State Auditor Beth Wood is not out to get you.

That was the message Wood brought Friday to a meeting of the UNC system’s Board of Governors, Eric Ferreri reports. Wood, who was elected last year, presides over an office that conducts routine and special audits of all state agencies including public university campuses.

"I want this to not be an 'I got you' office," Wood told board members. "I want to provide you information to make this university system the best it can be. While we’re not your buddy, we still want to make this a good working relationship."

Erskine Bowles, the UNC system’s president, said he appreciated Wood’s straight-forward, candid approach. "That is what we need," he said. "She tells you it’s either gonna get fixed, or there’s gonna be big trouble."

Former Gov. Jim Holshouser, longtime member of the UNC system's Board of Governors, was honored in Chapel Hill today with a birthday cake.

Though he turned 75 this week, the cake had 30 candles, symbolizing his years on the UNC governing board, reports Eric Ferreri. The former governor was celebrated for the wit and wisdom he dispenses, and he was quick with some ribbing for his colleagues.

Read about it in the Campus Notes blog.

UNC board leaders originally agreed to a lucrative exit package for departing N.C. State University Chancellor James Oblinger.

Then, they flip-flopped.

During the weekend that he accepted Oblinger's resignation, UNC system President Erskine Bowles cut a deal that would have allowed the former chancellor to keep his $420,000 salary for six months before he settled back into a faculty salary and teaching position.

But last month, the UNC Board of Governors rewrote the terms, cutting Oblinger to a $173,000 salary immediately. Bowles said that the board chairwoman, Hannah Gage, and vice-chairman, Peter Hans, were consulted on the original deal, reports Steve Riley.

"Peter and Hannah did change their minds," Bowles said. "They had their own rationale for doing that. They did what they thought was right. I gave my word, and that's it for me. I did what I felt was right."

At the board's meeting last month, Gage said that the board "acknowledged [Oblinger's] enormous contributions but felt there needed to be consequences for some things that went terribly wrong."

The UNC system's Board of Governors said goodbye today to five members whose terms expired.

Stepping down are Ray Farris, Brad Adcock, Craig Souza, Frank Grainger and William Smith, reports Eric Ferreri. Two other members whose terms expired - Jim Phillips and Brad Wilson - will remain on the board as emeritus members because each spent time as the board's chairman.

Farris, Adcock, Souza, Grainger, Wilson and Phillips each came aboard in 1997 and spent 12 years on the board, which makes policy for the state's 16 public universities.

Public higher education in North Carolina has changed dramatically since then. The system has more than 215,000 students now - 56,000 more than 12 years ago. The physical plant also expanded immensely through the $3.1 billion bond campaign for higher education, which brought a wave of campus construction.

The seven vacated spots will be filled by some names familiar in the state's political and higher education circles. The new members, who begin July 1, are Burley Mitchell, Bill Daughtridge, Franklin McCain, John Blackburn, Walter Davenport, James Deal and Paul Fulton.

Mitchell is a former chief justice of the N.C. Supreme Court. Daughtridge is a former state representative, and Fulton is a current trustee at UNC-Chapel Hill. McCain chairs the board of trustees at N.C. A&T State University, Davenport leads the Elizabeth City State University board, as does Blackburn at Appalachian State University. Deal is on the Appalachian State board as well.

Eight members of the UNC Board of Governors were elected today by the state House.

Re-elected to the board were: Dudley Flood, a public speaker and educational consultant from Raleigh; Charles Mercer, Jr., a Raleigh attorney; Fred Mills, Sr., a Raleigh construction executive; Dr. Al Roseman, an endodontist from Wilmington; and David Young of Asheville, an Asheville business owner and chairman of the state Democratic Party.

New members elected were: Walter Davenport, a Raleigh accountant and trustee chairman at Elizabeth City State University; Bill Daughtridge, a Rocky Mount businessman and former House member; and James Deal Jr., a Boone attorney and trustee at Appalachian State University.

The Senate voted on its slate of eight members last month. The UNC Board of Governors makes policy and sets tuition at the state's 16 public universities and the N.C. School of Science and Mathematics in Durham.

The state Senate is scheduled to vote today to elect eight members of the UNC Board of Governors, the policymaking body for the state's university system.

But some big names on the slate apparently are causing heartburn about potential conflicts of interest.

Among the candidates: Bob Greczyn of Cary, CEO of Blue Cross and Blue Shield of North Carolina, and Paul Fulton, a UNC-Chapel Hill trustee from Winston-Salem.

Fulton, a former business school dean at UNC-CH's Kenan-Flagler Business School, is an organizer of Citizens for Higher Education, a big-spending political action committee that pushes issues for the UNC-CH campus. That group has at times clashed with the UNC system leaders.

Greczyn, chairman of the East Carolina trustees, runs the company behind the state health plan. That doesn't sit well with some, reports Dan Kane.

Ardis Watkins, a lobbyist for the State Employees Association of North Carolina, said lawmakers should reject Greczyn's nomination because Blue Cross has a no-bid contract to handle claims for the State Health Plan, which provides health insurance for 667,000 state employees, teachers and retirees. The contract terms could pay the health insurer roughly $120 million a year.

"The 16 universities are a big chunk of state government, and I don't think (Blue Cross) needs to be on the board of a customer of which they have a big contract," she said.

Update: Just before the vote this afternoon, Greczyn withdrew his nomination, along with three others — James, Smith and Williams — leaving the Senate to vote for eight candidates for eight seats.

More after the jump

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The slate of UNC Board of Governors candidates on the House side includes two players from the political world.

Among the 11 names nominated are Bill Daughtridge, a Republican former legislator and candidate for state treasurer, and David Young, chairman of the N.C. Democratic Party and who ran in the Democratic primary for state treasurer. Young is currently a member of the UNC board, which makes policy for the state's university system.

Though the board is elected through a political process, its members try to stay away from politics during board discussions.

The House is scheduled to elect eight members on April 1. The Senate is scheduled to vote on its slate today.

Besides Daughtridge and Young, other nominees on the House side are: current UNC board members Dudley Flood, Charles Mercer, Fred Mills and Irvin Roseman; and Walter Davenport, James Deal, Joel Harbinson, George Rountree and former N.C. Supreme Court Justice Willis Whichard.

A cash pool for Erskine Bowles could be trimmed.

The University of North Carolina system president has long had a "Strategic Initiative Reserve" that allows him to run new programs mid-year at state colleges and in the central administration.

In past years, the fund has been used to start new research centers, administer a billion-dollar construction program and improve internal auditing and accounting systems, said UNC spokesman Rob Nelson.

Bowles has sole discretion over the spending.

"He reports it to the Board of Governors, but it's his allocation, not theirs," Nelson said.

The fund typically receives $3.3 million. Gov. Beverly Perdue proposed reducing it by $1 million in next year's budget.

The UNC system has a new lobbyist.

Anita S. Watkins, legislative counsel for the N.C. League of Municipalities, will serve as vice president for government relations for the multi-campus UNC system, Eric Ferreri reports. 

She replaces Andy Willis, who resigned earlier this month to become a senior adviser to Gov. Beverly Perdue.

UNC President Erskine Bowles announced her appointment today. It is effective Jan. 26.

Watkins will serve as the university's primary liaison to the state legislature, the governor's office and state government agencies. She will also work with Bowles, the UNC Board of Governors and senior staffers to develop policies and programs.

She holds a law degree and a master's degree in city and regional planning from UNC-Chapel Hill, as well as undergraduate degrees in political science and Spanish from N.C. State University.

After graduating from NCSU in 1994, she served for three years as a research assistant in the office of state Senate leader Marc Basnight. She later was senior policy analyst for the state Department of Environment and Natural Resources before going to the League of Municipalities.

Today was Andy Willis' last day working for the UNC system and its president, Erskine Bowles. Willis is leaving his post as the UNC system's chief lobbyist for a similar role working for Gov.-elect Beverly Perdue.

Bowles was effusive Friday in his praise for Willis, reports Eric Ferreri.

"When Andy walks in a room, it's like a big bundle of joy walks into the room," Bowles said at a meeting of the UNC system's Board of Governors. "He lifts your spirit, moves the process and gets the job done."

Bowles joked that Perdue stole Willis from UNC, but then again, he pointed out that he poached Willis from N.C. State back in 2006.

Bowles concluded with a suggestion for UNC board members, who yesterday sat through a presentation about cuts in higher education spending.

"Starting Monday, when he takes office, call him about the budget," Bowles said.