The Office of Residential Education (ResEd) has implemented changes to the financial policies for student-managed Row houses over the recent months, following the identification of several “compliance issues” during a general review process, according to administrators.
These changes, some of which have endured while others have not, included more University oversight of student house dues and vendor payment.
In an email to The Daily, Assistant Dean of ResEd Nate Boswell referenced the Sept. 2010 hiring of Director of Operations Aaron Buzay as the result of a larger review process conducted by Deborah Golder, dean of ResEd.
“The hiring of this position increased oversight of all operational and financial activities in ResEd and supplemented existing partnerships with Business Affairs,” Boswell said. “During the first comprehensive review conducted by Director Buzay, the department identified several compliance issues that required attention and worked together with the Auditing Office and other Business Affairs partners to make corrections.”
This past spring, ResEd prohibited Row houses from using social dues to purchase alcohol, citing a school policy that restricts University funds from being used to buy alcohol for those under the age of 21. Several house financial managers (FMs) noted that under the previous system, Stanford could be held legally responsible in the case of an alcohol-related accident, since the purchases were made through University-owned bank accounts.
At the outset of this autumn quarter, the University introduced a new round of changes to Row financial policies.
ResEd standardized Row house social dues at $75 and began collecting this fee through students’ University bills instead of through student FMs. ResEd also experimented with the way Row house food vendors are paid, shifting the responsibility from FMs to the Row Central Office for the first five weeks of the quarter.
A new staff member, Financial Associate Jo Arredondo, is charged with looking over weekly house budget reports and serves as a point person for FMs.
These changes raised several questions for FMs about the shifting nature of their role and what autonomy they can expect to have in the future.
“We are committed to preserving the core tenets of the student management program which is geared towards enabling student leaders to build vibrant, intimate residential communities,” wrote Boswell and Buzay in a joint email to The Daily. “However, we are also committed to and responsible for upholding the standards of the University.”
The Row is a collection of 36 houses along Mayfield Avenue and spanning from the Cowell Cluster to the Lake Houses. It includes 29 self-ops, where students manage the house’s meal services and hire a cook, and seven co-ops, which are completely student-run and do not receive University custodial services.
All of these houses are University-owned except for the co-op Chi Theta Chi and the fraternity Sigma Chi – which have lease agreements with the University and are owned by separate alumni boards. Chi Theta Chi and Sigma Chi are the only houses unaffected by the changes, according to student staff.
Michelle Berry ’12, FM of the co-op Kairos, highlighted the unique aspect of Stanford’s housing options.
“One of the things to consider is that we are basically the only system like this in the country,” Berry said. “There’s no other system that has all of these University-owned houses that are run by students. That is putting a large responsibility on students, so it’s understandable that the University and the donors and the administration would be concerned about giving this responsibility to students.”
Berry noted what she sees as implicit benefits to having a system where students manage virtually all aspects of house life, adding that in a co-op like Kairos – where students all share the responsibility to cook and clean – it makes sense that residents have decision-making power for the house.
“I think we are going to have ongoing conversations with the administration about what our role at the University is,” Berry said. “I don’t know where that will lead though. I want to say that I’m optimistic that this system will continue in a similar form as it is now.”
Social dues at Row houses are now collected through the University bill, according to ResEd administrators, who noted that the change is “consistent with all residences on campus.”
In previous years, FMs would have to personally collect the social dues from each of their house’s residents. Most FMs said they appreciated the change, and that it has helped to simplify the process. If residents did not pay social dues in past years, student FMs have had to place a hold on a student’s accounts or set a late fine, according to Row management documents.
Since ResEd placed social dues on the University bill, the amount has been standardized across all Row houses at $75 per quarter. Previously, it had been the duty of FMs to work with house staff and residents to set the price for social dues. Social dues ranged from $23.64 at the sorority Delta Delta Delta to $124.23 at the self-op Phi Sig in the fall of 2007, according to Row management documents.
Social dues can be used to fund house trips, decorations for parties and other items such as dorm-themed apparel. Since last spring, the funds can no longer be used to purchase alcohol, which is what a bulk of the money had been spent on in the past, according to several FMs.
Anton Zietsman ’12, FM of the self-op La Maison Française, said that the $75 amount is significantly less than what his house has charged in the past, stating that the money is normally used to throw two all-campus events, which require a large amount of funds.
However, Maneeshika Madduri ’13, Hammarskjold FM, said that the standardized amount is more than the $50 the co-op has historically charged for social dues.
“It’s a little bit different in the sense that I don’t have to go around and ask people to give me checks for social dues,” she said. “But it’s also more than what most people in the house expect.”
Several FMs commented that it has become more of a challenge to purchase alcohol for house events since they can no longer use money from social dues.
“It’s been kind of a nightmare for me,” said Travis Noll ’12, FM of the fraternity Kappa Alpha.
Noll said in previous years, FMs were allowed to collect money from residents and put those funds into their University bank accounts to make purchases. However, with last spring’s policy change, no money from University bank accounts can be spent on purchases that include alcohol.
“I try to make sure that we have alcohol when our social chairs have requested it, and that it’s paid for properly, and we have enough money for it, and the budget works out,” Noll said. He declined to state how his house collects money for alcohol, but did say that they do not use their University-owned bank accounts.
Berry said the alcohol policy change has gone more smoothly at Kairos – which holds a weekly event known formally as “Cheese,” but informally amongst students as “Wine and Cheese.”
Berry said residents in the house have all pitched in a set amount to keep this tradition alive, calling the pot of money “slush funds.”
Berry said she did not face students who refused to pay this extra fund.
“They all understood that whether you drink or not, this money is being used for our Wine and Cheese event, which is an integral part of our house culture,” she said.
When asked about houses unofficially collecting money to purchase alcohol, Boswell and Buzay said in an email, “We do not account for funds that students/houses decide to collect outside of the University bill and outside of the University bank account.”
Payment of vendors
ResEd implemented a policy at the beginning of the autumn quarter that restricted FMs’ access to funds coming from residents’ board bills. However, after the University missed payments to food vendors on behalf of Row houses, and some houses did not receive their shipments of food on time, ResEd reversed the policy.
In previous years, FMs would pay vendors directly for the food that was delivered to their houses, using the money from residents’ board bills. However, at the beginning of this academic year, ResEd decided to limit FMs’ access to only 30 percent of their kitchen budget. The rest of the budget – 70 percent – was held by the Row Central Office, from which University officials would pay vendors on behalf of Row houses after FMs submitted their invoices.
Formally, the 30 percent that remained in house accounts was to be used for “open kitchen” items – snacks and other food supplies that can be accessed by residents any time throughout the day. The other 70 percent, which was held by the University, was set aside to purchase “closed kitchen” items from vendors, or food that is set aside for chefs to cook meals.
“I think the overall reason [for the policy change] was just so that they could control more of the funds,” Madduri said. “I think they wanted to see how the University handled it instead of having students take care of so much money.”
Noll said another reason why ResEd may have implemented the change was so they could “gain leverage over vendors in terms of prices.”
“We all share a lot of vendors in common, and they thought that rather than having 33 different houses paying a vendor, if one person does it, then you can kind of convince [the vendors]… to lower prices,” Noll said.
Row houses purchase all of their food from vendors – including produce, bread, meat and dairy products. Student staff members decide the amount and kinds of vendors they wish to use and employ anywhere from four mainstream vendors to seven to 10 smaller, more specialty vendors. Students maintained the power to select which vendors to use under the new policy at the beginning of the year.
This year though, when houses received invoices from vendors, they would log their purchases onto QuickBooks, small business accounting software that can be accessed both remotely by individual FMs and at the Row Central Office. In the past, the Row used Excel spreadsheets to keep track of house’s financial records.
Afterwards, FMs would place all their invoices in an envelope that was sent to the University, which would be responsible for paying the vendors.
According to several FMs, the University was often not able to process these invoices quickly enough to meet the deadlines for vendor payments, and some houses temporarily stopped receiving shipments of food as a result. According to FMs and ResEd administrators, this problem was largely due to the fact that the University’s billing system is monthly, while vendors expected to be paid weekly.
One FM, who asked to remain anonymous to avoid harming her working relationship with the University, said her house did not receive a food delivery due to a missed payment. However, she said the house chef was able to talk to the vendor and eventually convince them to lift the hold on their account long enough for the shipment to be delivered.
The day the shipment was originally missed though, the chef had to make dinner with the food the house already had, the FM added.
Berry said that several of her house’s payments were also missed, but that the house continued to receive shipments and never ran into any problems with its vendors.
“I think mainly because with the vendors we use, we’ve been using them for many years, and we have good relationships with them,” Berry said. “So even though they weren’t getting paid, and some sent us emails saying, ‘Oh, we haven’t received payments yet,’ none of them seemed angry – especially once we explained what the issue was, they were really understanding. All of our deliveries were made on time. We didn’t have an issue with that.”
According to FMs, ResEd officials considered two solutions to solve the problem: limiting the amount of vendors Row houses could use to five or restoring the responsibility to pay vendors to FMs. ResEd eventually chose the latter option.
“This shift represents the institution’s growing confidence that our program can be maintained by students, provided they perform their duties within the structures we continue to develop,” Arredondo wrote in an Oct. 31 email to Row management in which he announced the policy reversal.
FMs are now required to submit a weekly report including all profits, losses and receipts to Arredondo, who fills the new ResEd position of Financial Associate.
Several FMs expressed that this change has been positive.
“I like it because there’s a go-to person that if I have a question, I can ask – or if I have any concerns about my budget, I can talk to,” Madduri said.
FMs said that the recent policy changes have not affected Row life in any significant way, but the conversations between ResEd and the University are ongoing, and they want to make sure that the tradition of student management continues.
“I feel like if this power was taken away from student managers, then that ideology would be lost, and we wouldn’t be able to live in our houses in a way that we would like,” Berry said.
“Transition of this kind is always challenging,” ResEd administrators Boswell and Buzay said. “But we believe that the changes still allow for the flexibility of student-led management and adherence to University policies.”