Wisconsin Spotlight | Aug. 10, 2020
Madison — The University of Wisconsin System’s “slush fund” climbed to more than $1.3 billion, according to a new audit report.
Of those reserve balances, $866.6 million is made up of unrestricted balances, and $468 million is restricted balances.
Restricted balances primarily comprise gifts, nonfederal grants and contracts, and federal grants and contracts. Like the label suggests, such balances have restrictions on their use.
Unrestricted balances, however, do not come with such limitations. Those balances are derived from tuition, auxiliary operations, general operations, federal indirect cost reimbursements, and other sources.
Unrestricted balances came to be known as the UW System’s “slush fund” following 2013 revelations that the system held more than $1 billion in unrestricted balances, even though students had faced 5.6 percent annual tuition increases for years. Then-Gov. Scott Walker implemented a system-wide tuition freeze for in-state undergraduate students thereafter, and the Legislature ordered the UW System to spend down its balances.
In the years following the 2013 slush fund scandal, the UW System indeed spent down its unrestricted balances, though the figures have fluctuated. Total balances are larger today than they were in 2013, at $1.33 billion today compared to $1.27 billion in 2013. However, the proportion of unrestricted to restricted balances has shifted considerably. Where 86 percent of the UW System’s program revenue balances were unrestricted in 2013, 64 percent are today.
The audit, released by the nonpartisan Legislative Audit Bureau on July 30, shows total program revenue balances have increased by 0.8 percent since the previous year, when the system held $1.32 billion total. While restricted balances increased from $417 million to $468 million this year, unrestricted balances fell from $906.9 million.
Read more at the MacIver Institute.