Officials discover large reserve fund in the UW System

CREATED Apr. 19, 2013 - UPDATED: Apr. 19, 2013

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MADISON - State officials have discovered a large reserve fund in the University of Wisconsin System.

According to the Legislative Fiscal Bureau, the fund has accumulated over the last several years. It is possible it currently holds hundreds of millions of dollars.

The agency issued a memo on Friday, detailing the balance.

Speaker Robin Vos (R-Rochester), Senate Majority Leader Scott Fitzgerald (R-Juneau), Joint Finance Co-Chairs Senator Alberta Darling (R-River Hills)and Rep. John Nygren (R-Marinette) and Assembly Majority Leader Scott Suder (R-Abbotsford) issued the a statement on the surplus (courtesy RightWisconsin.com):

“We are outraged with the mishandling of taxpayer dollars and the pattern of incompetence shown by university system administrators. We want the citizens of this state to know that we will examine the gross mismanagement of the system’s finances. We will demand accountability and transparency.

“At a time when the UW System is asking for more flexibility and funding from the state, this situation clearly illustrates the need for strong legislative oversight. Our state deserves better from the institutions that are educating our students and future leaders. It is not only unfair to the students and their parents who keep getting hit with tuition hikes; it’s unfair to the taxpayers of Wisconsin.

“We want to assure the university students and their parents that, at a minimum, this budget will include a twoyear tuition freeze. We will work closely with Governor Walker to address this substantial accounting error and explore pursuing a comprehensive investigation into the management of UW System finances.”

A source told RightWisconsin.com the number is right around $450 million.

Gov. Scott Walker released a statement Friday on the findings -

"It is very concerning to learn the UW System has been running a surplus balance of this size, especially at a time when students, families, and lawmakers have continually heard from the UW System about the need for more money to offset 'devastating cuts.' At a minimum, on behalf of students and their families, I am asking legislative leaders to freeze tuition increases for two years for the entire UW System during their deliberations on the budget.

"Together with the Legislature, we will ensure a thorough review of UW System finances and increased transparency and accountability for students, their families, and taxpayers moving forward."

Gov. Scott Walker's new budget for the UW system "includes $181.4 million in new state (General Purpose Revenue) dollars, UW System President Kevin P. Reilly called it a 'good budget,'” according to UW.

The legislature's Joint Finance Committee will begin amending Governor Walker's budget on April 25.

University of Wisconsin released a statement Friday announcing new ideas proposed by UW System President Kevin Reilly.

“When Governor Walker announced his budget, we said this would set the stage for very low, very modest increases, and we meant it," said UW System President Kevin Reilly. "Students are making decisions now about college and we need to send the message now that a high-quality UW education will remain accessible and affordable.”

The four things the university hopes to change are -

1. Reducing tuition increases over the next two years.
2. Eliminating the waiting list for financial aid and expanding work-study opportunities
3. Matching the state's performance-based economic development grants
4. Accelerating the developmment of UW Flexible Option degrees.

There is no word on how, or if, the reserve fund will affect these plans.

RightWisconsin first broke this story, find more information here.