual Summer FTE (1999)                                                    15,448


   Determination of Faculty Units Required

         Staffing Ratio (FTE Students per Faculty Unit)                                  20

         Faculty Units Required                                                       772.4


   Determination of Funding Required for Faculty

         Direct Compensation                                  $   42,201
         FICA @ 7.65%                                              3,228
         Retirement @ 10.83%                                       4,570
         Hospitalization @ $2,256                                  2,256
         Total Cost per Faculty Unit                          $   52,256

         Number of Faculty Units @ $52,256                                 $   40,362,337


   Determination of Funding Required for Other Costs

         Other Instructional Cost @ $175/FTE                               $    2,703,400


   Total Summer Funding Required at Full Implementation                    $   43,065,737




                             EXHIBIT 3-3
                   PROPOSED PHASE-IN SCHEDULE FOR
          SUMMER TERM CURRICULUM INSTRUCTION FUNDING MODEL

                                         Amount                       Additiona l
                          Pe rce nt    Re quired a t      Amount       Funding
           Fiscal Yea r   Re quired    Full Funding       Re quired   Re quired

             2000-01          16.67% $ 43,065,737      $ 7,179,058    $ 7,179,058
             2001-02          66.67% $ 43,065,737      $ 28,711,927   $ 21,532,869
             2002-03         100.00% $ 43,065,737      $ 43,065,737   $ 14,353,810




MGT of America, Inc.                                                                   Page 3-7
4.0 REFINEMENTS FOR NEW
  CONSTRUCTION FORMULA
      4.0 REFINEMENTS FOR NEW CONSTRUCTION FORMULA

4.1   Background

      Due to growing discontent with the then-existing formula process used to set

priorities for capital funding for new construction, the North Carolina Community College

System undertook a major revision of its model during the 1998-99 year.           A new

approach was endorsed by the State Board and submitted to the General Assembly in

early 1999. This model was then used to identify potential capital allocations to each

college during the 1999 legislative session, but ultimately no new construction funds

were provided for higher education based on the new formula.

      There are two basic types of capital outlay funding for the NCCCS – funding for

new construction and funding for repair and renovation (R&R). Capital outlay funding for

new construction, as its name implies, is intended to provide the resources needed by

the colleges to erect new buildings or to construct major renovations or additions to

existing structures.   R&R funding, on the other hand, is intended for repair and

renovation projects (e.g., a roof replacement) for existing buildings.      The formula

adopted in 1999, and now subject to further refinement, relates to new construction.

      The State Board of Community Colleges has previously addressed the R&R issue.

In April 1998, the State Board endorsed a study recommendation that called for the R&R

funding request to be determined according to a percentage of the replacement value of

each building. The actual percentages in the model range from one to two percent

depending on the age of the building. Appropriations are to be allocated among the 58

community colleges in proportion to their age-weighted building replacement value.




MGT of America, Inc.                                                             Page 4-1
                                               Refinements for New Construction Formula


4.2   Previous New Construction Model

      The previous model for requesting and allocating new construction funds was

developed by the NCCCS in 1990. Basically, the model was designed to review and

assign priorities to proposals that had been submitted by each college for specific new

buildings to be constructed.       Each proposal was scored using a seven-factor

assessment model, and the building projects with the most points were considered to be

of the highest priority for any funding made available to the NCCCS. The seven factors

and their relative weight in the model are described in Exhibit 4-1. Some of the factors

appear to apply to the college generally, while several are specific to the construction

project that has been proposed.

      In addition to the point system, several other procedures governed which projects

and amounts are recommended for funding. For instance, a college that had recently

received state capital outlay funding was not allowed to participate in the next

appropriation cycle. Also, state funding was limited to $3 million per project, regardless

of project size, and a college was eligible only for one project per cycle regardless of its

enrollment size or the number of campuses it operates.

      For various reasons, the previous model came into disfavor. Some were critical of

one or more of the seven individual factors while others faulted the related rules and

procedures. Some critics simply found the model too complex to be confident that they

understood how their needs were being treated. Other than the 1993 bond funds, all

were concerned that the amount of funding, which had been distributed through the

model, was inadequate.




MGT of America, Inc.                                                                Page 4-2
                                                            Refinements for New Construction Formula


                               EXHIBIT 4-1
        FACTORS USED IN PREVIOUS CAPITAL PROJECT RANKING PROCESS

           Crite rion               W e ight                           Asse ssm e nt Com me nts
Assignable Square Feet per                 0.20   Is not related to either current demand or backlog of need
Adult Population

FTE Students per Adult                     0.10   Is not related to either current demand or backlog of need
Population

Capacity/Student Clock Hours               0.20   Limited only to instruction and library space


Room Hours of Instruction                  0.20   Serves to relieve overcrowding of classroom space


Local $ / State $                          0.10   Emphasis on matching penalizes colleges in low wealth areas


Project Type                               0.20   Places too much emphasis on classrooms

      Classroom & Laboratory     0.20

      Office and Study           0.10

      Other Space                0.05

Readiness to Implement                     0.05   Provides slight advantage to projects already planned

                         Total             1.05




4.3     Goals for 1999 Funding Model for New Construction

        In developing a proposal for a revised capital outlay-funding model in 1999, we

sought to address several problems that were attributed to the previous formula. A

primary goal was to create a model that provided a reasonable degree of equity across

campuses without being overly complex.

        Recognizing the great diversity in facilities capacity across the System and its

relationship to the matching requirements inherent in the current model, we sought to

take each college’s ability to pay for new facilities into account. We also attempted to

design a model that will allow colleges to use available capital resources for facilities that

are needed the most without undue influence to favor certain types of facilities as

experienced in the previous ranking model. The overarching objective was to develop a




MGT of America, Inc.                                                                                      Page 4-3
                                                 Refinements for New Construction Formula


streamlined capital outlay-funding model that could earn widespread support within the

NCCCS community and eventually from the General Assembly.



4.4   Description of 1999 Funding Model for New Construction

      Although many states use a facilities planning and budgeting model that

calculates space needs separately for each type of space, we found this level of

complexity was not necessary to meet the requirements of the NCCCS. Instead, we

proposed a more streamlined approach, which addresses the major factors that affect

the relative amount of space needed by each college while still being readily

understandable to a broad range of stakeholders.

      In particular, we proposed a funding model that relied on two major components to

estimate the unmet need for space for each campus in the NCCCS:

      !   a base allowance of square feet for each site that was sufficient to
          handle a minimum number of students, and

      !   a square-feet-per-student allowance for each student beyond the
          minimum enrollment level.

The total required square feet was then compared to the available square feet (including

projected additions and deletions to the facilities inventory) to determine unmet need. A

schematic of this model is illustrated in Exhibit 4-2.




MGT of America, Inc.                                                             Page 4-4
                                                     Refinements for New Construction Formula


                                     EXHIBIT 4-2
                      OVERVIEW OF CURRENT SPACE PLANNING MODEL



             Estima tion of                    Proje cte d Fa cilitie s                 Additiona l Space
     Tota l Fa cility Require me nts   Less          Inve ntory              Equals       Requirem ents




    FTE enrollment times space                Current facilities inventory            Sum of net requirements
    factor equals ASF required                plus new buildings coming               where a shortage is
                                              on line less buildings                  projected
                                              scheduled for termination




         The provision of a base allotment of square feet per campus was intended to

recognize that a certain minimum amount of space is needed regardless of the number

of students being served. Some of this core space was intended to provide a minimal

amount of general use space, and the rest was for a basic allotment of instructional and

office space.         Similar to the various “economy of scale” features found in several

components of the new formulas for the operating budget, a certain core level of space

was proposed. Specifically, the 1999 model provided 20,000 assignable square feet

(ASF) in the space-needs estimation model for each campus or center1. This rate was

suggested by study group members as being reflective of recently planned space for

branch campuses and centers in North Carolina and elsewhere, and it was further

corroborated by a regression analysis of NCCCS inventory data.

         The model also provided 90 ASF/FTE for each student beyond a minimum

enrollment threshold at each site. This rate was established based on compilations of

more detailed space planning formulas used in other states. For the main campus




1
  Space planning models for colleges and universities are typically based on the concept of
“assignable square feet” or ASF. Assignable square feet excludes corridors, stairwells,
restrooms, mechanical areas and similar types of space that can not be assigned from the count
of gross square feet.

MGT of America, Inc.                                                                            Page 4-5
                                               Refinements for New Construction Formula


location of most colleges, the combined base and per-student space allowances resulted

in a need for approximately 100 ASF/FTE, a rate typically found in other states. For use

in the capital outlay appropriation, the capital funding needs for campuses and centers

were presented separately to the General Assembly.

      As introduced earlier, one of the goals of the 1999 funding model for capital outlay

was to recognize the differing abilities of the colleges to meet the traditional 50 percent

matching requirement to be eligible to receive state appropriations. The 1999 model

called for waiving part of this requirement based on an ability to pay index. The index

rates were derived from a corresponding feature in the funding model for public school

districts in the state and took into account such measures as personal income rates and

property valuations. Under the model, a college or campus serving a county with a

lower than average ability to pay would be expected to match its state appropriation at a

correspondingly lower rate.    That is, if the ability to pay index for the county is 90

percent, it would be expected to match only 45 percent, which is 90 percent of the

traditional 50 percent requirement. For colleges serving more than one county, the

ability to pay index would be used for the county where the project is to be located.

      A final aspect of the new model called for increased flexibility for the colleges in

their use of capital outlay allocations. The current model provides that the colleges be

allowed to transfer R&R and new construction funds for such purposes upon review and

approval by the State Board of Community Colleges.



4.5   General Assembly Response to 1999 Proposal

      The recommended model for new construction funding for the System was

generally well received by the General Assembly. The simplicity of the design and the

feature related to ability-to-pay enjoyed strong support. In more detailed review of the



MGT of America, Inc.                                                               Page 4-6
                                              Refinements for New Construction Formula


impact of the model on individual colleges, however, several shortcomings were

identified.

       Concurrent with the System’s development of a revised model for new

construction, the University of North Carolina also was assessing its construction needs

and submitting capital funding proposals to the General Assembly. Among the several

differences in the approaches recommended by the two systems, perhaps the most

significant was the difference in timeframe. The Community College System proposal

focused on current unmet needs for facilities, while the University’s request took into

account projected needs 5-6 years into the future. To ensure comparability in assessing

the needs of the two systems, use of a common time frame was needed.

       A second concern uncovered during the General Assembly’s review of the

System’s revised model for new construction was its inclusion of various types of

inappropriate space in the facilities inventory. For instance, the model had only limited

provision for removing "temporary" or run-down space from the projected inventory used

to determine unmet needs. Likewise, it was noted that various types of unique special

purpose space (e.g., a community center) was included in the inventory of available

space even though it was not intended for instructional purposes.

       Since the General Assembly decided not to proceed with the proposed bond issue

in 1999, the State Board enjoyed an opportunity to refine its revised model for new

construction to address the above concerns related to comparability between the two

systems and handling of inappropriate and/or unique types of space.




MGT of America, Inc.                                                             Page 4-7
                                               Refinements for New Construction Formula


4.6   Issues to Address in 1999-2000 Refinements

      The effort to refine the new construction model during the 1999-2000 study period

focused on several issues.       Some were known concerns, related to previously

unavailable data, that were noted in the 1999 report. Others grew out of legislative

review of the new model, as discussed above.

      Several issues related to the procedures and definitions used to calculate eligible

FTE enrollment for the space needs model. These included:

      !   Site-Specific Enrollments – Since a separate projection of facilities
          needs is to be developed for each state Board-approved
          campus/center/site operated by each college, enrollment
          corresponding to each site should be used. During the 1998-99
          study period, this information was not available, so System staff
          subsequently undertook data collection efforts to resolve this issue.

      !   Students Not Requiring Space – Certain students do not use on-site
          facilities to receive their instruction. A common example is a
          prisoner taking a course in a correctional facility rather than on
          campus. System staff have now worked with college officials to
          remove such students from the projections used in the space needs
          model.

      !   Projected Enrollment – As discussed above, there was interest in the
          General Assembly in achieving greater comparability in the models
          used by the University and the Community College System. System
          staff worked with each college and UNC personnel to develop an
          enrollment projection model to be used in the new construction
          formula.

The projected “Construction FTE Enrollment,” which is used in the refined new

construction model, is shown for each college in Exhibit 4-3. Overall, just over a 20

percent increase in enrollment is forecasted over the next five years.




MGT of America, Inc.                                                              Page 4-8
                                                      Refinements for New Construction Formula


                               EXHIBIT 4-3
              CURRENT AND PROJECTED ENROLLMENT BY COLLEGE
                NORTH CAROLINA COMMUNITY COLLEGE SYSTEM


                                                        1998-1999     1999-2000   2004-2005
                                                          Tota l        Tota l      Tota l
                    Colle ges, Site s a nd Cente rs        FTE           FTE         FTE
          Ala m a nce CC                                    2,013       2,047       2,310
                Glenhope School Ctr.                             81       90         119
                Front Street Ctr.                                69       76         102
                Glen Raven Ctr.                                  98       99         112
          Asheville -Buncombe TCC                           3,724       3,845       4,541
                Madison Cty. Ctr.                                77       82         106
          Bea ufort County CC                               1,669       1,719       2,077
          Bla de n CC                                         801        961        1,217
                Kelly/East Arcadia Ctr.                          58       60          69
          Blue Ridge CC                                     1,257       1,279       1,491
                Transylvania Cty. Ctr.                        398        404         458
          Brunsw ick CC                                       574        592         673
                Job Link Ctr.                                     0       0            0
                Leland Ctr.                                   151        157         194
                Southport Ctr.                                   51       53          66
          Caldw e ll CC & TI                                1,869       1,835       2,030
                W atauga Cty. Campus                          593        609         669
                Admin. Support/Basic Skills Ctr.                  6       10          11
                W atauga Cty. Business Ctr.                      72       86          91
          Cape Fea r CC                                     3,747       4,321       6,407
                North Campus (being developed)                    0       0          586
                Hampstead Ctr.                                116        120          85
                Burgaw Ctr.                                      74       81          98
          Carte re t CC                                     1,299       1,450       1,822
          Cata w ba Va lle y CC                             2,852       2,665       3,076
          Central Carolina CC                               2,084       2,166       2,383
                Chatham Cty. Campus                           383        405         444
                Harnett Cty. Campus                           770        798         872
                School of Telecommunications                  144        148         164
                Siler City Ctr. (Chatham Cty.)                117        123         129
          Central Piedm ont CC                              8,795       7,656       6,513
                North Campus                                  606        822         891
                Northeast Campus (being developed)                0       0          727
                South Campus                                1,179       2,056       3,664
                Southwest Campus (being developed)               26      624         713
                W est Campus (being developed)                    0       0          807
                W est Center                                  131        218         214
          Cle ve la nd CC                                   1,577       1,791       2,043
          Coa sta l Ca rolina CC                            3,589       3,821       4,256
          Colle ge of The Albe m a rle                      1,230       1,306       1,489
                Chowan Cty. Ctr.                              109        115         148
                Dare Cty. Campus                              251        270         332
                Riverside Ext. Ctr.                               0       0            0
          Cra ve n CC                                       1,694       1,782       1,963
                Havelock/Cherry Point Ctr.                    277        291         318
          Davidson County CC                                2,051       2,035       2,296
                Davie Cty. Ctr.                               136        146         182
          Durham TCC                                        3,485       3,637       4,427
                Northern Durham Ctr.                          139        145         177



MGT of America, Inc.                                                                          Page 4-9
                                                       Refinements for New Construction Formula


                           EXHIBIT 4-3 (Continued)
              CURRENT AND PROJECTED ENROLLMENT BY COLLEGE
                NORTH CAROLINA COMMUNITY COLLEGE SYSTEM


                                                         1998-1999     1999-2000   2004-2005
                                                           Tota l        Tota l      Tota l
                   Colle ge s, Site s a nd Ce nte rs        FTE           FTE         FTE
         Edge combe CC                                         962        994        1,145
               Rocky Mount Campus                              730        784         909
         Fa ye tte ville TCC                                 6,546       6,913       8,329
               Firefighting Facility Ctr.                         38       60          75
               Fort Bragg Ctr.                               1,226       1,255       1,656
         Forsyth TCC                                         3,270       3,534       4,274
               Carver Road Ctr.                                157        206         255
               Kernersville Ctr.                               149        178         224
               W est Ctr.                                      842        867        1,003
         Ga ston Colle ge                                    2,847       2,850       3,171
               Lincoln Cty. Ctr.                               172        208         467
         Guilford TCC                                        4,514       4,818       6,928
               Aviation Ctr.                                   150        161         232
               Greensboro Campus                               941       1,007       1,749
               High Point Ctr.                                 486        521         740
               Small Business Ctr.                                 1       1            1
         Ha lifa x CC                                        1,452       1,584       2,294
         Ha yw ood CC                                        1,221       1,162       1,284
               Continuing Ed. Ctr.                                80       75          87
               High Tech Ctr.                                  159        129         144
               Human Resource Devel. Ctr.                         10       10          10
         Isothe rm a l CC                                    1,497       1,666       1,882
               Polk Cty.Ctr.                                      66       43          57
         Ja m e s Sprunt CC                                  1,082       1,093       1,229
         Johnston CC                                         2,387       2,394       2,672
         Le noir CC                                          2,172       2,389       2,793
               Aviation Ctr.                                      31       39          46
               Greene Cty. Ctr.                                212        230         347
               Jones Cty. Ctr.                                    51       52          63
               W alstonburg Ctr.                                   0       0            0
               W est Boundary Street Ctr.                          4       5            4
         Ma rtin CC                                            644        678         686
               Bertie Cty. Ctr.                                   33       29          31
         Ma yla nd CC                                          855        880        1,070
               Avery Cty. Ctr.                                    63       54          99
               Yancey Cty. Ctr.                                   49       59          84
         McDow e ll TCC                                        887        924        1,030
               Marion Ctr.                                         0       0            0
         Mitche ll CC                                        1,467       1,485       1,636
               Mooresville Ctr.                                105        169         188
         Montgome ry CC                                        618        609         712
         Na sh CC                                            1,896       1,826       2,084
         Pa m lico CC                                          291        318         703
         Pie dmont CC                                          763        846        1,132
               Caswell Cty. Ctr.                               303        335         434
         Pitt CC                                             3,975       4,034       4,345
         Ra ndolph CC                                        1,471       1,654       1,832
               Archdale Ctr.                                      87       91         103



MGT of America, Inc.                                                                           Page 4-10
                                                   Refinements for New Construction Formula


                           EXHIBIT 4-3 (Continued)
              CURRENT AND PROJECTED ENROLLMENT BY COLLEGE
                NORTH CAROLINA COMMUNITY COLLEGE SYSTEM


                                                      1998-1999     1999-2000 2004-2005
                                                        Tota l        Tota l     Tota l
                    Colle ge s, Site s a nd Ce nte rs    FTE           FTE        FTE
          Richmond CC                                     1,084       1,116      1,237
                 Continuing Education Ctr.                     51       52         57
                 James Nursing Bldg.                           34       26         27
                 Scotland Cty. Ctr.                         237        213        124
          Roa noke Chow a n CC                              762        767       1,080
          Robe son CC                                     1,941       2,009      2,437
                 Emergency Training Ctr.                       36       38         50
                 Lumberton Extension Ctr.                   176        182        216
                 Pembroke Extension Ctr.                    150        154        174
          Rockingha m CC                                  1,607           1,644     1,856
          Row a n-Ca ba rrus CC                           1,940           2,052     2,356
                 Cabarrus Cty. Campus                     1,100           1,225     1,429
                 Corban Ctr.                                    0              0         0
          Sa mpson CC                                     1,239           1,276     1,476
          Sa ndhills CC                                   2,720           2,871     3,446
                 Hoke Cty. Ctr.                             181              185      277
          South Pie dmont CC - Ea st Ca m pus (Anson)       786              785      845
                 Ansonville Ctr.                                0              0         0
                 W adesboro Ctr.                               49             32        48
                 Union Cty.                                 371              358      436
          Southe a ste rn CC                              1,770           1,796     2,004
          Southw e ste rn CC                              1,658           1,675     2,219
                 Macon Cty. Ctr.                            199              203      688
                 Swain Cty. Ctr.                               88             90      140
          Sta nly CC                                      1,261           1,290     1,586
                 W estern Stanly Ctr.                           0              0        19
          Surry CC                                        2,468           2,552     2,820
                 Yadkin Cty. Ctr.                           123              127      220
          Tri-County CC                                     688              932      852
                 Graham Cty. Ctr.                           106              104        98
          Va nce -Gra nville CC                           1,834           1,958     2,138
                 Franklin Cty. Campus                       398              481      568
                 Granville Cty. Campus                      693              643      820
                 W arren Cty. Ctr.                          317              343      388
          W a ke TCC                                      5,583           5,900     6,666
                 Adult Education Ctr.                       355              364      392
                 Health Sciences Campus                   1,234           1,246     1,357
                 Northeast Campus (being developed)             0              0         0
          W a yne CC                                      2,880           2,930     3,497
                 Aviation Ctr.                                 43             48        54
          W e ste rn Pie dmont CC                         1,867           1,855     2,049
                 North King/W est Meeting St. Ctr.              0              0         0
          W ilke s CC                                     1,554           1,650     1,810
                 Alleghany Cty. Ctr.                           48             66        70
                 Ashe Cty. Ctr.                             245              242      263
          W ilson TCC                                     1,427           1,541     1,801
                 Police Academy Ctr.                           73             64        73
          Tota l                                        138,761        145,302   173,963



MGT of America, Inc.                                                                         Page 4-11
                                               Refinements for New Construction Formula


      A second set of refinements to the model relate to the projected facilities

inventory. In the model, the projected inventory is compared to total estimated space

needs to determine whether any unmet need exists.             Several refinements were

undertaken to make the projected inventory more valid for use in the space planning

model:

      !   Removal of Unsuitable Space – System staff polled college-level
          facilities officers to identify various types of unsatisfactory space.
          Such space included temporary facilities, space that is in unusable
          shape, and similar situations. Overall, more than 200 thousand
          assignable square feet of space was removed from the projected
          inventory as summarized in Exhibit 4-4;

      !   Inclusion of Planned Space – System staff also polled college-level
          officials to determine how much new space was scheduled to be
          added to the facilities inventory.      As seen in Exhibit 4-4,
          approximately 1.2 million assignable square feet was added;

      !   Treatment of General and Special Use Space – Testimony revealed
          that several colleges, which were known to have significant needs
          for instructional space, were not shown to have a requirement for
          additional space through the new construction model. Detailed
          analysis of the situation at these colleges suggested that the
          inclusion of two types of space – general use and special use – was
          serving to distort the results. General use space includes such
          facilities as an auditorium or assembly hall and special use space
          includes buildings such as sporting facilities. As seen in Exhibit 4-5,
          one college has less than two square feet per student of such space
          while another has over 95 square feet per student (keep in mind that
          the 1999 formula only provided 90-100 assignable square feet per
          student for all types of space combined).




MGT of America, Inc.                                                                Page 4-12
                                                    Refinements for New Construction Formula


                                EXHIBIT 4-4
                 SPACE REMOVED FROM PROJECTED INVENTORY
                 NORTH CAROLINA COMMUNITY COLLEGE SYSTEM

                                               Fall 1998
                                                HEFC     Additions to Deletions to   Total
               College/Campus                    ASF        ASF           ASF        ASF
  Alam ance CC                                  153,399             0            0   153,399
     Alam ance-Glenhope School Ctr.               17,107            0            0    17,107
     Alam ance-Front Street Ctr.                   2,115            0            0     2,115
     Alam ance-Glen Raven Ctr.                     5,299            0            0     5,299
  Asheville-Buncombe TCC                        320,698       43,900             0   364,598
     As heville-Madis on Cty.                     11,625            0            0    11,625
  Beaufort County CC                            130,749         3,419            0   134,168
  Bladen CC                                       85,928            0            0    85,928
     Bladen-Kelly/Eas t Arcaddia Ctr.             14,910            0            0    14,910
  Blue Ridge CC                                 212,403             0            0   212,403
     Blue Ridge-Trans ylvania Cty.                15,708            0            0    15,708
  Brunsw ick CC                                 116,155       10,700             0   126,855
     Bruns wick-Job Link Ctr.                      2,842            0            0     2,842
     Bruns wick-Leland Ctr.                       12,735        3,965            0    16,700
     Bruns wick-Southport Ctr.                    21,896            0            0    21,896
  Caldw ell CC & TI                             224,366       14,925         6,760   232,531
     Caldwell-Watauga Cty.                        20,818           0            0     20,818
     Cald-Adm in. Support/Bas ic Skills Ctr.       1,761           0            0      1,761
     Cald-Watauga Cty. Cont. Ed. Ctr.              4,053           0            0      4,053
  Cape Fear CC                                   200,486      87,539        8,556    279,469
     Cape-North Cam pus                                0      74,800            0     74,800
     Cape-Burgaw Ctr.                             11,175       5,005            0     16,180
     Cape-Ham s tead Ctr.                         16,918           0            0     16,918
  Carteret CC                                    117,342       6,800       16,028    108,114
     Carteret-Davis Center                             0           0            0          0
  Cataw ba Valley CC                             279,346           0        2,103    277,243
  Central Carolina CC                            142,583           0            0    142,583
     Central-Chatham Cty.                         37,578           0            0     37,578
     Central-Harnett Cty.                         28,182      15,121            0     43,303
     Central-School of Telecom m unications        2,423           0            0      2,423
     Central-Siler City Ctr.                      10,132           0            0     10,132
  Central Piedmont CC                            589,387           0       55,151    534,236
     CP-North Cam pus                             30,401           0            0     30,401
     CP-Northeas t Cam pus                             0      27,510            0     27,510
     CP-South Cam pus                             78,878           0            0     78,878
     CP-Southwes t Cam pus                             0      65,960            0     65,960
     CP-Wes t Cam pus                                  0      42,486            0     42,486
     CP-Wes t Center                               7,830           0            0      7,830
  Cleveland CC                                   136,791      27,400            0    164,191
  Coastal Carolina CC                            196,029           0            0    196,029
  College of The Albem arle                      106,057      11,544            0    117,601
     Coll Alb-Chowan Cty.                         16,624           0       16,624          0
     Coll Alb-Dare Cty.                           12,687       7,592            0     20,279
     Coll Alb-Rivers ide Ext. Ctr.                     0           0            0          0


MGT of America, Inc.                                                                  Page 4-13
                                                    Refinements for New Construction Formula


                           EXHIBIT 4-4 (Continued)
                 SPACE REMOVED FROM PROJECTED INVENTORY
                 NORTH CAROLINA COMMUNITY COLLEGE SYSTEM

                                               Fall 1998
                                                HEFC     Additions to Deletions to   Total
              College/Campus                     ASF        ASF           ASF        ASF
  Craven CC                                     102,941       37,364             0   140,305
     Craven-Havelock/Cherry Point Ctr              6,489            0            0     6,489
  Davidson County CC                            200,770             0            0   200,770
     Davids on-Davie Cty.                         29,546            0            0    29,546
  Durham TCC                                    213,563             0            0   213,563
     Durham -Northern Durham Ctr.                 23,192            0            0    23,192
  Edgecom be CC                                   75,325            0      11,182     64,143
     Edge-Rocky Mount Cam pus                     50,437            0            0    50,437
  Fayetteville TCC                              441,579       23,185       11,900    452,864
     Fayetteville-Firefighting Facility Ctr.                    5,500            0     5,500
     Fayetteville-Fort Bragg Ctr.                      0      20,725             0    20,725
  Forsyth TCC                                   307,427             0      21,074    286,353
     Fors yth-Caver Road Ctr.                     16,967            0            0    16,967
     Fors yth-Kerners ville Ctr.                  17,617            0            0    17,617
     Fors yth-Wes t Ctr.                          55,948            0            0    55,948
  Gaston College                                268,860       22,563         5,261   286,162
     Gas ton-Lincoln Cty.                          1,980      42,752         1,980    42,752
  Guilford TCC                                  430,141       50,790             0   480,931
     Guilf-Aviation Ctr.                          32,559            0            0    32,559
     Guilf-Greens boro Cam pus                    75,166            0            0    75,166
     Guilf-High Point Ctr.                        26,706            0            0    26,706
     Guilf-Sm all Bus ines s Ctr.                      0        2,992            0     2,992
  Halifax CC                                    124,036         2,400        1,157   125,279
  Hayw ood CC                                   192,785             0      15,395    177,390
     Haywood-Continuing Ed. Ctr.                   9,081            0            0     9,081
     Haywood-High Tech. Ctr.                      16,966            0            0    16,966
     Haywood-Hum an Res ours e Dev. Ctr.           2,474            0            0     2,474
  Isothermal CC                                 159,656       49,177             0   208,833
     Is otherm al-Polk Cty.                        9,380        1,822            0    11,202
  James Sprunt CC                               107,551         2,386        2,014   107,923
  Johnston CC                                   194,067         2,312            0   196,379
  Lenoir CC                                     203,203             0            0   203,203
     Lenoir-Aviation Ctr.                          5,039            0            0     5,039
     Lenoir-Greene Cty.                            5,148      11,872             0    17,020
     Lenoir-Jones Cty.                            25,406            0            0    25,406
     Lenoir-Wals tonburg Ctr.                          0        3,000            0     3,000
     Lenoir-Wes t Boundary Street Ctr                759            0          759         0
  Martin CC                                     164,049             0            0   164,049
     Martin-Bertie Cty.                            8,175            0            0     8,175
  Mayland CC                                      82,207            0            0    82,207
     Mayland-Avery Cty.                            2,810            0            0     2,810
     Mayland-Yancey Cty.                           1,354        5,768            0     7,122




MGT of America, Inc.                                                                  Page 4-14
                                                 Refinements for New Construction Formula


                           EXHIBIT 4-4 (Continued)
                 SPACE REMOVED FROM PROJECTED INVENTORY
                 NORTH CAROLINA COMMUNITY COLLEGE SYSTEM

                                            Fall 1998
                                             HEFC     Additions to Deletions to   Total
               College/Campus                 ASF        ASF           ASF        ASF
  McDow ell TCC                                81,640            0          641    80,999
      McDowell-Marion Ctr.                      3,520            0            0     3,520
  Mitchell CC                                170,122             0            0   170,122
     Mitchell-Moores ville Ctr.                15,019            0            0    15,019
  Montgom ery CC                               80,749        2,000            0    82,749
  Nash CC                                    109,223       34,555         1,297   142,481
  Pamlico CC                                   28,395        7,611            0    36,006
  Piedm ont CC                                 89,001            0            0    89,001
      Piedm ont-Cas well Cty.                  21,411            0            0    21,411
  Pitt CC                                    187,535       14,967         5,607   196,895
  Randolph CC                                177,603       10,974             0   188,577
      Randolph-Archdale Ctr.                    8,531            0            0     8,531
  Richm ond CC                                 93,571            0            0    93,571
      Richm ond-Continuing Education Ctr.       3,397            0            0     3,397
      Richm ond-Jam es Nurs ing Building        9,400            0            0     9,400
      Richm ond-Scotland Cty.                   5,741        4,500            0    10,241
  Roanoke-Chow an CC                           99,803      21,784             0   121,587
  Robeson CC                                 136,255             0            0   136,255
      Robes on-Em ergency Training Ctr.         4,132            0            0     4,132
      Robes on-Lum berton Extens ion Ctr.           0        1,622            0     1,622
      Robes on-Pem broke Extens ion Ctr.            0        8,767            0     8,767
  Rockingham CC                              221,001             0            0   221,001
  Row an-Cabarrus CC                         173,281             0        6,266   167,015
      Rowan-Cabarrus Cty.                      29,847      33,050             0    62,897
      Rowan-Cabarrus -Corban Ctr.               6,266            0            0     6,266
  Sampson CC                                 110,000             0        2,723   107,277
  Sandhills CC                               225,352       29,625           614   254,363
      Sandhills -Hoke Cty.                      3,867        6,148            0    10,015
  South Piedm ont CC                           48,493      41,444             0    89,937
      SP-Ans onville Ctr.                           0        3,310            0     3,310
      SP-Union Cty. Cam pus                    10,252      29,240             0    39,492
      SP-Wades boro Ctr.                        5,985            0            0     5,985
  Southeastern CC                            145,456         2,720            0   148,176
  Southw estern CC                           139,305         2,720            0   142,025
      Southwes tern-Macon Cty.                 10,500            0            0    10,500
    ' Southwes tern-Swain Cty.                 17,529            0            0    17,529
  Stanly CC                                  107,006         6,980      10,105    103,881
      Stanly-Wes tern Stanly Ctr.                   0      13,600             0    13,600
  Surry CC                                   180,336         8,200            0   188,536
      Surry-Yadkin Cty.                             0      16,600             0    16,600
  Tri-County CC                                82,235      11,900             0    94,135
      Tri-County-Graham Cty.                    9,529            0            0     9,529




MGT of America, Inc.                                                               Page 4-15
                                                  Refinements for New Construction Formula


                            EXHIBIT 4-4 (Continued)
                  SPACE REMOVED FROM PROJECTED INVENTORY
                  NORTH CAROLINA COMMUNITY COLLEGE SYSTEM

                                             Fall 1998
                                               HEFC     Additions to Deletions to   Total
                College/Campus                  ASF         ASF          ASF        ASF
  Vance-Granville CC                            121,338            0            0   121,338
      Vance-Franklin Cty.                        25,545            0            0    25,545
      Vance-Granville Cty.                       14,262        6,089            0    20,351
      Vance-Warren Cty.                          10,666            0            0    10,666
  W ake TCC                                     292,015      74,815         1,131   365,699
      Wake-Adult Education Ctr.                  17,470            0            0    17,470
      Wake-Health Ed. Cam pus                    39,828      51,190             0    91,018
      Wake-Northeas t Cam pus                         0            0            0         0
  W ayne CC                                     201,519            0            0   201,519
      Wayne-Aviation Ctr.                        12,751            0            0    12,751
  W estern Piedm ont CC                         161,099        1,867            0   162,966
      WP-North King/Wes t Meeting St. Ctr.            0        2,880            0     2,880
  W ilkes CC                                    223,815        4,424        2,541   225,698
      Wilkes -Alleghany Cty.                      6,924            0            0     6,924
      Wilkes -As he Cty.                         14,254            0            0    14,254
  W ilson TCC                                   125,158        3,500            0   128,658
      Wils on-Police Academ y Ctr.                1,675                         0     1,675
      Tota l                                 11,206,382   1,190,356      206,869 12,189,869


                               EXHIBIT 4-5
         ANALYSIS OF SPECIAL USE AND GENERAL USE SPACE PER FTE
                         NCCCS MAIN CAMPUSES

                             Total       Specia l      General     Specia l   General Combined
                              FTE        Use (500)     Use (600) Use          Use       Spec/Gen
Colle ge /Campus/Center     1998-99        ASF           ASF       ASF/FTE ASF/FTE ASF/FTE
Alam ance CC                    2,013          5,058       10,091         2.5       5.0        7.5
As heville-Buncom be TCC        3,724        28,970        17,160         7.8       4.6       12.4
Beaufort County CC              1,669            400       14,858         0.2       8.9        9.1
Bladen CC                         801              0       13,174         0.0      16.4       16.4
Blue Ridge CC                   1,257          6,496       19,978         5.2      15.9       21.1
Bruns wick CC                     574            574       31,895         1.0      55.5       56.5
Caldwell CC & TI                1,869        16,454        37,570         8.8      20.1      28.9
Cape Fear CC                    3,747          1,333         7,785        0.4       2.1        2.4
Carteret CC                     1,299          8,943       10,936         6.9       8.4       15.3
Catawba Valley CC               2,852        36,825        17,757       12.9        6.2      19.1
Central Carolina CC             2,084        10,865        26,653         5.2      12.8      18.0
Central Piedm ont CC            8,795        28,861        40,033         3.3       4.6        7.8
Cleveland CC                    1,577        11,377        14,952         7.2       9.5       16.7
Coas tal Carolina CC            3,589          4,032       15,500         1.1       4.3        5.4
College of The Albem arle       1,230            159       23,365         0.1      19.0       19.1
Craven CC                       1,694          1,797         7,397        1.1       4.4        5.4
Davids on County CC             2,051        15,364        14,550         7.5       7.1       14.6
Durham TCC                      3,485          2,129       17,022         0.6       4.9        5.5



MGT of America, Inc.                                                                  Page 4-16
                                                   Refinements for New Construction Formula


                          EXHIBIT 4-5 (Continued)
         ANALYSIS OF SPECIAL USE AND GENERAL USE SPACE PER FTE
                         NCCCS MAIN CAMPUSES

                              Tota l     Spe cia l     Ge ne ra l  Spe cia l   Ge ne ra l Com bine d
                               FTE       Use (500)     Use (600) Use           Use         Spe c/Ge n
Colle ge /Ca mpus/Ce nte r   1998-99       ASF           ASF       ASF/FTE ASF/FTE ASF/FTE
Edgecom be CC                      962         1,346         8,849         1.4         9.2        10.6
Fayetteville TCC                 6,546       19,570        36,770          3.0         5.6         8.6
Fors yth TCC                     3,270         3,410       26,985          1.0         8.3         9.3
Gas ton College                  2,847         8,151       29,483          2.9        10.4        13.2
Guilford TCC                     4,514         7,373       39,996          1.6         8.9        10.5
Halifax CC                       1,452         4,975       10,221          3.4         7.0        10.5
Haywood CC                       1,221       25,178        29,472        20.6         24.1        44.8
Is otherm al CC                  1,497       25,791        11,373        17.2          7.6        24.8
Jam es Sprunt CC                 1,082         4,468         9,620         4.1         8.9        13.0
Johns ton CC                     2,387       10,469        30,202          4.4        12.7        17.0
Lenoir CC                        2,172       24,815        23,007        11.4         10.6        22.0
Martin C C                         644         4,740       56,610          7.4        88.0        95.3
Mayland CC                         855         6,248         9,798         7.3        11.5        18.8
McDowell TCC                       887         1,514       10,817          1.7        12.2        13.9
Mitchell C C                     1,467       16,406        28,496        11.2         19.4        30.6
Montgom ery CC                     618         2,120         8,827         3.4        14.3        17.7
Nas h CC                         1,896             0         3,569         0.0         1.9         1.9
Pam lico CC                        291           140         1,973         0.5         6.8         7.3
Piedm ont CC                       763         8,814       11,097        11.6         14.5        26.1
Pitt C C                         3,975         5,664         7,253         1.4         1.8         3.2
Randolph CC                      1,471         4,326       13,652          2.9         9.3        12.2
Richm ond C C                    1,084         4,082         8,142         3.8         7.5        11.3
Roanoke-Chowan CC                  762         1,087       10,014          1.4        13.1        14.6
Robes on CC                      1,941         2,734       24,555          1.4        12.7        14.1
Rockingham CC                    1,607       36,410        25,301        22.7         15.7        38.4
Rowan-Cabarrus CC                1,940         3,941       18,131          2.0         9.3        11.4
Sam ps on CC                     1,239         3,927       10,003          3.2         8.1        11.2
Sandhills CC                     2,720       12,264        30,231          4.5        11.1        15.6
South Piedm ont CC                 786           560         3,456         0.7         4.4         5.1
Southeas tern CC                 1,770       11,378        10,797          6.4         6.1        12.5
Southwes tern CC                 1,658         8,352       24,005          5.0        14.5        19.5
Stanly C C                       1,261         1,644       11,904          1.3         9.4        10.7
Surry CC                         2,468       17,706        14,941          7.2         6.1        13.2
Tri-County CC                      688             0       10,184          0.0        14.8        14.8
Vance-Granville CC               1,834         1,351       24,006          0.7        13.1        13.8
Wake TCC                         5,583       21,082        42,507          3.8         7.6        11.4
Wayne CC                         2,880         4,499       17,115          1.6         5.9         7.5
Wes tern Piedm ont CC            1,867         5,100       13,560          2.7         7.3        10.0
Wilkes CC                        1,554       26,986        44,452        17.4         28.6        46.0
Wils on TCC                      1,427           890       12,838          0.6         9.0         9.6
Other Campuses/Centers          18,567       25,574       101,342          1.4         5.5         6.8
         TOTAL                138,761       554,722     1,206,230          4.0         8.7        12.7




MGT of America, Inc.                                                                      Page 4-17
                                              Refinements for New Construction Formula


4.7   Recommended Revisions to Model

      Based on additional analyses and discussions with college personnel during the

1999-2000 study period, we recommend several refinements to the new construction

model that was adopted by the State Board last year:

      !   Use of Projected Construction FTE Enrollment – To ensure greater
          consistency in capital funding requests being submitted to the
          General Assembly, projected FTE enrollment should be used. This
          enrollment projection should be performed on a site-specific basis
          and exclude immured populations and other types of students who
          do not require facilities for their instructional programs.

      !   Elimination of General and Special Use Space from “Available
          Inventory” – These two types of space are largely unrelated to the
          instructional programs of the colleges, and instead are more focused
          on meeting community needs for space. We recommend that both
          general use and special use space not be included in the inventory
          used to develop a request for state appropriations for new
          construction.

      !   Elimination of Base Allowance for Special and General Use Space –
          The formula adopted in 1999 provided a base allowance of 20,000
          assignable square feet per college plus an additional 90 assignable
          square feet per FTE student. The primary intent of the base
          allowance (which was not generated by student counts) was to
          provide an inventory of general and special use space. Concurrent
          with the elimination of general and special use space from the
          available inventory, we recommend elimination of the base
          allowance feature of the space needs model.              We further
          recommend that the per-FTE allowance be increased from 90 to 100
          assignable square feet. This adjustment is intended to help offset
          the elimination of the base allowance and to recognize the significant
          space requirements of the System’s more technically-oriented
          programs.




MGT of America, Inc.                                                               Page 4-18
                                               Refinements for New Construction Formula


4.8    Simulation of Refined New Construction Model

       In Exhibit 4-6, we display the results of a simulation of the refined model for new

construction space needs. This simulation reflects the revised procedures for enrollment

recognition (including use of projected enrollments), the revised procedures for

determination of available inventory, the elimination of the base allowance, and the use

of a new rate of 100 assignable square feet per construction FTE enrollment. Overall,

the revised new construction model identifies a need for approximately seven million

additional square feet for the state’s community colleges.

       Exhibit 4-6 also lists the estimated construction cost for this space using the

current average cost of $163 per assignable square foot. The reader should note that

this rate is roughly equivalent to $108 per gross square foot and does not include

construction management fees or allowances for inflation.       At current rates, the 7.4

million assignable square feet that is needed would cost approximately $1.2 billion.

Assuming that, on average, this space will be constructed approximately three years

from now, the total cost inclusive of construction management fees and inflation can be

expected to reach $1.5 billion.

       Based on the space needs by college identified above, Exhibit 4-7 provides a

projection of the amount of state support required to fully fund these requirements at

current construction cost levels. This funding estimate incorporates updated information

for ability-to-pay and overmatch credits.        An estimated $825 million of state

appropriations would be needed to support an overall capital expansion program of $1.2

billion.




MGT of America, Inc.                                                             Page 4-19
                                                                                                                             Refinements for New Construction Formula


                                                 EXHIBIT 4-6
              SIMULATION OF ASF REQUIREMENTS AFTER WAIVER OF EXCESS SPECIAL/GENERAL USE SPACE

                                                     A                B             C                   D                         E              F              G
                                                 Projected      Allotment of      Tota l               Less:                 Projected                      Estim ated
                                                Construction    100 ASF pe r    Projected      Spe cial      General         Ava ilable      Additional       Cost @
                                                    FTE         Construction    Ava ilable     Use (500)     Use (600)          ASF            Nee d        $163/ASF
       College/Ca mpus/Center                     2004-05       FTE 2004-05       ASF            ASF           ASF         Less 500 & 600      (B-E)         (Ex$163)
       Alam ance CC                                    2,310         231,000       153,399           5,058       10,091            138,250        92,750       15,118,250
        Alam ance-Glenhope School Ctr.                    119         11,900          17,107         1,828         1,080            14,199            -                 0
        Alam ance-Front Street Ctr.                       102         10,200           2,115             0             0             2,115          8,085       1,317,855
        Alam ance-Glen Raven Ctr.                         112         11,200           5,299             0             0             5,299          5,901         961,863
       As heville-Buncom be TCC                        4,541         454,100        364,598        28,970        17,160            318,468       135,632       22,108,016
        As heville-Madis on Cty.                          106         10,570          11,625           171         1,813             9,641            929         151,498
       Beaufort County CC                              2,077         207,682        134,168            400       14,858            118,910        88,772       14,469,830
       Bladen CC                                       1,217         121,673          85,928             0       13,174             72,754        48,919        7,973,776
        Bladen-Kelly/Eas t Arcadia Ctr.                    69           6,900         14,910             0           960            13,950            -                 0
       Blue Ridge CC                                   1,491         149,081        212,403          6,496       19,978            185,929            -                 0
        Blue Ridge-Trans ylvania Cty.                     458         45,758          15,708             0         1,039            14,669        31,089        5,067,540
       Bruns wick CC                                      673         67,295        126,855            574       31,895             94,386            -                 0
        Bruns wick-Job Link Ctr.                            0             -            2,842             0             0             2,842            -                 0
        Bruns wick-Leland Ctr.                            194         19,432          16,700             0           744            15,956          3,476         566,511
        Bruns wick-Southport Ctr.                          66           6,623         21,896           888         5,798            15,210            -                 0
       Caldwell CC & TI                                2,030         203,004        232,531        16,454        37,570            178,507        24,497        3,992,992
        Cald-Watauga Cty. Cam pus                         669         66,870          20,818             0           613            20,205        46,665        7,606,372
        Cald-Adm in. Support/Bas ic Skills Ctr.            11           1,089          1,761             0             0             1,761            -                 0
        Cald-Watauga Cty. Bus . Ctr.                       91           9,118          4,053             0             0             4,053          5,065         825,633
       Cape Fear CC                                    6,407         640,700        279,469          1,333         7,785           270,351       370,349       60,366,887
        Cape-North Cam pus                                586         58,600          74,800             0             0            74,800            -                 0
        Cape-Burgaw Ctr.                                   98           9,800         16,180             0         1,084            15,096            -                 0
        Cape-Ham s tead Ctr.                               85           8,500         16,918             0             0            16,918            -                 0
       Carteret CC                                     1,822         182,200        108,114          8,943       10,936             88,235        93,965       15,316,295
       Catawba Valley CC                               3,076         307,553        277,243        36,825        17,757            222,661        84,892       13,837,384
       Central Carolina CC                             2,383         238,281        142,583        10,865        26,653            105,065       133,216       21,714,259
        Central-Chatham Cty.                              444         44,393          37,578           600         1,015            35,963          8,430       1,374,153
        Central-Harnett Cty.                              872         87,160          43,303             0         2,158            41,145        46,015        7,500,420
        Central-School of Telecom m unications            164         16,430           2,423             0             0             2,423        14,007        2,283,139
        Central-Siler City Ctr.                           129         12,927          10,132             0           804             9,328          3,599         586,706
       Central Piedm ont CC                            6,513         651,300        534,236        28,861        40,033            465,342       185,958       30,311,154
        CP-North Cam pus                                  891         89,100          30,401         3,600         2,802            23,999        65,101       10,611,463
        CP-Northeas t Cam pus                             727         72,700          27,510             0             0            27,510        45,190        7,365,970
        CP-South Cam pus                               3,664         366,400          78,878         1,061       15,622             62,195       304,205       49,585,415
        CP-Southwes t Cam pus                             713         71,300          65,960             0             0            65,960          5,340         870,420
        CP-Wes t Cam pus                                  807         80,700          42,486             0             0            42,486        38,214        6,228,882
        CP-Wes t Center                                   214         21,400           7,830             0           792             7,038        14,362        2,341,006




MGT of America, Inc.                                                                                                                                                  Page 4-20
                                                                                                                               Refinements for New Construction Formula


                                              EXHIBIT 4-6 (Continued)
                SIMULATION OF ASF REQUIREMENTS AFTER WAIVER OF EXCESS SPECIAL/GENERAL USE SPACE

                                                    A                 B               C                   D                           E               F               G
                                                Proje cte d     Allotm ent of      Tota l                Less:                   Proje cte d                     Estim a te d
                                               Construction     100 ASF pe r     Proje cte d     Spe cia l     Ge ne ra l        Ava ila ble      Additiona l      Cost @
                                                   FTE          Construction     Ava ila ble     Use (500)     Use (600)             ASF            Ne e d       $163/ASF
    Colle ge/Ca m pus/Ce nte r                   2004-05        FTE 2004-05        ASF             ASF           ASF           Le ss 500 & 600      (B-E)         (Ex $163)
    Cleveland CC                                       2,043         204,268         164,191         11,377        14,952              137,862         66,406       10,824,248
    Coas tal Carolina CC                               4,256         425,600         196,029           4,032       15,500              176,497        249,103       40,603,789
    College of The Albem arle                          1,489         148,900         117,601             159       23,365                94,077        54,823         8,936,149
     Coll Alb-Chow an Cty.                               148          14,770                 0             0         1,416                    0        14,770         2,407,577
     Coll Alb-Dare Cty.                                  332          33,248           20,279              0         1,339               18,940        14,308         2,332,232
     Coll Alb-Rivers ide Ext. Ctr.                          0             -                  0             0               0                  0            -                  0
    Craven CC                                          1,963         196,271         140,305           1,797         7,397             131,111         65,160       10,621,017
     Craven-H avelock/Cherry Point Ctr                   318          31,846            6,489              0              90              6,399        25,447         4,147,860
    Davids on County CC                                2,296         229,600         200,770         15,364        14,550              170,856         58,744         9,575,272
     Davids on-D avie Cty.                               182          18,167           29,546              0         1,115               28,431            -                  0
    Durham TCC                                         4,427         442,700         213,563           2,129       17,022              194,412        248,288       40,470,944
     Durham -Northern Durham Ctr.                        177          17,700           23,192              0         1,128               22,064            -                  0
    Edgecom be CC                                      1,145         114,500           64,143          1,346         8,849               53,948        60,552         9,869,976
     Edge-Rocky Mount Cam pus                            909          90,900           50,437              0         5,142               45,295        45,605         7,433,615
    Fayetteville TCC                                   8,329         832,936         452,864         19,570        36,770              396,524        436,412       71,135,203
     Fayetteville-Firefighting Facility Ctr.               75           7,500           5,500              0               0              5,500          2,000          326,000
     Fayetteville-Fort Bragg Ctr.                      1,656         165,600           20,725              0               0             20,725       144,875       23,614,625
    Fors yth TCC                                       4,274         427,393         286,353           3,410       26,985              255,958        171,435       27,943,949
     Fors yth-Carver Road C tr.                          255          25,492           16,967              0           418               16,549          8,943        1,457,759
     Fors yth-Kerners ville Ctr.                         224          22,391           17,617              0           418               17,199          5,192          846,281
     Fors yth-Wes t Ctr.                               1,003         100,300           55,948        12,562          7,906               35,480        64,820       10,565,660
    Gas ton College                                    3,171         317,136         286,162           8,151       29,483              248,528         68,608       11,183,059
      Gas ton-Lincoln Cty.                               467          46,700           42,752              0               0             42,752          3,948          643,524
    Guilford TCC                                       6,928         692,800         480,931           7,373       39,996              433,562        259,238       42,255,794
      Guilf-Aviation Ctr.                                232          23,200           32,559              0           576               31,983            -                  0
      Guilf-Greens boro Cam pus                        1,749         174,899           75,166          1,850         8,185               65,131       109,768       17,892,231
      Guilf-High Point Ctr.                              740          73,991           26,706              0           516               26,190        47,801         7,791,502
      Guilf-Sm all Bus ines s Ctr.                          1               76          2,992              0               0              2,992            -                  0
    Halifax CC                                         2,294         229,400         125,279           4,975       10,221              110,083        119,317       19,448,671
    Haywood CC                                         1,284         128,427         177,390         25,178        29,472              122,740           5,687          926,961
      Haywood-Continuing Ed. Ctr.                          87           8,695           9,081              0           248                8,833            -                  0
      Haywood-High Tech. Ctr.                            144          14,398           16,966          2,281         2,456               12,229          2,169          353,571
      Haywood-Hum an R es ours e Dev. Ctr.                 10           1,000           2,474              0           106                2,368            -                  0
    Is otherm al C C                                   1,882         188,200         208,833         25,791        11,373              171,669         16,531         2,694,553
      Is otherm al-Polk Cty.                               57           5,733          11,202              0         2,761                8,441            -                  0
    Jam es Sprunt CC                                   1,229         122,900         107,923           4,468         9,620               93,835        29,065         4,737,595




MGT of America, Inc.                                                                                                                                                     Page 4-21
                                                                                                                           Refinements for New Construction Formula


                                            EXHIBIT 4-6 (Continued)
              SIMULATION OF ASF REQUIREMENTS AFTER WAIVER OF EXCESS SPECIAL/GENERAL USE SPACE

                                                   A                B             C                   D                        E               F              G
                                               Proje cted     Allotm ent of     Total                Less:                 Proje cted                     Estim ated
                                              Construction    100 ASF per     Proje cted     Special       Gene ral        Availa ble      Additional       Cost @
                                                  FTE         Construction    Availa ble     Use (500)     Use (600)          ASF            Need         $163/ASF
       Colle ge/Campus/Center                   2004-05       FTE 2004-05       ASF            ASF           ASF         Less 500 & 600      (B-E)         (Ex$163)
       Johns ton CC                                   2,672        267,200        196,379        10,469        30,202            155,708       111,492       18,173,196
       Lenoir CC                                      2,793        279,300        203,203        24,815        23,007            155,381       123,919       20,198,797
        Lenoir-Aviation Ctr.                             46           4,600          5,039             0           260             4,779            -                 0
        Lenoir-Greene Cty.                              347         34,700         17,020              0         8,439             8,581        26,119        4,257,397
        Lenoir-Jones Cty.                                63           6,264        25,406              0           435            24,971            -                 0
        Lenoir-Wals tonburg Ctr.                          0             -            3,000             0             0             3,000            -                 0
        Lenoir-Wes t Boundary Street Ctr                  4             449              0             0             0                 0            449          73,213
       Martin CC                                        686         68,600        164,049          4,740       56,610            102,699            -                 0
        Martin-Bertie Cty.                               31           3,100          8,175             0         2,786             5,389            -                 0
       Mayland CC                                     1,070        107,000         82,207          6,248         9,798            66,161        40,839        6,656,757
        Mayland-Avery Cty.                               99           9,900          2,810             0             0             2,810          7,090       1,155,670
        Mayland-Yancey Cty.                              84           8,380          7,122             0             0             7,122          1,258         205,096
       McDowell TCC                                   1,030        103,042         80,999          1,514       10,817             68,668        34,374        5,602,968
        McDowell-Marion Ctr.                              0             -            3,520             0           255             3,265            -                 0
       Mitchell CC                                    1,636        163,635        170,122        16,406        28,496            125,220        38,415        6,261,660
        Mitchell-Moores ville Ctr.                      188         18,846         15,019              0           496            14,523          4,323         704,714
       Montgom ery CC                                   712         71,200         82,749          2,120         8,827            71,802            -                 0
       Nas h CC                                       2,084        208,400        142,481              0         3,569           138,912        69,488       11,326,544
       Pam lico CC                                      703         70,300         36,006            140         1,973            33,893        36,407        5,934,341
       Piedm ont CC                                   1,132        113,200         89,001          8,814       11,097             69,090        44,110        7,189,930
        Piedm ont-Cas well Cty.                         434         43,400         21,411              0         1,682            19,729        23,671        3,858,373
       Pitt CC                                        4,345        434,500        196,895          5,664         7,253           183,978       250,522       40,835,086
       Randolph CC                                    1,832        183,200        188,577          4,326       13,652            170,599        12,601        2,053,963
        Randolph-Archdale Ctr.                          103         10,251           8,531             0           187             8,344          1,907         310,807
       Richm ond CC                                   1,237        123,659         93,571          4,082         8,142            81,347        42,312        6,896,933
        Richm ond-Continuing Education Ctr.              57           5,743          3,397             0           601             2,796          2,947         480,431
        Richm ond-Jam es Nurs ing Building               27           2,661          9,400             0         1,257             8,143            -                 0
        Richm ond-Scotland Cty.                         124         12,406         10,241              0             0            10,241          2,165         352,816
       Roanoke-Chowan CC                              1,080        108,000        121,587          1,087       10,014            110,486            -                 0
       Robes on CC                                    2,437        243,700        136,255          2,734       24,555            108,966       134,734       21,961,642
        Robes on-Em ergency Training Ctr.                50           5,000          4,132             0             0             4,132            868         141,484
        Robes on-Lum berton Extens ion Ctr.             216         21,600           1,622             0             0             1,622        19,978        3,256,414
        Robes on-Pem broke Extens ion Ctr.              174         17,400           8,767             0             0             8,767          8,633       1,407,179
       Rockingham CC                                  1,856        185,600        221,001        36,410        25,301            159,290        26,310        4,288,530
       Rowan-Cabarrus CC                              2,356        235,574        167,015          3,941       18,131            144,943        90,631       14,772,882
        Rowan-Cabarrus Cty.                           1,429        142,866         62,897            326         1,714            60,857        82,009       13,367,406
        Rowan-Cabarrus -Corban Ctr.                       0             -            6,266             0             0             6,266            -                 0




MGT of America, Inc.                                                                                                                                                Page 4-22
                                                                                                                              Refinements for New Construction Formula


                                            EXHIBIT 4-6 (Continued)
              SIMULATION OF ASF REQUIREMENTS AFTER WAIVER OF EXCESS SPECIAL/GENERAL USE SPACE

                                                    A                 B             C                    D                         E               F              G
                                                Proje cte d     Allotm ent of     Total                 Less:                 Proje cte d                     Estim ate d
                                               Construction     100 ASF per     Proje cte d     Special       Ge ne ral       Available        Additional       Cost @
                                                   FTE          Construction    Available       Use (500)     Use (600)           ASF            Ne ed        $163/ASF
       Colle ge/Cam pus/Center                   2004-05        FTE 2004-05       ASF             ASF           ASF         Le ss 500 & 600      (B-E)         (Ex$163)
       Sam ps on CC                                    1,476         147,641        107,277           3,927       10,003              93,347        54,294        8,849,877
       Sandhills CC                                    3,446         344,633        254,363         12,264        30,231             211,868       132,765       21,640,726
        Sandhills -Hoke Cty.                             277          27,663         10,015               0             0             10,015        17,648        2,876,571
       South Piedm ont CC                                845          84,500         89,937             560         3,456             85,921            -                 0
        SP-Ans onville Ctr.                                 0             -            3,310              0             0              3,310            -                 0
        SP-Union Cty. Cam pus                            436          43,600         39,492               0           715             38,777          4,823         786,149
        SP-Wades boro Ctr.                                 48           4,800          5,985              0           545              5,440            -                 0
       Southeas tern CC                                2,004         200,355        148,176         11,378        10,797             126,001        74,354       12,119,687
       Southwes tern CC                                2,219         221,900        142,025           8,352       24,005             109,668       112,232       18,293,816
        Southwes tern-Macon Cty.                         688          68,800         10,500               0           380             10,120        58,680        9,564,840
        Southwes tern-Swain Cty.                         140          14,000         17,529               0           440             17,089            -                 0
       Stanly CC                                       1,586         158,600        103,881           1,644       11,904              90,333        68,267       11,127,521
        Stanly-Wes tern Stanly Ctr.                        19           1,900        13,600               0             0             13,600            -                 0
       Surry CC                                        2,820         282,007        188,536         17,706        14,941             155,889       126,118       20,557,297
        Surry-Yadkin Cty.                                220          22,000         16,600               0             0             16,600          5,400         880,200
       Tri-County CC                                     852          85,200         94,135               0       10,184              83,951          1,249         203,587
        Tri-County-Graham Cty.                             98           9,800          9,529              0           416              9,113            687         111,981
       Vance-Granville CC                              2,138         213,800        121,338           1,351       24,006              95,981       117,819       19,204,497
        Vance-Franklin Cty.                              568          56,800         25,545               0         2,794             22,751        34,049        5,549,987
        Vance-Granville Cty.                             820          82,000         20,351               0           361             19,990        62,010       10,107,630
        Vance-Warren Cty.                                388          38,800         10,666               0           373             10,293        28,507        4,646,641
       Wake TCC                                        6,666         666,583        365,699         21,082        42,507             302,110       364,473       59,409,112
        Wake-Adult Education Ctr.                        392          39,174         17,470               0           809             16,661        22,513        3,669,594
        Wake-Health Ed. Cam pus                        1,357         135,743         91,018             407         5,226             85,385        50,358        8,208,367
        Wake-Northeas t Cam pus                             0             -                 0             0             0                  0            -                 0
       Wayne CC                                        3,497         349,735        201,519           4,499       17,115             179,905       169,830       27,682,362
        Wayne-Aviation Ctr.                                54           5,442        12,751               0           187             12,564            -                 0
       Wes tern Piedm ont CC                           2,049         204,900        162,966           5,100       13,560             144,306        60,594        9,876,822
        WP-North King/Wes t Meeting St. Ctr.                0             -            2,880              0             0              2,880            -                 0
       Wilkes CC                                       1,810         181,042        225,698         26,986        44,452             154,260        26,782        4,365,395
        Wilkes -Alleghany Cty.                             70           7,020          6,924              0           582              6,342            678         110,474
        Wilkes -As he Cty.                               263          26,265         14,254               0           258             13,996        12,269        1,999,823
       Wils on TCC                                     1,801         180,057        128,658             890       12,838             114,930        65,127       10,615,696
        Wils on-Police Academ y Ctr.                       73           7,314          1,675              0             0              1,675          5,639         919,202
                  TOTAL                             173,963        17,396,328    12,189,869        554,722     1,206,230          10,430,333     7,218,377    1,176,595,391




MGT of America, Inc.                                                                                                                                                    Page 4-23
                                                                               Refinements for New Construction Formula


                                                EXHIBIT 4-7
                                FUNDING REQUIREMENTS FOR NEW CONSTRUCTION
                                 NORTH CAROLINA COMMUNITY COLLEGE SYSTEM

                                               A                B               C               D              E                F               G
                                                                                                                          Balance of
                                                            Non-State                                         State            cost
                                             Tota l       Expe nditures                     Balance of    Percenta ge     w ith ability
                                           Estim ated      in ex cess of   Application of      Cost       w ith Ability      to pa y      State Portion
College/Cam pus/Center                        Cost        State Approp. Col. B to Col. A      (A-C)          to Pay           (DxE)           (F+C)
Alam ance CC                                15,118,250          1,279,536      1,279,536     13,838,714          50.00%        6,919,357       8,198,893
 Alam ance-Glenhope School Ctr.                       0                  0              0             0          50.00%                 0              0
 Alam ance-Front Street Ctr.                 1,317,855                   0              0     1,317,855          50.00%          658,928         658,928
 Alam ance-Glen Raven Ctr.                     961,863                   0              0       961,863          50.00%          480,932         480,932
As heville-Buncom be TCC                    22,108,016         13,308,683     13,308,683      8,799,333          50.00%        4,399,667     17,708,350
 As heville-Madis on Cty.                      151,498             21,073         21,073        130,425          62.55%           81,581         102,654
Beaufort County CC                          14,469,830          3,296,574      3,296,574     11,173,256          58.61%        6,548,645       9,845,219
Bladen CC                                    7,973,776          1,825,489      1,825,489      6,148,287          60.82%        3,739,388       5,564,877
 Bladen-Kelly/Eas t Arcadia Ctr.                      0                  0              0             0          60.82%                 0              0
Blue Ridge CC                                         0         1,441,490               0             0          50.00%                 0              0
 Blue Ridge-Trans ylvania Cty.               5,067,540            787,276        787,276      4,280,264          50.00%        2,140,132       2,927,408
Bruns wick CC                                         0         4,681,659               0             0          50.00%                 0              0
 Bruns wick-Job Link Ctr.                             0                  0              0             0          50.00%                 0              0
 Bruns wick-Leland Ctr.                        566,511            566,511        566,511              0          50.00%                 0        566,511
 Bruns wick-Southport Ctr.                            0                  0              0             0          50.00%                 0              0
Caldwell CC & TI                             3,992,992          7,037,968      3,992,992              0          58.19%                 0      3,992,992
 Cald-Watauga Cty. Cam pus                   7,606,372            246,507        246,507      7,359,865          50.00%        3,679,932       3,926,439
 Cald-Adm in. Support/Bas ic Skills Ctr.              0                  0              0             0          50.00%                 0              0
 Cald-Watauga Cty. Bus . Ctr.                  825,633                   0              0       825,633          50.00%          412,816         412,816
Cape Fear CC                                60,366,887         50,979,692     50,979,692      9,387,195          50.00%        4,693,598     55,673,290
 Cape-North Cam pus                                   0             1,447               0             0          50.00%                 0              0
 Cape-Burgaw Ctr.                                     0                  0              0             0          50.00%                 0              0
 Cape-Ham s tead Ctr.                                 0                  0              0             0          50.00%                 0              0
Carteret CC                                 15,316,295          3,030,948      3,030,948     12,285,347          50.00%        6,142,674       9,173,622
Catawba Valley CC                           13,837,384         10,754,538     10,754,538      3,082,846          50.00%        1,541,423     12,295,961
Central Carolina CC                         21,714,259          2,332,316      2,332,316     19,381,943          52.09%       10,096,054     12,428,370
 Central-Chatham Cty.                        1,374,153             78,225         78,225      1,295,928          50.03%          648,353         726,578
 Central-Harnett Cty.                        7,500,420            175,120        175,120      7,325,300          67.32%        4,931,392       5,106,512
 Central-School of Telecom m unications      2,283,139                   0              0     2,283,139          52.09%        1,189,287       1,189,287
 Central-Siler City Ctr.                       586,706                   0              0       586,706          50.03%          293,529         293,529
Central Piedm ont CC                        30,311,154        30,311,154      30,311,154              0          50.00%                 0    30,311,154
 CP-North Cam pus                           10,611,463         10,611,463     10,611,463              0          50.00%                 0    10,611,463
 CP-Northeas t Cam pus                       7,365,970          7,365,970      7,365,970              0          50.00%                 0      7,365,970
 CP-South Cam pus                           49,585,415          8,545,847      8,545,847     41,039,568          50.00%       20,519,784     29,065,631
 CP-Southwes t Cam pus                         870,420            870,420        870,420              0          50.00%                 0        870,420
 CP-Wes t Cam pus                            6,228,882          6,228,882      6,228,882              0          50.00%                 0      6,228,882
 CP-Wes t Center                             2,341,006          2,341,006      2,341,006              0          50.00%                 0      2,341,006




       MGT of America, Inc.                                                                                                     Page 4-24
                                                                                    Refinements for New Construction Formula


                                                EXHIBIT 4-7 (Continued)
                                     FUNDING REQUIREMENTS FOR NEW CONSTRUCTION
                                      NORTH CAROLINA COMMUNITY COLLEGE SYSTEM
                                                 A                 B                 C                 D               E                F                  G
                                                                                                                                  Ba la nce of
                                                               Non-Sta te                                             Sta te           cost
                                              Tota l         Ex pe nditure s                      Ba la nce of    Pe rce nta ge   w ith a bility
                                            Estim a te d      in e x ce ss of   Applica tion of       Cost        w ith Ability      to pa y       Sta te Portion
Colle ge /Ca m pus/Ce nte r                    Cost          Sta te Approp. Col. B to Col. A          (A-C)          to Pa y          (Dx E)            (F+C)
Cleveland CC                                 10,824,248                38,884           38,884     10,785,364            58.20%        6,277,082         6,315,966
Coas tal Carolina CC                         40,603,789             6,048,405       6,048,405      34,555,384            66.15%       22,858,387       28,906,792
College of The Albem arle                     8,936,149               745,913         745,913        8,190,236           62.64%        5,130,364         5,876,277
  Coll Alb-Chowan Cty.                        2,407,577                       0               0      2,407,577           61.12%        1,471,511         1,471,511
  Coll Alb-Dare Cty.                          2,332,232                81,442           81,442       2,250,790           50.00%        1,125,395         1,206,837
  Coll Alb-Rivers ide Ext. Ctr.                          0                    0               0               0          62.64%                  0               0
Craven CC                                    10,621,017             4,239,143       4,239,143        6,381,874           56.97%        3,635,754         7,874,897
  Craven-Havelock/Cherry Point Ctr            4,147,860                       0               0      4,147,860           56.97%        2,363,036         2,363,036
Davids on County CC                           9,575,272             4,187,998       4,187,998        5,387,274           54.34%        2,927,445         7,115,443
  Davids on-Davie Cty.                                   0            859,706                 0               0          50.00%                  0               0
Durham TCC                                   40,470,944             2,670,647       2,670,647      37,800,297            50.00%       18,900,149       21,570,796
  Durham -Northern Durham Ctr.                           0                    0               0               0          50.00%                  0               0
Edgecom be CC                                 9,869,976               593,994         593,994        9,275,982           62.15%        5,765,023         6,359,017
  Edge-Rocky Mount Cam pus                    7,433,615                       0               0      7,433,615           62.15%        4,619,992         4,619,992
Fayetteville TCC                             71,135,203            8,964,397        8,964,397      62,170,806            55.59%       34,560,751       43,525,148
  Fayetteville-Firefighting Facility Ctr.       326,000                      0                0         326,000          55.59%          181,223           181,223
  Fayetteville-Fort Bragg Ctr.               23,614,625                      0                0    23,614,625            55.59%       13,127,370       13,127,370
Fors yth TCC                                 27,943,949            6,779,140        6,779,140      21,164,809            50.00%       10,582,405       17,361,545
  Fors yth-Carver Road Ctr.                   1,457,759                      0                0      1,457,759           50.00%          728,880           728,880
  Fors yth-Kerners ville Ctr.                   846,281                      0                0         846,281          50.00%          423,141           423,141
  Fors yth-Wes t Ctr.                        10,565,660                      0                0    10,565,660            50.00%        5,282,830         5,282,830
Gas ton College                              11,183,059            9,907,731        9,907,731        1,275,328           50.00%          637,664       10,545,395
  Gas ton-Lincoln Cty.                          643,524            1,448,912          643,524                 0          54.41%                  0         643,524
Guilford TCC                                 42,255,794           23,379,945       23,379,945      18,875,849            50.00%        9,437,925       32,817,870
  Guilf-Aviation Ctr.                                    0                   0                0               0          50.00%                  0               0
  Guilf-Greens boro Cam pus                  17,892,231                      0                0    17,892,231            50.00%        8,946,116         8,946,116
  Guilf-High Point Ctr.                       7,791,502                      0                0      7,791,502           50.00%        3,895,751         3,895,751
  Guilf-Sm all Bus ines s Ctr.                           0                   0                0               0          50.00%                  0               0
Halifax CC                                   19,448,671            1,547,095        1,547,095      17,901,576            66.45%       11,895,597       13,442,692
Haywood CC                                      926,961            3,313,232          926,961                 0          52.52%                  0         926,961
  Haywood-Continuing Ed. Ctr.                            0                   0                0               0          52.52%                  0               0
  Haywood-High Tech. Ctr.                       353,571              353,571          353,571                 0          52.52%                  0         353,571
  Haywood-Hum an Res ours e Dev. Ctr.                    0                   0                0               0          52.52%                  0               0
Is otherm al CC                               2,694,553            3,096,618        2,694,553                 0          57.76%                  0       2,694,553
  Is otherm al-Polk Cty.                                 0              7,305                 0               0          50.00%                  0               0
Jam es Sprunt CC                              4,737,595              332,163          332,163        4,405,432           58.25%        2,566,164         2,898,327




            MGT of America, Inc.                                                                                                       Page 4-25
                                                                               Refinements for New Construction Formula


                                           EXHIBIT 4-7 (Continued)
                                  FUNDING REQUIREMENTS FOR NEW CONSTRUCTION
                                   NORTH CAROLINA COMMUNITY COLLEGE SYSTEM
                                            A                 B                C                D               E                F                G
                                                                                                                           Ba lance of
                                                          Non-Sta te                                           Sta te           cost
                                          Tota l        Ex pe nditure s                    Ba lance of     Pe rce nta ge   w ith ability
                                        Estima te d      in ex ce ss of  Applica tion of       Cost        w ith Ability      to pa y      Sta te Portion
Colle ge /Ca mpus/Ce nte r                 Cost         Sta te Approp. Col. B to Col. A       (A-C)           to Pa y          (Dx E)           (F+C)
Johns ton C C                            18,173,196           9,589,798       9,589,798       8,583,398           58.04%        4,981,804      14,571,602
Lenoir CC                                20,198,797           3,771,493       3,771,493     16,427,304            58.40%        9,593,546      13,365,039
 Lenoir-Aviation Ctr.                               0                  0               0               0          58.40%                 0               0
 Lenoir-Greene C ty.                      4,257,397           2,261,284       2,261,284       1,996,113           64.99%        1,297,274        3,558,558
 Lenoir-Jones Cty.                                  0                  0               0               0          60.53%                 0               0
 Lenoir-Wals tonburg C tr.                          0                  0               0               0          64.99%                 0               0
 Lenoir-Wes t Boundary Street C tr           73,213                    0               0         73,213           58.40%           42,756           42,756
Martin CC                                           0           689,534                0               0          63.41%                 0               0
 Martin-Bertie Cty.                                 0           490,542                0               0          69.93%                 0               0
Mayland CC                                6,656,757              97,266          97,266       6,559,491           57.37%        3,763,180        3,860,446
 Mayland-Avery C ty.                      1,155,670                    0               0      1,155,670           50.00%          577,835          577,835
 Mayland-Yancey Cty.                        205,096                    0               0        205,096           57.96%          118,874          118,874
McDowell TCC                              5,602,968             284,321         284,321       5,318,647           59.98%        3,190,125        3,474,446
 McDowell-Marion Ctr.                               0                  0               0               0          59.98%                 0               0
Mitchell C C                              6,261,660           4,068,636       4,068,636       2,193,024           50.00%        1,096,512        5,165,148
 Mitchell-Moores ville C tr.                704,714                    0               0        704,714           50.00%          352,357          352,357
Montgom ery CC                                      0           103,444                0               0          62.02%                 0               0
Nas h CC                                 11,326,544             613,101         613,101     10,713,443            59.24%        6,346,644        6,959,745
Pam lico CC                               5,934,341              12,897          12,897       5,921,444           59.81%        3,541,616        3,554,513
Piedm ont C C                             7,189,930             115,023         115,023       7,074,907           52.19%        3,692,394        3,807,417
 Piedm ont-Cas w ell C ty.                3,858,373              11,328          11,328       3,847,045           65.93%        2,536,357        2,547,685
Pitt CC                                  40,835,086           8,255,911       8,255,911     32,579,175            56.42%       18,381,171      26,637,082
Randolph CC                               2,053,963           1,956,628       1,956,628          97,335           55.82%           54,332        2,010,960
 Randolph-Archdale Ctr.                     310,807                    0               0        310,807           55.82%          173,493          173,493
Richm ond CC                              6,896,933           3,408,267       3,408,267       3,488,666           67.29%        2,347,524        5,755,791
 Richm ond-Continuing Education C tr.       480,431             480,431         480,431                0          67.29%                 0         480,431
 Richm ond-Jam es Nurs ing Building                 0                  0               0               0          67.29%                 0               0
 Richm ond-Scotland C ty.                   352,816                    0               0        352,816           63.22%          223,050          223,050
Roanoke-C howan CC                                  0           214,597                0               0          67.25%                 0               0
Robes on C C                             21,961,642           5,910,155       5,910,155     16,051,487            70.24%       11,274,564      17,184,719
 Robes on-Em ergency Training Ctr.          141,484                    0               0        141,484           70.24%           99,378           99,378
 Robes on-Lum berton Extens ion C tr.     3,256,414                    0               0      3,256,414           70.24%        2,287,305        2,287,305
 Robes on-Pem broke Extens ion C tr.      1,407,179                    0               0      1,407,179           70.24%          988,403          988,403
Rockingham CC                             4,288,530           7,173,935       4,288,530                0          57.66%                 0       4,288,530
Rowan-Cabarrus CC                        14,772,882             718,275         718,275     14,054,607            55.09%        7,742,683        8,460,958
 Row an-C abarrus C ty.                  13,367,406             791,888         791,888     12,575,518            50.00%        6,287,759        7,079,647
 Row an-C abarrus -Corban Ctr.                      0                  0               0               0          50.00%                 0               0




           MGT of America, Inc.                                                                                                   Page 4-26
                                                                              Refinements for New Construction Formula


                                          EXHIBIT 4-7 (Continued)
                               FUNDING REQUIREMENTS FOR NEW CONSTRUCTION
                                NORTH CAROLINA COMMUNITY COLLEGE SYSTEM
                                              A                 B               C                D               E                F                 G
                                                                                                                            Ba lance of
                                                            Non-State                                           Sta te           cost
                                            Tota l        Expenditures                      Ba lance of     Pe rce ntage    w ith ability
                                          Estim a ted      in e xce ss of  Application of       Cost        w ith Ability      to pay       Sta te Portion
Colle ge /Ca mpus/Ce nte r                   Cost         Sta te Approp. Col. B to Col. A       (A-C)          to Pa y          (Dx E)           (F+C)
Sam ps on CC                                8,849,877             352,133        352,133       8,497,744           61.63%        5,237,160        5,589,293
Sandhills CC                               21,640,726         11,301,795      11,301,795     10,338,931            50.00%        5,169,466      16,471,261
 Sandhills -Hoke Cty.                       2,876,571              86,290         86,290       2,790,281           74.56%        2,080,433        2,166,723
South Piedm ont CC                                    0           150,563               0               0          64.92%                 0               0
 SP-Ans onville Ctr.                                  0                  0              0               0          64.92%                 0               0
 SP-Union Cty. Cam pus                        786,149                    0              0         786,149          54.46%          428,137          428,137
 SP-Wades boro Ctr.                                   0                  0              0               0          64.92%                 0               0
Southeas tern C C                          12,119,687           3,217,624      3,217,624       8,902,063           64.19%        5,714,234        8,931,858
Southwes tern CC                           18,293,816           1,961,186      1,961,186     16,332,630            50.00%        8,166,315      10,127,501
 Southw es tern-Macon Cty.                  9,564,840               2,508           2,508      9,562,332           50.00%        4,781,166        4,783,674
 Southw es tern-Swain C ty.                           0            14,789               0               0          64.45%                 0               0
Stanly CC                                  11,127,521             354,688        354,688     10,772,833            60.46%        6,513,255        6,867,943
 Stanly-Wes tern Stanly Ctr.                          0                  0              0               0          60.46%                 0               0
Surry CC                                   20,557,297           1,352,677      1,352,677     19,204,620            56.13%       10,779,553      12,132,230
 Surry-Yadkin Cty.                            880,200           1,500,000        880,200                0          57.60%                 0         880,200
Tri-County CC                                 203,587             450,000        203,587                0          60.53%                 0         203,587
 Tri-County-Graham Cty.                       111,981                    0              0         111,981          63.26%           70,839           70,839
Vance-Granville CC                         19,204,497           1,231,790      1,231,790     17,972,707            62.16%       11,171,835      12,403,625
 Vance-Franklin Cty.                        5,549,987           1,001,550      1,001,550       4,548,437           62.62%        2,848,231        3,849,781
 Vance-Granville Cty.                      10,107,630             190,025        190,025       9,917,605           61.64%        6,113,212        6,303,237
 Vance-Warren Cty.                          4,646,641              13,320         13,320       4,633,321           66.88%        3,098,765        3,112,085
Wake TCC                                   59,409,112         26,762,876      26,762,876     32,646,236            50.00%       16,323,118      43,085,994
 Wake-Adult Education Ctr.                  3,669,594                    0              0      3,669,594           50.00%        1,834,797        1,834,797
 Wake-Health Ed. Cam pus                    8,208,367                    0              0      8,208,367           50.00%        4,104,183        4,104,183
 Wake-Northeas t Cam pus                              0                  0              0               0          50.00%                 0               0
Wayne CC                                   27,682,362           3,864,644      3,864,644     23,817,718            63.00%       15,005,162      18,869,806
 Wayne-Aviation Ctr.                                  0                  0              0               0          63.00%                 0               0
Wes tern Piedm ont CC                       9,876,822           1,079,304      1,079,304       8,797,518           59.00%        5,190,536        6,269,840
 WP-North King/Wes t Meeting St. Ctr.                 0                  0              0               0          59.00%                 0               0
Wilkes CC                                   4,365,395           4,474,394      4,365,395                0          56.62%                 0       4,365,395
 Wilkes -Alleghany Cty.                       110,474                    0              0         110,474          50.00%           55,237           55,237
 Wilkes -As he Cty.                         1,999,823              59,554         59,554       1,940,269           53.13%        1,030,865        1,090,419
Wils on TCC                                10,615,696           3,737,003      3,737,003       6,878,693           53.97%        3,712,431        7,449,434
 Wils on-Police Academ y Ctr.                 919,202                    0              0         919,202          53.97%          496,093          496,093
           TOTAL                        1,176,595,391        360,893,502     341,739,109    834,856,281                      467,373,379      809,112,488




       MGT of America, Inc.                                                                                                      Page 4-27
5.0 SUMMARY
                                    5.0 SUMMARY

5.1   Context of Recommendations

      Over the past four years, the North Carolina Community College System has

undertaken a major review of the funding models it uses to request funding for and

allocate state appropriations to the state’s 58 community colleges.              Working

cooperatively with the General Assembly and the colleges (including the trustees,

presidents and business officers), the State Board and System Office staff have restored

credibility to the funding process for the System.

      A number of recommendations have evolved from the ongoing study and have

been adopted by the State Board and then incorporated in funding decisions by the

General Assembly. The general thrust of the series of recommendations has been to

create a funding model that is easy to understand, treats individual colleges equitably,

reflects changing models for delivering postsecondary education, and supports the

state’s goal for providing world-class training programs for its citizens.

      This phase of the         study   brings forward      several   new and   significant

recommendations related to faculty compensation and summer term funding. It also

revisits an earlier recommendation for capital funding and offers proposals for its

refinement.



5.2   Summary of Findings and Recommendations

      The major focus of the current study has been to respond to the special provision

enacted by the 1999 General Assembly that called for an examination of several issues

related to faculty employment. In particular, the study considered the interrelated issues

of faculty compensation, faculty contract length, and funding policies for summer term

instruction.

MGT of America, Inc.                                                              Page 5-1
                                                                                  Summary


      The study found that one of the major factors in the state’s relatively low standing

on faculty salaries in its community colleges relates to the lack of specific state support

for summer term curriculum instruction. In the absence of summer term funding, the

colleges must divert a portion of the state appropriations generated through the formulas

for regular term instruction to pay their faculty for summer teaching responsibilities. This

diversion, of course, leaves fewer dollars available for regular term salaries for faculty

and, hence, the report of unexpectedly low salaries for North Carolina faculty in regional

and national rankings of the states.

      In addition to the need for a funding model that can compensate faculty

adequately, a summer term instruction formula is needed to enable the colleges to

respond to student demand for programming. Under current practices, many colleges

are unable to meet community needs for instructional offerings during the summer.

      We recommend that the state create a new component for the System’s funding

model for summer term curriculum instruction.        This model would be similar to the

corresponding model for regular term instruction, but without the sliding scale features.

Our recommendation for summer term funding applies only to the instruction model,

since the components related to support functions (such as general administration and

libraries) are already funded to operate on a 12-month basis.

      A second focus of the current study has been on opportunities for refinement of

the new construction formula that was adopted by the State Board in 1999. While

keeping the overall design of the model intact, we recommend slight modifications in

how students (the driver variable in the model) are counted and how currently available,

but inappropriate, space is treated. In particular, we recommend that the formula rely on

projected enrollment and that general use and special use space be excluded from the

model.



MGT of America, Inc.                                                                Page 5-2
                                                                                 Summary


5.3   Further Issues for Consideration

      During the four years of the funding model review activity, considerable progress

has been made in updating the formulas used to determine the resource requirements of

the state’s community colleges. This study has taken place, however, in a very dynamic

period where the environment in which the colleges operate has changed dramatically.

Thus, several new issues have emerged that were not clearly understood when the

funding models were first assessed in 1996.

      Perhaps the most significant change that is occurring relates to how instruction is

being delivered. While “distance learning” was only beginning to be envisioned in the

mid-1990s, it is becoming increasingly common today and is expected to grow in

importance rapidly over the next few years.

      The funding implications of distance learning are just now starting to be

understood. Unlike most regular instruction programs, distance learning often involves

multiple institutions (sometimes from outside the System) that each play a distinct role

and incur unique costs. Sometimes, these costs are significantly different than those

incurred in regular instruction. We believe that the System will need to develop a more

formal process for addressing the funding requirements of distance learning in the near

future.

      A second issue is the need to revisit the earlier interest in a curriculum funding

model that recognizes differences in program costs. On several occasions, the Study

Group and its predecessor considered and then postponed making a recommendation

on this issue. The postponement was due, in part, to lack of definitive data to evaluate

program cost differences.

      The current study of faculty employment has served to highlight the difficulties that

the colleges have in providing adequate compensation for their faculty, particularly those



MGT of America, Inc.                                                               Page 5-3
                                                                             Summary


in the more technical areas where market competition is most keen. Given this situation

coupled with recent enhancement in data systems, we believe that the System may want

to again consider a refinement to its curriculum instruction model to recognize program

costs.




MGT of America, Inc.                                                           Page 5-4

				
DOCUMENT INFO