Birth of a Rollover

By Mac McCreary

Around this time a year ago the Macalester College campus was abuzz with lively debate over roughly $75,000 of student activity fee money that had been “found” in the Macalester College Student Government (MCSG) operating fund. This $75,000 — which came to be known as “the rollover” — was the accumulation of several years’ worth of unspent funds. MCSG had decided something should be done with it instead of allowing it to sit untouched in an account. The announcement of these surplus funds and the process to make a decision on how to spend the money caused an uproar among many student organizations and members of the student body. Ultimately, students voted to use this money to make an ice skating rink on campus during the winter. There is currently an MCSG commission working on the implementation of this project. In the meantime, the Financial Affairs Committee (FAC) of MCSG, which I currently chair, has been charged with improving the budgeting and additional allocation processes to prevent recurring rollover situations. The first course of action was to create a new fund, named the MCSG Reserve fund, where all of the surplus funds were transferred. This means that at the beginning of the academic year the MCSG Operating fund was empty–ensuring that remaining funds from this point forward will not be confused with surplus funds from previous semesters. Before each semester, the balance of funds from the previous semester will be transferred into the Reserve fund. Another choice we made to prevent surplus funds was to allocate a much larger portion of the available funds during the budgeting process for Fall 2011. Out of the $124,740 of the Student Activity Fee allocated to the MCSG Operating fund for Fall 2011, we dispersed $97,044. This is approximately $10,000 larger than the sum usually allocated during the budget process, and left us with only $27,000 for additional allocations during the semester. Our logic behind this decision was to provide orgs with more of the requested funds early on so they would know what they had to work with far in advance and could make the best use of it. Last semester, the FAC reviewed fewer additional allocation requests than usual. However, we still were able to allocate the remaining $27,000 to student orgs, in order to provide the student body with the high quality of events we have all come to expect. MCSG even voted to allow the FAC to allocate an additional $5,000 from the reserve fund so we wouldn’t need to deny orgs funding near the end of the semester. Through the course of the semester, we also worked with orgs to reallocate funds that had originally been for different purposes. At the end of the semester I felt that the FAC had done a quality job making sure that the funds were being used responsibly and to their full potential. We had completely exhausted our funds and it was in the hands of the student orgs to follow through with their requests and use the funds as allocated. Due for another rollover However, at the beginning of this semester, in reviewing the student org accounts I saw that things had not gone as planned. In the operating fund, about $19,000 of what was allocated for the fall remained unspent by student orgs. While unspent funds are inevitable, I did not expect the surplus to be this large. I dug into the numbers even more and was shocked by the average percentage at which student orgs actually used their allocated funds. The average of student org spending was 56 percent of what they were allocated, meaning on average orgs left 44 percent of their funds unspent. Certainly some organizations spent quite effectively, but others didn’t spend a single cent of what was allocated to them. This kind of usage of the allocated funds is very troublesome to me. The FAC really does want to see all of the available student activity funds allocated and ultimately spent. When we allocate funds, they are for events we are excited about having on campus and that we believe will really enrich your Macalester experience. Seeing a funding surplus like this at the end of the semester just makes me think of all of the unfulfilled plans. I feel like there is little more we can do on the FAC’s side of the process to help prevent a surplus like this. We need to be able to count on student orgs to spend the money we allocate to them to avoid a surplus at the end of the semester. Otherwise, we’ll have more rollovers. The FAC has been trying to look at other budgeting models and how things are done at peer institutions. But, for the time being, the process is staying the same. It is also that time of the semester once again for the budgeting process to start. Budgets request from student orgs for Fall 2012 are due on ScotSync at 11:59 PM on April 13. When figuring out your budget requests for next semester I strongly encourage you all to keep this surplus funding situation in mind. Students orgs can take a couple simple steps to avoid unspent funds. First and foremost, I strongly urge you to select your org leadership for next year now and make sure they are actively engaged in the budgeting process. This will ensure that the new leadership is aware of the events that are being planned and committed to following through next semester. Next, I urge you to only budget for events that the org is really excited about and wants to do, or does every year. New events are always a great. But, if they are loosely planned in advance for the budget and little action is made afterwards, then any allocated funds can easily go unspent. If you are only budgeting for events that you know for sure your org is planning on doing, then you are also much more likely to receive funding during the budgeting process. Then, if during the semester there are ideas for events the group is really passionate about, there are still funds for additional allocations. Speaking from experience, the allocation of funds to student orgs always involves some difficult decisions. The FAC strives to be fair and responsible in our allocation choices. We need the cooperation of student orgs to follow through with the funds allocated to them as well as to make the current system work smoothly. So please, if you are an org leader doing a budget during the next two weeks, please keep what I have discussed here in mind. We will be having FAC office hours that will be posted on-line when you can have drop in sessions to review your budget request before submission, and the FAC email ([email protected]) is also a great place to send your questions. We look forward to seeing your requests. And remember to have them submitted by 11:59 PM on Friday, April 13. refresh –>