Report 2019-114 Recommendation 3 Responses

Report 2019-114: California State University: The Mandatory Fees Its Campuses Charge Receive Little Oversight Yet They Represent an Increasing Financial Burden to Students (Release Date: May 2020)

Recommendation #3 To: University, California State

To ensure that CSU campuses adequately identify the need for their proposed mandatory fee amounts, the Chancellor's Office should revise its fee policy to require campuses to justify amounts for new or increasing fees by providing supporting documentation demonstrating the need for the fees, how they calculated the fee amounts, and how they determined that no other source of funding could pay for the needed services.

Annual Follow-Up Agency Response From September 2023

Audit and Advisory Services (A&AS) completed three campus-based mandatory student fees audits as part of its annual audit plan for 2021-2022. The audits were completed in December 2021, May 2022, and August 2022. In general, A&AS noted that the campuses had appropriate frameworks for the administration of student fees. CSU management believes that these steps are sufficient and will not take any further action.

California State Auditor's Assessment of Annual Follow-Up Status: No Action Taken

The Chancellor's Office's response does not address our recommendation. As we conclude throughout the audit report, the current fee policy does not ensure adequate accountability to students. Because the fee policy does not contain meaningful requirements in these areas, the response from the Chancellor's Office that its audits did not identify issues with campus processes does not address our concern.

Annual Follow-Up Agency Response From October 2022

Audit and Advisory Services (A&AS) completed three campus-based mandatory student fees audits as part of its annual audit plan for 2021-2022. The audits were completed in December 2021, May 2022, and August 2022. In general, A&AS noted that the campuses had appropriate frameworks for the administration of student fees.

California State Auditor's Assessment of Annual Follow-Up Status: No Action Taken

The Chancellor's Office's response does not address our recommendation.

As we conclude throughout the audit report, the current fee policy does not ensure adequate accountability to students. For example, as we discuss on pages 28-32, the vague requirements in the fee policy allowed the campuses we reviewed to impose or increase mandatory fees without justifying specific fee amounts. Further, the fee policy does not require campuses to demonstrate that they have no other way to pay for their needs, and the campuses we reviewed consistently failed to do so.

Because the fee policy does not contain meaningful requirements in these areas, the conclusions CSU reaches based on its recent audits are not relevant and CSU's response does not address the deficiencies we found in the policy. The Chancellor's Office's planned approach is also concerning because it did not dispute any of our conclusions in its response to the audit report and, in fact, on page 53 stated its intention to implement our recommendations to improve its policies and practices. Therefore, we stand by our recommendation that the Chancellor's Office revise its policy to require campuses to justify amounts for new or increasing fees.

Annual Follow-Up Agency Response From October 2021

At the May 2021 meeting, the Board of Trustees approved audits of campus-based mandatory fees as part of the division of Audit and Advisory Services annual audit plan for 2021-2022. The audits will assess whether the campuses adhered to CSU policy with regard to the establishment, assessment, and implementation of the fees. The first of these audits started on September 27, 2021, and two more are currently planned.

California State Auditor's Assessment of Annual Follow-Up Status: No Action Taken

As with its previous responses, the Chancellor's Office's reported action does not address our recommendation.

As we conclude throughout the audit report, the current fee policy does not ensure adequate accountability to students. For example, as we discuss on pages 28-32, the vague requirements in the fee policy allowed the campuses we reviewed to impose or increase mandatory fees without justifying specific fee amounts. Further, the fee policy does not require campuses to demonstrate that they have no other way to pay for their needs, and the campuses we reviewed consistently failed to do so.

Because the fee policy does not contain meaningful requirements in these areas, the described action regarding internal audit activities to ensure adherence to CSU policy is not relevant and will not address the deficiencies we found in the policy. The Chancellor's Office's planned approach is also concerning because it did not dispute any of our conclusions in its response to the audit report and, in fact, on page 53 stated its intention to implement our recommendations to improve its policies and practices. Therefore, we stand by our recommendation that the Chancellor's Office revise its policy to require campuses to justify amounts for new or increasing fees.

1-Year Agency Response

At the May 2021 meeting, the Board of Trustees is expected to approve audits of campus-based mandatory fees as part of the division of Audit and Advisory Services annual audit plan for 2021-2022. The audits will assess whether the campuses adhered to CSU policy with regard to the establishment, assessment, and implementation of the fees.

California State Auditor's Assessment of 1-Year Status: No Action Taken

The Chancellor's Office's response does not address our recommendation.

As we conclude throughout the audit report, the current fee policy does not ensure adequate accountability to students. For example, as we discuss on pages 28-32, the vague requirements in the fee policy allowed the campuses we reviewed to impose or increase mandatory fees without justifying specific fee amounts. Further, the fee policy does not require campuses to demonstrate that they have no other way to pay for their needs, and the campuses we reviewed consistently failed to do so.

Because the fee policy does not contain meaningful requirements in these areas, the described plan to conduct internal audit activities to ensure adherence to CSU policy is not relevant and will not address the deficiencies we found in the policy. The Chancellor's Office's planned approach is also concerning because it did not dispute any of our conclusions in its response to the audit report and, in fact, on page 53 stated its intention to implement our recommendations to improve its policies and practices. Therefore, we stand by our recommendation that the Chancellor's Office revise its policy to require campuses to justify amounts for new or increasing fees.

6-Month Agency Response

The Chancellor has asked the division of Audit and Advisory Services to conduct more frequent periodic reviews of campus-based mandatory fees to ensure that campuses continue to adhere to CSU policy with regard to their establishment, assessment, and implementation. The division of Audit and Advisory Services is developing its 2021-22 audit plan and will include at least one fee audit in the audit plan it submits to the Board of Trustees for approval in May 2021.

California State Auditor's Assessment of 6-Month Status: No Action Taken

The Chancellor's Office's response does not address our recommendation.

As we conclude throughout the audit report, the current fee policy does not ensure adequate accountability to students. For example, as we discuss on pages 28-32, the vague requirements in the fee policy allowed the campuses we reviewed to impose or increase mandatory fees without justifying specific fee amounts. Further, the fee policy does not require campuses to demonstrate that they have no other way to pay for their needs, and the campuses we reviewed consistently failed to do so.

Because the fee policy does not contain meaningful requirements in these areas, the Chancellor's Office's plan to increase internal audit activities to ensure adherence to CSU policy is not relevant and will not address the deficiencies we found in the policy. The Chancellor's Office's planned approach is also concerning because it did not dispute any of our conclusions in its response to the audit report and, in fact, on page 53 stated its intention to implement our recommendations to improve its policies and practices. Therefore, we stand by our recommendation that the Chancellor's Office revise its policy to require campuses to justify amounts for new or increasing fees.

60-Day Agency Response

The Chancellor has asked the division of Audit and Advisory Services to conduct more frequent periodic reviews of campus-based mandatory fees to ensure that campuses continue to adhere to CSU policy with regard to their establishment, assessment, and implementation. The division of Audit and Advisory Services plans to begin these reviews in 2021, after the audit plan is approved by the Board of Trustees.

California State Auditor's Assessment of 60-Day Status: No Action Taken

The Chancellor's Office's response does not address our recommendation.

As we conclude throughout the audit report, the current fee policy does not ensure adequate accountability to students. For example, as we discuss on pages 28-32, the vague requirements in the fee policy allowed the campuses we reviewed to impose or increase mandatory fees without justifying specific fee amounts. Further, the fee policy does not require campuses to demonstrate that they have no other way to pay for their needs, and the campuses we reviewed consistently failed to do so.

Because the fee policy does not contain meaningful requirements in these areas, the Chancellor's Office's plan to increase internal audit activities to ensure adherence to CSU policy is not relevant and will not address the deficiencies we found in the policy. The Chancellor's Office's planned approach is also concerning because it did not dispute any of our conclusions in its response to the audit report and, in fact, on page 53 stated its intention to implement our recommendations to improve its policies and practices. Therefore, we stand by our recommendation that the Chancellor's Office revise its policy to require campuses to justify amounts for new or increasing fees.

All Recommendations in 2019-114

Agency responses received are posted verbatim.