ASSOCIATED STUDENTS UCLA



ASSOCIATED STUDENTS UCLA

BOARD OF DIRECTORS

Regular Meeting

January 27, 2012

12:00 p.m.

Kerckhoff Hall Staterooms

PRESENT: Jacob Ferrari, Karleen Giannitrapani, Mike Jedlicka, Paul Lanzillotti, Amy Liu, Dave Lowenstein, Mark Reyes, Ryan Roberts, Mikaela Saelua, Maggie Thornton, Pam Viele, Dorothy Wiley, and Bob Williams

ABSENT: Hironao Okahana

EARLY

DEPARTURE: (Karleen Giannitrapani, Amy Liu, Mikaela Saelua, and Dorothy Wiley)

MANAGEMENT: Cindy Bolton, ASUCLA Director of Food Operations

Roy Champawat, ASUCLA Student Union/Student Support Services Director

Rich Delia, ASUCLA Chief Financial Officer/Finance Director

Sandi Gillespie, Association Affairs Manager

Patrick Healey, UCLA Store General Manager/Director Apparel/Accessories/LuValle Commons/Health Sciences Store;

Karen Noh, ASUCLA Special Projects Director

Jan Griwach-Ronci, UCLA General Manager/Director Computers/Supply Division & Hill Top Shop

Neil Yamaguchi, UCLA Store General Manager/Director of Academic Support

GUESTS: Andrew Alexah, UCLA Academic Planning and Budget

Ronald Arruejo, USAC Finance Committee Chair

David Bocarsly, USAC General Representative

Kylie Reynolds, Daily Bruin

Melissa Truang, Daily Bruin

CALL TO ORDER

Mr. Reyes called the meeting to order at 12:08 p.m.

APPROVAL OF AGENDA

Ms. Giannitrapani asked to add an Executive Committee action item Contingent Liability to Assist USAC as agenda item VIII.D and subsequently agenda items VIII.D and E will become agenda items VIII.E and F. Mr. Williams stated that he would like to add an Executive Session as agenda item VIII.G.

Mr. Reyes called for consent to approve the Associated Students UCLA Board of Directors January 27, 2012, Regular Meeting Agenda as amended. There being no objections, the motion was approved by unanimous consent.

ELECTION OF OFFICERS

Ms. Giannitrapani stated that the Nominating Committee is recommending that the Associated Students UCLA Board of Directors approve the appointment of Karleen Giannitrapani as Board Chair and Mark Reyes as Board Vice Chair effective immediately. Mr. Reyes called for a secret ballet vote. The nominations were approved by a vote of 10 yeas and no nays.

APPROVAL OF MINUTES

Ms. Giannitrapani called for consent to approve the Associated Students UCLA Board of Directors December 2, 2011, Regular Meeting Minutes. There being no objections, the motion was approved by unanimous consent.

EXECUTIVE DIRECTOR’S REPORT

Mr. Williams offered the Executive Director’s Report to the Board.

A. Financial/Operational Items

1. November

ASUCLA fell slightly behind plan in November in both sales and net income. The Store continues to be the division seeing the slower trends. Bearwear had a solid month in sales and contribution, but this was offset by the slower Computer Store results. Ackerman textbook results were solid and LuValle was on plan while Health Sciences was off plan due to dental kit timing.

Food sales were slightly off plan but were better than expected considering the Court of Sciences Student Center is not open. As with previous months, several units exceeded their budgets since they were not experiencing the expected cannibalization from the new operation. LuValle had a tough month in costs and Café Synapse continues to miss plan but Catering continued its run of positive results. Management is planning to make adjustments in Café Synapse in the coming months.

Overall for the month, the Association was $33,000 negative to plan in net income.

2. December

December results were stronger than November. Overall, the Association’s sales were ahead of plan and net income results exceeded budget by $46,000. Store sales continue to face challenges in many areas but a positive dental kit month created a positive sales variance. As a result of the sales mix, contribution fell short of plan by $15,087. Bearwear, Campus Photo Studio, Computer Store, textbooks, APS, and LuValle were all off plan. The two divisions with the largest positive sales were in dental kits and in the Bookzone. The positive sales in the BookZone were due to the UCLA History Book and the John Wooden Book.

Food Service had a strong December and exceeded their plan in both sales and contribution. This is very positive outcome considering the delay in the Court of Sciences Student Center. LuValle came in with a solid month, Café 451 continues to perform well and the Coffee House saw positive results versus plan. Catering continued its positive trend and exceeded sales by $33,713 and contribution by $15,180.

The Services and Student Union Divisions were on plan for December. Utilities were high but this may be timing. Overall results for the month show the Association ahead of sales plan by $135,000 and net income by $46,000. For the first five months of the fiscal year, ASUCLA Services and Enterprises is ahead of budget in net income by $92,000 including the additional $75,000 in early merit increases costs.

3. January

January sales trends in the Store and Food Service are well behind plan. Mr. Williams noted that as a result of the calendar change, comparisons in the Store and Food Service to last year in January do not correspond to the same period making them difficult to analyze.

Store sales are off plan significantly led by slowing trends in textbooks and computer hardware. Customer counts and traffic in the Store are down noticeably since the return from winter break. Although slower sales were anticipated due to the closing of Pauley Pavilion, results are slower than expected.

Food Service trends are also slower than normally experienced in the fall. Food Service had some budgeting errors where the calendar was not shifted leading to larger shortfalls on paper. However, when those budgeting errors are factored out sales are still behind budget. Management expects a boost in sales when the Court of Sciences Student Center opens.

B. *Our Independent Bookstore

1. Loyalty Program

Over 30,000 coupons were distributed for winter quarter and management will be tracking redemption and will be compiling a report on the findings.

C. *Campus Partnerships

1. DIA Revenue Sharing Agreement

ASUCLA finalized the Licensing and Store revenue sharing agreement with DIA. The agreement is designed to create partnerships with athletics to maximize revenues.

2. Recreation Marketing Agreement

The Marketing Department is working on an agreement with CRA to coordinate some marketing efforts that will support both organizations.

D. *Championship Service

1. John Wooden Apparel Collection

The John Wooden Apparel Collection is on display in the Store and management is working with the vendor to expand sales to other locations.

2. Valentine’s Day Sale

The next big Store sale will be the Valentine’s Day sale on February 9. These sales continue to be more important sales days with the current economic trends.

E. *Your Student Association

1. ASUCLA Benefits U

ASUCLA Benefits U schedule will be:

Jan 17 – Store Patio Sale

Jan 23 – Ackerman Union Open Late

Feb 9 – UCLA Store Valentine Sale

Feb 21 – UCLA Restaurants theme

2. Ackerman Union Open Late

Management continues to do marketing and enhance services for the Ackerman Union Open Late program. Mr. Champawat gave an update at the Services Committee meeting which also highlighted many of the programming connections to both USA and GSA events. Mr. Champawat’s staff will be doing some actual counts of people in the building to present at a future meeting.

F. *Building Towards the Future

1. Court of Sciences Student Center

Construction punch list items are being completed and signage is up in the food operations. ASUCLA is waiting to get the go ahead to take over the building and begin operational preparations to open.

2. Ackerman Union Interior Design/Patio Project

Several meetings have occurred on this project which included additional discussions regarding the overall goal of the project. Step two was to work with the retail team to determine back of house and staff needs for management, processing and storage. The architects toured the areas with the store management team on January 12, 2012. There have been two additional meetings with the architectural and store design team to develop the A and B level plans.

3. Pauley Pavilion

Management continues to work with DIA in developing the food line up and concession stand construction.

4. Kinross

The opening of this facility has been delayed; however, fitness equipment and layout are nearing completion.

G. Employee Investment

1. Employee of the Year

ASUCLA held its annual Employee of the Year Awards ceremony on December 16 from 2-4 p.m. in the Young Grand Salon. Thank you to all the Board members who attended.

H. Space, Outreach, and Services

1. Health Sciences

The Health Sciences Committee took an extensive tour of the existing Café Med facilities including the very large kitchen and loading dock facility on the lower floor. The Committee will be meeting to develop clear outcomes for any proposal and consider whether to move to some initial plan sketches.

2. New Media

The New Media Committee had a quick meeting last week and looked at several versions, layouts, and new media strategies for the ASUCLA website. The Committee was able to develop a clear understanding of what was needed including what content and language should be highlighted or avoided. Management will take this input and develop a couple more refined versions for the next meeting.

I. Food Service

Management is analyzing the impact of the new northern campus area coffee houses to understand the sales and net income outcomes. This will help develop some criterion for future projects in the same region of campus.

J. Development

There was a good discussion regarding development at the JOC meeting and opened up the issue for campus partnerships.

K. ASUCLA – Delegations, Rights and Role on Campus

There have been several ongoing discussions in various forums regarding ASUCLA’s role and delegations on campus. This was another topic discussed at JOC but more strategic work must be considered by the Board.

EXECUTIVE COMMITTEE REPORT

Ms. Giannitrapani stated that the Committee met on January 11 and discussed several campus issues including the campus wide Apple contract, campus wide beverage contract, and campus wide payroll services. The Committee also started planning the mid-year retreat scheduled for February 10. Finally, the Committee is forwarding two items today, Notice of the Bylaw Amendments and Election of Officers.

The Committee met again on January 26 to discuss the funding for USAC’s programming issue and is forwarding an action item today.

FINANCE COMMITTEE REPORT

Mr. Ferrari stated that the Committee met on January 20 and discussed and approved the external audits and is forwarding three items today; approval of external audits, funding for the Ostin Music Café, and funding for USAC.

SERVICES COMMITTEE REPORT

Ms. Liu stated that the Committee met on January 13 and heard a presentation from John Masline, UCLA Radio General Manager regarding playing UCLA Radio in select locations and times in ASUCLA’s facilities. The Committee also heard a presentation from USAC regarding their request for funding and is forwarding an action item today. Finally, the Committee approved the Ostin Music Café project which is also being forwarded to the Board today.

HEALTH SCIENCES AD HOC COMMITTEE REPORT

Ms. Thornton stated that the Committee toured the Med Café area on December 9 and will meet on February 3 to develop a plan.

NEW MEDIA AD HOC COMMITTEE REPORT

Mr. Roberts stated that the Committee met briefly on January 20 and looked at several drafts of the new ASUCLA website.

FINANCE DIRECTOR’S REPORT

November Financial Results

Mr. Delia briefly went over the November Financial Results stating that the Association was $33,000 negative to plan in net income and $45,000 better than plan year-to-date.

December Financial Results

In December ASUCLA Services & Enterprises reported a positive budget variance of $46,000 and a negative variance of $48,000 compared to the prior year, in terms of net income.

This bottom-line result was achieved by a positive gross income variance of $57,000 in the Store; $66,000 in Restaurants, and $11,000 in the Services Division.

These results were further strengthened by wages and benefits which in total were $21,000 better than planned, such that net income from operations was $42,000 greater than planned and $51,000 less than the prior year.

Given this, year-to-date net income for the Association as a whole was $92,000 greater than planned at December month-end, but $187,000 less than the same period in the prior year.

In terms of cash, Services & Enterprises reported a $9,126,000 book balance at month-end, of which $3,570,000 has been committed to capital projects, leaving $4,882,000 in uncommitted cash and a Reserve Surplus of $257,000.

Mr. Delia reported that as of December, past due accounts receivable has stayed consistent at 2% of total accounts due. Additionally, Store inventory at cost is at $8,000,000 while inventory turns decreased slightly to 4.75.

January Preliminary Sales

To date in January Store sales were $850,321 less than planned, with negative budget variances appearing in most of the divisions.

Sales in the Apparel Division are negative to plan by $92,927. The largest contributor to the negative sales variance is the Supply Division which is $332,652 less than planned due to a $303,579 negative variance in the Computer Store.

Sales in the textbook area are concerning. Total Academic Support is negative to plan by $294,448 of which Ackerman Union new text is $275,191 less than plan and APS $127,103 less than plan. Textbooks in all the other areas are negative to plan as well.

Additionally, the Store is reporting a $8,340 negative variance in sales from the Kinross Graduate Student Center, and a $23,400 negative variance at the Court of Sciences Student Center due to their delayed openings.

Sales in the Mail Telephone and Web department exceeded plan by $9,496, which is another indicator that less people are on campus due to the closing of Pauley Pavilion.

Given these results, management anticipates that the Store would report a negative variance of $202,720 in terms of gross margin, by month-end.

The Restaurants Division has a $153,139 negative variance to plan, due primarily to a $52,494 negative variance in sales at the Court of Sciences Student Center along with the related 3rd party vendors (Yoshinoya and Subway) which together have a negative variance of $105,138. This operation’s opening has been delayed. Also, there was a calendar shift this year which some of the food division did not account for in their budgets; therefore, management feels that the Restaurants will balance out next month.

NOTICE OF BYLAW ADMENDMENTS

Mr. Reyes explained that the amendments to the Bylaws were mainly grammatical and formatting revisions with the exception of one addition that includes adding a five day grace period to the eligibility section which is consistent with the USAC Bylaws. The amendments will be voted on at the next Board meeting.

APPROVAL OF FY 10/11 AUDITED FINANCIAL STATEMENTS

Mr. Ferrari made a motion that the Finance Committee is recommending that the Associated Students UCLA Board of Directors approve the FY 10/11 Audited Financial Statements. Ms. Giannitrapani called for a vote. The motion was approved by a vote of 10 yeas and 0 nays.

APPROVAL OF THE OSTIN MUSIC CAFÉ PROJECT

Mr. Ferrari stated that the Finance Committee along with the Services Committee is recommending that the Board of Directors approve a capital expenditure for a new café in the Ostin Music building expansion. The project is planned to be completed in 2014 and at this time, preliminary estimates project that the café will require approximately $200,000 capital investment by AUSCLA.

Mr. Ferrari and Ms. Liu made a motion that the Finance Committee and the Services Committee are recommending that the Associated Students UCLA Board of Directors approve a capital expenditure of $200,000 for the Ostin Music Café Project. Ms. Giannitrapani called for a vote. The motion was approved by a vote of 10 yeas and no nays.

APPROVAL OF CONTINGENT LIABILITY FOR USAC’S STUDENT PROGRAMMING

Mr. Williams explained that a creation of a Contingent Liability in the ASUCLA Services and Enterprises financial statement of $76,000 will assist USAC by providing a guarantee that will allow USAC to continue the funding of student programs throughout the remainder of the academic year 2011-2012. The amount of this guarantee is split into $42,000 for the USAC Contingency Fund and $34,000 for the USA/BOD Programming Fund.

If the surplus at the end of the academic year is greater than the amount of the guarantee authorized by the Board, then the guarantee will not be utilized. If this surplus amount is less than the amount of the guarantee, then ASUCLA Services and Enterprises will be authorized to make up the difference up to $76,000 in accordance with the amounts specified above.

It is further recommended that management work with the necessary personnel to provide USAC with the surplus amount for the upcoming year earlier than they have in the past.

The Board and several members of USAC discussed at length the use of surplus funds and the need to know how much surplus is available earlier in the academic year. It was specifically noted from several Board members that USAC should not be relying on surplus to fund its student programming.

Ms. Saelua made a motion, seconded by Mr. Jedlicka that the Associated Students UCLA Board of Directors approve the creation of a $76,000 Contingent Liability to assist USAC in its funding of student programming. Ms. Giannitrapani called for a vote. The motion was approved by a vote of 7 yeas and 2 nays.

Ms. Liu made a motion, seconded by Ms. Saelua that the Associated Students UCLA Board of Directors remove agenda items VIII.E and VIII.F, USAC Contingency and Programming Fund from Finance and Services Committee from the agenda. Ms. Giannitrapani called for a vote. The motion was approved by a vote of 9 yeas and no nays.

EXECUTIVE SESSION

Ms. Giannitrapani called for consent for the Associated Students UCLA Board of Directors to enter into Executive Session. There being no objections, the motion was approved by unanimous consent.

The Board entered into Executive Session at 2:29 p.m.

Mr. Reyes called for consent to adjourn the Associated Students UCLA Board of Directors Executive Session. There being no objections, the motion was approved by unanimous consent.

The Board adjourned Executive Session at 3:42 p.m.

ADJOURNMENT

Mr. Reyes called for consent to adjourn the Associated Students UCLA Board of Directors January 27, 2012, Regular Meeting. There being no objections, the meeting was adjourned at 3:42 p.m.

* * * * * * * * * * * *

Pursuant to Bylaw 3, section 3.6(d) of the ASUCLA Board of Directors Bylaws, I have reviewed these Minutes and hereby attest to their accuracy.

David Lowenstein

Board Secretary and Administrative Representative

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