SAC Chair tells clubs that GUSA’s budget battle could put them in “deep financial jeopardy”
Posted by: Juliana Brint in News, Vox Populi, tags: Aakib Khaled, GUSA, GUSA Budget, SACFor many Georgetown students, the current GUSA budgetary stand-off is probably just another in a long line of amusing student government squabbles. But for those who have been waiting months to get their funding and are potentially getting screwed over by all the GUSA grandstanding—namely SAC and the student groups it oversees—it’s a somewhat more pressing issue.
On Sunday, SAC Chair Aakib Khaled sent out a lengthy, “urgent” missive to student organization leaders giving them a heads up about the increasingly dire situation. The email says that if GUSA doesn’t pass the budget, SAC will be out $52,000 (25% of their overall budget) and may not be able to pay for some events it already approved.
Khaled also defends the oft-impugned Reserve fund (which, for SAC, currently stand at $195,000, according to Khaled) as necessary to “manage the risk we incur when we allocate our money to our groups.”
From the looks of it, this could easily balloon into the great GUSA-SAC war redux (perhaps Khaled could turn the tables on Troiano & Co. and stage an impromptu sit-in?). Full text of the email after the jump.
Dear Student Organization Leaders,
I hope this finds you well. This letter is to inform you of a serious issue that has arisen between GUSA and the advisory boards, and specifically how it affects SAC. Please pay attention to the contents of this email as it very directly affects the future of your groups. Every year, the Funding Board, comprised of the chairs of each of the five advisory boards (CSJ ABSO, Club Sports, Media Board, PAAC and SAC), representatives from GUSA and GPB, and six senators representing the GUSA Finance and Appropriations Committee meet to distribute the Student Activities Fee. This year, we also voted to distribute money from the University’s new contract with Coca Cola. The budget is generally decided by consensus. This year was no different, and the numbers were agreed upon in February.
As you may be aware from the Hoya, the budget that the Funding Board approved has not been passed by GUSA. SAC has already had BAG weekend to allocate out money for Fiscal Year 2010 and many of you have been promised money for events next year. If this budget is not passed, SAC’s financial capabilities will be reduced by some $52 thousand dollars, or about 25%. GUSA has two more meetings this semester, Sunday, April 19th and Wednesday, April 22nd. If this budget does not pass, SAC will not be able to follow through with the money that was promised to you and we will potentially have to reevaluate all of the requests we received at BAG.
While there have been a variety of reasons alluded to by GUSA for the budget not passing, the one that has been highlighted in meetings between the leadership is the existence of the advisory boards’ Reserve Accounts. Some of you may remember when this issue was misleadingly overblown last year with the Hoya stating that SAC had $800 thousand dollars in its reserve. This was, however, the total in all the advisory boards’ reserve accounts. The University has given the advisory boards the ability to maintain reserve accounts to manage the risk we incur when we allocate out money to our groups. For SAC, our total risk can be conceptualized as the total income we allow you all to bring in fore events throughout the year. If you do not bring in this money, SAC is responsible for being to cover the difference. For example, if a major event does not draw in the projected number of attendees, then SAC must often cover any differences. Or if rented equipment for a show is damaged, SAC must be able to pay for it. These are just a few of the many situations in which our Reserve is of vital importance. Last year, the total income we allocated out to our groups stood at $500 thousand. In the midst of the controversy regarding the size of our Reserve last year when it stood at its highest point of $276 thousand, SAC agreed to spend down its Reserve Account to $250 thousand; a number recommended to us by the University’s Senior Business Manager for Student Affairs, Lynn Hirschfield.
The past two years, however, have indicated how important the SAC Reserve Account is. SAC is allocating far more money than it has in the past. Last year, we had to draw $40 thousand dollars out of the Reserve Account to cover expenses for the rest of the year when our yearly allocation from the University and the Funding Board ran out. This year, we ran out of money allocated to us for FY09 in February and drew $25 thousand out from the Reserve to help us through the year. Currently, SAC’s Reserve stands at $195,000.
I apologize for the length of this email, but I wanted to communicate to you all the seriousness of these issues. From this email, please keep in mind four things: (1) GUSA has not passed the Budget that the Funding Board agreed to by consensus in February; (2) if this Budget is not passed by the end of the year, SAC will most likely have to reevaluate the money we promised to you at BAG and many events may be in jeopardy; (3) SAC’s Reserve Account is now steadily depleting and (4) without the Reserve Account, SAC cannot possibly allocate out money to the diverse and complicated events that our groups plan because we will not be able to cover the risk and place our groups’ futures in deep financial jeopardy.
Please know that we are doing everything possible to try an avert any negative repercussions from impacting our groups, however it may be beyond our control. This email is already quite long, but obviously it is a summary of a number of important issues. If you have any specific questions about the Funding Board, what has been taking place with GUSA and SAC’s Reserve account, please contact me via sac@georgetown.edu at your convenience. Due to the volume of email I receive, I will do my best to get back to you as soon as possible.
Thank you for your time and patience.
Sincerely,
Aakib Khaled
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SAC is changing a lot of the facts in an attempt to scare clubs into backing its ridiculous reserves policy. Also, last year SAC proposed dropping its reserve fund to $100,000, not $250,000, according to those who (unlike Khaled) were at the funding meeting that Khaled refers to.
I for one don’t think this issue is being overblown. If it is, the people overblowing it are SAC. All that GUSA is asking is that the advisory boards (including but not only SAC) justify the current levels of their reserves and submit a plan to spend them down or otherwise deploy them in a useful way for students. What SAC isn’t telling you is that chances are that they’ll have another budget surplus at the end of this year, when all is said and done.
As noted elsewhere, SAC’s current reserve fund of $195,000 doesn’t include the tens of thousands of dollars that will be rolled back into it at the end of the year when most clubs underspend their budgets. The actual number is probably much closer to the $275,000 than SAC would like to admit. SAC leaders including Mr. Khaled, I hope you will disclose the real numbers of how much SAC has in both its reserve account and in the unspent budgets of the many clubs that will be rolled back into the reserve at the end of the year.
I wonder why trying to do “everything possible” did not include meeting a second time after the budget failed in order to fix the problem.
I voted against the budget the first time because of a ~$60,000 surplus that I felt should be allocated to the funding boards so that student can benefit from it. It was also because the current GUSA President had no voice in the budget process (perhaps part of that surplus could be put toward the platform he was elected on, i.e. the Georgetown Fund). It was only after this that the issue of large reserves arose again.
That was many weeks ago. The intention was the have the Committee reconvene to settle these issues and pass a new budget to present to GUSA. For a reason unknown to me, that never happened – and THAT is why we are in this predicament. [GUSA's FinApp Committee should share in responsibly for this.]
Might I also reiterate that SAC should reevaluate the entire way the process by which clubs are funded. An initial fall allocation to all clubs (with the possibility to reapply in the spring) would, to a degree, allow clubs to cover their own risks of events and activities AND put an end to the mind boggling micromanaging that students are tired of. Adding a level of accountability (i.e. elections??) would also be a step forward.
Instead of Aakib sending out an email to instill fear in clubs, why not convene them to discuss ways in which SAC can transform into a functional, transparent and accountable funding board?
How many years do the same problems have to repeat before something is done?
CSJ at least submitted an incredibly detailed plan last year for their reserves. I know because I helped write it. And GUSA was like, “Wow, great plan, we totally understand that you are expanding so rapidly that you are going to automatically be spending down your reserves over the next few years.” Yet, because info gets lost every year people seem to forget that.
Wow. Molly Keogh, defending GUSA?
I know for a fact that all of the people currently involved have copies of CSJ ABSO’s plan because I gave it to them a while ago when they asked for a data dump and held it up as an example of a very good reserves proposal and exactly the kind of accountability the system needs. CSJ ABSO has always been pretty on top of its game.
From what I can tell, as other people have said, this isn’t an attempt to completely get rid of reserves or steal money from clubs, it’s an attempt to at least make sure that there’s a good justification for the reserve funds and a plan to use them going forward (like GUSA asked for last year). I dunno if there’s something else at play or not, but from the 35,000 foot level having not been involved, that’s what it looks like. It’s possible that the whole thing is really Calen wanting his Club Fund, or alternatively SAC trying to kill the Club Fund.
Molly’s reserves plan was brilliant. If every board had submitted something like that last year then the only question this year would have been “Have you been following it, and if not, why not?”
I can corroborate what “’10″, whoever that is, said btw, SAC did originally propose going down to something like 100 or 150k, NOT 250k. And s/he’s right that SAC will roll money back into the reserves fund at the end of the year. Is ’10 a SAC insider mayhaps?
Nick’s proposal deserves serious consideration. Why can’t we be like every other university and give groups an allocation at the start of the year, while keeping SAC around for major events that require more funding? SAC could still perform audits, etc. to make sure the money isn’t being completely wasted of course. I imagine SAC would argue that having such disciplined control of groups allows them to ensure top efficiency. And looking purely at cash flows, I suppose efficient to find a caterer who will do things for $20 less. But if it takes you 20 man hours to jump through all the extra hoops (your time, your group’s time, advisers’ time), it’s simply not worth it to anyone.
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See The Hoya’s more in-depth and objective coverage here: http://thehoya.com/node/18882
ABC,
Let’s keep this civil. Let the readers decide which coverage they prefer. As for objectivity, our news section always strives to be objective, but we have a bit more editorial license on the blog.
I agree people should be able to decide which is more objective, but there’s no doubt in this case that the Hoya’s coverage is much clearer. I’m a bit disappointed that the Voice Blog (here and in the Angertometer), usually so reliable, gave in to SAC’s attempts to scare people into submission.
The budget only gets passed once a year. The irony is that when GUSA audited the reserves last year, clubs were the first on board with GUSA’s desire to monitor these funds and make sure that they were put to the best possible use. The Senate, which first voted this budget down more than a month ago, simply asked the boards to review and justify their reserves, which they have refused for more than a month to do in order to try to wait GUSA out. Now, SAC has spelled out a ridiculous scenario involving unnecessary budget cuts, and these same groups have abandoned a cause GUSA is pursuing solely for their benefit. Rather than report SAC’s claims and independently verify them, the Voice Blog lent their website as a platform for SAC to manipulate the student body out of its interests.
Chelsea, there’s a difference between editorial license and shoddy reporting.
Re: Chelsea Paige,
Thanks for the feedback. You certainly seem to know a lot about the situation. Thus, it would be great if you could comment under your own name.
[...] heard the SAC side of the great GUSA Battle of the Budget, so we thought it was about time to check in with the [...]
[...] are, more or less, harmless fun. But potentially putting student groups in a position where they won’t get adequate funds? That’s actually not so [...]