Members Present: Susie Garretson, Chair; Allan Affeldt; David Connell; Sam Henderson; Linn Montgomery; Carl Phagan; Peter Pilles; Wayne Ranney; Carolyn Shoemaker; Larry Stevens; Miguel Vasquez; and Steve Verkamp.

Members Absent: Rowena Dickerson, Susan Golightly, Leigh Kuwanwisiwma, Jack Metzger, Barbara Poley, Katrina Rogers, and Octaviana Trujillo.

Others in attendance: Susan Deaver Olberding (on leave from the board), guest; Dennis Miller, Miller/Russell, Lori Booth-Houle, Miller/Russell (during Miller/Russell report only); and Jim Roberts, architect, Roberts/Jones (during director’s report only).

Staff present: Dianna Van Sanford, Janet Gillette (during director’s report only); and Lynn Yeager.

Volunteers present: Karen Enyedy, Volunteer Development Director; and Mary Ann Isom, President, Sedona Muses.

Call to Order. The meeting began shortly after 9:00 am. There was not a quorum initially, information items were discussed and no action items were taken up pending a quorum.

Report from the Chair
Susie Garretson gave the Chair’s report. She noted that she was trying to find a chair of the Program Committee but has yet to find success. Rowena Dickerson is considering the position. Ms. Garretson noted the passing of Jessica Danson. She passed around cards of condolence for the Danson family and urged board members to make contributions to the Danson Anthropology Endowment Fund in honor of Mrs. Danson. The combined board gifts will be made in the name of the MNA board.

Allan Affeldt arrived---a quorum was present.

Report from the Director
Robert Breunig reported on up coming museum exhibits. In February the NAYA (Native American Youth Art) Exhibit will open. This exhibit is of Indian youth art from schools around northern Arizona. It will be juried by native artists. There will be no opening event but there will be a closing event on Mary-Russell Ferrell Colton’s birthday on March 25th. She began the tradition of such exhibits in the early 1930’s. Ann Doyle of the Education Department is curating the exhibit. The law firm of Hufford, Horstman, Mongini, Parnell and Tucker has pledged a sponsorship grant for the NAYA exhibit.

On March 4th Fragile Antiquities, an exhibit commemorating the 100th anniversary of the Antiquities Act, will open. The exhibit will feature photographs of archaeological sites protected by the Antiquities Act taken by Gene Balzer and Russ Gilbert and a history of the Antiquities Act and subsequent legislation. This event will also kick off Archaeology Month at MNA. Stefan Sommer has been curating the exhibit.

Dr. Breunig also reported that planning was underway for an exhibit in early 2007 for an exhibit on the Therizinosaur, a dinosaur from the Cretaceous Period. It will feature fossil materials excavated in Utah by Dr. David Gillette, the Colbert Chair of Paleontology who is serving as curator of the exhibit. Dr. Breunig noted the participation of Victor Lesheck, a scientific illustrator from Sedona, who was recruited by Dr. Gillette. Lesheck has drawn various images of the Therizinosaur which illustrate various hypotheses about the dinosaur’s environment, behavioral patterns, subsistence strategies and appearance. The exhibit will describe the science processes and the multiple hypotheses that frame the interpretation of Therizinosaur. Actual fossil material and a cast skeleton will be at the heart of the exhibit.

Dr. Breunig reported on the resignations of Dr. Stefan Sommer, Deputy Director of Public Programs; and Rose Hawee, Retail Manager. Tracy Anderson, Education Director, will assume Dr. Sommer’s duties, and Gil Berg will serve as acting Retail Manager until a permanent manager is hired. Wayne Ranney asked what the plan was for replacing Dr. Sommer. Dr. Breunig reported that he and Tracy Anderson had agreed that we would see how things went under her leadership and a decision on replacing Dr. Sommer would be made at a later time.

Robert Breunig reported that Martin Sullivan, Chair of the American Association of Museums Accreditation Commission, had made an unofficial, personal visit to MNA and had met with some staff and toured our collections facilities.

The Stories on Stone lecture series has been extended into February. Dr. Breunig urged board members to attend the remaining talks in this popular series and he acknowledged the hard work Dr. Sommer put into this program.

Dr. Breunig noted the existence of an “MNA Fellows” program that was begun in1984 by the MNA board but which has been inactive for many years. The Fellows title was intended to be an honorary title bestowed on individuals who have given exemplary service to MNA. The first MNA Fellow was Katharine Bartlett. It has been proposed by Dianna Van Sanford, Susan Olberding, and Janet Gillette to reactivate the MNA Fellows program to honor Mr. Terry Merkel, a long time volunteer in the natural sciences. Ms. Gillette read a proposed resolution in honor of Mr. Merkel. (See attached resolution). The motion was made and seconded to bestow on Mr. Merkel the title of MNA Fellow. It was passed unanimously. Mr. Merkel will be informed of the award at the Volunteer Appreciation Breakfast on February 24th and receive the award at the MNA Members Meeting on June 5th.

Robert Breunig announced that he and Dr. Larry Stevens had met last Thursday to discuss the possibility that Larry would become the museum’s curator in the natural sciences. For now, this would be an unpaid curatorship with Larry continuing grants and contracts through MNA. Larry would direct biological collections to MNA. Robert said he felt it important that we “plant the flag” by reinstating biological science activity at MNA. This move would also enable us to more fully serve our mission. Larry is respected as one of the most knowledgeable biologists of the Colorado Plateau and Grand Canyon region and he brings enormous credibility to the MNA science program. Larry has prepared a letter to Robert outlining his thoughts on the new role which Robert has just received. Linn Montgomery stated that Larry was highly regarded at NAU and that this was a great move for MNA. There was applause for this announcement. Larry indicated that if he becomes curator he will not, of course, run for a new term on the board.

Special Presentation: Miller/Russell Endowment Report
Dennis Miller, of Miller /Russell, gave the annual investment review on the performance of the MNA combined endowment portfolio for 2005. He reported a very positive performance for the year. The endowment fund grew by 1.2 million dollars due to the addition of new funds and market appreciation. The total fund grew by 7.97% due to market appreciation. He compared each class of investments (e.g. large cap, mid-cap and small cap, etc.) against key industry benchmarks. Except for real estate, fund managers for Miller Russell had beat all benchmarks and the market index by 2%. He commended MNA on the growth of the endowment fund, noting more than $830,000 in endowment contributions in 2005. None of the endowment funds managed by Miller Russell had that level of new contributions. He waked the board through three future scenarios over the next five years based on 8% annual growth and assuming no new contributions, $250K in contributions annually and $500K annually. He also presented worst case and best case scenarios. The very positive effects of continuing endowment gifts combined with market growth were highlighted. Mr. Miller also discussed the museum’s asset allocation (35% fixed assets, 65% equities). He described this mix as “right down the middle of the fairway”, using a golf metaphor. He said our policy was fairly conservative but provided a nice balance between growth and risk.

Lori Booth-Houle, Mr. Miller’s associate, then reviewed the research Miller /Russell has conducted on socially responsible investment (SRI) funds. She stated that they applied the criteria that they normally use to evaluate funds including past performance and familiarity with the fund managers. No fund with less than 5 years performance history was considered. Given that most SRI funds had less than 5 years performance history there were only a few funds to consider at this time. Miller/Russell has identified several funds that qualify for further analysis. One issue she noted was how MNA wants to define “socially responsible”. For example, does MNA want to screen out military based industries, alcohol, gambling, tobacco, etc? Does MNA want an emphasis on investment in “green” industries, she asked? Different SRI funds have different emphases. Members are asked to let Robert know what screens or criteria they think should be applied in an SRI fund. Miller/Russell will continue to research these types of funds.
David Connell stated that the museum was fortunate to have such capable investment advisors.

Approval/Acceptance of Minutes
There now being a quorum, Ms. Garretson returned to the Approval/Acceptance of the Minutes of December 3rd, 2005. The motion was made and seconded. They were unanimously approved.

Approval of Consent Agenda
Ms. Garretson asked for approval of the Consent Agenda, except for the Fundraising Committee minutes which have not yet been forwarded to the board. The motion was made and seconded. It was unanimously approved.

Report from the Director Continued: Collection Center and Master Plan
Jim Roberts, of Roberts/Jones Architects, gave an overview of the status of the Master Plan and the development of the Collections Center. He outlined the vision for the MNA campus over the next fifty years if everything was done ideally. He noted, however, that the vision will no doubt evolve in response to changing circumstances and needs. Our immediate need is to design and construct the new Collections Center, but that to properly place the center we need the over-all vision to be well defined. He described the proposed “ flow” through the campus, the placement of new facilities including the Collections Center, the historic buildings to be rehabilitated or restored and the over-all feel of the campus. In this plan the museum will re-open the historic entrance on Fort Valley Road near the Homestead. Visitors will arrive at the core of the historic campus, seeing the historic Research Center administration building first and then getting views into the heart of the historic campus with the various original farm buildings (Powell, Milt’s Barn, the Potato Barn, etc) which will be restored and adaptively reused. Power lines will be buried and the new facilities will be sited to take advantage of views of the San Francisco Peaks. The work on the Collections Center is still in the analysis phase and design work will not begin until this phase is completed.

One issue that needs to be resolved is final assurance that the abandoned city reservoirs north of the museum pose no future risk of flooding to the Collection Center. The walls of the former reservoirs have had notches cut into in them to reduce the potential volume of water that they could hold and to prevent them from holding large volumes of water in the future. This move removes them from the “unsafe damn” category. Engineering studies by the City of Flagstaff on these modifications have been sent to the NPS for their review. It appears now that this will not be an issue. A relatively small quantity of water will remain in the west reservoir for use in fighting forest fires. The east reservoir, just north of the Collection Center site, is empty.

The Collections Center and research offices and laboratories will be located near the existing Bailey, Biology and Parsons Buildings which will be removed. The collections and research functions will be integrated into a complimentary whole set of structures surrounding a central courtyard. Collections will be consolidated into one structure with research facilities located in adjacent, adjoining buildings. The goal will be to optimize the interaction between the research activities and the collections and to foster interdisciplinary research activities. There will be a strong emphasis on sustainability and green building technology. Mr. Roberts noted that environmental conditions in Flagstaff are idea for storage of collections (relatively cool and dry) and that the building will be passively designed to take advantage of these conditions along with feature to mitigate swings seasonal spikes in temperature and humidity. We are working with Richard Cronenberger, a National Park Service (NPS) architect who specializes in repository design, and Matt Crawford, a conservator, on design criteria. Mr. Roberts also reviewed an object flow chart that diagramed the flow of objects through the Collections Center and the interactions between the curators and the collections management staff. The diagram was developed to ensure that the structure and arrangement of the building would properly accommodate the needs of the staff and the efficient movement of collections in the structure.

The Collection Center will be phased, with the first phase constructed with the $3 million gift. This structure will be approximately 15 thousand square feet and will hold “Priority One and Two” level (as determined by conservation requirements) collections. These include all of the ethnographic, perishable archaeological, natural science, herbarium, and fine arts collections and whole archaeological vessels. Not included in this phase will be geological, paleontological, archaeological ground stone (e.g. manos and metates) and archaeological bulk sherd collections. By their nature these collections are less at risk. Existing buildings can be upgraded to provide better environmental conditions for these collections. Library and archive collections will also remain in place. A second phase, to be funded by a $5 million Congressional appropriation in the NPS budget, is scheduled for 2009, and will be constructed to will allow for housing the remaining collections, other regional NPS collections, and for future collections expansion. With the use of compact storage systems most Priority One and Two MNA and federal collections will go into the building constructed in the first phase.

Mr. Roberts pointed out that between the construction of the collections building and the new research facilities that there will be a physical separation between the research offices and the collections. This is an issue that will have to be addressed as there may be concern among the research staff about this separation.

Dr. Miguel Vasquez stated that it was his hope that the architecture would reflect the regional character of Flagstaff and not be just a generic building. Mr. Roberts responded that if we do the building right, with design that serves the function of the building, with proper use of sustainable principles and local materials, then it should reflect regional architectural traditions. This is his objective. He noted that as part of the on going analysis MNA was convening a meeting of Native American advisors to consult on the design of the building and special features to accommodate cultural practices.

Dr. Allan Affeldt asked if the building would have LEED (Leadership in Energy and Environmental Design) certification (a program of the US Green Building Council). Mr. Roberts stated that the project has been registered with LEED and that MNA would be aiming to achieve the highest LEED level that is practicable.

There appeared to be consensus that the master plan was going in the right direction and that Mr. Roberts should continue to along current lines and finalize the plan.

Report from the Director: Development Report
Karen Enyedy distributed a written report on the annual appeal/year end Campaign for MNA. She broke down contributions into five categories: the spring summer appeal; the Metzger Ranch event; the first year end letter; and the second year end letter and a “Wilson challenge” in the last three days of 2005. The total of all five components was $506,704 (preliminary numbers). Ms. Enyedy noted that several significant gifts came in response to the second year end appeal letter which highlighted KETRA, the (Katrina Emergency Tax Relief Act)—a one time tax benefit enacted by Congress in the wake of Hurricane Katrina. (See attached report). The board thanked Karen for all of her hard work on the annual appeal and other development efforts and in appreciation Wayne Ranney presented her with a gift certificate for a stay at Briar Patch Lodge in Sedona on behalf of the board.

That concluded the Director’s report.

Institutional Planning
Next Steps. There was no meeting of the Institutional Planning Committee and thus no report. A committee meeting will be held in February and a museum member’s meeting for IPC input is planned for March 12.

Report from the Finance and Investment Committee
Comptroller Lynn Yeager reviewed the December 2005 preliminary financial reports. MNA achieved a balanced budget in 2005. She pointed positive annual appeal, admissions, membership and discovery program numbers. She also noted declines in gift shop sales and the custom tour program. She noted that she was still reconciling accounts in preparation for the annual audit to be held the first week in March. Final numbers for board acceptance will be presented following the audit.

Dr. Linn Montgomery presented a motion on behalf of the F&I Committee that Gil Berg, the acting Retail Manager, be added as a signer to the Gift Shop checking account along with Director Robert Breunig. The motion was unanimously approved.

Robert Breunig discussed the implementation of the 2006 budget. He noted concerns over increasing health insurance costs. MNA has $400.00 per person per month available within its budget. Our premium with our current insurance carrier, Starmark, has been raised from $367.00 per person per month to $517.00 per person per month. This was due to the demographics of our staff and our particular claim history. We have looked at many alternative plans with two different agents and we cannot find a better traditional plan. The only way to hold costs in line with MNA’s budget would be to go with a high deductible major medical insurance plan combined with the use of a Health Saving Account (HSA). We are exploring a Blue Cross plan combined with a HSA. The Blue Cross plan would cost $267.00 person per month. It has strong “wellness” provisions covering such things as routine physical exams, mammographies, and colonoscopies, etc. The museum could then contribute to each employee’s HSA. If for example, if we put in $133.00 a month per employee, each employee would receive $1600.00 a year in his or her account. The employee would have exposure between the $1600.00 annual contribution to the HSA and the $5000.00 deductible major medical plan. The HAS, however, would belong to the employee and would grow over the years, increasing coverage if it is largely untapped. They would also provide employees with more medical alternatives such as the use of naturopathic physicians. Director Breunig expressed frustration with the available alternatives and the likely need to restructure benefits to hold down costs. Allan Affeldt said that we used HAS’s in his business and that the employees really liked them and they worked well for a business such as his. Director Breunig said that he and Marlene Lloyd would be holding a “focus group’ with members of the staff in the coming week to get their feelings and thoughts on the matter.

Dr. Montgomery reported that the Colton House checking account had been discontinued in order to simplify the number of museum accounts.
Dr. Montgomery also reported the recommendation of the Finance and Investment Committee that the MNA board approve the draft bylaws of the MNA Endowment Foundation. He stated that the committee recommended that the Director proceed immediately to establish the foundation. The motion was approved with 11 yes votes and one abstention.

Muses Report
Mary Ann Isom gave the Muses Report, noting revisions to the Muses bylaws. She encouraged members of the board to attend the Muses Lecture Series in Sedona.

Other Business
Dr. Carl Phagan reported on the status of MNA-ES. He noted that MNA-ES ended the year with a slight loss. He stated that a shareholder’s meeting would be required in May at the time of the regular MNA board meeting and that that would be a good time to review the operational agreement between MNA and MNA-ES. It was agreed that the F&I Committee of MNA and the board of MNA-ES should meet together to review the status of MNA-ES. Robert Breunig reported that it appeared that CPCESU projects could be done by MNA-ES employees in sub-contracts with MNA. It was agreed that MNA-ES is doing very well for a start up business in environmental consulting.

There being no further business the regular meeting of the board adjourned at 12:30 pm for a group photo in front of Colton House and for lunch.

Respectfully submitted,
Sam Henderson, Secretary of the Board