UW-Whitewater Foundation in compliance with rules, officials say
WHITEWATER—In light of suspected illegal transfers of money at UW-Oshkosh, officials with the UW-Whitewater Foundation and UW System say the UW-Whitewater Foundation is in compliance with the rules.
The UW System is suing UW-Oshkosh's former chancellor, Richard Wells, and former chief business officer, Thomas Sonnleitner, accusing them of transferring $11.3 million from the university to the nonprofit UW-Oshkosh Foundation, the Wisconsin State Journal reported.
UW System spokesperson Stephanie Marquis said in an email Monday the system has no indication there are any issues with the UW-Whitewater Foundation as it conducts an “internal, comprehensive review.”
UW-W Foundation President and Vice Chancellor for University Advancement Jon Enslin said the foundation is in compliance with system and state Legislature requirements. He said they were “nowhere near” doing anything that UW-Oshkosh is accused of doing.
The UW-W Foundation is a nonprofit corporation separate from the university. Its sole purpose is to support UW-W, primarily through raising charitable gifts, Enslin said. The foundation aims to make the university accessible “by bridging the gap between state funding and tuition dollars,” according to its website.
The foundation is overseen by a board of directors and operates within an agreement it has with the university, Enslin said. The agreement details the foundation's responsibilities and that “the money raised has to be used for certain purposes at the university, whatever the donor intends for it to be used for.”
The foundation has a financial audit shared with the university every year, and its tax returns are public information in accordance with federal law for nonprofits, Enslin said.
According to the foundation's 2015 Form 990 available on Guidestar.org, the foundation reported:
-- $26.2 million in assets, which was the market value of everything the foundation owned. The “vast majority” of this amount was cash and investments related to foundation investments, Enslin said.
-- $3.5 million in income, which included all donations as well as other income, such as investment income.
-- $3.2 million in expenses, which was money spent on things such as scholarships, foundation expenses and salaries.
-- $361,986 in liabilities, which is what the foundation owed. Enslin said the foundation took out a loan to build a house on a piece of real estate it owned, but the foundation has since sold the house and closed the loan.
UW System President Ray Cross and UW Regent Michael M. Grebe, who chairs the Regent Audit Committee, addressed the state Joint Legislative Audit Committee on March 30 and explained what the system is doing to prevent further controversies.
Cross said they are now requiring affiliated foundations to provide more detailed annual financial reports. Foundations that receive annual contributions of more than $500,000 must submit an independent audit, he said.
On a second front, Cross said they recently gave each UW institution a document outlining best practices and requirements in a formal agreement between an institution and its primary foundation.
The state's audit committee ordered an audit of the UW System. Marquis said they “welcome their review.”
As rules are changing, Enslin said, they will follow any new requirements.
“We'll be happy to comply with whatever reporting they require us to do,” Enslin said.
As the legal matters involving UW-Oshkosh proceed, Enslin said his biggest worry is how donors perceive the UW-Whitewater Foundation.
“The biggest worry I have about this is that our donors might believe that what happened at Oshkosh is representative of what happens here, and it isn't,” Enslin said. “That's what I'm more worried about than anything from the foundation's perspective.”