A version of the Student Activity Fee was first established in 1957 to provide funding to all of the extracurricular activities on SUNY campuses, which they otherwise would not have had. This included but was not limited to tickets for athletic events, entertainment events, and cap and gown expenses. During the social unrest of the 1960s-1970s, students won the right for the Student Activity Fee to be considered separate from tuition and effectively gave students greater decision making abilities outside of the administration's immediate control.

In 2001, the SUNY Chancellor formed a new task force on student activity fees. This University-wide group was organized in response to legislative interest in the University's student activity fee program, particularly the referendum process. The Specific charge to this task force was to review the current University Board of Trustees policy on the Student Activity Fee, which had not been reviewed since its development in the late '70s, to ensure that procedures were in place to achieve fiscal accountability and to address recent Supreme Court decisions regarding viewpoint neutrality (Southworth Case). The task force, through subcommittees, studied issues relating to referenda, communication, disclosure, fiscal integrity, and operational procedures.

The task force recommendations lead to updated and refined University policies and procedures relating to the Student Activity Fee, while clarifying roles and responsibilities of the three participants within the overall student activity fee structure: the student government, the campus president and/or designee, and the independent fiscal agent. The recommendations addressed a range of legal issues that had been the subject of recent court decisions. In addition, a number of recommendations sought to increase student participation in the decision-making process, as well as strengthening internal control features to ensure fiscal accountability.

Now known as the Mandatory Student Activity Fee, the undergraduate student body votes biennially (every two years) whether or not to participate in the fee and every SUNY student at participating universities pays into the system that makes their student governments possible. Each undergraduate student at the University at Buffalo pays $109 per semester; this amount then collectively funds all extracurricular activities organized by the Undergraduate Student Association. All use of Mandatory Student Activity Fee money is governed by UB policies, New York State law, Federal law, and SUNY Mandatory Activity Fee Guidelines.

The Student Association's budget is approximately $4.5 million, which is allocated to SA Activities and Entertainment, SA Clubs, and Campus Services. Students have direct control over the Mandatory Student Activity Fee by electing representatives for the SA Senate and SA Executive board.