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enrollment is down; however, doctoral degrees awarded at commencement helped the
university exceed its goal of 250. There are some limits on how the university progresses
with respect to diversity. Industry research is on the rise but not where it should be.
President Todd mentioned that these results are on the university's web site, and the
report is also available.

      Mr. Hardymon said that he was glad he attended commencement because it was
such a good feeling. He noted that Ms. Watts reached new heights, and she received a
round of applause from the Board members.

      E.    Waiver of Part X of the Governing Regulations Pertaining to the
Employment of Relatives in the Case of Brian P. Butler (PR 3)

      President Todd said that PR 3 is a part of the university's regulations dealing with
nepotism. The recommendation is that the Board authorize the continued employment of
Brian Butler, son of Frank Butler, Executive Vice President for Finance and
Administration, for two years pursuant to the provision contained in Governing
Regulation X authorizing a waiver of the rules prohibiting employment of a relative of
the Provost, Vice President, or Associate Vice President in that officer's administrative
area.

      Brian Butler has worked for the university since 1988 and was not under Frank
Butler's supervision until just recently. As a result of this action, the associate vice
president for campus services will assume all such supervisory responsibilities for Brian
Butler. Frank Butler will not be involved in any promotion or other employment
decisions regarding his son. If it is necessary for an issue to go to a higher level, it will
go straight to the president. President Todd recommended approval of PR 3.

      On motion made by Alice Sparks, seconded by Mr. Williams and carried, PR 3
was approved without dissent. (See PR 3 at the end of the Minutes.)

      Mr. Hardymon stated that all the deans will be making a college report. Due to
the length of some presentations on the agenda, the college report was eliminated for this
meeting; however, the reports will continue with future meetings.

      Mr. Hardymon reminded the Board of his appointment of a special committee for
the Governing Regulations. He said that he thought the administration was surprised and
pleased at how well that committee had prepared themselves for the assignment. He
asked Ms. Ball, chair of the special committee, to make her report.

      F.    Proposed Revisions to the Governing Regulations (SCGR 1)

      Ms. Ball said that the members of the special committee were Frank Shoop,
Barbara Young, Russ Williams, and Roy Moore. The committee spent an afternoon
reviewing the Governing Regulations. She noted that a committee, chaired by Phyllis