Approved by President
Effective Date: June 5, 2017
Responsible Division: Business and Finance
Responsible Office:  Business and Finance
Responsible Officer:  Associate Vice President, Business and Finance

I.  Purpose

The primary mission of Middle Tennessee State University (MTSU or University) is the creation and dissemination of knowledge. To carry out this mission, it is often desirable to establish educational business activities, or auxiliary enterprises, to provide goods and services that enhance, promote, or support its instructional, research, public service, and all other educational and support functions in order to meet the needs of the students, faculty, staff and members of the public participating in institutional events.

Educational business activities shall be established and carried on only when pursuant to, and in accordance with, an authorization and statement of purpose approved by the University's President or designee.

This policy provides uniformity and guidance in the classification and operation of auxiliary enterprises at the University. Also provided are examples to supplement University policies, procedures, and reports concerning the operation of auxiliary enterprises.

II.  Definitions

Definitions of Educational Business Activity and Auxiliary Enterprises are given as part of the policy.

III. Educational Business Activity

A.  Definition of Educational Business Activity. Each educational business activity shall meet the following three (3) conditions:

1.  The activity is deemed to be an integral part in the fulfillment of the University's educational, research, public service, and campus support functions, and other educational and support activities, without regard to profit.

2.  The activity is needed to provide an integral good or service at a reasonable price, on reasonable terms, and at a convenient location and time.

3.  The activity is carried out for the primary benefit of the campus community but with sensitivity to the total community.

B.  Concept of Unrelated Activities. The University must comply with applicable laws and regulations pertaining to such activities, and educational business activities not falling within the conditions established above may be unrelated business income activities and subject to unrelated business income tax.

IX.  Auxiliary Enterprise Operation

A.  Role and Scope of an Auxiliary Enterprise Operation:

1.  Definition of Auxiliary Enterprises

a.  An auxiliary enterprise furnishes goods or services to students, faculty, or staff, and charges a fee directly related to, but not necessarily equal to, the cost of the goods or services.

b.  The public may be served incidentally in some auxiliary enterprises.

c.  They are essential elements in support of the education program, and conceptually should be regarded as self-supporting. Little or no