Legislated revenue streams for student societies

Clark Wilson LLP released an excellent edition this morning of its “Campus Counsel” newsletter, which deals with the legislative autonomy granted to student societies.   I reproduce it in full below.

The Vancouver Province newspaper has recently reported on problems of the Kwantlen Student Association (the student society at Kwantlen Polytechnic University), which is involved in three legal actions. At the centre of these problems are questions regarding financial management by Kwantlen Student Association. As the Vancouver Sun reports, controversy and litigation regarding the financial management of the student societies of British Columbia institutions of higher learning is not new, with past instances arising at Douglas College in 2006 and at the University of Victoria in 2001. This article is a brief review of the legal framework within which these controversies arise.

In both the University Act and the College and Institute Act, a “student society” is defined as an organization incorporated as a society under the Society Act whose purpose is to represent the interests of the general student body, but does not include a provincial or national student organization. By definition, all student societies in British Columbia are created under the Society Act and, as a result, they are legal entities which are separate and apart from their respective academic institutions, with internal governance which is different from that of their institutions.

Section 21 of the College and Institute Act and section 27.1 of the University Act deal with student fees and are almost identical. In essence, the boards of colleges, institutes and universities are required to collect and remit student society fees to the respective student societies of their institutions. Neither statute stipulates the purposes for which student fees may be collected or imposes any controls on how they are administered. Both statutes permit a student society to increase student fees if authorized by student referendum.

Section 27.1 of the University Act and section 21 of the College and Institute Act were introduced pursuant to the Miscellaneous Statutes Amendment Act (No. 3) 1999. Certainly, from the perspective of business efficacy, it makes sense that student fees be collected with tuition; however, according to Hansard, there was no legislative debate focused on these sections when they were grafted onto the legislation. Accordingly, the rationale behind these provisions is not clear, although the Vancouver Province reported that the changes were the result of lobbying by the Canadian Federation of Students, requesting more autonomy. One presumes that a key objective of the legislation regarding student fees was to ensure the independence of student societies and that they have the means to achieve student goals, as determined by the students, and not the administration.

Pursuant to both the University Act and the College and Institute Act, the board of a college, institute or university may only stop collecting and remitting student fees if its student society does not make audited financial statements available or if the student society is struck off the register pursuant to section 71 of the Society Act. Otherwise, an institution’s board has no right to direct the purposes for which student fees are collected or how the fees are administered after they have been remitted to its student society. From the perspective of most students, they pay one global amount to their institution for their education and related benefits and services and often do not distinguish the amount being paid over to a student society. Many students may wrongly assume that their institutions administer or at least monitor how student fees are handled. A failure on the part of a student society to properly administer its resources may therefore affect the reputation of the institution as a whole, even though it has limited ability to manage the situation. Nevertheless, absent legislative change, the boards of British Columbia academic institutions are not in a position to intervene in their student societies’ affairs.

Some student societies work closely with their institution’s administration and share resources or facilities and agree to make payments to their institutions in respect of such arrangements. Other student societies carefully guard their independence. The legislation does not provide a specific mechanism for academic institutions to recoup the cost of services of facilities that they provide to their student societies nor does it constrain the kinds of agreements that an academic institution may enter into with its student society. As the institutions and student societies are separate and independent legal entities, they are free to enter into legally binding agreements which govern their relationship. These agreements may include binding obligations on the part of a student society to pay funds derived from student fees to their institutions for services rendered or facilities provided by the institution to the student society. These agreements may also include mechanisms pursuant to which such obligations may be satisfied from the amounts to be remitted by the institution to its student society.

In light of the controversies that have arisen in recent years, it may be time to review the provisions of the University Act and College and Institute Act which apply to student fees.