1-31: Governing Board Financial Oversight

Policy Overview

This policy describes the Santa Fe Community College (SFCC or College) Governing Board’s (Board) financial oversight, authority and responsibilities.

Scope and Applicability

This policy addresses the budget and financial oversight of SFCC; sets out the responsibilities for contracting processes; and sets limits for authorizing business expenditures. This policy applies to Board members and the President or designee.

Policy Statement

This policy sets out the responsibilities of Board members and the President regarding SFCC’s financial obligations.


  1. Expenditures for Instruction (Exhibit 10) Funds for activities that are part of the instructional program: credit and noncredit courses; academic, vocational and technical instruction; remedial and tutorial instruction; community education; adult education; contract training; and regular, special and extension sessions and faculty and chairs compensation, as long as their primary duties are instruction.
  2. Academic Support (Exhibit 11) Funds that provide support services for the College’s primary missions. This includes academic administration, libraries, galleries, ancillary support, academic personnel development and course and curriculum development.
  3. Student Services (Exhibit 12) Funds for activities that contribute to the student’s emotional and physical well-being, such as counseling, career guidance and student aid administration and offices such as Enrollment, Registrar, Financial Aid, Counseling Services, Career Services, Student Services administration, etc.
  4. Institutional Support (Exhibit 13) Funds for executive-level activities concerned with management and long-range planning for the entire College, such as the Governing Board (planning, programming, legal services) and fiscal operations, and offices such as Governing Board, President, Foundation, Marketing and Public Relations, Planning and Institutional Research, Human Resources, Safety and Security, Financial Services.
  5. Operation and Maintenance of Plant (Exhibit 14) Funds for the operation and maintenance of the physical plant, such as services and maintenance related to landscaping and grounds, facilities, utilities, fire protection, property insurance, physical plant administration, building maintenance, custodial services, and utilities. It does not include expenditures from the institutional plant fund accounts.
  6. Student Social and Cultural Are funds for activities whose primary purpose is to contribute to students’ emotional and physical well-being and to their intellectual, cultural and social development outside the context of the formal instruction program, such as student government, student leadership, student organizations and clubs, and student activities.
  7. Public Service Funds include revenues and expenditures for organizational units that are established primarily to provide non-instructional services that are beneficial to individuals and groups external to the institution: television and radio stations, general advisory services (e.g. the Small Business Development Corporation), health care and social services (early childhood center), consulting, and similar non-instructional services (conference center).
  8. Internal Service Department Activities which provide services mainly to internal institutional departments for a specific charge which should cover the actual costs of providing the service.
  9. Student Aid and Grants Financial assistance provided to students in the form of outright grants, tuition and fee waivers and remissions trainee stipends, and gifts and prizes, either awarded by and/or administered through the College.
  10. Auxiliaries Auxiliaries are entities that exist to furnish a service to students, faculty and/or staff, and that charge a fee that is directly related to, but not necessarily equal to, the cost of the service. Auxiliary enterprises are managed as self-supporting operations. Operations designed to serve the institution and its organizational units internally should be classified as internal service departments. Operations designed to serve individuals or groups external to the institution should be classified as public service or community education (New Mexico Higher Education Department Exhibit 20 definition).
  11. Capital Outlay Expenditures for both major and minor projects that generally will increase the institution's investment in plant account. This exhibit contains two sections: one for allocated funds, and one for unallocated funds. Funds are allocated by action of the Governing Board, by appropriation, or by a third party funding source. Any other funds are unallocated.
  12. Renewal and Replacement Are expenditures for major maintenance or renewal and replacement of existing plant assets, including buildings, campus infrastructure and equipment that do not increase the institution’s investment in plant.
  13. Retirement of Indebtedness Revenues, transfers, and expenditures associated with the repayment of bond issues or the retirement of the institution's debts.
  14. Cash Match refers to a cash contribution from SFCC, funds that are part of a sharing of costs in the form of actual currency (hard match), not in-kind contributions (soft match).
  15. Contract Training Study of content designed or customized for specific audience related to certain skills or proficiency and of limited duration.
  16. Credit Course Study of content for which academic credit is granted upon completion of all requirements.
  17. Unrestricted Current Funds are near-term economic resources available for use in the mission-related activities of the College that are expendable for any purpose in performing the primary objectives of the College, are resources used for the day-to-day general operation of the College, and that typically do not include longer-term funds (endowments, plant funds, debt service). Current funds are classified into the following categories/exhibits: • § Instruction and General (Exh 10-14) • § Student Social and Cultural (Exh 15) • § Public Service (Exh 17) • § Internal Service (Exh 18) • § Student Financial Aid (Exh 19) • § Auxiliary Activities (Exh 20)

Policy Process

  1. The Board has the authority to approve budgets, budget adjustments and financial statements.
  2. The Board shall meet to review the financial statements.
  3. The Board’s review of the financial reports shall be made available to the public through meeting minutes.
  4. The President and Vice President of Finance/Chief Financial Officer shall prepare the fiscal year budget of income and expenditures through an inclusive process with the campus community.
  5. The Board shall determine the operating budget for the distribution of available resources according to the Board’s priorities for SFCC. The President may re-allocate funds within the budget of any specific exhibit, but not between exhibits without Board approval.
  6. Sole authority for establishing tuition and fees of a general nature for semester-hour credits resides with the Board, upon recommendation of the President.
    1. Normally, action to approve tuition and fees for credit classes shall be taken by the Board once each year as part of its approval of the forthcoming year’s operating budget.
    2. The Board may delegate to the President or designee authority to approve individual course fees, such as laboratory fees for science courses.
    3. When a financial emergency is declared by the Board, tuition and fees may be changed outside of the normal budget approval process. Upon the decision to make changes in tuition and fees, the College shall provide notice as soon as possible to students and the community.
    4. Individual course fees shall be recorded as general revenue. In rare circumstances, individual course fees may be redistributed to individual departments to offset special costs of particular courses upon recommendation of the Vice President of Finance/Chief Financial Officer and subsequent approval of the President.
    5. Authority for establishing tuition and fee charges for noncredit and contract training classes shall reside with the President or their designee.
  7. Purchasing and Contracts
    1. An independent audit report prepared annually according to New Mexico State Statutes and Administrative Code shall be submitted to the Board. The Board or a Board Audit Committee shall participate in the entrance and exit audit conferences.
    2. SFCC shall attempt to procure materials and services for the greatest value in accordance with the Procurement Code (Policy 6-11 Procurement). The Vice President of Finance/Chief Financial Officer shall establish purchasing protocols, approved by the President, that describe the process to be followed for all purchases.
    3. The power to contract on behalf of SFCC is vested in the Board; however, subject to the exceptions below, the Board authorizes the execution of contracts and agreements as follows:
      1. Contracts and agreements at dollar amounts up to $200,000, with the exception of multi-year contracts greater than four years, may be authorized and executed by the President or their designee.
      2. Contracts and agreements at dollar amounts over $200,000 must be authorized by the Governing Board and, once authorized, may be executed by the President or their designee.
      3. Contracts for purchases that are exempt from the Procurement Code and emergency procurements, as defined in the Procurement Code, are not subject to approval as described above. Those contracts shall be addressed in the purchasing protocols. The Board must be notified at the next Board meeting of any emergency procurement.
      4. The Board also shall approve the following contracts:
        1. Architectural services for newly proposed projects whose estimated value is over $200,000
        2. New construction projects that add or eliminate square footage
        3. Any construction project that converts classroom space to general administration space
        4. Multi-year contracts greater than four years and whose total value exceeds $200,000, including gross receipts tax
        5. Legal services
        6. Insurance
        7. Auditing services, and
        8. The President’s contract.
    4. The Board shall be notified in a timely manner of administrative intent to pursue grants equal to or exceeding $100,000 and any grant that has a cash match of more than $50,000 that would have significant impact on the budget (SFCC Policy 6-10 External Funding: Grants).
  8. Capital Improvement Change Orders
    1. Every capital improvement project in excess of $10,000 shall include a contingency change order budget of 10 percent for new construction and remodeling projects.
    2. For change orders that do not exceed that budget, the following approvals are authorized:
      1. The Vice President of Finance/Chief Financial Officer may authorize and execute a single change order up to $100,000.
      2. The Vice President of Finance/Chief Financial Officer shall report to the President any cumulative dollar amount of change orders on any one project that exceeds $100,000.
      3. The President shall request approval of the Board for any change order when the cumulative dollar amount of change orders on any one project exceeds $100,000, and shall make additional reports for each 20 percent increment of change orders.
  9. Signatory Authority
    1. Grants: The President or designee is authorized to make application on behalf of SFCC to private and governmental agencies for g­rant funding (Policy 6-10 External Funding: Grants). Prior approval of the Board shall be required for any grant application:
      1. In support of new construction, and
      2. When the terms require specific Board approval.
    2. Surplus Property: Upon approval from the Board, the President or designee is authorized to sign documents necessary for the purchase or disposition of surplus property items from appropriate state agencies as allowable by law (New Mexico Statute § 13-6-6 (1996 through 1st Session 50th Legislature)).
  10. Facilities and Equipment
    1. The Board declares its property to be restrictive in use and purpose to that of supporting educational programs and activities under the control of SFCC.
    2. The Board designates to the President or designee the management of facilities and obligates SFCC to maintain a campus environment appropriate for educational purposes.
    3. Off-campus groups using the facilities shall be required to follow appropriate policies and procedures (Policy 5-4 Facilities Use, Allocation and Management, Policy 8-2 Space Rental, Political Activity, Solicitation and Vending on Campus, Policy 10-1 Collaborative Use of College-Owned and -Leased Property).
    4. SFCC may establish and operate auxiliary services such as a bookstore and food service to support its mission and purposes.
  11. Financial Review Committee
    1. The President shall annually establish a Financial Review Committee with representatives appointed by the President, Faculty and Staff Senates, and Student Government Association that shall meet prior to each Board meeting.
    2. Faculty Senate, Staff Senate and the President shall each appoint five members and Student Government Association shall appoint two members to serve on the Committee.
    3. The Financial Review Committee shall study the monthly financial statements prior to each Board meeting.
    4. During the annual budget process, the Financial Review Committee shall review the draft budget and its assumptions.
    5. The Financial Review Committee shall study the institutional budget prior to presentation to the Board and share its insights and suggestions with the President and the Board.

L. Cash Reserves

  1. The Board establishes a cash reserve requirement in order to mitigate cash flow issues that may result from the timing of when mill levy revenues are received, grant receivables, financial aid disbursements, and unexpected financial issues.
  2. The Board directs the President to establish a designated fund in the accounting system that holds the entirety of cash reserves related to this policy.
  3. The minimum amount held in the College’s cash reserve fund shall be equal to 25% of the average of the prior two years’ unrestricted current funds actual expenditures at June 30.
  4. The Board authorizes the President to invest the appropriate level of cash reserve funds in moderate- to low-risk investment funds that generate a prudent and reasonable investment return while also maintaining appropriate liquidity for the cash reserve fund.
  5. Any investment of cash reserves will adhere to the Uniform Prudent Management of Institutional Funds Act (UPMIFA).

Statement of Accountability and Responsibility

The Governing Board, the President, and the Vice President of Finance and Administration/Chief Financial Officer are responsible for the implementation and enforcement of this policy. They will work together with the different departments and offices to comply with this policy and to develop procedures that will enforce this policy regarding awareness, prevention, and remediation.


Uniform Prudent Management of Institutional Funds Act
New Mexico Statute § 13-6-6 (1996 through 1st Sess 50th Legis)
Financial Reporting for Public Institutions in New Mexico
New Mexico Administrative Code 2.2.2 Audit Rules
New Mexico Procurement Code (§13-1-21 to 13-1-199, NMSA, 1978 as amended)
SFCC Policy 5-4 Facilities Use, Allocation and Management
SFCC Policy 6-10 External Funding: Grants
SFCC Policy 6-11 Procurement
SFCC Policy 8-2 Space Rental, Political Activity, Solicitation and Vending on Campus
SFCC Policy 10-1 Collaborative Use of College-Owned and -Leased Property


SFCC Governing Board approved: 9/23/15
Revised and SFCC Governing Board approved: 2/25/19
Revised and SFCC Governing Board approved: 10/30/19
Revised and SFCC Governing Board approved: 10/27/2021

Associated Procedures