President Alexander Gonzalez borrowed $164,000 of CSUSFoundation money to help finance his home in Natomas with alow-interest loan, as part of a plan approved by the Foundation inMay to help with his relocation costs.

According to the PriceWaterhouseCoopers audit, Gonzalez receiveda loan of $164,000 plus an additional $2,371 per month for homepayments for three years, totaling an estimated $249,000 inloans.

The Foundation initially loaned $104,000 to the president topurchase his home. An additional $60,000 was loaned in August.

The Foundation holds the second deed of trust on thePresident’s home. According to the audit the loan has aninterest rate of 1.697 percent and is due and payable in 2006.

According to the May 9 minutes of the CSUS Foundation Board ofDirectors meeting, requests for housing loans must be approved bythe president of the university or by CSU Chancellor CharlesReed.

Edward Del Biaggio, vice president of business andadministration, said Chancellor Reed approached him about thepossibility of the Foundation funding the purchase ofGonzalez’s home.

The Foundation also committed to advancing the president $2,371per month.

The President receives an annual housing allowance from thestate of $36,000 in addition to his $221,004 salary.

Del Biaggio said the loan was made at the “goingrate” for the Foundation. He said the original loan of$104,000 and the monthly advances are charged at an interest of5.25 percent but the additional loan of $60,000 is charged at 1.697percent.

Julio Valasquez, a student member of the board of directors ofthe Foundation and executive vice president of Associated Students,Inc. said the board decided to offer the president the loan as agesture of hospitality and welcome.

“It is at a low interest rate to make it more convenientfor him. He had to move all the way to Sacramento from SanMarcos,” Valasquez said.

ASI President and Foundation board member Peter Ucovich said hehad mixed feelings about the loan.

“Frankly, as a student, it definitely ruffles my feathersthat I am paying more on my student loan than anyone, whetherit’s the university president or not, is paying on a homeloan,” Ucovich said.

Del Biaggio said the loan is available to any new faculty memberas a way to attract people to Sacramento State, however no otherloans have been made from the Foundation. It will also depend onhow much money the Foundation has available.

“If 100 faculty members apply, we will not be able to helpall of them,” Del Biaggio said. “We would have tocontrol the number of requests.”

“Purchasing a home appropriate for entertaining on behalfof the president is beyond the means of most people,” hesaid. “Providing a loan is a way of attracting the presidentto Sac State.”

The Board of Directors of the Foundation agreed to make fundsavailable for new University employees in May. Minutes of a meetingthis year read, “Use of this program will be based onrequests from either the CSU Chancellor or CSUSPresident.”

The President did not approach the Foundation for the loan; DelBiaggio said he asked the Foundation to assist the new President inpurchasing a new home at the request of Chancellor Reed.

Del Biaggio said that the loan’s interest is at the goingrate for the Foundation and they have a deed to the house, so theycould take ownership if the president fails to repay the loan.Loans from the Foundation are open to all faculty and not only tothe president as a way of attracting people to work at theUniversity, Del Biaggio said.

The Foundation is a non-profit corporation and an auxiliaryorganization of Sac State that provides facilities for theuniversity, including the Hornet Bookstore and dining services. Italso provides contract services for the university, includingpayroll and administration for university research and sponsoredprograms.

The Foundation has $102 million in assets, with net assets of$27 million. Students spent $29 million on CSUS Foundation’sservices last year.

The Board of Directors of the Foundation has 14 appointedmembers, including four student members from ASI. The four studentmembers are Ucovich, Residence Hall Associate Angela Murdoch, Chiefof Staff Erin Hicks and Velasquez.

David Levy, the Foundation’s assistant director ofmarketing services, said the Foundation’s goal is for alltheir divisions to run self-sufficiently and aim to take in 5percent profit.

Levy said some sections do very well in reaching and exceedingthis goal like the Hornet Bookstore. Others, like the DiningCommons, do not reach their target.

The Bookstore earned $1.6 million last year.

Velasquez said that as a student board member, his goal is togive more of the Foundation’s profit back to students. Hesaid the Foundation is constantly giving money back to theUniversity through grants and investing money in new buildings likeModoc Hall and Capital Public Radio.

“The Foundation aims to more than break even so that wecan give back to students because without students we would nothave a Foundation,” Velasquez said.