Union: CSU public, private funds wrongly mixed

Public and private funds have been improperly mixed in California State University auxiliary accounts, the CSU faculty union charged in a report issued Wednesday.

Representatives of the California Faculty Association say they found proof of "financial mismanagement" in the minutes of closed-door meetings involving top CSU executives.

One section reads: "There continue to be findings from the internal auditors that some campuses have monies held inappropriately by auxiliary organizations. The finding is that funds should be moved to the state side."

Lillian Taiz, a history professor at CSU Los Angeles and the union president, said faculty have long been told that those accounts hold only private money.

But "from these minutes, we can see that this is simply not true," she said.

CSU officials acknowledged the problem and say they are working to correct it. They also said the issue doesn't involve general fund dollars or student fees, but mainly ticket or fee money that should reimburse universities for services.

"Some of the funds that should be placed in state accounts were not being placed there in a timely fashion," said Benjamin Quillian, executive vice chancellor and chief financial officer for the 23-campus CSU system.

For example, he said, an auxiliary may owe money to a university for police or other services provided at a football game. Quillian said he didn't know how much money is involved because officials aren't finished combing through accounts.

Deborah Adishian-Astone, associate vice president for auxiliary operations at Fresno State, said officials are diligently working to ensure that money is handled correctly.

Student fee revenue and state general fund money are not accepted into auxiliary accounts, university officials said.

The report issued Wednesday by the faculty association is the latest chapter in a long-running battle over CSU auxiliaries and foundations. Those entities, which typically raise money and run some commercial enterprises on campuses, are not subject to the same public scrutiny as the universities.

The union has supported legislation to make those organizations more transparent. CSU officials have opposed the move, saying it could have a chilling effect on fundraising.

The governor vetoed legislation last year, but a similar bill now is pending on his desk. Wednesday, faculty leaders renewed their push for the legislation and also asked for a state investigation and audit into the misclassified money.

Editor's note: This story has been revised to reflect this correction, published Aug. 27:

Due to incorrect information provided to The Bee, a story Thursday on Page A3 incorrectly reported that Fresno State's auxiliary accounts may occasionally hold student fees and state general fund money related to authorized research activities. Auxiliary officials said Thursday that those funds are not accepted in auxiliary accounts.

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