Centrally Paid Costs and Debt Service
Each year the Chancellor’s Office allocates direct and indirect costs to campuses as well as Systemwide Revenue Bond (SRB) debt service. The indirect costs are made up of the Department of Finance State Pro Rata charges and Chancellor’s Office (CO) overhead expenses. The State Pro Rata charges and CO overhead expenses are essentially a reimbursement to the State and the Chancellor’s Office for their costs associated with administering each campus’ non-state supported activities. The direct costs are made up of expenses related to bonds issued by CSU to build non-state facilities (e.g. SJSU’s Campus Village Housing Complex).
Each year, campuses receive a memo listing the annual amounts for State Pro Rata and Chancellor’s Office overhead charges (see link below). These charges are assessed through quarterly Cash Posting Orders (CPO). Each campus is then required to reallocate the direct and indirect expenses to the appropriate campus funds.
The SJSU funds that are impacted by these CO direct and indirect costs include: Continuing Education (CIES), Housing, Parking, Health Center (facility related only), Auxiliary Organizations, Student Union, and the following special trust funds:
- All funds beginning with “65” (Miscellaneous Trust, CSU Fund 496)
- Fund 76000 ( Capital Project Management, CSU Fund 542)
- All funds beginning with “77” (Cost Recovery/Reciprocal and Nonreciprocal Campus, CSU Fund 543)
- All funds beginning with “78” (Cost Recovery/Exchange and Nonexchange Auxiliary Orgs/3rd party, CSU Fund 544) – note that State Pro Rata charges for CSU 544 are waived in FY 2012-13 per the AVP Finance
The annual memo from the Chancellor’s Office specifically distributes direct and indirect costs to each of the self-support and auxiliary enterprises. However, the charges to the special trust funds listed above must be calculated and distributed by each campus. Because most of the indirect cost portion is for retired annuitant health benefit costs, the Chancellor’s Office distributes these costs based on actual expenses recorded in account code 603005 (retirement costs) as of two years ago (this is the latest actual data they have when the charges are calculated). San José State distributes the expenses in the same way to the funds listed above.
Reference: http://www.calstate.edu/FinancialServices/CodedMemos/2013/FS2013-01-REVISED-8-26-13.pdf for full detail of the memoranda