Repository: UIHistories Project: Board of Trustees Minutes - 1942 [PAGE 109]

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BOARD O F T R U S T E E S

[October 21

Service is attached. T h e present practice is not only wrong in principle but has practical disadvantages. T h e use of Federal funds for extension work is restricted. If the University received the State appropriation the latter could be used for certain educational services highly important to the extension program in general for which Federal funds may not be used. Heretofore the absence of a direct State appropriation for extension work has necessitated drawing entirely on Federal funds for administrative expenses, salaries of extension specialists, and travel, all of which makes the University's Federal fund expenditures for administration appear unduly large, thus creating an unfavorable impression in the United States Department of Agriculture. It is therefore recommended that the Board of Trustees request the General Assembly of Illinois to make the appropriations for salaries of F a r m and H o m e Bureau Advisers to the University of Illinois in the future, instead of to the State Department of Agriculture, as heretofore. T h e appropriation for 1930-1941 is $306,160. Director H . P . Rusk recommends that an increase of $125,000 ($250,000 for the biennium) be requested. This appropriation should be in a separate bill and not a part of the University's biennial appropriation for

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I submit a memorandum prepared by the Director in support of his recommendation and giving more detailed information about this situation. I concur in his recommendation.

On motion of Mr. Jensen, this recommendation was adopted.

DEPOSIT O F FEDERAL FUNDS (9) On July 21, 1916, the Board of Trustees adopted a rule that all funds of the University shall be deposited in a single account with the University Treasurer and that the Comptroller shall maintain such accounts as are necessary to show at all times the distribution of these deposits by funds. This procedure has been followed by the officers concerned, and is the general practice of other universities and public bodies. The University receives from the Federal government annual grants of funds under various acts of Congress. T h e acts specify the purposes for which the funds may be used and require an annual accounting in detail, but make no mention of the procedure to be followed in the deposit of moneys received under them. In J 933 the Comptroller-General of the United States ruled that any interest accruing on these funds must be remitted to the United States, and recommended that, for the purpose of computing such interest, Federal funds be deposited in a separate bank account. T h e University of Illinois for many years has received no interest on its current deposits and consequently no steps were taken to segregate these funds in a separate bank account. No question has been raised concerning this procedure until recently when a representative of the United States Department of Agriculture called on the University to place these funds in a separate bank account saying that this is required by the Comptroller-General. T h e Comptroller of the University of Illinois refused to do this after consultation with the Director of the Agricultural Experiment Station and the University Counsel, on the ground that this procedure is not required by Federal law and the Comptroller-General has no authority over the University's internal procedure. Furthermore, the statements of the Comptroller-General are recommendations only, not requirements. T h e Secretary of Agriculture has stated that his Department "has no choice other than to withhold the issuance of warrants for the Illinois Experiment Station to receive further quarterly allotments and the Federal-grant funds for research during the current fiscal year until this requirement of the ComptrollerGeneral of the United States has been met." T h e President of the University concurs in the action of the University Comptroller on this point and believes there is nothing to justify the Secretary of Agriculture in certifying that the University of Illinois is not "complying