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Tuesday, September 17, 2013

Tuesday, September 17, 2013

Tuition Hikes Ahoy!

As we all prepare for the Napolitano era, the Regents are heading to their favorite meeting place at UCSF (safe from undergraduates) with time to stop off at Lawrence Livermore National Laboratory.   There are any number of items to be discussed but first and foremost is the question of the UC budget.  There the crucial meeting is Wednesday's Finance Committee Session.  Among other items, the Finance Committee is to hear about the long-range budget plan, the expected 2014-2015 budget, and the wondrous accomplishments of the "working smarter initiative."  Although we won't know in detail what UCOP is proposing until they actually make their presentations, it is possible to see the general strategies and narratives that UCOP is proposing for budgetary planning and decision-making.

As ever, UCOP appears not to know what it wants to say; as a result it continues to alternate in what it is asking of the State and from the University community.  But appearances can be deceiving.

If you turn the budget presentations into a narrative it would go something like the following: 

After long years of budgetary cuts, Governor Brown has, through his handling of the state's debt, his success in achieving passage of proposition 30, and his willingness to commit to a series of funding increases over the next several years succeeded in staunching the bleeding of budget cuts.  In the new state budget UC's general fund increases total $256M in unrestricted funds although $125M of those go for a tuition buy-out.  In this way, the state is now in the words of OP: "signify the welcome, necessary return of the State to being a true partner with UC." (3) BUT this "true partnership" is, notable for its stability more than its adequacy.  Indeed, at the heart of OP's narrative is the argument that although the State has agreed to helpful increases in funding it is also preventing the University from functioning properly by restricting its ability to raise tuition.

Put another way, the real message behind OP's budget narrative is that UC must increase tuition if it is to continue to function as a leading research University and the Regents, the public, and the State must accept this claim.

The headlines that OP seems to want to emerge from the meeting is that although State funding has increased, it has not increased sufficiently to cover required increases in expenditures so that long-standing problems cannot be addressed.   Again in OP's language:

The State funds provided in 2013-14 ($256.4 million) are a welcome departure from past years’ base budget cuts. However, they are sufficient to fund only the cost increases on the State-funded portion of the budget – which is now less than half of the total core funds.  (2)


Thankfully, the OP has stopped insulting the State every time it seeks funding.  But we must be clear that OP is presenting a scenario in which the state must choose between rising tuition and decreasing quality.

There are several preliminary things to be said about these claims.

First, it is clear that the state funding does remain insufficient.  The increases in State funding do not recover from the years of cuts and leave numerous buildings in need of maintenance, faculty positions unfilled, staff positions cuts etc.  But the University has accepted the state funding end of the equation as satisfactory.  It is the tuition side that they are pushing--not more public investment.  We appear to be entering a period where OP has de facto accepted an updated version of the earlier compact with Arnold.  And we know how well that turned out.

Second, it is not clear that OP's numbers add up.  In its discussion of the 2013-2014 budget OP makes their case for the necessity of tuition increases by insisting that the increase in state funding only covers the cost of increases to the core budget.  According to OP the necessary increase comes to $155M (or more than is left over after the tuition buyout).  But OP is also touting the fact that they will save $80M because of a shift in debt accounting (2) and Executive Vice-Presidents Brostrom and Taylor are claiming that they have created $171M worth of funds this year due to "working smarter." (1)  If these claims of financial and administrative wizardry are accurate then that should leave roughly $100M in funds for UC (or nearly as much as the administration had hoped to get from tuition increases and without the reduction of "return to aid").  So either their claims about the necessity of tuition increases appear overstated or the claims about the wondrous savings are overstated.

Third, if you read the documents I linked at the top (and I urge you to do so) you will see that OP has set off a set of oppositions between "truly mandatory" and "high priority" costs. (2)  Strikingly, the "truly mandatory" costs focus largely on benefits for faculty, staff, and retirees.  The "high priority" costs on the other hand tend to focus on delayed maintenance and steps taken to ensure increased quality in education.  Now, I am happy to see that OP takes the declining benefit situation seriously and also agree that with their insistence that the State commit to its responsibility for UCRP.  But the way that they have set the argument up places employee benefits and salaries and tuition increases in a paired relationship.  Put bluntly, OP appears to be constructing a narrative in which faculty and staff compensation (in all of its forms) is the driver behind increases in tuition.

There are subsidiary lines about alternative sources of revenue--mostly in terms of out of state and especially international students.  But the main thrust appears to be Tuition Hikes Ahoy or say goodbye to quality. 


2 comments:

Gerry Barnett said...

Perhaps UCOP is hoping to get both higher tuition and lower quality, but preserve UC's reputation for quality. You know, run like a business. It's all about brand and margins. Is there anything suggesting that most of the requested money will go to instruction?

stone said...

@Gerry Barnett
Yes, I agree with you.

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