For the second time in less than two years, the Student Activities Council has issued a moratorium that will prevent new student groups from receiving recognition and funding.
SAC’s general body passed the moratorium — which took effect immediately — by a vote of 94-29 Wednesday night. The moratorium will not impact groups that already receive SAC funding.
Currently, 48 SAC-recognized groups are in debt, according to documents that were distributed at SAC’s general body meeting. All of this debt was incurred after September 2011. Fifteen of these groups are in more than $1,000 of debt, and 33 groups are in under $1,000 of debt.
College senior and SAC Chair Melissa Roberts, who attributed the decision to implement the moratorium to “considerations about our long-term sustainability,” said the total debt among SAC-recognized groups falls between $20,000-$30,000.
“The main thing to stress is that we’re not in a financial crisis or anything,” Roberts said. “But when we looked ahead at some of the trends we’re expecting to see in the future … we didn’t feel completely confident moving forward, which is why we voted for the new moratorium.”
In addition to maintaining SAC’s viability as a funding source for approximately 200 student groups, Roberts said the decision was made due to several other factors.
Although SAC received $1,001,067 in funding from the Undergraduate Assembly for the 2012-13 school year — a 7.5-percent increase from the previous year’s total — Roberts explained that this uptick has been offset by increases in facilities costs for student events.
“Facilities costs are increasing 15 percent a year while our budget is increasing just 3 to 6 percent a year,” she said. “That’s happened for so many years with our current course of direction that we felt we really had to take a hard look at what we’re funding.”
Wharton junior and SAC executive board member Siteng Ma added that the group’s reserve funds are running “very low” right now.
While Roberts declined to comment on how much SAC currently has in reserve funds, she acknowledged that there has been a dropoff from previous years’ levels. In January 2011, SAC’s reserve funds stood at $103,837 — a decrease from more than $400,000 between 2006 and 2008, according to Daily Pennsylvanian archives.
Ma described the moratorium as a short-term stopgap that will allow SAC to build up its reserve funds. He is hopeful that the group will discuss ways to find more sustainable solutions in the future.
“We’re at the point now this year where the plan is not to dip into the reserve or to dip into it very limitedly,” Roberts added.
The last moratorium — which largely resulted from SAC over-allocating its budget from the UA by $169,992 in 2010-2011, with the intent of covering the difference through reserve funds — lasted from January to September 2011. When the moratorium was lifted a year ago, SAC agreed to relieve all students groups of their historic debt.
Though SAC added new measures to hold students groups more accountable for their future debt — including implementing budget cuts for groups that overspent — Roberts said these steps have not been foolproof.
“When we realize that groups are in debt we do cut them off, but a lot of groups are able to get into debt before they’re caught because of the administrative issues involved,” she said.
Some of these administrative issues might include things like the unknown costs of bringing certain speakers to campus, as well as year-to-year increases in paying for event space.
In anticipation of its next GBM in October, SAC will require groups that have incurred more than $2,000 in debt to meet with SAC’s executive board and present plans to get out of their debt.
Although Roberts is unsure of when the moratorium will be lifted, she said that previous SAC moratoriums have lasted anywhere from a semester to a year.
“We obviously wanted the moratorium to head off any fiscal problems, but we also want to open up to new groups again as soon as we’re in a financially sound position,” Roberts said. “But these are pretty big structural changes, and they don’t happen overnight.”