On Sept. 22, ASUCR voted to close the student-owned Exchange store due to budget concerns, specifically citing its projected overhead cost of nearly $120,000 and a deficit of almost $60,000. The reallocation of funds away from the student store has resulted in the loss of six student employees and furloughed its business manager of 14 years.
Known for its postal system, celebratory merchandise and discounted tickets, the Exchange was established as a student service store in 1994. Concerns from UCR faculty members and students have been raised over ASUCR’s ability to make personnel decisions, especially in regards to long-term staff positions.
“The decision to close the exchange was based off the financial aspect and an unfortunate consequence of that decision was a loss of jobs,” stated ASUCR Vice President of Internal Affairs Kevin Jo.
The release of 2011-2012 annual fiscal report in July revealed that the Exchange continued to suffer from high net losses, especially from costly staff and employee wages. “There were a lot of factors that were very unexpected and out of our control such as the UCOP tax and the fact that tuition is rising for students here on campus,” which made the Exchange less appealing to students, stated Senator Jo.
Enacted at the beginning of 2011-2012, the University of California Office of the President (UCOP) assessment tax enforces a 1.6 percent fee on all campus expenditures throughout the UC system. Under this policy, student-funded programs and services were controversially included as new revenue sources, but does not apply to referenda-funded programs and organizations. As a result, the Exchange store faced the hardship of paying both sales tax and an additional UCOP tax, especially when purchasing bulk tickets from local movie theaters and amusement parks. At the same time, the UCOP tax applied separately to ASUCR, as seen in an estimated ASUCR budget for the 2012-2013 school years.
In an interview with the former Exchange business manager, Mickey De Leon expressed that her release was overly abrupt because no prior notification was ever given. With costs rising over the last few years, she was informed that the Exchange may possibly close by the end of the year, not the beginning of fall. “The whole idea of the Exchange store, since I have been there for 14 years, was not for the store to make money. It was there for the services, discounted services for the students,” said Leon.
UC policy guarantees a former employee preferential treatment in terms of an interview, but does not guarantee that they will be rehired. The ability for ASUCR to fund particular programs has led to the unintentional consequence of enacting personnel decisions in terms of employment. Employee confidentiality and UCR HR policy has restricted student senators from speaking on this matter.
During a closed session, ASUCR voted to close the Exchange before the beginning of the academic year. A concerned faculty member found it troubling that an executive decision on a student service was made in the summer with no community input, yet recognized that these practices were common during times of financial difficulties. “A closed session may be called during regular meetings for the purpose of discussion of an ASUCR representative, personnel or employee grievance matters,” stated the ASUCR Constitution and Bylaws. The sensitive nature of the discussion in regards to employment was a major factor that attributed ASUCR’s decision to have a closed session.
“It was not our intention to get rid of jobs on campus. Our intent was to look at the numbers and see that the service we provide is justifiable to the costs we have to incur,” stated Senator Jo, in referring to the arduous months of discussion among senators which led to ASUCR’s decision. With rising costs over the years, two Student Advisory Committees were formed by ASUCR in 2008-2009 with the purpose of improving the Exchange. Tasked with conducting surveys, hosting marketing events, and advertising during Wednesday’s Highlander Nooners, committee members met twice a week throughout the school year.
Former employees, such as fourth-year UCR student Darlene Lopez, questioned the effectiveness of these committees, which did not implement any suggestions to physically improve the store. After one year of employment at the Exchange, Lopez was initially promoted to Student Manager this year. Prior to the closing, pre-ordered merchandise was in the process of shipping, yet these operations were immediately halted once news of the Exchange’s closing came out. The inability to finish orders and lack of prior notification on the part of the associated students, led her to contact the Highlander.
“[ASUCR] shouldn’t be in that position of power because they’re students; why should you guys, as students, have the power to decide whether a person gets fired or not?” stated Lopez.
ASUCR has established an internal team, which will determine what will replace the vacated Exchange. An initial ASUCR budget designated certain funds to the Exchange, yet the closing of the store will result in a surplus in reserves. These funds will be dedicated to other student-funded programs over the course of the year and discussions are currently underway. The services, once provided by the Exchange, will be absorbed by other on-campus departments.
ASUCR will conduct their first public meeting of the 2012-2013 academic year on Oct. 1 at 6:30 p.m. in the Senate Chambers next to HUB 202.