UW System Reserve Fund Furor Sparked by State Republican 'CPA Caucus'

Tim Goral's picture

The origins of a nightmarish last week for University of Wisconsin System officials can be traced to a meeting of accountants earlier this year at the state Capitol.

The four accountants also are Republican state representatives, comprising the so-called “CPA Caucus.” A fifth person there, Bob Lang, is director of the Legislative Fiscal Bureau, a nonpartisan agency that helps lawmakers make sense of budget and financial matters.

The accountant-lawmakers had questions about one line buried in a 2012 state financial report showing the System carried a balance of $1.05 billion.

“It was a large number with no detail or breakdown,” said Rep. Howard Marklein, R-Spring Green, who hosted the meeting. “That’s why we were questioning it.”

Lang agreed to take a closer look. Two Fridays ago, he delivered answers to their questions in a memo showing that, of the $1.05 billion cash balance, the System carried $648 million in balances from funding sources it had spending discretion over at the end of fiscal year 2012, most of it from tuition and student fees. Of the total, $207 million had no specific funding destination.

Its release on a Friday afternoon came as an April surprise that fundamentally changed the tone of budget negotiations between the System and state Legislature. And it raised questions about the effectiveness of System leaders, including President Kevin Reilly.

“I think that the current leadership team at the university System has serious credibility problems with legislators,” said Assembly Speaker Robin Vos, R-Rochester. For his part, Reilly said he’s not concerned about his job security as it’s out of his control.

Until that time, things had been mostly cordial, with university leaders applauding a two-year funding boost of $181 million proposed by GOP Gov. Scott Walker and moves by the Legislature to grant more autonomy to the System and UW-Madison regarding personnel.

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