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Class Councils Face Unexpected Debts From Doughnut Stand

Jiri Schindler -- The Tech
The doughnut stand run each year by the junior class to raise funds has been netting yearly losses of thousands of dollars for the past three years.

By Dan McGuire
News Editor

Revised budget figures indicate that the Lobby 7 doughnut stand run by the junior class each year to raise funds has been operating at a significant loss for the past several years.

The figures show that the Class of 1996 may have lost approximately $5,000 and that the Class of 1997 may have lost about $3,500 dollars while running the stand. The reasons for the loss and the cause of the accounting errors are not clear.

The debts were discovered when the Office of Residence and Campus Activities reorganized its records from the past three years to enter them into their new accounting system.

At the moment, RCA is trying to confirm the problem before continuing. The office needs to "verify that this debt exists and where it came up and how to resolve it," said Andrew M. Eisenmann '75, associate dean for residence and campus activities.

"The first concern is to make sure that the current junior class isn't walking into quicksand" by running the doughnut stand, he said.

Food and labor are the major expenses for the stand, said John S. Choe '98, this year's doughnut stand manager. The doughnut stand pays the MIT minimum wage to workers and has supply contracts with three different vendors for the coffee, doughnuts, and pastries they sell, Choe said.

"What we want to do now is bring all of the different people together to sit down and talk about" whether changes to the stand are needed and what those changes should be, Eisenmann said. A meeting about the doughnut stand will probably take place today.

Senior class council will have to resolve debt

The state of last year's debts, totalling an estimated $3,500, will need to be resolved by the senior class council.

Pardis C. Sabeti '97, last year's junior class president and this year's senior class president, said that she was surprised to learn of the losses. But she said that expects that the senior council will be refunded the difference for the lost money.

"We've been told that we can just go and retrieve our money. I looked at the amount of money we had in January, and we were doing fine," Sabeti said.

Sabeti said that business was very good at the doughnut stand last year and that the stand was consistently selling out of popular items. "We [were] doing better each day" than we had in previous years, she said.

The discrepancy in the revised numbers may be a result of accounting errors made by RCA, she said.

Eleanor P. Crawford, staff associate for RCA, who handles the accounting work for the doughnut stand, declined to comment.

If the debts are not forgiven and the senior class council has "a deficit going into senior year, we will deal with that without affecting the activities of the senior year," Eisenmann said.

A possible shortfall of several thousand dollars is only a very small portion of the total amount of money that passes through the senior class council, Eisenmann said. Classes sometimes deal with as much as a hundred thousand dollars during Senior Week alone.

In the past, when there has been a surplus in the budget from sales by the doughnut stand, the class council has used the funds to subsidize the tickets to Senior Week events like clam bakes and cruises, Eisenmann said.

One possible way to cover the losses from the stand would be to increase the ticket prices for Senior Week events, he said.

"The reputation has been that [the senior class council] could provide funds to subsidize senior year events," said Eisenmann. "We'd like that to happen if at all possible," he said.