University fined after errors in 2006 audit

The federal government is requiring the university to return $232,000.

By James Hatler

Published March 12, 2009

MU will return $232,000 to the U.S. Department of Health and Human Services following an audit of the research funds the university received from the government.

At Thursday's Faculty Council meeting, Vice Chancellor for Research Rob Duncan informed council members about the financial issue.

The $232,000 to be returned to the federal government was 10 percent of $2.3 million not accounted for by the university in a 2006 audit, Duncan said.

"These are forced returns due to the fact that federal funds through an audit were seen to have been misappropriated, in one way or another," he said. "These are forced returns of funds back to the federal government for these specific reasons."

The more than $232,000 the university will return to the federal government is in addition to $50,000 returned to the federal government by the UM System due to errors in monitoring the funds. That fine was initially $4 million, but Vice President for Finance and Administration Nikki Krawitz negotiated down the fine, Duncan said.

The money to repay the federal government will come from Finance and Administration, a $32 million fund, Duncan said.

Craig Stevenson, Associated Students of the University of Missouri chairman, and Graduate Professional Council President Alaine Arnott also presented a resolution passed by the Missouri Students Association that requested changes in the way the supplemental fees were approved every year.

The supplemental fee is a per-credit hour charge in addition to other fees charged by some of the schools and colleges in the UM system.

"As students we are concerned that under Senate Bill 389, tuition and the student activity fee is capped at inflation, but the supplemental fee is not," Stevenson said. "That is the one fee that students have to pay that is not covered, and in recent years on average the student activity fee has risen above inflation and well above inflation in specific areas."

MSA passed a resolution asking that a committee be created or charged with overseeing the increases of the fees, Stevenson said.

The fee already has a process for review: it starts at the vice provost's office, and then goes to the provost, chancellor and UM system President Gary Forsee and then to the Board of Curators.

"At any point in the process they can veto the fee," Arnott said. "Before the fee is presented to the provost's office it is supposed to go to the divisional council student representatives as well as whatever council is represented in that school."

No supplemental fee increases will occur this fiscal year.

"I was told conditionally by Chancellor Deaton on Thursday that none of the fees are going through for this year," Arnott said.

Arnott said the current process does not work for students, because departments tell students how the fee will increase, and do not allow for input.

"It's falling through the cracks," Arnott said.

Arnott said when she requested to see where the funds were being used, there was no accountability and transparency, and the departments are not required to give that to the students and faculty.

"There are two separate issues here, one is the raising of the fee and the lack of transparency," Faculty Council member Jay Dow said.

There is already a report created for the fee showing where the funds go, but it is not shared with students.

The council decided they would suggest to the provost's office that the report be shared with faculty and students.