SAN LUIS OBISPO COUNTY COMMUNITY COLLEGE DISTRICT · 2020. 9. 18. · SAN LUIS OBISPO COUNTY COMMUNITY COLLEGE DISTRICT Audit Report ENROLLMENT FEE COLLECTIONS AND WAIVERS PROGRAM

SAN LUIS OBISPO COUNTY

COMMUNITY COLLEGE DISTRICT

Audit Report

ENROLLMENT FEE COLLECTIONS

AND WAIVERS PROGRAM

Education Code Section 76300 and California Code of

Regulations, Title 5, Sections 58501-58503, 58611-58613,

58620, and 58630

July 1, 1998, through June 30, 2010

JOHN CHIANG California State Controller

May 2013

JOHN CHIANG California State Controller

May 3, 2013

Patrick Mullen, President

Board of Trustees

San Luis Obispo County Community College District

P.O. Box 8106

San Luis Obispo, CA 93403-8106

Dear Mr. Mullen:

The State Controller’s Office audited the costs claimed by the San Luis Obispo County

Community College District for the legislatively mandated Enrollment Fee Collections and

Waivers Program (Education Code section 76300 and Title 5, California Code of Regulations,

sections 58501-58503, 58611-58613, 58620, and 58630) for the period of July 1, 1998, through

June 30, 2010.

The district claimed $3,944,923 ($3,954,923 less a $10,000 penalty for filing a late claim) for the

mandated program. Our audit found that $820,647 is allowable and $3,124,276 is unallowable.

The costs are unallowable because the district claimed estimated costs that were not supported by

source documentation, claimed ineligible time, misstated indirect cost rates, and misstated

eligible offsetting revenues.

If you disagree with the audit findings, you may file an Incorrect Reduction Claim (IRC) with

the Commission on State Mandates (CSM). The IRC must be filed within three years following

the date that we notify you of a claim reduction. You may obtain IRC information at the CSM’s

website at www.csm.ca.gov/docs/IRCForm.pdf.

If you have any questions, please contact Jim L. Spano, Chief, Mandated Cost Audits Bureau, at

(916) 323-5849.

Sincerely,

Original signed by

JEFFREY V. BROWNFIELD, CPA

Chief, Division of Audits

JVB/kw

http://www.csm.ca.gov/docs/IRCForm.pdf

Patrick Mullen, President -2- May 3, 2013

cc: Gilbert Stork, Superintendent/President

President Office


Toni Sommer, Vice President

Administrative Services


Chris Green, Director of Fiscal Services


Nohemy Ornelas, Dean of Student Services


Christine Atalig, Specialist

College Finance and Facilities Planning

California Community Colleges Chancellor’s Office

Ed Hanson, Principal Program Budget Analyst

Education Systems Unit

California Department of Finance

Mario Rodriguez, Finance Budget Analyst

Education Systems Unit

California Department of Finance

Jay Lal, Manager Division of Accounting and Reporting

State Controller’s Office

San Luis Obispo County Community College District Enrollment Fee Collections and Waivers Program

Contents

Audit Report

Summary ............................................................................................................................ 1

Background ........................................................................................................................ 1

Objective, Scope, and Methodology ................................................................................. 2

Conclusion .......................................................................................................................... 3

Views of Responsible Official ........................................................................................... 3

Restricted Use .................................................................................................................... 3

Schedule 1—Summary of Program Costs ........................................................................... 4

Findings and Recommendations ........................................................................................... 14

Attachment—District’s Response to Draft Audit Report


-1-

Audit Report

The State Controller’s Office (SCO) audited the costs claimed by the San

Luis Obispo County Community College District for the legislatively

mandated Enrollment Fee Collections and Waivers Program (Education

Code section 76300 and Title 5, California Code of Regulations, sections

58501-58503, 58611-58613, 58620, and 58630) for the period of July 1,

1998, through June 30, 2010.

The district claimed $3,944,923 ($3,954,923 less a $10,000 penalty for

filing a late claim) for the mandated program. Our audit found that

$820,647 is allowable and $3,124,276 is unallowable. The costs are

unallowable because the district claimed estimated costs that were not

supported by source documentation, claimed ineligible time, misstated

indirect cost rates, and misstated eligible offsetting revenues.

Education Code section 76300 and Title 5, California Code of

Regulations, sections 58501-58503, 58611-58613, 58620, and 58630

authorize community college districts to calculate and collect student

enrollment fees and to waive student fees in certain instances. The codes

also direct community college districts to report the number of, and

amounts provided for Board of Governors Grant (BOGG) and to adopt

procedures that will document all financial assistance provided on behalf

of students pursuant to Chapter 9 of Title 5, California Code of

Regulations.

The sections were added and/or amended by:

Chapter 1, Statutes of 1984;

Chapter 274 and 1401, Statutes of 1984;







Chapter 8, 66, 67, and 1124, Statutes of 1993;



Chapter 63, Statutes of 1996; and

Chapter 72, Statutes of 1999.

On April 24, 2003, the Commission on State Mandates (CSM) adopted

the Statement of Decision for the Enrollment Fee Collection and Waivers

Program. The CSM found that the test claim legislation constitutes a new

program or higher level of service and imposes a reimbursable state-

mandated program on community college districts within the meaning of

Article XIII B, section 6 of the California Constitution and Government

Code section 17514.

Summary

Background


-2-

The CSM found that the following activities are reimbursable:

Calculating and collecting the student enrollment fee for each student enrolled, except for nonresidents and special part-time students, as

cited in Education Code section 76300, subdivision (f).

Waiving student fees in accordance with the groups listed in Education Code section 76300, subdivisions (g) and (h).

Waiving fees for students who apply for and are eligible for BOGG fee waivers.

Reporting to the California Community Colleges Chancellor the number of and amounts provided for BOGG waivers.

Adopting procedures that will document all financial assistance provided on behalf of students pursuant to Chapter 9 of Title 5 of the

California Code of Regulations; and including in the procedures the

rules for retention of support documentation which will enable an

independent determination regarding accuracy of the district’s

certification of need for financial assistance.

The program’s parameters and guidelines establish the state mandate and

define reimbursement criteria. The CSM adopted the parameters and

guidelines on January 26, 2006. In compliance with Government Code

section 17558, the SCO issues claiming instructions to assist local

agencies and school districts in claiming mandated program reimbursable

costs.

We conducted the audit to determine whether costs claimed represent

increased costs resulting from the Enrollment Fee Collections and

Waivers Program for the period of July 1, 1998, through June 30, 2010.

Our audit scope included, but was not limited to, determining whether

costs claimed were supported by appropriate source documents, were not

funded by another source, and were not unreasonable and/or excessive.

We conducted this performance audit under the authority of Government

Code sections 12410, 17558.5, and 17561. We did not audit the district’s

financial statements. We conducted the audit in accordance with

generally accepted government auditing standards. Those standards

require that we plan and perform the audit to obtain sufficient,

appropriate evidence to provide a reasonable basis for our findings and

conclusions based on our audit objectives. We believe that the evidence

obtained provides a reasonable basis for our findings and conclusions

based on our audit objectives.

We limited our review of the district’s internal controls to gaining an

understanding of the transaction flow and claim preparation process as

necessary to develop appropriate auditing procedures.

Objective, Scope,

and Methodology


-3-

Our audit found instances of noncompliance with the requirements

outlined above. These instances are described in the accompanying

Summary of Program Costs (Schedule 1) and in the Findings and

Recommendations section of this report.

For the audit period, the San Luis Obispo County Community College

District claimed $3,944,923 ($3,954,923 less a $10,000 penalty for filing

a late claim) for costs of the Enrollment Fee Collections and Waivers

Program. Our audit found that $820,647 is allowable and $3,124,276 is

unallowable.

For the FY 1998-99, the State paid the district $45,634. Our audit

disclosed that $66,385 is allowable. The State will pay allowable costs

that exceed the amount paid, totaling $20,751, contingent upon available

appropriations.

For the FY 1999-2000 through FY 2007-08, the State made no payment

to the district. Our audit disclosed that $730,188 is allowable. The State

will pay allowable costs claimed, contingent upon available

appropriations.

For the FY 2008-09, the State paid the district $20,419. Our audit

disclosed that $24,074 is allowable. The State will pay allowable costs

claimed that exceed the amount paid, totaling $3,655, contingent upon

available appropriations.

For the FY 2009-10 claim, the State paid the district $18,345. Our audit

found that $16,743 is allowable. The State will offset $1,602 from other

mandated program payments due to district. Alternatively, the district

may remit this amount to the State.

We issued a draft audit report on March 29, 2013. Toni Sommer, Vice

President, Administrative Services, responded by letter dated April 17,

2013 (Attachment), agreeing with the audit results. This final audit report

includes the district’s response.

This report is solely for the information and use of the San Luis Obispo

County Community College District, the California Community Colleges

Chancellor’s Office, the California Department of Finance, and the SCO;

it is not intended to be and should not be used by anyone other than these

specified parties. This restriction is not intended to limit distribution of

this report, which is a matter of public record.

Original signed by

JEFFREY V. BROWNFIELD, CPA

Chief, Division of Audits

May 3, 2013

Views of

Responsible

Official

Conclusion

Restricted Use


-4-

Schedule 1—

Summary of Program Costs


Actual Costs Allowable Audit

Claimed Per Audit Adjustment Reference1


Enrollment fee collection:

Direct costs - salaries and benefits:

Prepare policies and procedures -$ 435$ 435$ Finding 1

Staff training 17,017 3,753 (13,264) Finding 2

Calculating and collecting enrollment fees 372,442 87,277 (285,165) Finding 3

Total direct costs 389,459 91,465 (297,994)

Indirect costs 27,262 6,403 (20,859) Finding 8

Total direct and indirect costs 416,721 97,868 (318,853)

Less offsetting savings and reimbursements:

Enrollment fee collection (13,454) (31,483) (18,029) Finding 9

Total program costs 403,267$ 66,385 (336,882)$

Less amount paid by the State -

Allowable costs claimed in excess of (less than) amount paid 66,385$



Direct costs - salaries and benefits:


Staff training - 1,315 1,315 Finding 2







Total enrollment fee collection 408,670 71,915 (336,755)

Enrollment fee waivers:

Direct costs - salaries and benefits

Prepare policies and procedures 493$ 493$ -$

Staff training 552 653 101 Finding 4

Adopt procedures, record and maintain records 53,371 1,188 (52,183) Finding 5

Waiving student fees 40,004 14,519 (25,485) Finding 6

Reporting BOGG fee waiver data to CCCCO 5,962 5,071 (891) Finding 7


Cost Elements


-5-

Schedule 1 (continued)



Cost Elements

July 1, 1999, through June 30, 2000 (Continued)




Enrollment fee waivers (55,652) (63,252) (7,600) Finding 9

Adjustment for unused portion of offsets2

- 39,793 39,793 Finding 9

Total enrollment fee waivers 51,757 - (51,757)







Staff training -$ 1,315$ 1,315$ Finding 2














Reporting BOGG fee waiver data to CCCCO 6,260 5,071 (1,189) Finding 7





Enrollment fee waivers (63,421) (60,921) 2,500 Finding 9


- 37,646 37,646 Finding 9






-6-




Cost Elements






















Enrollment fee waivers (58,914) (59,741) (827) Finding 9


- 34,354 34,354 Finding 9

















-7-




Cost Elements














- 36,807 36,807 Finding 9






























- 42,920 42,920 Finding 9






-8-




Cost Elements


























- 57,802 57,802 Finding 9

















-9-




Cost Elements















- 45,591 45,591 Finding 9


Total costs 414,196 68,837 (345,359)

Less late filing penalty (10,000) (6,884) 3,116

















-10-




Cost Elements





Staff training 441 - (441) Finding 4










- 54,349 54,349 Finding 9









Calculating and collecting enrollment fees 92,254 123,773 31,519 Finding 3

Total direct costs 92,254 125,272 33,018

Indirect costs 32,990 57,074 24,084 Finding 8

Total direct and indirect costs 125,244 182,346 57,102



Total enrollment fee collection 93,776 120,539 26,763




Staff training 447 - (447) Finding 4



Reporting BOGG fee waiver data to CCCCO 5,111 6,534 1,423 Finding 7







- 41,614 41,614 Finding 9






-11-




Cost Elements




Staff training 4,827$ 1,499$ (3,328)$ Finding 2










Staff training 426$ -$ (426)$ Finding 4










- 40,961 40,961 Finding 9



Less amount paid by the State (14,403)






Staff training 3,876 1,499 (2,377) Finding 2



Indirect costs 29,770 29,369 (401) Finding 8






-12-




Cost Elements




Adopt procedures, record and maintain records 39,685$ 4,554$ (35,131)$ Finding 5









- 37,215 37,215 Finding 9





Summary: July 1, 1998, through June 30, 2010



Prepare policies and procedures -$ 2,639$ 2,639$

Staff training 25,720 18,939 (6,781)

Calculating and collecting enrollment fees 2,622,139 1,143,641 (1,478,498)

Total direct costs 2,647,859 1,165,219 (1,482,640)

Indirect costs 391,121 277,546 (113,575)

Total direct and indirect costs 3,038,980 1,442,765 (1,596,215)


Enrollment fee collection (376,202) (615,234) (239,032)

Total enrollment collection 2,662,778 827,531 (1,835,247)


-13-




Cost Elements

Summary: July 1, 1998, through June 30, 2010 (Continued)



Prepare policies and procedures 4,976$ 4,976$ -$

Staff training 3,372 2,666 (706)

Adopt procedures, record and maintain records 742,947 23,840 (719,107)

Waiving student fees 827,395 272,079 (555,316)

Reporting BOGG fee waiver data to CCCCO 67,665 64,830 (2,835)

Total direct costs 1,646,355 368,391 (1,277,964)

Indirect costs 368,813 108,547 (260,266)

Total direct and indirect costs 2,015,168 476,938 (1,538,230)


Enrollment fee waivers (723,023) (945,990) (222,967)


- 469,052 469,052

Total enrollment fee waivers 1,292,145 - (1,292,145)

Total costs 3,954,923 827,531 (3,127,392)

Less late filing penalty (10,000) (6,884) 3,116

Total program costs 3,944,923$ 820,647 (3,124,276)$

Less amount paid by the State (14,403)


_________________________

1 See the Findings and Recommendations section.

2 Offsetting savings and reimbursements are limited to total allowable direct and indirect costs and are calculated separately for enrollment fee collection and enrollment fee waivers.


-14-

Findings and Recommendations

The district did not claim any costs during the audit period for the one-

time activity of preparing district policies and procedures for the

collection of enrollment fees. We determined that salaries and benefits

costs totaling $2,639 are allowable.

We worked with district staff in the Cashier’s Office to determine the

tasks involved during the audit period to set up and test enrollment fee

costs in the district’s computer systems, to update links within the

district’s webpage, and the time required to complete these tasks. We

also obtained information from the California Community Colleges

Chancellor’s Office (CCCCO) confirming that enrollment fees increased

in fiscal year (FY) 1998-99, FY 1999-2000, FY 2003-04, FY 2004-05,

FY 2006-07, and FY 2009-10. Using the information provided by the

district, we determined allowable costs for these years.

The following table summarizes the claimed, allowable, and audit

adjustment amounts per fiscal year:

Amount Amount Audit

Fiscal Year Claimed Allowable Adjustment

Salaries and Benefits:

1998-99 -$ 435$ 435$

1999-2000 - 435 435

2003-04 - 463 463

2004-05 - 476 476

2006-07 - 496 496

2009-10 - 334 334

Total, salaries and benefits -$ 2,639$ 2,639$

The program’s parameters and guidelines (section IV–Reimbursable

Activities) state:

To be eligible for mandated cost reimbursement, only actual costs may

be claimed. Actual costs are those costs actually incurred to implement

the mandated activities. Actual costs must be traceable and supported

by source documents that show the validity of such costs, when they

were incurred, and their relationship to the reimbursable activities. A

source document is a document created at or near the same time the

actual cost was incurred for the event or activity in question. Source

documents may include, but are not limited to, employee time records,

time logs, sign-in sheets, invoices, and receipts.

The parameters and guidelines also state that salaries and benefits are

reimbursable if claimants report the name, job classification, and

productive hourly rate of each employee implementing the reimbursable

activities, and provide a description of the specific reimbursable

activities performed and the hours devoted to these activities.

FINDING 1—

Enrollment Fee

Collection: Preparing

Policies and

Procedures Cost

Component –

understated one-time

costs


-15-

The parameters and guidelines (section IV.A.1.a – Reimbursable

Activities, Enrollment Fee Collection – One-Time Activities – Policies

and Procedures) state that the preparation of policies and procedures is

reimbursable as a one-time activity for collection of enrollment fees. The

CSM Final Staff Analysis for the Proposed Parameters and Guidelines

dated January 13, 2006, for the one-time activity of adopting policies and

procedures, states “. . . staff finds that updates to the policies and

procedures would be subject to change in the community college

district’s policy rather than state law, and would not be reimbursable.”

Recommendation

We recommend that the district ensure that claimed costs include only

eligible costs, are based on actual costs, and are properly supported.

District’s Response

The district concurs with the finding and recommendation.

The district claimed $25,720 in salaries and benefits during the audit

period for the activity of training district staff who implement the

program on the procedures for the collection of enrollment fees (one time

per employee). We determined that $18,939 is allowable and $6,781 is

unallowable. The unallowable costs occurred because the district claimed

estimated costs.

District staff in the Cashier’s Office provided us a walk-through related

to training that employees received during the audit period to perform the

reimbursable activities, the number of employees that received training,

the Student Account Specialist that provided the training, and the number

of hours provided for each employee.


adjustment amounts per fiscal year:

Amount Amount Audit


Salaries and benefits:

1998-99 17,017$ 3,753$ (13,264)$

1999-2000 - 1,315 1,315

2000-01 - 1,315 1,315

2001-02 - 1,315 1,315

2002-03 - 1,319 1,319

2003-04 - 1,324 1,324

2004-05 - 1,350 1,350

2005-06 - 1,362 1,362

2006-07 - 1,389 1,389

2007-08 - 1,499 1,499

2008-09 4,827 1,499 (3,328)

2009-10 3,876 1,499 (2,377)

Total, salaries and benefits 25,720$ 18,939$ (6,781)$

FINDING 2—

Enrollment Fee

Collection: Staff

Training Cost

Component –

unallowable one-time

costs


-16-

The district claimed costs for district staff for the one-time reimbursable

activity of training district staff (one-time per employee) on enrollment

fee collection procedures as follows:

FY 1998-99

24 hours for the Student Account Specialist classification

216 hours for the Account Clerk II classification

24 hours for the Admissions and Records Specialist classification

24 hours for the Admissions and Records Technician classification

24 hours for the North County Coordinator classification

1,152 hours for Regular Aides classification

FY 2008-09 and FY 2009-10

114 hours for the Accounting Technician II classification

59 hours for the Business Office Assistant classification

82 hours for the Business Office Supervisor classification

Based on interviews and observations that we conducted at the Cashier’s

Office and the training manual the district provided, we determined the

following classification titles of district staff and allowable hours for the

one-time reimbursable activity of training district staff (one-time per

employee) on enrollment fee collection procedures:

FY 1998-99

20 hours for the Account Clerk II classification

40 hours for the Account Technician classification

20 hours for the Admissions and Records Specialist classification

20 hours for the Admissions and Records Technician classification

100 hours for the Hourly Clerks I classification


20 hours for the Student Services Site Specialist classification

FY 1999-2000 through FY 2009-10

100 hours for the Hourly Clerk I classification


The parameters and guidelines (section IV–Reimbursable Activities)

require claimed costs to be supported by source documents that were

created at or near the same time the actual cost was incurred for the event

or activity in question. (See Finding 1 for the specific language).

The parameters and guidelines (section IV.A.1.b – Reimbursable

Activities – Enrollment Fee Collection – One-Time Activities – Staff

Training (one time per employee) state that staff training is reimbursable

as a one-time cost per employee for training district staff who implement

the program based on the procedures for the collection of enrollment

fees. Consistent with the Final Staff Analysis for policies and procedures,

training existing staff for changes in the community college district's

policies and procedures is not reimbursable.


-17-

The parameters and guidelines (section V.A.1-Claim Preparation and

Submission-Direct Cost Reporting-Salaries and Benefits) require

claimants to “Report each employee implementing the reimbursable

activities by name, job classification, and productive hourly rate.

Describe the specific reimbursable activities performed and the hours

devoted to each reimbursable activity performed.”

Recommendation





The district claimed $2,622,139 in salaries and benefits for the

Calculating and Collecting Enrollment Fees cost component during the

audit period. We determined that $1,143,641 is allowable and $1,478,498

is unallowable. The costs are unallowable because the district estimated

the amount of time required to perform the reimbursable activities and

claimed employee classifications that did not perform the reimbursable

activities. In addition, the district did not take into account the varying

levels of workload due to changes in student enrollment from year-to-

year.

The following table summarizes the overstated ongoing costs related to

calculating and collecting enrollment fees by fiscal year:

Amount Amount Audit


Salaries and Benefits:

1998-99 372,442$ 87,277$ (285,165)$

1999-2000 403,526 92,919 (310,607)

2000-01 329,574 95,389 (234,185)

2001-02 286,840 105,327 (181,513)

2002-03 273,774 101,996 (171,778)

2003-04 212,393 103,154 (109,239)

2004-05 212,273 105,609 (106,664)

2005-06 146,098 104,636 (41,462)

2006-07 148,247 107,126 (41,121)

2007-08 92,254 123,773 31,519

2008-09 72,359 58,086 (14,273)

2009-10 72,359 58,349 (14,010)

Total 2,622,139$ 1,143,641$ (1,478,498)$

FINDING 3—

Enrollment Fee

Collection:

Calculating and

Collecting Enrollment

Fees Cost Component

– unallowable ongoing

costs


-18-

The parameters and guidelines (section IV.A.2) allow ongoing activities

related to costs for calculating and collecting the student enrollment fee

for each student enrolled, with the exception of nonresidents and special

part-time students, as cited in Government Code section 76300,

subdivision (f), for the following six reimbursable activities:

i. Referencing student accounts and records to determine course workload, status of payments, and eligibility for fee waiver. Printing a list of enrolled

courses. (Activity 1)

ii. Calculating the total enrollment fee to be collected. Identifying method of payment. Collecting cash and making change as necessary. Processing credit

card and other non-cash payment transactions (however, any fees that may

be charged to a community college district by a credit card company or

bank are not reimbursable). Preparing a receipt for a payment received.

(Activity 2)

iii. Answering student’s questions regarding enrollment fee collection or referring them to the appropriate person for an answer. (Activity 3)

iv. Updating written and computer records for the enrollment fee information and providing a copy to the student. Copying and filing enrollment fee

documentation. (Activity 4)

v. Collecting delinquent enrollment fees, including written or telephonic collection notices to students, turning accounts over to collection agencies,

or small claims court action. (Activity 5)

vi. For students who establish fee waiver eligibility after the enrollment fee has been collected, providing a refund or enrollment fees paid and updating

student and district records as required. (Refund process for change in

program is not reimbursable). (Activity 6)


require claimed costs to be supported by source documents that were

created at or near the same time the actual cost was incurred for the event

or activity in question. (See Finding 1 for the specific language.)

Salaries and Benefits

For FY 1998-99 through FY 2009-10, the district claimed salaries and

benefits for five reimbursable activities under the Calculating and

Collecting Enrollment Fees cost component. During the audit period, the

district did not claim costs for collecting delinquent enrollment fees

(Activity 5).

The district did not compute claimed costs based on average time

allowances to perform the reimbursable activities. Instead, district

employees estimated the percentage of each work day that was spent by

various employee classifications to perform each of the five reimbursable

activities and reported that information on forms developed by the

district’s mandated cost consultant. The district did not provide any

source documentation based on actual data to support the estimated time

allowances. In addition, the district did not factor in the varying levels of

effort spent by staff as a result of changes in student enrollment from

year to year and included costs for employee classifications that did not

perform the reimbursable activities.


-19-

The mandated activities were being performed at the district during the

audit period. Therefore, we assessed whether or not the time estimates

cited by district staff were reasonable. We interviewed various district

representatives in order to determine the procedures district staff

followed in order to perform the reimbursable activities. We observed

district staff in the Cashier’s Office, which collects enrollment fees from

students. We documented the average time increments spent by district

staff to perform these activities based on our observations. Based on the

interviews and observations that we held with the Cashier’s Office staff,

we also determined the employee classifications that performed the

reimbursable activities during the audit period.

As noted previously, the district did not factor into its calculations the

varying levels of effort required due to changes in student enrollment.

We calculated costs for each of the reimbursable activities using the time

increments that we observed and the number of enrolled students

(multiplier). We determined that the district overstated salaries and

benefits by $1,478,498 for the audit period.

Activity 1 through Activity 4: Activity 1–Referencing student

accounts, Activity 2–Calculating and collecting the fee; Activity 3–

Answering students’ questions; and Activity 4–Updating student

records

Time Increments

Using forms developed by the district’s mandated cost consultant, the

district estimated the hours district staff spent performing reimbursable

activities. Specifically, staff estimated the percentage of time spent per

day by various employee classifications working on activities 1 through

4. The district did not make any allowance for varying levels of effort

from year to year based on changes to student enrollment. The district

also overstated and understated the number and types of employee

classifications that performed the reimbursable activities.

We held discussions with various district representatives during the audit

period in order to determine the procedures that district staff followed to

perform the reimbursable activities. We observed district staff in the

Cashier’s Office performing reimbursable and other non-mandated

activities. During FY 1998-99 through FY 2007-08, the district used a

software system called Reflections to perform the reimbursable activities

and then changed to its current system Banner, for FY 2008-09 and FY

2009-10. As both systems are still accessible, we were able to document

the average time increments spent by district staff to perform the

reimbursable activities based on our observations for both systems. We

determined that the total allowable time to complete activities 1 through

4 was 15.50 minutes for FY 1998-99 through FY 2007-08 and 6 minutes

for FY 2008-09 and FY 2009-10. District representatives confirmed that

these time increments were representative of the time it took to perform

reimbursable Activity 1 through Activity 4.


-20-

Multiplier Calculation

For Activities 1 through 4, we obtained the enrollment numbers from the

CCCCO and deducted ineligible non-resident and special admit students

(students who attend a community college while in high school pursuant

to Education Code section 76001) to determine net student enrollment

for each fiscal year of the audit period. The CCCCO’s management

information system (MIS) identifies enrollment information based on

student data reported by the district. The CCCCO identifies the district’s

enrollment based on CCCCO’s MIS data element STD 7, codes A

through G. The CCCCO eliminates any duplicate data by term based on

the student’s Social Security number.

For Activity 1, we added the number of delinquent fees and refunds

processed by district staff to the net enrollment numbers from the

CCCCO. We used delinquent fees and refund information provided by

the district. For Activity 2, we added the number of refunds processed by

district staff and deducted the number of Board of Governors Grant

(BOGG) recipients confirmed by the CCCCO from net student

enrollment. For Activity 3, we used net enrollment numbers. For

Activity 4, we deducted the number of BOGG recipients confirmed by

the CCCCO from net student enrollment. The CCCCO identifies the

unduplicated number of BOGG recipients by term based on MIS data

element SF21 and all codes with the first letter of B or F.

For the audit period, the district provided a breakdown of the number of

students who paid their enrollment fees through the district’s online

system and those who paid in person. Based on the information provided

by the district, we determined the percentage of enrollment fees paid at

the Cashier’s Office in person by dividing the number of fees paid in

person by the total number of fees paid. During our observation, we

observed district staff providing students, in person and over the

telephone, step-by-step instructions for paying their enrollment fees

online using the district’s website. To process online payments, the

district has available for students computer stations that are located

outside the Cashier’s Office. When students request to pay enrollment

fees with a credit card, district staff members direct them to the computer

stations outside and walk them through the payment process. We noted

during our observations that district staff frequently assisted students in

making online payments. Also, we observed students who had made

online payments come to the Cashier’s Office to ask questions and

process additional payments for items other than enrollment fees. We

determined that it is reasonable to add both the number of students who

paid their enrollment fees through the district’s online system and those

who paid in person. Therefore, we did not allocate the net enrollment

numbers to determine the number of enrollment fees paid in person.


-21-

Productive Hourly Rates

We determined that the district overstated and understated productive

hourly rates in its claims for district staff during the audit period. In

addition, costs were claimed for staff members who did not perform the

reimbursable activities. Based on discussions with, and information

from, representatives of the Cashier’s Office, we determined that

employees in the following seven employee classifications performed the

reimbursable activities during the audit period:

Account Clerk II

Accounting Technician I, II

Admission/Records Specialist

Admission/Records Technician

Hourly Clerk

Student Account Specialist

Student Services Site Specialist

Based on information provided by the district, we determined average

productive hourly rates for these staff members during the audit period.

To calculate the average rate, we used employee classification salary

range and benefit rate information provided by the district. For each

employee classification, we used a salary amount in the middle of each

range and 1,800 productive hours. We computed a simple average by

dividing the total of the productive hourly rates by 7.

The following table summarizes the average productive hourly rates for

Activity 1 through Activity 4 by fiscal year:

Activities 1 through 4

Average

Fiscal Productive

Year Hourly Rate

1998-99 - 2000-01 18.99$

2001-02 20.28

2002-03 20.72

2003-04 20.92

2004-05 21.68

2005-06 21.85

2006-07 21.89

2007-08 - 2009-10 23.95

Activity 5 – Collecting Delinquent Enrollment Fees

Time increments

The district understated costs for collecting delinquent enrollment fees

for the audit period. While we determined that the district incurred costs

for collecting delinquent enrollment fees during the audit period, the

district did not claim the costs.


-22-

We held discussions with various district representatives during the audit

in order to determine the procedures that district staff followed to

perform the reimbursable activity of collecting delinquent enrollment

fees. Based on interviews with representatives of the Cashier’s Office

and our own observations, we determined the employee classifications

that performed the reimbursable activity and the actual time spent.

The district maintains a spreadsheet that identifies a cumulative listing of

students with delinquent enrollment fees for each academic year. The

district reviews the delinquent fees spreadsheet and students’ accounts to

determine whether the accounts are still delinquent. The Cashier’s Office

is responsible for processing delinquent enrollment fee letters. The

district is required to attempt contact with students regarding delinquent

fees by sending the students two delinquent-fee letters within a 30-day

period. The district is then required to wait 30 days from the date that the

second delinquent fee letter was sent to the student before reporting the

delinquent fee information to the CCCCO for further collection activity.

The CCCCO refers delinquent accounts to the Franchise Tax Board for

collection.

We documented the average time increment spent by district staff in

collecting delinquent enrollment fees, based on our observations. We

determined the total allowable time allowance for this activity is four

minutes to process delinquent fee letters and one hour to report

information to the CCCCO. District representatives confirmed that this is

the amount of time that it took to perform Activity 5 during the entire

audit period.


The district provided the delinquent fee report, which included a

cumulative listing of all delinquent fees the district processed for

FY 2004-05, FY 2005-06 and FY 2007-08. We performed a filtered

search so that the reports reflected only the total number of delinquent

enrollment fees for each fiscal year. The district was able to provide

reports only for these three fiscal years. We determined the total number

of delinquent enrollment fees processed for these three years and

calculated the average number of delinquent enrollment fees processed

per year, totaling 136. We applied the average number of delinquent fees

processed for all fiscal years of the audit period.


Based on information provided by the district, we determined that the

employee classification of Student Account Specialist performed

Activity 5 during the audit period; we also determined the productive

hourly rates for this classification during the audit period. To calculate

the average rate, we used the Student Account Specialist salary range and

benefit rate information provided by the district. We used a salary

amount in the middle of the range and 1,800 productive hours to

compute the following productive hourly rates:


-23-

Student Account Specialist

Productive

Fiscal Hourly

Year Rate

1998-99 - 2001-02 22.93$

2002-03 23.17

2003-04 23.40

2004-05 24.70

2005-06 - 2006-07 25.31

2007-08 - 2009-10 27.73

Activity 6 – Providing a refund for students who establish fee waiver

eligibility after the enrollment fee has been collected

Time Increments

Using forms developed by the district’s mandated cost consultant, the

district’s prior Director of Fiscal Services estimated the hours district

staff spent providing refunds for students who established fee waiver

eligibility after paying enrollment fees to the district.

To receive a refund of enrollment fees paid, students are required to fill

out a refund request form and submit it to the Cashier’s Office for

processing. The employee classification of Student Account Specialist

performed the reimbursable activity during the audit period. When a

refund request form is received, the student’s account is reviewed to

verify the student’s current address and confirm whether or not a refund

is due. If a refund is due, the refund amount is calculated and the refund

information is logged into a spreadsheet and the refund request form is

filed. The Student Account Specialist submits the refund spreadsheet to

the Computer Services Department on a monthly basis. The Computer

Services Administrator/Operator uploads the spreadsheet into the

district’s computer system. The upload process updates the students’

accounts with calculated refund information and then generates and

prints refund checks.

Based on our interviews and observations with district staff, we

determined that it takes the Student Account Specialist 4 minutes to

process refunds for students who established fee waiver eligibility after

paying their enrollment fees to the district. We also determined that it

takes the Computer Services Administrator/Operator 3.5 hours per month

(42 hours per year) to perform the necessary steps to process the refund

information and generate refund checks. The monthly processing time

did not vary significantly due to the level of activity. District

representatives confirmed that these time increments were representative

of the time it took to perform reimbursable Activity 6 during the entire

audit period.


-24-

The following table summarizes the time increments required to perform

Activity 6 by fiscal year:

Activity 6

Total

Fiscal Time

Year Increment

1998-99 7.70

1999-2000 6.18

2000-01 6.60

2001-02 6.49

2002-03 6.20

2003-04 6.01

2004-05 5.78

2005-06 5.52

2006-07 5.37

2007-08 5.48

2008-09 - 2009-10 5.95


The district provided a report that identified the number of refunds issued

during the audit period to students who established fee waiver eligibility

after paying enrollment fees to the district.


Consistent with the information presented for Activities 1 through 4, we

determined that the district overstated and understated productive hourly

rates in its claims for district staff during the audit period. In addition, the

district claimed costs for staff members who did not perform the

reimbursable activities. Based on discussions with, and information

from, representatives of the Cashier’s Office, we determined that

employees in the classifications of Student Account Specialist and

Computer Services Administrator/Operator performed the reimbursable

activity during the audit period.

Based on information provided by the district, we determined average

productive hourly rates for these staff members during the audit period.

To calculate the average rate, we used employee classification salary

range and benefit rate information provided by the district. For each

employee classification, we used a salary amount in the middle of each

range and 1,800 productive hours. We computed a simple average by

dividing the total of the productive hourly rates by 2.


-25-

The following table summarizes the average productive hourly rates for

Activity 6 by fiscal year:

Activity 6

Average

Fiscal Productive

Year Hourly Rate

1998-99 - 2000-01 24.21$

2001-02 25.74

2002-03 26.01

2003-04 26.27

2004-05 27.36

2005-06 27.67

2006-07 27.67

2007-08 - 2009-10 30.31

Calculation of Time Increments

The following table summarizes the minutes allowable for reimbursable

Activity 1 through Activity 6 by fiscal year:

Allowable

Reimbursable Activity FY 1998-99 FY 1999-2000 FY 2000-01 FY 2001-02 FY 2002-03 FY 2003-04

Referencing Students' Accounts 1.50 1.50 1.50 1.50 1.50 1.50

Calculating the Fee 6.00 6.00 6.00 6.00 6.00 6.00

Answering Questions 2.00 2.00 2.00 2.00 2.00 2.00

Updating Records 6.00 6.00 6.00 6.00 6.00 6.00

15.50 15.50 15.50 15.50 15.50 15.50

Collecting Delinquent Fees 4.44 4.44 4.44 4.44 4.44 4.44

Providing Refunds 7.70 6.18 6.60 6.49 6.20 6.01

12.14 10.62 11.04 10.93 10.64 10.45

Total 27.64 26.12 26.54 26.43 26.14 25.95

Allowable

Reimbursable Activity FY 2004-05 FY 2005-06 FY 2006-07 FY 2007-08 FY 2008-09 FY 2009-10

Referencing Students' Accounts 1.50 1.50 1.50 1.50 1.50 1.50

Calculating the Fee 6.00 6.00 6.00 6.00 1.25 1.25

Answering Questions 2.00 2.00 2.00 2.00 2.00 2.00

Updating Records 6.00 6.00 6.00 6.00 1.25 1.25

15.50 15.50 15.50 15.50 6.00 6.00

Collecting Delinquent Fees 4.44 4.44 4.44 4.44 4.44 4.44

Providing Refunds 5.78 5.52 5.37 5.48 5.95 5.95

10.22 9.96 9.81 9.92 10.39 10.39

Total 25.72 25.46 25.31 25.42 16.39 16.39


-26-

Calculation of Multiplier

The following table summarizes the allowable amounts for the multiplier

for each reimbursable activity that took place at the district during the

audit period for reimbursable activities 1 through 6:

Reimbursable Allowable

Activity Multiplier

1 289,435

2 214,711

3 270,439

4 199,347

5 1,632

6 15,364

Total 990,928

Calculation of Hours Adjustments

We multiplied the allowable minutes per activity by the multiplier for the

reimbursable activities (as identified in the table above) to determine

the number of allowable hours for reimbursable Activity 1 through

Activity 6.

The following table summarizes the claimed and allowable hours for the

audit period:

Reimbursable

Activity

Hours

Claimed

Hours

Allowable

Adjusted

Hours

1 48,721.60 7,235.00 (41,486.60)

2 110,788.39 18,577.00 (92,211.39)

3 23,269.15 9,015.00 (14,254.15)

4 11,793.83 17,244.00 5,450.17

5 - 120.00 120.00

6 669.50 1,527.00 857.50

Total Hours 195,242.47 53,718.00 (141,524.47)

Calculation of Costs by Reimbursable Activities

For Activity 1 we multiplied allowable minutes, based on our

observation (1.50 minutes), by net student enrollment to determine the

number of hours spent to perform the activity. We then multiplied the

hours spent times the audited productive hourly rates to determine

allowable costs for salaries and benefits. We determined net student

enrollment by excluding from total student enrollment non-residents and

special part-time students. The CCCCO’s management information

system (MIS) identifies enrollment information based on student data

that the district reported. The CCCCO identifies the district’s enrollment

based on the CCCCO’s MIS data element STD 7, codes A through G.

The CCCCO eliminates any duplicate students based on their Social

Security numbers. We also included the number of delinquent fees and

refunds processed by district staff.


-27-

For Activity 2, we multiplied the allowable minutes, based on our

observation (6.00 minutes for FY 1998-99 through FY 2007-08 and 1.25

minutes for FY 2008-09 and FY 2009-10), by the adjusted net student

enrollment to determine the number of hours spent to perform the

activity. We then multiplied the hours spent times the audit productive

hourly rates to determine allowable costs for salaries and benefits. To

determine adjusted net student enrollment, we deducted from net student

enrollment the number of students who were exempt from paying

enrollment fees because they received BOGG fee waivers. We obtained

the number of students in the district who received BOGG fee waivers

each year from the CCCCO based on data the district reported. The

CCCCO identifies the unduplicated number of BOGG recipients by term

based on MIS data element SF21 and all codes with the first letter of B

or F. We also included the number of refunds processed by district staff.


observation (2.00 minutes), by net student enrollment to determine the

number of hours spent to perform the activity. We then multiplied the

hours spent times the audited productive hourly rates to determine

allowable costs for salaries and benefits.


observation (6.00 minutes for FY 1998-99 through FY 2007-08 and 1.25

minutes for FY 2008-09 and FY 2009-10), by the adjusted net student

enrollment to determine the number of hours spent to perform the

activity. We then multiplied the hours spent times the audited productive

hourly rates to determine allowable costs for salaries and benefits.

We applied the audited productive hourly rates to the allowable hours per

reimbursable activity. We determined that salaries and benefits totaling

$1,143,641 are allowable and $1,478,498 is unallowable.

The following table summarizes the claimed and allowable salary and

benefit costs by reimbursable activity for the audit period:

Reimbursable

Activity

Salaries and

Benefits

Claimed

Salaries and

Benefits

Allowable

Audit

Adjustment

1 588,190$ 155,450$ (432,740)$

2 1,411,251 389,137 (1,022,114)

3 409,630 193,700 (215,930)

4 196,609 360,763 164,154

5 - 2,966 2,966

6 16,459 41,625 25,166

Total 2,622,139$ 1,143,641$ (1,478,498)$

Recommendation




-28-



The district claimed $3,372 for the one-time activity of staff training

(once per employee) for district staff members who implement the

program on the procedures for determining which students are eligible

for enrollment fee waivers. We determined that $2,666 is allowable and

$706 is unallowable. The district claimed staff training costs for FY

1999-2000, FY 2000-01, and FY 2003-04 through FY 2008-09. Based

on our review, the district claimed staff training costs for the same

employees in its claims for FY 2006-07, FY 2007-08, and FY 2008-09

that it claimed for FY 2005-06. Therefore, we determined that staff

training costs claimed in FY 2006-07, FY 2007-08, and FY 2008-09 are

unallowable. We also determined that the district understated employee

training costs in FY 1999-2000 through FY 2005-06.


adjustment amounts for the one-time reimbursable costs for the

Enrolment Fee Waivers – Staff Training Costs component:

Amount Amount Audit Fiscal Year Claimed Allowable Adjustment

Salaries and benefits:1999-2000 552$ 653$ 101$ 2000-01 253 342 89 2003-04 133 273 140 2004-05 681 820 139 2005-06 439 578 139 2006-07 441 - (441) 2007-08 447 - (447) 2008-09 426 - (426)

Total, salaries and benefits 3,372$ 2,666$ (706)$


require claimed costs to be supported by source documents that created

at or near the same time the actual cost was incurred for the event or

activity in question. (See Finding 1 for the specific language.)

The parameters and guidelines (section V.A.1-Claim Preparation and

Submission-Direct Cost Reporting-Salaries and Benefits) require

claimants to “Report each employee implementing the reimbursable

activities by name, job classification, and productive hourly rate.

Describe the specific reimbursable activities performed and the hours

devoted to each reimbursable activity performed.”

The parameters and guidelines (section IV.B.1.b – Reimbursable

Activities – Enrollment Fee Waivers – One-Time Activities – Staff

Training (one time per employee) state that staff training is reimbursable

as a one-time cost per employee for training district staff who implement

the program on the procedures for determining which students are

eligible for waiver of the enrollment fee. Consistent with the Final Staff

FINDING 4—

Enrollment Fee

Waivers: Staff

Training Cost

Component –

unallowable one-time

costs


-29-

Analysis for policies and procedures, training existing staff for changes

in the community college district’s policies and procedures is not

reimbursable.

Recommendation





The district claimed $742,947 in salaries and

Documents

SAN LUIS OBISPO COUNTY COMMUNITY COLLEGE DISTRICT · 2020. 9. 18. · SAN LUIS OBISPO COUNTY COMMUNITY COLLEGE DISTRICT Audit Report ENROLLMENT FEE COLLECTIONS AND WAIVERS PROGRAM