Audit Proves UNT Manipulated Millions In Payroll Collections
DENTON (CBSDFW.COM) - The University of North Texas is facing a potentially big IOU from the State of Texas. A state audit shows that for years, perhaps decades, UNT improperly manipulated its payroll collections to the tune of at least $75.6 million in money now owed to the state. Some UNT students said they worry paying back would mean them paying more.
"I definitely think it would affect students who get grants and are funded by the university," said Sarah Brown, a freshman who says she depends on grants to go to school.
The root issue is how employee benefits were formerly paid. Workers whose paychecks were written from local or university accounts were to have their benefits paid for locally, too. Instead, the university apparently comingled all the benefits and charged them to the state, according to the UNT system's top administrator, Chancellor Lee Jackson. "It is deeply embarrassing and very disappointing that our staff was this out of touch with the best acceptable accounting practices. It should have been detected, it should have been corrected, but as long as the overall budget matched, as long as state reports were filed, as long as no red flags went up, it was not apparent," he said.
Jackson adds that five financial administrators have been replaced and a new central controller is coming on. But even state-mandated reviews missed the discrepancies, he said. "Years, maybe decades ago, we were told that it didn't conflict with any state law -- it's perhaps in a gray area but it's something the state's not going to object to, we have no evidence that anyone in state office ever said it was okay."
So how big a hit is $75-million? About the same amount as it cost to build the new Apogee football stadium, which was $78-million when completed in 2011. Students are wary the cost will be passed on to them.
"The way college is trending right now I'm pretty sure most of it's going to come out of teacher-student' tuition and probably my next semester's tuition, too," said Seth Leingang a UNT senior. Fellow senior Jennifer Blanco echoed his concern. "It'd probably be, like, hard for me to, like, pay for school. These grants are really important to me."
Late Thursday State Senator Royce West, who sits on both education and finance committees, told CBS 11 News the legislature will work out repayment... but said the same bad accounting may be occurring at 30 or more other state schools. Thus, nothing should be done until they're examined as well.
UNT Denton's President Neal Smatresk released the following statement: "I believe Texas state officials will seek a thoughtful, fair resolution to this matter. A fair resolution will ensure there's no adverse impact on our students and our mission to help transform the state by providing an outstanding education here at UNT."
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