LTTE: USG: Do not create an endowment with our tuition dollars

Letter to the Editor

We are the SEC Allocations Committee, the student body’s elected representatives that manage all things related to student finances. Specifically we oversee the Student Activity Fee (SAF), a fee every undergraduate pays to fund all the umbrella organizations on campus, and distribute it to all the major student organizations on campus. We also oversee all spending of the SAF, auditing these student organizations to ensure proper spending of your tuition dollars. Unfortunately we come to the student body with unfortunate news about how your tuition dollars are being spent by our student groups.

It is rare to ever receive funding for everything you need as an organization under the Undergraduate Student Government (USG). For instance, USG insists on funding items such as a pizza party at only $2/person, and small events at a mere $15/person. Many USG organizations have been forced to turn to alternative funding sources, such as the Allocations Committee (AC), to fund their basic expenses. Despite this, USG still has one of the largest estimated buildups of unused funds out of any student group on campus—over $250,000. This is already not ideal, but new USG proposals would sweep this issue under the table, preventing our tuition dollars from being used to support the current undergraduates—funds that belong to students—and instead would serve only their own interests.

USG’s plan, as outlined by proposed Bill 31-17, creates an endowment fund to cover their basic operational expenditures. At Case Western Reserve University, organizations can create an endowment—a type of fund where you deposit money and only receive interest in return. Endowments typically accrue 4.9% interest, with the returns going back into one’s main account. However, it is unclear why USG needs a fund that accrues over time. Summarized in the proposed bill are plans to spend the endowment on things that USG already funds—causes like the Student Activities Fair, S’party and discretionary spending. This is a flagrant misuse of the SAF, which should be going towards funding student life in the same semester that students pay for it. The SAF goes directly to student groups, making it one of the few aspects of tuition that students have direct control over. Because the SAF is paid for by a portion of undergraduate tuition each semester, ideally all the semesterly allocated funds would be spent by the end of it, benefiting the activities and overall student life of that semester. Thus it is disappointing to see when organizations fail to spend their funds efficiently and in a manner that benefits the student body.

That being said, all of the major organizations directly funded by the SAF did not spend their entire allocation this semester—it’s been especially hard in recent semesters due to programming limitations—but USG is estimated to be the worst offender. Unused funds, or rollover, build up in their accounts over time, and should ideally be cut down over time through proper budgeting and spending. Although the ways that USG could cut down on rollover may seem apparent—such as imposing significantly fewer limits for their clubs or for their own internal spending so these funds would get used—their new plan does not accomplish this. Instead it violates the principles by which our tuition dollars should be spent, keeping funds away from student organizations for no real purpose. It seems hypocritical to criticize CWRU administration for not using all of our tuition dollars to benefit the current student body when our elected student representatives plan to do the same thing.

By creating an endowment, USG is withholding $250,000 from the current student body. This is money paid by students currently attending CWRU and thus it should go to us. No one should be paying for the activity of future students—the spending of USG’s SAF allocation should reflect that principle. As custodians of the SAF, we at the AC strongly urge USG to reconsider their endowment plan and to instead find a way to bring value to us, the students at CWRU, especially when we haven’t had much of a student life over the past few years.


The SEC Allocations Committee