ISU officials tell JFAC forensic-lab funds will be returned; university pledges tighter controls

BOISE, Idaho — Idaho State University officials told the Joint Finance-Appropriations Committee on Wednesday that the university will return funds that had been appropriated for an Eastern Idaho forensic pathology laboratory and that an audit of the matter is underway.

The disclosure came as Kevin Campbell, budget and policy analyst with the Legislative Services Office, gave JFAC an overview of ISU’s FY2026 budget request and other financial details. “This morning, I’m starting your day with an overview of Idaho State University’s budget, including their FY 2026 budget request,” Campbell said. President Rob Wagner told the committee he had reviewed the transactions and communications and concluded the university should have retained closer control of the appropriation. “I believe Idaho State University should have kept those funds. We should have been responsible for those funds,” Wagner said.

The matter traces to a prior plan for a forensic pathology facility that would have been located on ISU’s Pocatello campus and that the university expected would provide training opportunities for ISU health sciences students. According to Wagner, ISU initially expanded a small portion of the appropriation for a consultant but later followed a memorandum of understanding that transferred remaining funds to a county partner after the county decided a campus facility was no longer desirable.

Wagner described steps his administration is putting in place to strengthen accountability for legislative funds: identifying ownership of appropriations, establishing invoice procedures when third parties operate on ISU’s behalf, and tracking legislative intent so the university can demonstrate funds were used in keeping with appropriators’ direction. Representative Scott Manwaring, who asked about the timeline and internal controls, thanked Wagner for the university’s cooperation and for the decision to return the funds.

Campbell’s budget presentation also reviewed ISU’s fund sources and expenditures, noting a technical error in tuition-fee beginning-balance figures in the slides that did not affect the underlying treasury balances. He reported ISU’s base budget and major budget drivers: ISU serves more than 12,000 students, personnel costs account for roughly three quarters of expenditures, and the FY2026 request includes operational capacity enhancements and enrollment workload adjustments. “Idaho State University has not overdrawn its bank account,” Campbell said, noting he would update the record if the corrected slide is needed.

Committee leaders told members the audit is already in process. A co-chair announced to the committee that a public report prepared by the university’s staff has been posted and that a legislative audit request has been made to “make sure that no lines were crossed.” The chair characterized appropriations as law and said the committee expects full transparency and accountability going forward.

The committee also questioned Wagner about programmatic changes at ISU. Wagner described recent consolidations of two student resource centers into functions focused on student success, the creation of a Bengal Success Center available to students across ISU’s campuses, and the reallocation of two staff positions (one to student involvement and one to the office of equal opportunity/title IX reporting to the president). He said those moves were intended to increase student completion and to refocus student services on academic success.

Wagner and committee members also discussed workforce-related needs in eastern Idaho, ongoing enrollment growth, and targeted requests in ISU’s FY2026 submission. In his remarks Wagner said he would return to the committee with proposals if ISU seeks future partnerships or appropriations to address public-safety and workforce gaps in the region.

What’s next: the committee’s announced audit will produce findings that JFAC can use to determine whether further legislative action is warranted. ISU said it will provide corrected budget-slide data if needed and will continue to report on changes to internal controls and the disposition of the previously appropriated funds.