In a "letter of regret," the Tufts Community Union (TCU) Treasury announced Thursday that money later discovered to be $53,000 in expenses to be paid out of the Student Activities fee had been left out of this year's budget.
The same error has been made for several years, but was not discovered until an outside firm audited the budget this semester. Previously, the costs had been unknowingly deducted from the budget surplus, which is also used to fund unexpected club requests and special projects. The surplus has fallen to $20,000 from $200,000 in 1998.
The deficit came as a surprise to senators. Earlier this year Treasurer Ben Lee touted the success of the Treasury thanks to its balanced budget and "fiscal responsibility" in the State of the Treasury speech.
Former TCU Treasurer Michelle Shelton, who drafted last year's budget, said that the Student Activities expenditures were left out due to "human error." This is the first year the oversight will negatively impact TCU-funded groups - rather than continuing to drain the surplus, the Treasury plans to include these costs in next year's budget.
"It was an oversight on the part of the treasury," Shelton said. "It's easy for things to slip through the cracks."
The Treasury failed to account for a yearly $10,000 loan payment on the Mountain Club's New Hampshire lodge and the $43,000 salary and benefits of the Budget and Fiscal Coordinator in the 2001-2002 budgets. The expenditures, which are automatically deducted from the budget each year, are part of contractual agreements with the University, and have existed since the late '90s. That process, combined with inadequate accounting procedures, has allowed tens of thousands of dollars to be deducted in previous years without the treasury noticing.
Because the operating budget and surplus were lumped together into the same account, Shelton said, treasurers have never had an accurate picture of how big the surplus was.
"There were these rough estimates of the surplus, but there was never really a clear number because it was all in one account," Shelton said. When the Treasury switched banks last year, the funds were separated into two accounts to more effectively manage the money.
The University loaned the Tufts Mountain Club $100,000 in an interest-free loan to repair the lodge, which would be repaid over the next ten years with the money allocated by the Senate. No Treasury has ever taken the $10,000 dollar expenditure into its budgeting projections.
Shelton said she and previous treasurers were not privy to the exact deductions that the Administration made to the Senate's budget. In the absence of a thorough understanding of how the Budget Coordinator and lodge repayments were made, the expenses were overlooked.
"The Treasury had access to University statements [this year] that I did not have access to," Shelton said.
Despite the large deficit forecasted for this year, the Treasury is still planning to balance the budget for the next fiscal year. Treasurer Ben Lee said in a meeting Sunday that the Senate might look into canceling the Fall Fest music concert in an effort to save money for next year. As well, the Treasury has cut the Senate's allocation of roughly $46,000 of the Student Activities fee for itself by $4,000.
"To put it simply, if every group requested exactly the same amount as last year, we would still run a deficit, without even considering the new groups that have been recognized," the Treasury said in its letter to student groups. The TCU Judiciary approved several new groups this semester, all of which are eligible for funding from the Treasury.
The Treasury said it does not plan to cut indiscriminately, however. "The cuts will not be across the board," the letter read, adding there will be some groups that will face more constrained budgets next year.
Since campus groups did not all exhaust their entire budgets last year, the surplus will pay down the final deficit to a projected $45,000. If enough campus groups are under budget again this year, the deficit could be reduced further.
The yearly Student Activities budget, which is controlled by the Setate, is roughly $900,000.
"We firmly believe that last year's Treasury did not engage in any fiscal mismanagement," current Assistant Treasurer Nick Abraham said. Last year's Budget Coordinator, Frank Nocito, said that all precautions were made but that it was his job to prevent the error.
"It is one of the roles of the Budget and Finance Coordinator to monitor and address those types of mistakes for the Treasury," Nocito said. "We took extreme efforts to make sure that information such as ongoing agreements with student organizations and the University Administration were well-documented."
Shelton said that more frequent auditing would prevent something like this from happening in the future. Currently, an independent auditor goes through the Treasury's budget once every four years.
Shelton lost the Senate Presidential election to Eric Greenberg last year, and resigned her position as Treasurer from the Senate this year citing personal reasons.
