Report 2019-114 Recommendation 5 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 #5 To: University, California State

To ensure that CSU campuses adequately identify the need for their proposed mandatory fee amounts, the Chancellor's Office should increase the rigor of its fee proposal review and approval process to better ensure that it detects campuses' violations of the fee policy.

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. Specifically, the planned approach does not address the shortcomings we identified with the Chancellor's Office's review of proposed mandatory fees at CSU campuses, particularly in the area of student consultation. For the reasons we raised in our responses to previous Chancellor's Office updates, audits after the fact are not a replacement for appropriate oversight of proposed fees.

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. Specifically, the planned approach does not address the shortcomings we identified with the Chancellor's Office's review of proposed mandatory fees at CSU campuses, particularly in the area of student consultation. As we discuss on pages 33 and 34 of the audit report, we identified several instances in which campuses' processes violated student consultation requirements. However, the Chancellor's Office did not intervene to enforce the requirements in any of those cases. Instead, the Chancellor's Office approved these mandatory fees and students have been paying them since.

As we have stated in previous assessments, CSU's approach to addressing the issues we found through additional internal audits is not sufficient. In the event those audits identify issues with campuses' fee processes, it will be after mandatory fee increases are already in place and students have been paying them. For this reason, increased audits after the fact do not relieve the Chancellor's Office of its responsibility to thoroughly review campuses' proposed mandatory fees before campuses implement those fees. Finally, although we called out the above violations in the report and the Chancellor's Office did not dispute those findings, it has not indicated that it intervened to address the violations, nor that it intends to do so. As such, we question whether the Chancellor's Office will take any action if and when its own staff identify similar violations after the fact. Therefore, notwithstanding CSU's statements about the conclusions of its recent audits, we stand by our recommendation that the Chancellor's Office increase the rigor of its fee proposal review and approval process to better ensure that it detects campuses' violations of the fee policy.

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 actions do not address our recommendation. Specifically, its approach does not address the shortcomings we identified with the Chancellor's Office's review of proposed mandatory fees at CSU campuses, particularly in the area of student consultation. As we discuss on pages 33 and 34 of the audit report, we identified several instances in which campuses' processes violated student consultation requirements. However, the Chancellor's Office did not intervene to enforce the requirements in any of those cases. Instead, the Chancellor's Office approved these mandatory fees and students have been paying them since.

Even if the Chancellor's Office's actions succeed in identifying such violations in the future, it will be after mandatory fee increases are already in place and students have been paying them, rather than before the increases are imposed. For this reason, performing additional audits after the fact do not relieve the Chancellor's Office of its responsibility to thoroughly review campuses' proposed mandatory fees before campuses implement those fees. Finally, although we called out the above violations in the report and the Chancellor's Office did not dispute those findings, it has not indicated that it intervened to address the violations, nor that it intends to do so. As such, we question whether the Chancellor's Office will take any action if and when its own staff identify similar violations during these reviews. Therefore, we stand by our recommendation that the Chancellor's Office increase the rigor of its fee proposal review and approval process to better ensure that it detects campuses' violations of the fee policy.

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. Specifically, the planned approach does not address the shortcomings we identified with the Chancellor's Office's review of proposed mandatory fees at CSU campuses, particularly in the area of student consultation. As we discuss on pages 33 and 34 of the audit report, we identified several instances in which campuses' processes violated student consultation requirements. However, the Chancellor's Office did not intervene to enforce the requirements in any of those cases. Instead, the Chancellor's Office approved these mandatory fees and students have been paying them since.

Even if the Chancellor's Office's planned actions succeed in identifying such violations in the future, it will be after mandatory fee increases are already in place and students have been paying them, rather than before the increases are imposed. For this reason, increased audits after the fact do not relieve the Chancellor's Office of its responsibility to thoroughly review campuses' proposed mandatory fees before campuses implement those fees. Finally, although we called out the above violations in the report and the Chancellor's Office did not dispute those findings, it has not indicated that it intervened to address the violations, nor that it intends to do so. As such, we question whether the Chancellor's Office will take any action if and when its own staff identify similar violations after the fact. Therefore, we stand by our recommendation that the Chancellor's Office increase the rigor of its fee proposal review and approval process to better ensure that it detects campuses' violations of the fee policy.

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 and mischaracterizes our audit results by stating that it will "ensure campuses continue to adhere to CSU policy." Specifically, the planned approach does not address the shortcomings we identified with the Chancellor's Office's review of proposed mandatory fees at CSU campuses, particularly in the area of student consultation. As we discuss on pages 33 and 34 of the audit report, we identified several instances in which campuses' processes violated student consultation requirements. However, the Chancellor's Office did not intervene to enforce the requirements in any of those cases. Instead, the Chancellor's Office approved these mandatory fees and students have been paying them since.

Even if the Chancellor's Office's planned actions succeed in identifying such violations in the future, it will be after mandatory fee increases are already in place and students have been paying them, rather than before the increases are imposed. For this reason, increased audits after the fact do not relieve the Chancellor's Office of its responsibility to thoroughly review campuses' proposed mandatory fees before campuses implement those fees. Finally, although we called out the above violations in the report and the Chancellor's Office did not dispute those findings, it has not indicated that it intervened to address the violations, nor that it intends to do so. As such, we question whether the Chancellor's Office will take any action if and when its own staff identify similar violations after the fact. Therefore, we stand by our recommendation that the Chancellor's Office increase the rigor of its fee proposal review and approval process to better ensure that it detects campuses' violations of the fee policy.

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 and mischaracterizes our audit results by stating that it will "ensure campuses continue to adhere to CSU policy." Specifically, the planned approach does not address the shortcomings we identified with the Chancellor's Office's review of proposed mandatory fees at CSU campuses, particularly in the area of student consultation. As we discuss on pages 33 and 34 of the audit report, we identified several instances in which campuses' processes violated student consultation requirements. However, the Chancellor's Office did not intervene to enforce the requirements in any of those cases. Instead, the Chancellor's Office approved these mandatory fees and students have been paying them since.

Even if the Chancellor's Office's planned actions succeed in identifying such violations in the future, it will be after mandatory fee increases are already in place and students have been paying them, rather than before the increases are imposed. For this reason, increased audits after the fact do not relieve the Chancellor's Office of its responsibility to thoroughly review campuses' proposed mandatory fees before campuses implement those fees. Finally, although we called out the above violations in the report and the Chancellor's Office did not dispute those findings, it has not indicated that it intervened to address the violations, nor that it intends to do so. As such, we question whether the Chancellor's Office will take any action if and when its own staff identify similar violations after the fact. Therefore, we stand by our recommendation that the Chancellor's Office increase the rigor of its fee proposal review and approval process to better ensure that it detects campuses' violations of the fee policy.

All Recommendations in 2019-114

Agency responses received are posted verbatim.