A new report finds that $41 million in state appropriations “were not properly restricted and in some instances were co-mingled with other funds” at Oklahoma State University in violation of state laws and policies, according to an internal audit obtained by media outlets in the state.
The audit—conducted by an office of the Oklahoma Agricultural and Mechanical Colleges Board of Regents, which oversees Oklahoma State and other public institutions—found “significant issues in the allocation and management of legislatively appropriated funds” at OSU.
The report found examples of such funds being transferred improperly, including $11.5 million for aerospace, health and polytechnic programs being directed to the OSU Innovation Foundation instead, without a contractual agreement or approval from regents.
“As a result, some state appropriated funds were utilized for unauthorized and unrelated purposes, and were not retained in full by OSU, the intended recipient,” the audit found.
A university spokesperson told the Tulsa World that “while the financial decisions and transactions which occurred are concerning, they were isolated and do not impact OSU’s overall financial foundation.”
The audit also called on Oklahoma State to improve financial oversight and transparency.
Though the audit did not name former president Kayse Shrum, who resigned abruptly without explanation last month, it indicated the alleged misappropriation happened during her administration. Shrum did not appear to be interviewed as part of the audit, according to a list of individuals who were contacted as part of the investigation into the use of appropriated funds.
Florida governor Ron DeSantis is launching a state initiative to cut spending and optimize efficiency modeled after the Elon Musk’s federal Department of Government Efficiency, which has cut billions in contracts at federal agencies, The Orlando Sentinel reported.
Over the course of a year, Florida’s version of DOGE intends to sunset dozens of state boards and commissions, cut hundreds of jobs, and probe university finances and managerial practices.
“This is the DOGE-ing of our state university system, and I think it’s going to be good for taxpayers, and it’s ultimately going to be good for students as well,” DeSantis said Monday.
He added that the state would leverage artificial intelligence to help with the initiative.
The Republican governor also indicated that the state-level initiative would target what he referred to as “ideological study stuff” in an effort to “make sure that these universities are really serving the classical mission of what a university should be, and that’s not to impose ideology. It’s really to teach students how to think and to prepare them to be citizens of our republic.”
The move comes as the state has already targeted curriculum in recent months, stripping hundreds of courses from the general education offerings of state universities earlier this year. Many of the classes touched on topics such as race, gender, sexuality, and non-Christian religions.
Florida has also hired multiple GOP officials—some sitting, others who previously served—to lead state universities, including several who have no higher education management experience.
In a response to DeSantis, who pressed for the need to eliminate inefficiencies, the Florida Democratic Party noted that Republicans have controlled state politics for nearly 30 years and questioned the outgoing governor’s motivations in launching the state equivalent of DOGE.
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Dive Brief:
A state audit of employee spending practices at the Connecticut State Colleges and Universities system found several financial transactions that broke university policies or lacked adequate documentation.
Comptroller Sean Scanlon detailed over $19,000 in spending on food by system Chancellor Terrence Cheng in fiscal years 2022 through 2024, by far the majority of spending on his institutional credit card. Violations included missing receipts, missing guest lists and purchases of restricted items like alcohol.
Scanlon’s probe came at Connecticut Gov. Ned Lamont’s request after CT Insider reported Cheng spent lavishly on meals with a state-funded credit card over the past few years.
Dive Insight:
The report from CT Insider alleged that Cheng had spent as much as $1,114 at restaurants in a week, and paid for private chauffeurs despite having access to a state-provided car at the time. Once, he spent nearly $500 for the service, the outlet reported.
Scanlon’s office concluded that “while not technically violating state or university policy, we found that, in the absence of sound, comprehensive policies, the Chancellor utilized poor [judgment] when making P-Card purchases that were especially troubling given the financial stress on the CSCU system.”
The audit zeroed in on spending on food and transportation by the chancellor. Meals designated as business meetings accounted for 70% of the spending on the official’s card, and some transactions exceeded the $50 meal limit for system employees, the audit found. It also found 18 food purchases with tips deemed excessive — above 22% — which the report noted “is not a policy violation but a questionable use of university funds.”
Of the chancellor’s food-related transactions reviewed by the comptroller’s office, 43% had either no itemized receipts or were missing receipts entirely.
Among other violations were 30 instances where Cheng paid sales tax. That’s a violation of policy because institutional credit cards — also known as P-cards — are exempt from sales tax but must go through a process with vendors to credit those taxes.
However, the comptroller found that Cheng did not technically violate policy because as chancellor he can “override the policy at his own discretion.”
As for chauffeur use, the report noted three times when Cheng — who lives in New York state — paid for a private car service with his P-card, including two trips even more expensive than the one reported by CT Insider. Scanlon determined that these services did not represent violations but said that they “are of note as the Chancellor was provided with a state vehicle for their use.”
In an emailed statement Thursday, Cheng said that he appreciated the audit’s thoroughness and that the system is “committed to implementing stronger controls, policies, and comprehensive training.”
The system review also found issues with P-card use by other leaders, including the interim president of Southern Connecticut State University, Dwayne Smith. The audit found that Smith’s P-card “shows a wide variety of infractions spanning almost every category of restricted purchasing and failure to follow many of the policy requirements for documentation and reporting of transactions.”
Specifically, the comptroller’s office faulted Smith for failing to keep receipts, as well as purchasing tickets to an outside football game without stating its business purpose, among other issues.
In an emailed statement, Smith thanked the comptroller for his analysis and recommendations, adding that many of his office’s P-card transactions relate to his community engagement activities.
“These meetings have yielded significant support for our scholarship programs, internships, mentoring, and ultimately, enhanced job opportunities for our graduates,” Smith said.
Scanlon’s audit found many other issues across the Connecticut college system’s staff. His office’s report lists 10 recommended changes the system should make, including reinstating internal audits, establishing a central policy for P-card use, creating accountability measures for card misuse and establishing a policy for vehicle use.
“Unfortunately, this audit revealed troubling gaps in oversight and questionable spending practices,” Scanlon said in a Wednesday statement. “Our recommendations provide a clear path forward with more comprehensive policies, consistent enforcement, and greater overall accountability.”
In his statement, Cheng said the recommendations would “support the goal of accountability and transparency across the system.”
He added, “The system has begun to take steps in this direction and over the next 100 days, I’ve instructed my team to implement recommendations to improve compliance and reporting.”
The system’s governing board this fall moved to increase oversight of spending in its central office. As part of that process, the system recently hired a new chief compliance officer and legal counsel.
