Snow College’s latest travel policy included new, logical restrictions. For example: Employees would be reimbursed only for for hotel stays on days that matched an event’s agenda, and they could no longer expense a first-class airline seat.
The Utah college got lots of comments—about three-quarters of them negative—when the regulations were posted for a 30-day review by faculty and staff. “Buy-in was really hard,” says Lisa Jones, assistant director of finance and disbursements at the two-year college. “There was a lot of flack.”
In any industry, employees grow accustomed to making their own travel arrangements and tiptoeing over established boundaries. But that leeway has diminished significantly in higher ed.
The uncovering of outrageous abuses of travel policies, along with tight budgets and public skepticism of tuition increases, are leading to scrutiny of every penny spent on travel. Long gone are the chauffeured limousines, $1,200-a-night hotel rooms and other lavish expenses of traveling administrators at some institutions that have grabbed news headlines.
Colleges and universities are implementing a wide variety of strategies to protect their resources and reputation. Some are centralizing travel bookings to better monitor activity.
Others are deploying technology that analyzes data to identify travel patterns, catch abuses and find better vendor rates. The pendulum has now swung completely to the other side, holding faculty and staff strictly accountable for travel dollars spent.
Pulling back the reins
Before Snow College’s new travel policy required employees to submit conference agendas, individuals could fly out on a Sunday for a conference that didn’t start until Tuesday, yet charge their entire hotel bill and meals to the school, Jones says.
The other changes, implemented in the years since the policy was first released in 2009, eliminated travel advances, with limited exceptions, such as student group travel. The finance office does, however, now require groups to submit the name of every student traveling.
Outsourcing travel management for savings and safety
With shrinking budgets, some colleges and universities are consolidating and outsourcing their travel program for hard dollar savings and safety.
Over the past year, a handful of public and private colleges and universities have moved from a “do whatever you like” philosophy to designating one travel management company for employees, says Kathleen Roberts, manager of business development at Christopherson Business Travel in Salt Lake City.
The travel management firm services 25 colleges and universities, including the University of Utah, University of Colorado and Auburn University in Alabama.
What’s surprising to Roberts is that many schools have only a general idea about their actual travel costs. “They don’t know what they’re spending,” she says. “Generally, what happens is [that accounting says] they book $4 million in travel and [when] we get in there, it turns out to be $8 million. A lot doesn’t get coded correctly.”
Meanwhile, Christopherson, Concur and other travel firms are delivering a new service, sometimes called Duty of Care. It alerts travelers about potential hazards, such as approaching hurricanes, so they can recoup costs if trips are cancelled.
Still, Roberts believes a successful travel program involves more than just policies and reports. “It’s the ability to leverage with vendors and provide negotiations and discounts.”
“The advances were getting so out of hand, we spent most of our time funding advances and figuring them out afterward,” says Jones, adding that it was common for the advances to be more than people needed.
No one is reimbursed for first-class airfare anymore. If employees prefer lodgings outside a conference hotel, they must shop around, compare rates and ask for state discounts. Similarly, if conference registration includes meals, they must provide reasons for food expenses.
Although she has not compared travel costs before and after the new policy, Jones suspects that, so far, the college has saved thousands of dollars.
Jones’ advice to administrators elsewhere: “Remember, you’re not there to please [employees]. You’re there to protect them and the college.”
Snow College, the University of Colorado system and Princeton University are among the schools controlling budgets by issuing travel credit cards that employees can use for large expenses such as hotel and airfare. Employees never even see a bill. After they reconcile their receipts, finance directly pays their travel bills and ensures that negotiated vendor discounts are applied.
But employee convenience isn’t the only reason University of Colorado employees have travel cards. The CU system’s Procurement Service Center uses $200,000 a year in credit card rebates to offset other travel fees, says Sandy Hicks, assistant vice president and chief procurement officer.
Individual CU departments must pay a $6 fulfillment fee (charged by a travel management company) every time a staff member purchases an airline ticket. CU’s procurement center now pays that fee if employees use its online business travel software—Concur Expense and Concur Travel—which track employee spending behaviors.
“[The center] paid $75,000 university-wide, which departments would have had to pay,” Hicks says, adding that 93 percent of CU’s employees currently use the system. “Now we know exactly what we’re spending with different airlines and can get better contracts. Last fiscal year, we saved $260,000 on those contracts.”
Meanwhile, to encourage continued use of its travel and expense system, her staff routinely posts information about travel savings and efficiencies on the university’s website, in its newsletter and in employee emails.
Other policy changes at the school involve reimbursement for out-of-pocket expenses, such as for taxis, shuttles or parking. Employees were previously required to submit receipts for purchases over $25. But due to an IRS revised ruling (IRS Publication 463), that amount has increased to $75, says Hicks.
Still, she says the university didn’t adopt the new ruling until last year, nearly a decade after it was revised. An “approver” in each department ensures that expenses seem reasonable, regardless of receipt threshold, and monitors for abuse.
Currently, Hicks and her staff are re-examining CU’s international travel policies to see if they are they outdated or consistent with policies at other schools. Currently, CU employees have to fly for a certain number of hours to be fully reimbursed for a first class seat, unless they can claim medical necessity. Perhaps the policy can be more flexible.
Travel is an area that institutions can get more control over while offering better service to faculty and staff, Hicks says.
Data is king
In some cases, online travel and expense systems are the driving force behind policy changes.
For the past six months, Cindy Shumate, travel program manager at Princeton, has been analyzing data gathered by its online travel system to negotiate lower airline rates. If she’s successful, new travel policies may require employees to use specific airlines over others.
“Data is strength,” she says. “This is one of the big advantages of a system like this—to have actual data you can analyze, provide to suppliers and share with users to make good decisions.”
Ithaca College in New York, which supports 1,000 faculty and staff, is following a similar path. Last September, it began piloting a program to make its external and internal systems—Orbitz for Business, ExpenseAnywhere and its daily ledger— compatible with each other so the school can collect valuable travel data, says Gerald Hector, vice president of finance and administration.
Say the data reveals employees are frequently traveling to the college’s campuses in London and Los Angeles. Then his department can negotiate favorable rates with local vendors. “We’ll have reports on where and what we’re spending, what departments are traveling regularly,” says Hector.
This new approach is not meant to be onerous or harsh, but will keeps practices equitable across the institution, he says. College leaders must be very “dispassionate” about travel policies to realize savings and put those dollars back into the school’s core mission of education, he adds.
Deep impact
Another culprit behind travel policy changes is state budget cuts, which are further straining systems that have already experienced major cuts.
Chicago State University is bracing itself for a potential 10 percent budget cut, says Tom Wogan, university spokesperson.
Pre-authorizing travel is a standard policy at the school. What hasn’t been typical, until now, is rejecting professional development travel requests.
“As much as we would like to maximize things like conferences and professional development … I do not foresee that we’re going to be able to do that,” says Wogan. “[It] is going to boil down to athletic teams that need to travel and if members of our administration need to go to Springfield to meet with our legislators.”
University officials encourage travelers to create reports or deliver presentations about what they learned on their trips and how that will benefit the university, says Wogan. “Every dollar we spend that’s taxpayer money has to be accounted for very thoroughly.”
Carol Patton, based in Las Vegas, is UB’s Human Resources columnist.
