ASUC Senate weighs options in face of $50,000 budget deficit

The ASUC faces a deficit with their current budget.
Benny Grush/Staff
The ASUC faces a deficit with their current budget.

The ASUC Senate could face a $50,000 deficit at the end of the year, according to most recent projections — a funding gap that might force the student government to freeze funding for student groups in the future.

When the senate depletes the roughly $1.6 million in funds that it collects from student fees, it relies on a Carry Forward Fund, which holds about $400,000 in reserves, according to ASUC Finance Officer Amir Chini.

Though the ASUC Senate has drawn money from its Carry Forward Fund for years, it was not running  a deficit because the amount of funds being drawn was replaced by funds from the ASUC Auxiliary’s business operations, according to ASUC Attorney General Hinh Tran.  However, because the Auxiliary has not made significant profits for several years, according to Tran, funds taken from the Carry Forward account have not been replaced. ASUC officials are classifying this unsustainable spending as the deficit.

At the meeting Wednesday night,  Tran warned senators that they should begin explaining to their constituencies that the levels of funding they now receive might be in jeopardy because of the deficit.

“We’ve reached a critical threshold where we have to take action now, or very soon or the Senate will deplete the Carry Forward Fund, and we’ll have to cut funding to student groups,” Tran said at the meeting.

The ASUC bylaws mandate that the senate operate a balanced budget. If revenues and spending are not balanced, the ASUC Judicial Council has the power to freeze senate spending.

To deal with the deficit, senators discussed the possibility of creating a student fee referendum for the spring 2013 ballot that would increase the amount students pay each semester to support the ASUC.

Student Action Senator Mihir Deo, a member of the senate’s financial committee, said a fee increase might be necessary to accommodate robust student life.

“When we’re in Finance Committee, we realize the urgency of certain groups who need that money,” Deo said.

Alternatively, CalSERVE Senator Nolan Pack suggested that the senate might have to cap the number of student groups it funds every semester.

Senators also emphasized the importance of long-term financial stability and avoiding the precedent of operating with an unbalanced budget.

“We need short-term policies to address this issue right now,” Cooperative Movement Senator Jorge Pacheco said. “We need to make sure the Association never goes down the path of structural deficit ever again.”

Tran said his goal was to address the impending deficit crisis in the next year, which Chini emphasized could easily turn out to be larger or smaller than projected.  Any surplus funding that student groups have at the end of the year would be returned to the senate’s contingency fund, shrinking the deficit. Alternately, student groups could request more funding than they were allocated in spring budgeting, causing the deficit to grow.

According to Executive Vice President Justin Sayarath, an ad hoc committee will be appointed soon to address the projected budget deficit.

Jeremy Gordon covers student government. Contact him at [email protected].

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  • Vinit Sukhija

    I worked in the ASUC for two years as the Elections Council Chair and can attest that this deficit can be easily closed through deliberate, intelligent cost-cutting measures. If the Carry Forward Fund cannot be replaced by ASUC Auxiliary operations (which is more than understandable, given current general economic conditions), then it is incumbent upon the Senate to find other ways to close the deficit without actually gutting the ASUC’s primary role of financially supporting student groups. When I served as Elections Council Chair, we were able to run the election some $25,000 under budget after we reduced the number of physical polling locations on campus. It didn’t affect turnout (which actually increased from 11,016 to 12,383) but we were able to save a substantial amount of money. Bottom line–the ASUC needs to do a better job of performing cost-benefit analyses on how it spends its money.

  • LOL

    LOL increase in student fees? Like that would EVER pass. We’re lucky we scraped by with V.O.I.C.E.
    Pathetic.

  • studentclub

    this is hardly the fault of the current senators. the current senators in the finance committee have been the strictest ever seen in recent years in regards to funding. this article is very inaccurate because money hasn’t been replenished to the carryforward fund in years, we have consistently dipped into our bank accounts to fund clubs. last year’s senate class went $100,000 in deficit and repleted those funds. They are being as financially responsible as possible. They just get attacked all the time, 1) by not giving student groups enough money 2) by students who think they are spending too much money. so they have to go for a compromise. all these attacks are baseless. That’s really insensitive and they are getting attacked from both sides.

    • I_h8_disqus

      I have heard that the finance committee has been strict, but over time the ASUC has shown that they are not ready for financial responsibility. The university has already taken some of their responsibilities away in terms of the student store, which the ASUC was running into the ground, and with talk about raising fees, it is a good time for the university to step in and have professionals handle the money. The ASUC can still decide what groups to fund, but they won’t be able to write the checks, and the professionals will make sure that the ASUC doesn’t overspend their budget.

      • studentclub

        Well, I don’t believe the fee increase is that significant. When people hear fee increase, they yell “fire”, but something like only $2 would go a long way. The Daily Cal got money, why shouldn’t the ASUC? It’s not a $100 fee increase on students. It’s a cookie at CREAM. With the amount of student life here, we pay among the lowest student fees towards the ASUC. UCSB pays upwards of $300 dollars, we pay $64 at a university that has substantially more clubs. Hopefully with the lower sproul redevelopment revenues should help, but its unfair to judge the current senate class on trying to deal with a problem that other classes absolutely refused to touch.

        • Guest

          The $300 at UCSB includes the student union building fee, doesn’t it? In this case, with the ramping up of the Lower Sproul fee we’ll pass that very soon

        • I_h8_disqus

          I am not putting all the blame on the current senate class. I know this has come from previous groups, but history indicates what we will see in the future, and we should consider setting up a process that prevents irresponsible senates from continuing the problem. As for your comparison of the fee increase being similar to going to Cream. There are a lot of students who have to walk by Cream without getting an ice cream cookie. I don’t get parental support. I pay for college, room, and board through working. During the semester, I don’t work that much, and so I have to watch my pennies pretty close. I would be much happier if I could splurge on Cream than send in $2 for most of the things the ASUC supports. I think students in student groups can contribute money to their groups instead of the ASUC asking me to use loan money to pay for the groups.

        • student

          Student groups should be able to fund themselves…it’s their interest, then it should be up to them to raise funds (use their own money) to keep their activities lively. Daily Cal should continue to expand its options to raise funds (get some better online ads)…I feel that groups are funded in such ways, they lose ability to be productive in their finances in terms of raising funds and spending.

  • pissed off student

    You’ve got to be kidding me ASUC…. Understand, students don’t care about your little model government. Your role is a trivial as model UN…The students don’t need to forced to give this organization over a million dollars a year. We’re facing another tuition hike, and how dare you think of a fee increase???

    Would you dare to spend more than what you have in your own bank account? Why do you think it’s okay to overspend and then put more burden on the student body. You don’t represent us..we don’t need ASUC, the forum for egotistical students who want to embellish their resumes thru student government.

    • glad you are here

      If DailyCal were a fisherman, it’d be the richest fisherman in the world because there are so many fish in the sea to be snagged – namely, the likes of you who jump at the slightest hint of sensationalism.

      Let me try to understand you: you probably think the American government, and any government in general, is a useless piece of bureaucratic shit because most, if not all, governmental institutions in the world are running deficits and what they do usually don’t affect individuals. I’m glad you are here at Berkeley to learn more about civic engagement, because we really can’t afford to have ignorant people like you roaming the world. Governments provide public goods that can’t otherwise be afforded or be accessible; you say that the role of ASUC, the “little model government… that egotistical students who want to embellish their resumes thru student government”, is trivial. I bet you haven’t done enough research, or even paid the slightest attention to what it actually does for campus and the students, and what the absence of it will do to each and every student.

      It’s easy to complain about shit, but takes sacrifice and guts to do something about it.

      If you don’t have the initiative to do something to change the system, stay in your little hole and watch others struggle to make it better.

      • guest

        And your use of the English language made me doubt you are a parent. Was your bright shining star baby in the ASUC senate? Fiscal irresponsibility by a student-group (empowered by the administration) is infuriating for the entire student body.

        • glad you are here too

          First things first: “parent” stands to denote the parent article.
          I would rather you pointed out fallacy in my writing than personally attack me as an individual, especially when that attack is an invalid one.
          I would be more than happy to teach you the art of debate, even if my “use of the English language” is not up to your standards.

          ^^

    • What a joke.

      Wait… are you being serious? Sorry, for a second there I thought you didn’t care about Calapalooza, Cal Day, the Class Pass (who doesn’t like free bus rides?), the Student Store, the Cal logo, the Cal Marching Band and Football team (both of which were owned by the ASUC), on campus events, student groups, or the 24 hour SLC?

      If students don’t care about the campus government, they probably don’t know enough about what would happen if the ASUC didn’t exist. Check your facts before you embarrass yourself again.

  • I_h8_disqus

    It is our own Cal version of Prop. 30 coming up. They want to tax students, because the ASUC legislature can’t control its spending. This is something that we could see coming for years, so there shouldn’t be an emergency situation. The ASUC operations were running a deficit for several years, so they should have already been adjusting down spending.

    • guest

      Except that in the case of Prop.30, the state has been making billions in cuts yearly for a few years.

  • Guest

    With their sense of fiscal irresponsibility, these wannabe politicians will make perfect California Democratic legislators when they graduate.

    • I_h8_disqus

      I was thinking the same thing.