SGA officials recently invested $45,000 in an endowment to a reserve fund.
SGA President Randy Gipson-Black said the idea is for the investment to gain interest and be used by future SGA officials for necessary purchases. $45,000 is about 41 percent of the SGA reserve fund.
SGA currently operates out of allocated funds from the university and roll-over funds left by past administrations. This is the first time officials have made investments in this way.
“We wanted to create an endowment after learning the ins and outs of the endowment and what SGA can do with our funds, especially in a reserve, so we decided to create the endowment in order to have our money working for us down the road,” Gipson-Black said.
The money cannot currently be accessed by any current SGA members besides the top three officials–president, vice president and vice president of Student Activities Council. It cannot be accessed until 2023. It is being saved for special projects.
“We wanted to make it easy enough to pull out if we needed it, but hard enough to keep it from being pulled out willy-nilly,” Gipson-Black said.
Gipson-Black said with any reserve fund request, any SGA member can make a request, but they have to use it for that intended use. Because Gipson-Black made this request, he and who he chooses will be the only members with access. He said he chose the three high officers because they represent the areas that receive the most funding.
Gipson-Black said part of the reason for this is the cutting back of the SGA allotment, and the five-year restriction is in place so that no current member of SGA will be able to access it.
“We saw an opportunity for a return on an investment later on down the road, so we jumped on that boat,” he said.
Gipson-Black said this came about from a meeting with the board of trustees, after which he and Amy Ayres, vice president for student affairs and dean of students, drafted a proposal. They then took it to the office of advancement and spoke with University President Robert Henry and Catherine Maninger, chief financial officer.
“They were all on board with it,” Gipson-Black said. “They didn’t think it was inappropriate. They didn’t think it was a misuse of funding. They thought it was wise and right that we invest in our future, so that’s exciting.”
Gipson-Black said the decision won’t directly impact current students, but it may impact them as an alumni.
Possible future uses for the money include expanding the Aduddell Fitness Center or furthering the Blue Goes Green initiative.
“SGA used to do a lot of things when our budget was a lot bigger, like we used to do the whole New York Times subscription for students. Professors ask me all the time why we can’t bring that back, and I’m like ‘we don’t have enough money,’ and it’s those types of things this endowment will be able to supplement for in future years,” he said.
Gipson-Black said no SGA money comes from student fees. SGA gets their funding from student affairs, which gets its money from the general university pond at the beginning of the fiscal year. He said this is similar to what other universities do, which may be why many students assume their fees are going to SGA.
“There’s no line item in student fees that says ‘SGA budget,’” he said.
An investment around $20,000 is required to create an endowment. When SGA executives proposed $45,000, some members of Student Senate found the number to be too high.
“The more you put in, the more you get back, in terms of interest,” Gipson-Black said.
Gipson-Black said that, with a 6 percent return, he estimates about $12,000 – $15,000 in five years.
The motion ended up passing with seven voting “yes,” five voting “no” and one abstaining from Jordan Tarter, English Junior and humanities chair. Tarter said the main reason she abstained was because she thought the amount of money was too high.
“I was part of the reserve committee that decided on whether or not it passed through to the floor, and during that committee there was a vote on whether or not to raise the amount of the endowment from $35,000 to $45,000,” she said. “I voted against the initial raising of it at all, but I was okay with the amount towards the end.”
Tarter said another reason for her not supporting the decision was because, although she saw the benefit of the endowment down the line, she didn’t see it as being helpful for current students or senate members.
“The more I thought about it, the less I really supported it because it really doesn’t do anything for the current students at the school,” she said.
Tarter said if it were rewritten so that senators could have more of a say, she would feel more comfortable.
“It’s money that the senators have access to, and, if there was a way to change the amount to be lower again, I would have said ‘yes,’” she said. “I did not want the idea to die and to just cease to exist, so I didn’t vote ‘no’ because I didn’t want to see it leave because it is an interesting idea. However, I couldn’t bring myself to say ‘yes.’”
Trae Trousdale, mass communications freshman and freshman-at-large senator, voted “no” on the proposed endowment. Trousdale said he also was on board with the idea but not the amount of money proposed. He said he would have been more comfortable with the $35,000.
“Just under one third I was completely okay with,” Trousdale said. “I was a little nervous at first because it is taking $35,000 out of senate control and giving it to executive at the end of the five years, but, when it got a little greedy at $45,000, I decided I wasn’t okay with it.”
Trousdale said his initial hesitation came from the idea of making this money inaccessible for current students and senators. He said he thinks it might be useful for senators to create their own endowment for senators’ access.
“If we’re going to do it for one branch, we have to be willing to do it for all three,” he said. “If we’re going to let the executive do it, we might as well be entitled to it.”
Trousdale said his decision to vote against the idea shocked some people, but he ultimately stood by his decision.
“I just felt that taking one third of the reserve was not what we need to be doing,” he said. “I thought there were other places SGA could be using those funds.”
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