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Hospitality Policy

Hospitality Policy

Reviewed By: Administrative Council on
Approved By: President Karnig on
Reviewed By: Administrative Council on
Approved By: President Morales on
Reviewed By: Administrative Council on
Approved By: President Morales on

For interpretation of this policy, please contact the responsible department: Associate Vice President of Finance, 909/537-5129

 

Purpose

It is the policy of California State University San Bernardino (CSUSB) and its auxiliaries (Auxiliaries), unless otherwise noted and together referred to as the “University” that hospitality expenses may be paid to the extent that such expenses are necessary, appropriate to the occasion, reasonable in amount and serve a purpose consistent with the mission and fiduciary responsibilities of the University. This policy applies to employees, students, donors, guests, visitors, volunteers, and other individuals as part of a business meeting; recreational, sporting or entertainment event; or other occasion that promotes the mission of the University and serves a bona fide business purpose. The policy also addresses meals served to employees and meals provided to prospective students and employees.

Scope

This policy applies to all campus business units within the CSUSB.  This policy governs the appropriate use of state and auxiliary organizations. CSUSB and its auxiliary organizations will comply with additional restrictions when established by funding sources.

Authority

Authority for this policy is pursuant to California Education Code section 89044.  This policy is issued under delegation of authority from the Chancellor to the Executive Vice Chancellor and Chief Financial Officer, and implementation and compliance with the policy is further delegated to the campus Chief Financial Officer.  California Education Code sections 66600, 89030, and 89035.  In compliance with the ICSUAM policy, section 1301.00.

Definitions

Approving Authority – a person to whom authority has been delegated in writing to approve expenses for meals, light refreshments, and other amenities described within the policy.

Auxiliary Organization Funds – CSU auxiliary organizations are separate legal entities authorized in the Education Code to provide essential services to students and employees. Auxiliary organizations operate in association with campuses pursuant to special written agreements, and are authorized to perform specific functions that contribute to the educational mission of the campus. These organizations are subject to applicable state and federal laws and regulations.

De Minimis – small in value, relative to the value of total compensation. There is no set dollar amount in the law for nominal prizes or awards. The de minimis value for this specific policy is 75.00

Employee Meetings – meetings which serve a CSU business purpose and are generally administrative in nature such as staff meetings, CSU system wide meetings of functional offices, meetings of the Academic Senate, campus meetings of deans and directors, employee morale functions, extended formal training sessions, conferences, extended strategic planning sessions, and meetings of appointed workgroups and committees.  Does not include one on one lunches when the meeting could otherwise be completed during the regular business day.

Events and Recognition – Events which serve a CSU business purpose and are in acknowledgement of milestones, significant contributions and employee recognition are generally allowable. 

  • Awards and Prizes
    • Something of value given or bestowed upon an individual, group, or entity in recognition of service to the university or achievement benefiting the university with the expectation of benefit accruing to the university or for other occasions that serve a bona fide business purpose.
  • Events, Recognition, Entertainment Reasonable expenditures as part of a public purpose event includes, but is not limited to:
    • Equipment Rental
      • Venue Rental
      • Décor
      • Supplies
      • Music
      • Guest Speakers and Presenters
  • Food and Beverage
    • Reasonable provision of a:
      • Meal (catered or restaurant)
      • Light refreshments (beverages, hors d'oeuvres, pastries, candy and cookies).
  • Fundraising Events
    • Events conducted for the sole or primary purpose of raising charitable funds where participants make a charitable contribution and a purchase for the fair market value of goods or services. Fundraising events may include dinners, dances, door-to-door sales of merchandise, concerts, carnivals, golf tournaments, auctions, casino nights, and similar events. Fundraising events must have prior approval by VP for Advancement, per ICSUAM 15701.
    • Fundraising events do not include the following:
      • Activities substantially related to the accomplishment of the CSU’s educational purpose, including such activities that receive sponsorship
      • Fundraising solicitations and related prospecting activities intended to generate only a contribution (no purchase of goods or services)
      • Unrelated trade or business activities that generate fees for service
      • Raffles in which the prizes have only a nominal value and do not require reporting as taxable income
  • Promotional Items
    • Items that display the name, logo or other icon identifying the university such as a:
      • Keychain
      • Coffee mug
      • Calendar
      • Campus Gear Wear/Apparel
    • Promotional items are distributed to provide information and/or promote the name or image of the University and are not intended for CSUSB employees.
    • Clothing purchases for recognition when it pertains to safety, special events or special groups will be considered a regular business expense and not governed by this procedure; e.g. Commencement, Summer Orientation, and Diversity recognition.
    • Logo and related branding must be pre-approved by Strategic Communications.  

Membership in Social Organizations – University clubs, athletic clubs, civic organizations and other membership organizations that provide a venue for hosting hospitality events or a means for promoting goodwill in the community. Memberships in business leagues, chambers of commerce, trade associations and professional organizations are considered a regular business expense and are not governed by this procedure.

Official Host – a CSU trustee, auxiliary governing board member, or university or auxiliary employee who hosts guests at a meeting, conference, reception, activity, or event for the active conduct of CSU business.

Official Guest – a person invited by an official host to attend a CSU meeting, conference, reception, activity or event. Examples of official guests include employees visiting from another work location, students, donors, recruitment candidates, volunteers, members of the community, or media representatives.

Public Purpose - A business purpose, which include expenses, that serve a purpose consistent with the mission and fiduciary responsibilities of the CSU.

Private-Purpose Trust and Agency Funds - as defined by Executive Order (EO) 1000.  See https://www.calstate.edu/eo/EO-1000.html.

State Funds – These are monies that are either appropriated by the legislature, as part of the budget process or continuously appropriated (e.g., tuition and fees).

Sponsored Program Administration Funds - Federal, state, local government, and private contracts.

Student Organizations - As defined in Executive Order (EO) 1068 - See https://www.calstate.edu/eo/EO-1068.html– Student Activities, section titled "Formal Chartering and Recognition Policies."

Tip/Gratuity - A gratuity (also called a tip) is a sum of money customarily given by a client or customer to a service worker in addition to the basic price. Tipping is commonly given to certain service sector workers for a service performed, as opposed to money offered for a product or as part of a purchase price.

Work Location – The place where the major portion of an employee's working time is spent or the place to which the employee returns during working hours upon completion of special assignments. The employee's department determines what constitutes an individual employee's work location

 

Allowable Expenditures

Allowable Expenditure

*Allowable when authorized by the trust fund.  See trust fund for specific requirements and allowances.

**Use non-state resources. 

Hospitality expenses must be directly related to, or associated with, the active conduct of official University business. When an employee acts as an official host, the occasion must, in the best judgment of the approving authority, serve a clear University business purpose, with no personal benefit derived by the official host or other employees. In addition, the expenditure of funds for hospitality should be cost effective and in accordance with the best use of public funds.

When determining whether a hospitality expense is appropriate, the approving authority must evaluate the importance of the event in terms of the costs that will be incurred, the benefits to be derived from such an expense, the availability of funds, and any alternatives that would be equally effective in accomplishing the desired objectives.

Employee Meetings

Meals or light refreshments provided to employees may be permitted if the expenses occur infrequently, are reasonable and appropriate to the business purpose.

When a meeting takes place over an extended period and the agenda includes a working meal, there may be justification that the meal is integral to the business function.

Meals – Maximum per Person Rates

See Appendix “A”

Tipping/Gratuities Guidance

It is recommended that users be reasonable (tips and gratuities should generally be 20% or less of the cost of the meal.)

Spouses, Domestic Partners and Significant Others

Hospitality provided to the spouse, domestic partner or significant other of an employee maybe permitted when it serves a University business purpose such as ceremonial functions, fundraising events, alumni gatherings, athletic games, and community events.  An agenda, invitation or similar documentation must be included with the payment record.

Students and Prospective Students

Hospitality provided to students or prospective students may be permitted when it serves a University business purpose. To justify the expenditures, one must determine that the expenditure is consistent with the mission of the University. Permissible activities may include:

  • Recruitment Efforts
  • Student Activities
  • Student Programs
  • Student Organization Events
  • Student Recognition Events and Commencements

Students may be hosted to attend fundraising and other community relations events that enhance their learning experience, in recognition of their student achievement, to engage with alumni and donors, or as representatives of elected student leadership. 

Hospitality provided to student athletes and recruits must be in accordance with the rules, regulations, guidelines, standards and procedures of the intercollegiate athletic association’s national governing board; e.g., National Collegiate Athletic Association.

Awards and Prizes

Award programs may be established to the extent that such expenses serve a purpose consistent with the mission and fiduciary responsibilities of the CSU and aligns with IRS regulations. Cash and cash equivalent items, such as gift cards and gift certificates, no matter how small, are always taxable to the employee as wages. A non-cash award or prize may have a taxable consequence to the employee if it does not meet the IRS definition of de minimis and infrequent. Only tangible goods with a retail value of less than 75.00 is considered de minimis.  It is the responsibility of the department awarding the prize to report the value to the Payroll Department.  Refer to IRS for tax rules: https://www.irs.gov/government-entities/federal-state-local-governments/de-minimis-fringe-benefits

Unallowable Expenses

Personal Benefit

Hospitality expenses that are of a personal nature and not related to the active conduct of official University business will not be paid or reimbursed.  The California gift of public funds doctrine set forth in the California Constitution, article XVI §6, prohibits the giving or lending of public [state] funds to any person or entity, public or private, unless there is a public purpose. 

Examples include, but are not limited to:

  • Employee Birthdays
  • Weddings
  • Wedding Anniversaries
  • Baby Showers

Allowable Funding Sources

State Funds

Unless specifically authorized in the local trust agreement (LTA), State Funds have the following restrictions and uses:

  • State Funds may not be used:
    • To pay for any expenditure prohibited by applicable laws, regulations, or agreements including the California Budget Act.
    • To pay for food and beverages or entertainment services that do not serve a business purpose.
    • To pay for alcoholic beverages, memberships in social organizations, or tobacco products.
  • State Funds may be used:
    • To pay for awards and prizes to employees for exceptional contributions, to students for excellence, and individuals to participate in a research funded survey or study.
    • For employee recognition, and official presentations for length of service awards or exceptional contributions, with at least 5 years of service.
    • To pay for official employee morale-building and appreciation activities that serve a business purpose.

Auxiliary Organization Funds

Hospitality expenses may be charged to auxiliaries provided the expense serve a bona fide business purpose. Auxiliary organization funds may be used to pay for alcoholic beverages, formal awards and service recognition, entertainment services, gifts, membership in social organizations and promotional items to the extent these purchases are not restricted by other applicable laws, regulations, or funding source agreements.

Sponsored Programs Administration Funds

Federal or local government contract and grant funds may only be used to pay hospitality expenses specifically authorized in the contract or grant, or by agency policy.  In the event of a conflict between agency and University policy, the stricter of the two policies shall apply.

Federal Funds may not be used to purchase alcoholic beverages or tobacco products, unless alcohol and tobacco are part of the research. 

For specific Sponsored Program Administration Fund requirements, follow this link: https://www.csusb.edu/sites/default/files/305.0HospitalityPolicy.pdf

Private-Purpose Trust and Agency Funds

Hospitality expenses may be charged provided the expense serves a bona fide business purpose and to the extent other applicable laws, regulations, or funding source agreements do not restrict these purchases.

Purchase Order Requirements

Business Unit SBCMP:

  • When purchasing from any vendor other than campus catering, or the approved vendor list, a Purchase Order will be required for anything exceeding $250.00.  Submit the following to campus Purchasing with the Purchase Requisition: 
    • Approved Hospitality Form
  • Business Unit UEC, SBPHL
    • When purchasing from any vendor other than campus catering, a Purchase Order will be required for any amount exceeding $10,000.  Submit the following documents to the Purchasing unit with the Purchase Requisition: 
      • Approved Hospitality Form
      • Sole Source Form to establish a Purchase Order
  • Business Units: SBASI, SBSUN:
    • When purchasing from any vendor other than campus catering, a Purchase Order will be required for any amount exceeding $10,000.  Submit the following documents to the Purchasing unit with the Purchase Requisition: 
    • Approved Hospitality Form

Invoices must be submitted to Accounts Payable, with the valid PO number on the face of the invoice for payment processing.

Approval of Transactions

The authorized MPP must approve payment or reimbursement of hospitality expenditures. ​  If the authorized MPP is not available to sign, an authorized delegation of authority must exist. 

State Side Approvals

Requirements that individuals with delegated approval authority may not approve their own expenses and individuals may not approve expenses of their supervisor.  The exception is approval of President's expenditures by the Chief Financial Officer.

Requirements that payment or reimbursement for attendance at a community relations activity or fundraising event include documentation of the individual names, affiliations, and direct or indirect benefit to the University to be derived from the expense.

The President, or designee must approve payment or reimbursement of hospitality expenditures for recreational, sporting or entertainment events.

The President, or designee must approve payment or reimbursement of hospitality expenditures for a spouse, domestic partner or significant other of an employee.

Auxiliary Approvals

Requirements that individuals with delegated approval authority may not approve their own expenses and individuals may not approve expenses of their supervisor.  The exception is approval of President's expenditures by the Chief Financial Officer.

A Hospitality Expense Request must be completed whenever food (breakfast, lunch, and/or dinner) or light refreshments are served for the purpose of extending hospitality in connection with CSUSB and/or Auxiliary business. Requirements that payment or reimbursement for attendance at a community relations activity or fundraising event include receipt(s) and/or invoice, agenda of the meeting, documentation of the individual names, affiliations, and direct or indirect benefit to the University to be derived from the expense. 

 

Documentation Required

The following documents and attachments are required in order to formally support the expenditure. 

  • Hospitality Form 
  • Itemized receipt (receipt of invoice from the vendor showing payment) or Lost Receipt Memo
  • Must clearly state the business purpose (direct or indirect benefit to University)
  • Agenda/Flyer/Invitation
  • Listing of Attendees and Affiliations
    • In the event of a large-scale group event, such as commencement, campus wide business conferences, etc. where a sign in sheet is not available, include a flyer or invitation to justify why there is no attendee listing. 
  • Campus Catering - In addition to the above required documentation, the following are also required:  
    • Itemized Invoice
    • Detailed function sheet
  • Catering (other than campus catering) - Purchase Order Requisition submitted to the appropriate Purchasing unit and in compliance with their guidelines: 
    • Approved Hospitality Form
    • Itemized quote/invoice
    • Listing of Attendees/agenda/flyer
    • Submit invoice to Accounts Payable with PO number listed on the invoice
  • ProCard

 

Submission/Process Workflow - Catering

catering workflow

Submission/Process Workflow – Procard Purchases

procard purchase workflow

Submission/Process Workflow – Personal Reimbursements

Personal reimbursement workflow

Submission/Process Workflow – Vendor Direct Pay

(Other than Catering - For example, table rentals, decorations, party supplies, etc.)

vendor direct pay workflow

Appendix A

Meals – Local Rates  - Maximum per Person

The maximum per person rate(s) for breakfast, lunch, dinner and light refreshments inclusive of the total cost of food, beverages, labor, sales tax, delivery fees or other service fees are as follows:

Meal type chart with maximum person

*When authorized by the trust fund.  See trust fund for specific requirements and allowances. 

Meals – Out of Area/Travel Rates – Maximum per Person

The maximum per person rate(s) for breakfast, lunch, dinner and light refreshments inclusive of the total cost of food, beverages, labor, sales tax, delivery fees or other service fees for out of area travel may be obtained from the U.S. General Services Administration at the following link: 

https://www.gsa.gov/travel/plan-book/per-diem-rates

Note that while the University policy has a daily limit, for the benefit of expense processing, it is recommended that each meal be broken out individually.