The California State University (CSU) was not transparent about a surplus of more than $1.5 billion while negotiating state funding and raising student tuition, according to an audit report released Thursday, June 20.
Auditor Elaine Howle alleges the CSU did not properly disclose the money to students or legislators.
The majority of the budget surplus was accumulated from 2008 to 2018, primarily from tuition. The money can be used at the CSU’s discretion to cover the costs of instruction or other operations in times when the annual budget falls short.
The CSU increased yearly tuition from $3,048 in 2008 to $5,742 in 2018, with the argument that a tuition hike was the only way to keep programs running, according to the report.
“By failing to disclose this surplus when consulting with students about tuition increases or when projecting CSU’s resources and needs to the Legislature, the Chancellor’s Office has prevented legislators and students from evaluating CSU’s financial needs in light of its unspent financial resources,” Howle wrote in a public letter.
The report recommends the CSU publish information about where the surplus came from on their website.
In a response to the auditor, CSU Chancellor Timmothy White said the audit report mischaracterizes the role the reserve funds play.
“It is irresponsible to imply that these one-time funds could have been used in lieu of ongoing revenue sources, such as state funding or student tuition, for on-going costs,” White said in a statement.
In addition, the CSU Chancellor’s office said the surplus was disclosed in 30 public reports and in letters to legislators. However, the auditor said the information in those reports did not provide the detail or the context for the legislature to understand. One of the legislators who received a letter disclosing the surplus called for the audit.
Students involved agree that the information was not disclosed.
“It is disappointing and concerning that the CSU did not disclose their reserve amounts during their required consultation with students regarding tuition increases,” California State Student Association (CSSA) President Mia Kagianas wrote in an email.
The CSSA is the system-wide student organization, which engages with the CSU when changing tuition.
Cal Poly individually has $224 million in reserves, according to the report.