The issues surrounding the new University Student Center touch on finance, law, intent, good faith and the role of activity and service fees. It can all be a little wonky. Here, we’ll try to break it down.
Students supported the creation of the USC, why is there controversy now?
Students originally supported the creation of a student union with a dining hall, health clinic and spaces for student organizations, similar to student unions at other universities, said former student leaders, citing a survey issued prior to 2009. However, during the building planning process in 2009, a floor for student organizations and the health clinic was removed due to cost concerns and housing was added to the building. Student organizations, the health clinic and student services were to stay in the Campus Activities Center, renovated and renamed the Student Life Center.
Now students over the next 30 years will pay roughly $60 million total for the University Student Center; the SLC renovation cost approximately $2.5 million. For the 120 credit hours minimum required for a Bachelor’s degree, each student will contribute $1,656 to the building through activity and service fees.
What was the reaction from the students then?
The project was stalled for a few months in 2010 as the university sought a bond to pay for the building. The function of a bond is similar to that of a home mortgage. Then-Student President James Scott, who had helped lobby the Florida legislature and governor to pass the fee increase, sent a memo to campus leadership, urging them to return the building to its original intent as a student union. While the students did get renovated student organization spaces in another building, that portion of the project was an order of magnitude less expensive than the USC.
What are activity and service fees?
Activity and service fees, along with health and athletic fees, constitute the “combined fees” or “local fees.” While there are many other fees, these three are lumped together under state law. For example, the total of the three fees cannot exceed 40 percent of tuition per credit hour. Also, these fees cannot be raised by more than 5 percent per year, unless an exception is made by the state government. At the moment, the total is $31.40 per credit hour (plus a $5 flat fee for athletics). USFSP has the highest activity fee in the state, $25.05 per credit hour, as a result of a special exemption won by low-service state universities in 2010. USFSP students were integral in this process.
An important note about activity and service fees: only 5 percent of the prior year’s activity fee collection can be used to service bond debt. This is to prevent universities from tying up large amounts of activity fee revenue, which is intended for “campus life” activities and groups, on long-term building projects. For USF, system-wide activity fee revenue is used to determine this number.
Why was housing added to the project?
USFSP, and the USF system more generally, are seeking to increase the resident student population to 25 percent of the total student population. Resident students are thought to perform better inside and outside the classroom, and are considered the source of “campus culture” by university leaders. Future taxpayer funding of universities may also be connected to undergraduate achievement metrics, so there is an impetus to improve USF’s numbers, which are lower than UF, FSU and UCF.
The second reason is that creating campus services is a delicate balance, said former USFSP administrator and higher education building specialist Kent Kelso. Before the second dormitory could be built, the campus needed a health clinic and dining service. However, without a large enough resident student population, it would be difficult to attract a dining service provider. This is the main reason why all campus residents are required to purchase a meal plan—with a small resident population, even with the USC, the university was in a fairly weak negotiating position.
To avoid as many growing pains as possible, the dining service and second dormitory had to come at the same time, Kelso said, at a time when the state has shown reluctance in funding non-educational buildings.
What role did USF President Judy Genshaft play in the planning process?
The student leaders and lobbyists, in particular James Scott and Jon Ellington, said they had to choose between accepting the multi-use building or giving up the project entirely due to a demand for more housing from Genshaft. Former Regional Vice Chancellor Kent Kelso said the president made a “strong recommendation” to include housing during the planning process.
Surrogates of the university president have claimed she had little to no involvement in the planning of the building. USF lobbyist Mark Walsh said Genshaft’s involvement only extended to providing advice on funding the project due to the law that prevents significant student fees from being used to fund bond payments. Chief Operating Officer John Long said claims made by the student lobbyists and the former USFSP administrator about Genshaft’s involvement were “slanderous” and she had no direct input on the planning.
However, a timeline of events prepared by the university and obtained by The Crow’s Nest show Genshaft making the recommendation in 2009, prior to the 2010 legislative session when the fee increase was passed. Yes, there is a law that prevents more than 5 percent of activity and service fees from being bonded, but in 2009, university officials were hoping for a special single-purpose fee similar to the ones that fund the student unions at USF Tampa and FSU. In 2005 and 2006, this type of fee was passed in the Florida legislature for USFSP but was vetoed by Govs. Jeb Bush and Charlie Crist.
The original bill submitted to the Florida House and Senate in 2010 would have created this special fee, but that bill died in committee. Instead, a modification to state statute that allowed low-service universities (like the USF regional campuses) to increase their fees one time to the state average was included in a budget bill. However, this fee increase does not allow for bonding of activity fees beyond the 5 percent.
In short, if Genshaft’s recommendation to include housing was solely due to bonding limitations on student fees, she would have needed to expect the original bill to fail months before it did.
What are the concerns of Student Government?
Right now, they are two-fold: student governments get their authority and influence from the expenditure of activity and service fees. Without control of the expenditure of those fees, student governments lack a significant ability to effect student-led change on campus. USF attorneys have claimed the context of the 2010 fee increase constitutes a partial exemption to the state law that assigns authority over those fees to the student government. If the university maintains its current position, students will control 45 percent of the approximately $3.5 million in activity and service fees expected this year.
The second issue, which is being driven by the elements within SG focused on environmentalism and sustainability, is that the housing portion of the building is being subsidized by the student center portion. The building has one meter per utility, rather than a meter per section. Instead, costs are divided by square footage, meaning the ballroom is paying for the same amount for electricity, water and sewer as an equivalent area in the student housing portion.
Are activities fees subsidizing housing?
Yes. The building was funded using an $18 million, 30-year bond through a federal stimulus program called “Build America Bonds.” These debt instruments were created for the purpose of constructing “shovel-ready” civic infrastructure projects. However, the bond could not be used for retail construction, such as the area now occupied by Sodexo. It was determined the 6,000 sq. ft. area used by the food service provider would cost $2.8 million. It was funded with the first two years of the $13.80 per credit hour fee increase.
Despite paying cash for a little over one-sixth of the “student center” portion of the building, activity fee revenue is obligated to pay the debt consistent with the total area of the student center portion — 43 percent. By re-apportioning the debt obligation absent the area already purchased, student activity fees would pay approximately $519,000 per year, rather than the $579,000 currently expected.
There is also the question of relative utility costs, one-time capital purchases, maintenance contacts and staffing. An in-depth look at the proposed operational costs compared to other Florida university student centers will be included in a future issue of The Crow’s Nest.
