State auditor releases findings of admin fee review

Graphic made by Vicky Valdovinos

MATT THOMPSON, staff reporter

A top Central Washington University business administrator told the Services and Activities Fee committee that the school plans to credit at least $800,000 to the S&A fund in light of the March 18 letter from the Washington State Auditor’s Office.

The auditor’s review found that only 15.5 percent of the $1.362 million in S&A funds allocated to the administrative fee, or “admin” fee, over the fiscal years 2012 and 2013 was reasonably supported.

“We do not consider the university’s use of fees to follow the intent of state law … that S&A fees pay for student activities, not basic functions of the university,” Chuck Pfeil, director of state and local audit, said.

For both years, the auditor found that charging for public safety and police services, academic affairs, faculty relations, the president’s office, as well as grounds and custodial were incompliant with state law.

“What made me really happy to see was that the auditor identified the exact same four items I had identified and said that they were illegal,” Isa Loeb, S&A committee chair, said.

Loeb, who is currently serving her second year on the committee, has led the fight against the admin since last July, when she originally contacted the auditor’s office.

Following a series of budget shortfalls, Central proposed the fee in 2011 to charge many campus departments for services that they previously received for free.

Controversy began when Central sought to extend the admin fee to S&A funds.

In the fall of 2011, Paul Stayback, former S&A committee chair and BOD executive vice president, contacted the state auditor with his concerns that the admin fee was unlawfully charging S&A funds.

The auditor validated Stayback’s worries in a letter saying, “We are unaware of any other statute allowing the university to allocate indirect costs to the student activities fund.”

The latest letter from the auditor noted that Central continued to charge the admin fee without properly reevaluating the cost allocation model as the original letter had requested.

Central contends that the auditor agrees with the “basic methodology” used by the admin fee and said it is working to adjust charges to meet the auditor’s complaints.

“The letter was not a command, if you will, it was not a requirement,” Connie Williams, assistant vice president of the business and finance auxiliaries, said. “It was a suggested action.”

The auditor’s office said it will come back next year to confirm that the university has done enough to comply with the letter’s findings.

“Please let our office know how the university plans to address this condition,” Pfeil said. “We will follow up on your corrective action next year.”

Williams said she was working on a recalculation of the past admin fees and planned to present specific numbers at the S&A committee meeting scheduled for last night.

She said they will remove categories deemed not in compliance with state law as well as some but not all of the allocations said to be questionably supported.

Several facets of information technology policy — management, software licensing, application and enterprise information system management— were to be reviewed to gather further evidence to support these sections’ legitimacy, Williams said.

There is further confusion surrounding the admin fee for fiscal year 2013 because two different allocation methods were presented in the original request, a unit-based methodology and another based on percentage of services used by S&A-funded programs.

At the Nov. 28 meeting last fall, the S&A committee voted to approve an amount of $571,167.

But it is not clear whether the committee wanted to approve this amount using the unit-based or percentage-based method because it is not clearly stated in the minutes for that meeting.

The minutes for the Board of Trustees meeting that later approved the S&A committee’s decision states that the methodology used to reach the amount of $571,167 was unit-based.

The letter from the SAO questions whether the percentage-based method is appropriate for allocating monies from the S&A fund and consequently found that all categories of the fiscal year 2013 admin fee were either questionable or not in compliance with the law because their review was based on minutes from the Nov. 28 meeting.

Some on the committee said they believe that the intent of the decision made at that meeting was for the percentage-based methodology to be used while the Board of Trustees and other committee members believe it was a compromise to use a lower amount using the unit-based method.

Williams said that if the committee chooses to argue the allocation method used for fiscal year 2013, “I guarantee we will go to dispute resolution because, I know that [unit-funded methodology] was the intent of the administration.”

Although Loeb said the admin fee discussion is moving in the “right direction,” she said she feels the SAO recommendation doesn’t go far enough to protect S&A funds and that a court case is called for.

The legal system “needs to tell Central and to tell other universities that they cannot do this,” Loeb said. “And unless this goes to court that’s not gonna happen.”

As the S&A committee continues to discuss some of the finer details of the admin fee’s recalculation, some are elated that a resolution is in sight and that the hesitancy of the committee to approve the admin fee had not been for naught.

It was “one of the greatest spring break presents a person could ever get,” Dustin Waddle-Ford, S&A committee voting member, said.

 

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