$400,000 accounting error, grievance mark summer ASUO

A half-million dollar accounting error by a University employee and an old rival’s attempt to remove the student body president from office rattled the ASUO this summer, leaving the Executive in a near-constant state of damage control.

ASUO President Emma Kallaway said it is “nowhere near settled” how the ASUO will fill an estimated $400,000 gap in reserve funds that had to be depleted after an accounting error caused massive overspending. The outcome and tone of the first two meetings of the Student Senate will determine how quickly the case to remove Kallaway will proceed through the ASUO Constitution Court, and the level of harmony or discord to expect from the student’s legislature for the rest of the academic year.

Here’s a look at an eventful summer in campus politics.

A student fee buydown gone bad

Each year the University estimates how many students will enroll the following year and sets the rate of the incidental fee, which provides for “cultural and physical development” of students by funding the ASUO, which in turn funds hundreds of student programs, contracted services and some University departments. The University’s estimate is almost always high and the money collected exceeds what is necessary to fund the ASUO.  But until now all incidental fee money — reserves, surplus accounts, money for unpaid bills — were kept in one index.

“One of the problems that we discovered after the fact was by having all of the funds in the same account,” Stanley said. “When we thought we had enough money to do all of those things, in fact we didn’t.”

Conservatives in the ASUO such as Dotters-Katz denounce the usual over-realized process —  in which the money is spent on proposals submitted on short notice to fund events and other one-time expenditures for student programs — as a “a slush fund that really isn’t fair and isn’t talked about to students.” In January, Dotters-Katz acted with the administration to institute an unprecedented temporary $100 decrease of the incidental fee during spring term. The fee was $197 last fall and winter terms and $97 in the spring.
Kallaway said the buydown was simply too large.

“We wouldn’t even be having this conversation, probably, if the buydown was $70 less instead of $100 less,” Kallaway said. The buydown, as Kallaway sees it, did not leave enough of a cushion to ensure an error would not result in having to dip into the reserve, which had never been used before.

“Unless you have all the cash in hand you don’t know how much money is (available),” Kallaway said. “So its irresponsible to buy down over-realized to zero.”

Dotters-Katz told the Emerald that he actually left a cushion and the error cost more money than had been reported. He said he could have opted to buy down the incidental fee to $93.50 but instead took off an even hundred dollars, which he and the administration estimated would have left $200,000 in the over-realized fund and left the reserve funds untapped. That would bring the total cost of the error closer to $600,000, though Kallaway said the administration still has not given her a final number.

Along with figuring out how to fill the prudent reserve, Kallaway said she and the administration are working on ways to prevent such an error from occurring in the future, along with finding a way to protect students from having to pay for another error.

One way to prevent too large a buydown in the future, Kallaway said, is to clearly outline the process in the Clark Document, which gives the ASUO the legal right to collect fees from the student body and recommend to the University president how those funds are spent. Last year Dotters-Katz amended the Clark Document to include the option of buying down the fee. The Clark Document says “the Student Senate, ASUO Executive, and University administration shall adopt and maintain sound fiscal practices for Incidental Fee monies,” a phrase Kallaway interprets as a mandate to consult the Senate, which Dotters-Katz did not.

“The blatant disregard for Senate and the process that has worked in this office time and again is part of the reason this was caused,” Kallaway said. “Sam didn’t include the Senate. He sat on a committee of people that did not include any senators.” Kallaway said she wants to add to the Clark Document “explicit wording about the concept of buying down the over-realized.”

Dotters-Katz treated that as a red herring. “The error that caused this was made by a professional staff member,” Dotters-Katz said. “So including the Senate more really would not have prevented that from happening.”

Asked what he would do to fill the prudent reserve, Dotters-Katz was coy: “That’s for Emma to decide.” He still supports the intent of the buydown.

“The purpose of the buydown is to be more honest and transparent as a government,” he said. “To take (away) a slush fund that really isn’t fair and isn’t talked about to students. We were successful in getting back the extra money, but a staff member at the University made an error and that’s unfortunate. The idea of the buydown and the error are two different things.”

Kallaway grievance: ‘The Last Gasp’?

A grievance filed last month in the ASUO Constitution Court seeks to remove Kallaway from office on five charges including her failure to publish a document outlining her own criteria for her job as president, known in ASUO parlance as her “criteria for non-fulfillment of duties.” The Green Tape Notebook,  which contains all of the ASUO’s rules and procedures, stipulates that when any officer fails to fulfill his or her duties for 30 days his or her office is considered vacant.

The president must follow all of the rules of the job as outlined in the Green Tape Notebook to be fulfilling her duties. One of those rules is to write her own criteria above and beyond the duties of every president.

Each year, the president’s statement of criteria by which he or she should be judged is essentially a political document that reiterates campaign pledges. At the beginning of his term, Dotters-Katz wrote his letter to former University President Dave Frohnmayer instead of the student body. In it he attacked his predecessors’ antagonistic stance toward the University administration and promised greater comity during his tenure.

Kallaway failed to publish such a document until mid-July, and then it was deemed too sparse for Sens. Nick Gower and Lyzi Diamond’s liking. Kallaway rewrote the letter. Weeks later Michelle Haley, who Kallaway defeated for the presidency in the spring election, filed a grievance against her for not turning it in on time.

Kallaway’s response to this charge is essentially that she had already published the letter by the time Haley filed the grievance and the transgression does not warrant removal from office.

But the very existence of the grievance offers Kallaway a greater headache. Before the Constitution Court can decide her case, at least one other justice has to be appointed. The Executive must make the appointment. This leaves Kallaway in the awkward position of hiring the justices who will decide whether she will be removed from office. The Executive must also fill four empty Senate seats, only one of which she had appointed a student to when the grievance was filed and all of whose occupants could end up voting to confirm court nominees.

In such a politically perilous position, Kallaway has tried to distance herself from the selection process. Vice President Getachew Kassa took the reins in interviewing candidates for all positions affecting the grievance and asked former Sens. Tina Snodgrass and Cassie Gray to sit on the hiring committee. Snodgrass was viewed as a pragmatist during her time on Senate and Gray has strong conservative credentials that should blunt criticism of the hiring committee from conservative senators.

Candidates were also interviewed while Kallaway and Ella Barrett, her chie
f of staff whose own hire is questioned in the grievance, were out of town at a leadership retreat with limited cell phone service.

After these defensive selection processes were announced, the next criticism was the order in which the confirmations will take place. If the Senate appointees are confirmed before the judicial appointees, Gower posited at the final Summer Senate meeting, then Kallaway will be able to stack those additional votes in favor of her picks to sit on the court.

Sen. Zachary Stark-MacMillan said he does not anticipate the eventual order of the nominations to be an issue because he does not expect the new Senate appointees to affect the outcome of the votes on new justices.

“If we were going to make sure that Emma had as little influence as possible about who was being appointed to con court, I would say we would not want (the new Senate appointees) to be able to vote,” he said. “But I don’t think there’s any intention of hers to be influencing that and I don’t think it’s going to be an issue.” He added that Kallaway seems open to allowing judicial nominees to be voted on first.

Some have speculated the confirmation process could drive a lasting wedge between Kallaway and the Senate just as the over-realized process did to Dotters-Katz a year ago. If one thing was certain about Kallaway when she came into office, the argument goes, it was that she was likelier to seek consensus and would have a better relationship with the Senate. After all, she was a senator for a year and understands how the body operates.

Are the timing and source of the grievance — and the suspicion and acrimony surrounding the appointment process — a continuation of years-old conflicts in the ASUO that fall along old partisan lines?

“I think of it more as the last gasp,” ASUO Communications Director Curtis Haley said. Rather than the perpetuation of a conflict between two camps of current and former students fighting over the role of students in the University’s decision-making and supremacy over each other, Curtis Haley argued, the grievance could be a final, futile attempt to stoke those flames with a new generation of student leaders intent on solving bigger problems. Whether that is anything but idealistic spin will be apparent come the second Wednesday of fall term.

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