You may remember the screaming headlines last spring about how the University System had $1 billion unspent (of a roughly $5.9 billion total System budget), e.g., from the Journal Sentinel: “Lawmakers Rip University of Wisconsin System Because of Reserves Revelation. They Resist Giving Uw More Authority over Pay, Personnel….” The upshot was that the legislature cut the university budget, froze tuition increases for the biennium, and called for audits of UW budgeting practices.
Well, it turns out that the LAB lowered the “unspent” funds to $755 million, and classified a bit over 80% of these so called “revenue balances” as money that was in categories of “obligated,” “planned,” “designated,” or “committed reserve” funds. The money was not just sitting there on the books, but in fact was intended for the kind of spending we do every day, such as putting equipment in all those new buildings that are going up at UWM. The fifth category they unfortunately called “undocumented,” and the screaming headlines once again started out by noting that “$142 million” fell into that category, once again, implying we all have lots of spare cash squirreled away from public scrutiny.
Almost $123 million of that $142 million (87%) was “Federal Indirect Cost Return” from grants, what we would call, “$150 money.” About $98 million of the “undocumented” (150 money) was at Madison. UWM had about $6.3 million classified as “undocumented” 150 money. We all know that those funds get plowed back into research operations, as bridge funding between grant cycles, to purchase equipment, for seed money for new initiatives, and to support the research enterprise generally. The audit report does acknowledge that these funds are held very locally, but “that UW institution staff indicated that because Federal Indirect Cost Reimbursement balances are managed at individual departments within the institution, documentation of an obligation or plan could not be provided.” That is, there is no accounting system to monitor the likely thousands of 150 money accounts, large and small, around the system.
Going forward I wonder if legislators and state officials will press for more budget detail, or whether, now that the larger picture is a bit clearer, and the budgets have been cut and tuition frozen, the issue will subside and we’ll be left coping with the fallout.
(written by Margo Anderson)