While Sacramento State’s Center for Small Business provides free consultation services to small industries in the region, at least one professor remains skeptical about faculty and administrators taking advantage of projects completed by students.

Students in the College of Business Administration are sometimes required to complete projects for the center in their coursework but might be unaware faculty and management are being given honorariums in addition to their base salary, said chair of the College of Business Faculty Council Joseph Richards.

“(Students) interview the small businesses and do it as part of their coursework and honestly believe they are doing it to benefit the small business,” Richards said. “They have no option. They are paying tuition to do these projects. I think if they come to know the faculty (and) administrators are profiting off them, they would be extremely outraged.”

According to the Center for Small Business account ledger, six professors and administrators received between $800 to $12,500 in spring 2013.

While students are paid through class credit and experience, the  faculty honorariums are given in appreciation for the considerable extra time needed to make real-life learning opportunities available to students, said former center director Dennis Tootelian.

“[The faculty] like to use [the opportunities] because they’re real world experiences,” Tootelian said. “The students get a chance to do something other than just deal with a case. What it does for students is it gives them an understanding that they’ve really learned a lot more in their courses than they think they have.”

Tootelian, who served as the center’s director for 37 years before retiring in 2011, remains with the university as an emeritus professor.

Small businesses around Sacramento are encouraged to contact the center to seek out help or advice. After cases are accepted into the program, individual faculty make the final decision as to whether a case is suitable for a course.

While some projects are used in marketing and entrepreneurship classes, many cases are used in Strategic Management because it is a requirement for all business majors. A payment of $100 to $125 is given to faculty for each case assigned, which are typically completed by students in groups.

Tootelian said the gratuity is given due to the challenge of working in the real world, including ensuring signed waivers of liability from businesses and being available to answer questions after students have graduated. Faculty are also required to fill out timesheets to track how many hours the center contributes to the community.

“We give them a modest honorarium because the amount of work they do is well in excess of what they would do if they were just using text cases,” Tootelian said. “For example, if I was teaching a class and I had just used text cases, I could assign one case to the entire class.”

Founded in 1969, the Center for Small Business is a student consulting service that provides expertise and practical training for students. More than 3,000 industries, ranging from retail to professional services, have challenged students to practice their theoretical knowledge in real-life situations.

“It’s extra work but it’s very rewarding for students,” said Ping Tong, Strategic Management professor. “Students get to learn a lot of the complications in real business (and) real operations they would not have otherwise get from the cases.”

The services provided by the center are made possible by the donations of outside organizations, including Sacramento Municipal Utility District and Wells Fargo.

As chair of the Business Faculty Council, Richards represents the faculty in the College of Business Administration.

He remains concerned about the amount paid to administrators in charge of the Center for Small Business, including Tootelian and former faculty coordinator Seung Bach.

In 2006, Tootelian was paid $18,600 from the center’s account and in 2013, Bach was paid $25,000.

“In my opinion, this is outrageous,” Richards said. “This is an exploitation of our students. Why not these $30,000 to $40,000 be used to support some scholarship?”

Strategic Management Professor Jeff Niu said the cases are a rewarding experience for students that might lead to a future career.

“When students are working on real-world cases, there’s a lot more variables that they have to consider when making their strategic decision,” Niu said. “I would say (it) is the most important or best practice they can ever have when they are at Sac State.”

Trevor Howard, a senior business major, is enrolled in Market Potential and Demand Analysis this semester and has completed several projects for Sacramento small business owners, including marketing plans.

“If you are trying to make a company yourself, you want to make a plan first and everything,” Howard said. “If you can make it for a company, you can make it for yourself.”

In fall 2013, Business Administration was one of the smallest colleges at Sac State, with 1,704 students enrolled. However, 2,133 students were either a pre-major or expressed interest in business.

Recognized for “Best Practice” by the Association to Advance Collegiate Schools of Business, the Center for Small Business has been acknowledged by both Sac State and the community as an outstanding example of the benefits of a public-private partnership, Tootelian said.

Howard said the honorariums paid to faculty are worth it because the center’s projects are easier than taking a test and provides valuable experience.

“You can apply it at your own pace instead of just studying and memorizing facts and applying it to a test,” Howard said. “You don’t get to truly understand it that way.”