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Commission Reform

Commission Reform

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Published by GtownVoice

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Published by: GtownVoice on Mar 01, 2011
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03/01/2011

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COMMISSION ON STUDENT ACTIVITIESENDOWMENT REFORM
    SPRING 2011
 
   FINANCE & APPROPRIATIONS COMMITTEE
 
 
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INTRODUCTION
 
The mission of the Georgetown University Student Association (GUSA) is to safeguard theinterests of the student body and work for realistic, positive change on campus. With thismission in mind GUSA must now take on the matter of the Student ActivitiesEndowment (the “Endowment”). In 2001, the student body through referendum established a semesterly Student ActivitiesFee. Each year a committee comprised of 7 GUSA Senators and 6 other student leadersallocated half of the fee towards student activities and student life. The other half of the feewas automatically placed into an Endowment. The Endowment was comprised of purchased shares of the greater Georgetown University endowment and therefore subjectto the successes and failures of Georgetown’s investments. The intent behind placing half of the student fee money into an endowment was logical.Students in 2001 hoped that within 10 years the endowment would grow to approximately $10 million at which point the interest earned off of the endowment would make it self-sufficient and replace the semesterly fee paid by students. The policy was meant todemonstrate careful, long-term planning. However, it was not successful. The current value of the Endowment is approximately $3.4 million, which is far below where it should be today. This is because of a number of factors. First, in 2001 there was ageneral understanding that the University would contribute $3 million to the Endowmentas part of its $1 billion Third Century Campaign. Unfortunately, this fundraisingcampaign struggled and the Endowment never received the needed boost of schoolfunding. Second, in 2008 the economy went into recession and the growth of theUniversity endowment slowed, which greatly affected the Activities Endowment. Third, theoriginal plan for the Endowment was too optimistic and did not plan for likely problems.This is why no other peer institution has a similar endowment. Best practices tell us to
 
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allocate all revenue each year. The goal of reaching $10 million in 10 years was likely neverpossible. It may take an additional 10 years or more for the Endowment to grow to $10 million.Furthermore, if the Endowment was at $10 million today it would likely only generateapproximately $300,000 to be allocated for student life. This is simply not enough money.In the last budget cycle GUSA allocated nearly $400,000 to student programs, and theneed was still much higher. The FinApp Committee estimates that actual financial need of student life is around $800,000. This is far above what the Endowment could generateeven if the original policy was successful. It is clear that the concept of a Student Activities Endowment should no longer bepursued. Therefore, responsibility falls to the GUSA Finance & AppropriationsCommittee to resolve what is done with the remaining $2 million in the Endowment.However, this matter is too large and encompassing for only the seven members of theFinance & Appropriations Committee to handle. Therefore, the Committee is establishingthe “Commission on Student Activities Endowment Reform” to undertake this issue. This issue is best handled outside the FinApp Committee while it is busy implementingthe recent SAFE Reform measures and therefore unable to dedicate the necessary time tosuch an involved matter. Lastly, the issue of what to do with the remaining Endowmentmoney should be considered by a broad range of interested parties and representativesfrom across the Georgetown community. The goal of the Endowment Commission is to thoroughly research the issue of theEndowment, listen to all ideas on how the money should be spent, and ultimately create aproposal to be presented to the Finance & Appropriations Committee for consideration.The FinApp Committee will then consider the Commission’s proposal, make necessary amendments, and then present a final plan to the full GUSA Senate. The Senate wouldthen order a campus wide referendum to adopt the proposal.

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