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University of South Florida says it misappropriated $6.4 million in operating funds on construction

The university has told the state's Board of Governors the money was misappropriated to shore up funding for the Patel Center for Global Solutions in Tampa.

Officials at the University of South Florida have admitted they misused $6.4 million in state operating funds on a building completed in 2010

The Orlando Sentinel reports that the admission came in response to an inquiry prompted by the University of Central Florida's acknowledgment earlier this year that it used $38 million in operating funds to build Trevor Colbourn Hall, a violation of state rules.

The Board of Governors, which oversees Florida's state university system, had asked all institutions to confirm that facilities built since July 1, 2008, had been constructed using funds from appropriate sources.

South Florida was the only institution, aside from Central Florida, that said it had misappropriated funds on a building construction. The $21.7 million Patel Center for Global Solutions was built on the Tampa campus mostly from private donations, which is allowed, but South Florida also spent $6.4 million that was intended for other university needs on the project.

The decision to misuse state funds was because of “an administrative oversight and misunderstanding about the proper use of carry-forward funds,” wrote David Lechner, senior vice president for business and financial strategy at South Florida.

“The primary reason for the funding change appears to be that after the building was underway, significant, pledged private funds failed to materialize notwithstanding a signed and binding pledge for same,” Lechner wrote. “Those funds are still outstanding since the signed pledge has yet to be honored.”

No South Florida employees have been disciplined as a result of this matter, spokesman Adam Freeman said. The university’s Board of Trustees plans to conduct an independent review, he said.

The Patel building houses numerous programs, including the Patel College of Global Sustainability, which offers degrees in areas such as sustainable transportation, tourism and energy.

It’s unclear what consequences South Florida might face from the Board of Governors. The board lambasted Central Florida in September after the state auditor general discovered the university had used operating dollars to build Trevor Colbourn Hall.

Former Chief Financial Officer Bill Merck resigned in September, and took “full and immediate responsibility” for the decision after the Auditor General uncovered it, university officials say.

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