Mr. Travis Powell, who is on the Council of Postsecondary Education, discussed CPE's role and working with KSU as part of Senate Bill 185, including the fact that CPE will approve any obligations for payments $20,000 or more. Mr. Powell said things that are tied to the budget to be adopted will not require additional approval. He said if they get a personnel list, a master position list with a list of the salaries that are tied with the budget, then payroll will be approved for anyone on that list. He further said if those positions become vacant at any point during the fiscal year, they can be refilled without additional approval as long as they are on the list and within those salary ranges. He said they can make adjustments to that as needed as long as the budget would support those.

Mr. Powell said the same thing with contracts tied to the budget up to that amount and over $20,000. If they are tied to the budget, they will automatically be approved and when they get those lists and see how it works through the budget, then those will be deemed approved.

Mr. Powell said they are making no policy decisions on the expenditures, but it's can you pay for it. He said that is what they will be focused on. He elaborated that they are just monitoring the budget and making sure that KSU has the funds available to make those payments before the obligations are incurred.

Mr. Powell said CPE is also required to provide a quarterly report of the financial status of the university to the governor and legislature, which will come through a monthly report of finances that KSU will provide to them.

Mr. Powell further discussed monitoring revenues and expenditures as the year goes on to adjust any approvals.

Mr. Powell said the other item that they will receive a report on is a quarterly report from KSU for each outstanding balance in excess of $1,000 due by students.

Regent Hatchett asked if the crux of the change for CPE is more prior rather than retrospective review and approval. Mr. Powell agreed that he summed it up perfectly and further said there are some expenditures where things come up and you aren't able to get pre-approval and they have a process for that.

Regent Obielodan said that one of the conditions for removing financial exigencies is to demonstrate that they have sufficient financial cash flow and liquidity and is there a threshold set by CPE or the General Assembly for that. Greg Rush of CPE said that the General Assembly did not create a threshold and left it up to CPE. He said that is something they will work through over the next year or two. Mr. Rush said that one of the conditions that they will have to see is probably multiple years with the university not running a budget deficit, not dipping into reserves and building those reserves. He said once they've seen that pattern, CPE can determine the cash target. He said to be fair, it's probably not attainable in five years and they will have to come up with a threshold that they think is attainable and reasonable.