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UND, NDSU contest parts of audit findings

BISMARCK - North Dakota's two biggest universities don't do enough to make sure students accurately report their residency status, the State Auditor's Office found.

North Dakota State University in Fargo and the University of North Dakota in Grand Forks, among other state schools, don't require enough proof of in-state residency, the audit found, and they don't independently review residency reports for anomalies.

That lack of oversight could lead to out-of-state students paying in-state tuition, which would deprive the schools of a serious revenue stream, the audit said.

For example, an undergraduate North Dakota resident at UND last year would have paid about $7,500 for two semesters' worth of courses - without housing, meals and books.

But if he or she were from one of the states without a tuition agreement with the school, tuition would more than double to almost $18,000.

The situation is similar at NDSU. Resident tuition for the 2013-14 school year was about $6,600, compared to about $17,600 for nonresidents not living in a tuition exchange state.

UND, NDSU and four other state schools need better procedures for how they determine student residency and update students' status, the audit found.

The other four schools were Valley City State University, Bismarck State College, Dakota College at Bottineau and Dickinson State University.

While those schools agreed with all of the audit's residency-related findings and plan to improve their processes, NDSU and UND had some qualms with the findings.

UND argued that collecting further documentation to prove residency, like utility bills or tax returns, would be cumbersome.

Collecting and maintaining all that extra data would also make students more vulnerable to having their personal information stolen, said Peggy Lucke, UND associate vice president for finance and operations, during Wednesday's teleconference meeting of the state Board of Higher Education's Audit Committee.

But current state policy, which requires applicants to attest they're residents - and can be prosecuted for lying - doesn't go far enough, John Grettum, manager of college and university audits for the Office of the State Auditor, said at the meeting.

"We feel that's a little short on what an auditor or reasonable man would want to see," Grettum said.

UND and NDSU did agree with the bulk of the audit's findings and said they'll work on the auditors' recommendations.

Those recommendations include better documenting residency policies and doing more to identify errors in data.

The residency issue was just one part of the audit of eight of the 11 schools in the North Dakota University System.

The audit also found some schools didn't do enough to document credit adjustments on students' financial accounts, and that some schools didn't have clear policies regarding when to grant tuition waivers to certain types of students.

Overall, Grettum said at the meeting, the findings were flaws to work on, but his team didn't find any major issues with the state college system.

"I think it speaks well of the system and its campuses," he said.