The Historic Perspective

In the 1950s, the State University campuses organized and chartered not-forprofit corporations under the “Membership Corporation Law” (Chapter 40 of the Laws of 1909) to administer a fairly small set of campus enterprise activities, later classified as campus auxiliary services. This was done, in part, to further insulate NYS from services with high liability exposure and because NYS agency requirements and systems for accounting, reporting, and budgeting can not effectively accommodate retail and consumer service enterprises. Section 355(6) of the State Education Law specifically authorized the University Board of Trustees to enter into contracts necessary for carrying out the purposes of the University, including contracts “...with non-profit corporations organized by officers, employees, alumni or students...” of the University. This provision was first enacted by Chapter 494 of the Laws of 1958 and it is quite possible that this reference was intended only to authorize contracts with ASCs without competitive bidding. The Not-for-Profit Corporation Law was then enacted by Chapter 1066 of the Laws of 1969, effective September 1, 1970. As such, today’s corporations are organized under the State’s Not-for-Profit Corporation Law, in the same way as any other not-for-profit corporation. Each ASC is independently audited.

Most campuses had created these entities called Faculty Student Associations (FSAs) to provide basic food services, bookstores and limited vending programs. In the ensuing years, the rapid influx of students, faculty and staff to SUNY put new emphasis on the services and products offered by the associations and the increasing important role of FSAs in accommodating the expansion of campuses across the university.

By the mid 60s, the associations were thriving businesses with sizable payrolls, extending a broadening array of services across campus and generating modest profits to be shared with their campus community. Governance of each campus association was largely in the hands of campus administration with minimal participation by faculty and students.

...continue