An audit of Chicago State University by the state’s auditor general released on Wednesday found that the embattled university improperly reported more than $51 million in federal awards.
According to the report by the state’s Auditor General Frank Mautino, the university did not properly prepare expenditure reports, as federal law requires, for federal awards amounting to $51,731,277 for two loan programs from the Department of Education.
Two awards from the Department of Health and Human Services related to a program for providing education and training to eligible individuals for health-care related professions were also improperly classified, the report said.
The university is required to identify in its accounts all federal awards received and expended, and the federal programs under which they are received, the report said.
The university responded that it agreed with the recommendation but said that it had properly reported the loan amounts within the “footnotes” of their report.
Additionally, the audit found that 15 percent of employees were not eligible for accrued leave but were included on a leave schedule. Total absences reported by the university totaled $150,759, and the report states that the auditor’s finding has been repeated since 2011.
In a statement, the university said it’s working to stabilize finances, while also blaming the state budget impasse.
“We have made great progress in stabilizing the university’s finances even with the absence of a state budget or comparable funding as compared to prior years. We will continue to make improvements to ensure efficient and effective operations,” Interim President Cecil B. Lucy said in a statement.
The university is undergoing a national search for a new permanent president. Gov. Bruce Rauner had pushed for former CPS CEO Paul Vallas to head the university, but there have been questions about a conflict of interest because Vallas is currently serving as a trustee.
The university, and other public universities in the state, are in dire straits after nearly two years of a budget impasse has left funds running dry. Chicago State received some funding last year and zero funds this year as the budget impasse drags on. It has left a drop in enrollment, hundreds of employees laid off, vendor payments delayed and students left without essential financial assistance.
The audit was conducted for the year that ended on June 30, 2016.
The audit found the university spent more than $41.7 million while taking in revenues of $38.8 million. And it lost 376 students from 2016 to 2015.