Trust Fund Guidelines

Per California Education Code section 89721, money received by the University, aside from State support, must meet certain sources or purposes and shall be deposited and maintained in a Trust Fund.

These include:

  1. Any student loan or scholarship funds.
  2. Room, board, and similar expenses of students enrolled in SJSU's international programs.
  3. Funds held on deposit and subject to return upon approval of a proper application (e.g., equipment deposits.)
  4. Mandatory student fees (fees all students pay to enroll at San José State)
  5. Optional (non-mandatory) fees and charges for services, materials, and facilities. All fees that are deposited shall be used solely to meet the costs of providing these services, materials, and facilities.
  6. Fees for parking, health facilities or health services, and for extension programs, special sessions, and other self-supporting instructional programs.
  7. Lottery Funds.

Establishing a New Trust Fund

Most requests to establish a new trust fund stem from the collection of a new fee. New fees must be submitted to the Campus Fee Advisory Committee and approved before the related trust fund can be established. Revenues should not be collected in advance of receiving approval for a new trust fund. Please refer to the Campus Fee Program for more information.

Each trust fund established by SJSU shall be supported by an executed Trust Fund Agreement [DocuSign], which clearly indicates the source and purpose of the trust fund. Supporting documentation should always accompany a trust fund agreement. In most cases, a proforma showing anticipated revenues and expenditures for the current fiscal year should be included. Other documents, such as agreements, documented restrictions or reporting requirements that will impact administration of the fund, should also be attached to the trust fund agreement. Questions regarding requesting a new trust fund should be directed to the Budget & Financial Management analyst assigned to your unit.

Each trust fund agreement is reviewed by Budget & Financial Management and then forwarded to the Senior Associate Vice President for Finance and Business Services for approval. Upon approval, Accounting Services assigns a new trust fund number and establishes the new fund in the CFS. The requester and the Bursar's Office are notified when the fund is ready for use.

Trust fund agreements are subject to renewal every three years.

Trust Fund Administration

Trust funds should only generate revenue to fund expenses associated with providing a service or activity, as specified in the Trust Fund Agreement. Trust funds should not generate significant surpluses. Trust fund expenditures may only be made against existing deposits - expenditures may not be made in advance of collecting revenues, even if revenues are strongly anticipated. The cash balance must not be negative.

Once established, the trust fund owner should review financial reports generated by the CFS Data Warehouse regularly to verify revenues, expenditures and fund (cash) balance.

It is the responsibility of account owners to pro-actively notify their account contact in Finance and Business Services of any change in authorized signers or authorized user/approver of the account.

Please include the new information:

  • Name
  • Position Title
  • Effective date of the change

Allocation of Expense and Interest to Trust funds

Large self-supporting operations and auxiliary organizations that are included in the University Cost Allocation Plan are not governed by this section of the Trust Fund Guidelines.

Trust Funds essentially represent self-supporting activities. As such, the cost of providing insurance, and business and financial services must be recovered from (charged to) the Trust Fund. This section explains the charges that are assessed to Trust Funds and how they are determined.

Special Exemptions. Some trust funds are automatically exempted from charges. These include:

  • Scholarship funds: in order to preserve the greatest support for student aid, these funds are not assessed risk or administrative charges.
  • Lottery Education Funds: Lottery funds are considered a state appropriation, not a self-supporting activity.
  • Miscellaneous course fees: Per Executive Order 1054, miscellaneous course fees (category III fees) may only be assessed for the actual cost of the materials or services provided and may not include any administrative charges or inflationary components.
  • Capital Funds: Funds established to record Capital Projects [pdf].
  • Internal Services Funds: These funds represent fees collected from campus units that are covered by the CSU Operating Fund, or by self-supporting units that reimburse the CSU Operating Fund for risk coverage and administrative services through the University Cost Allocation Program.
  • Pass-through Funds: These are funds established to facilitate activities that do not fall under self-supporting activities, but instead are passed through campus accounts by necessity (an example is the Associated Student fee collected by the campus and passed through to Associated Students).
  • Other: Special exemptions may be granted on a case-by-case basis where revenues are generated by activities that result from a student's enrollment in a course.  An example of this is theater productions, where participation in theater performance is required component of a course, and the performance generates revenues from ticket sales.

Other funds may be exempted from charges at the President and/or Chief Financial Officer's discretion, typically when a fund's dollar volume will be very small.

Some Trust Funds receive interest earnings on cash balances based on specific agreements with the President and Chief Financial Officer.