SAN FRANCISCO — Gov. Jerry Brown handed the UC Board of Regents what he called a “reality sandwich” Thursday, saying that if the university doesn’t change its long-term approach to financial planning, students will face a massive tuition hike in the near future.
Brown’s wake-up call sparked a debate among regents at the final day of their November meeting as they considered a university budget for 2014-15 that Lt. Gov. Gavin Newsom, who is also an ex-officio regent, called a “wish list.”
The preliminary budget, which the regents passed unanimously, maintains resident undergraduate tuition at $12,192, a figure that has not changed since the 2011-12 academic year. The freeze, however, may rely on additional state funding of more than $120 million — money Brown said the university is unlikely to receive.
“We’re on a track here for a gigantic tuition increase, or you’re going to have a big financial crisis,” Brown said. “The ‘big bad state’ is not going to bail you out at a rate that is different than what we’re doing now.”
Brown’s multiyear funding plan has allocated $146.2 million in increased state funding to the university for 2014-15 — funds that were made possible in part by the passage of Proposition 30, a California ballot initiative passed by voters last year to increase state support for public education.
UC President Janet Napolitano and others said Thursday that this funding does not do enough to support the university, asking for $120.9 million more than the governor has included in his proposal to support enrollment growth, the university’s retirement program and programs to reinvest in academic quality.
Brown said the university must develop a plan to stabilize tuition without hoping for additional funding from an unwilling Legislature, arguing that putting off long-term planning while asking the state for more money will only lead to a major tuition hike a few years down the line.
Others shared similar concerns.
“I, for one, am uncomfortable passing a budget that has so many asterisks,” Newsom said.
Nathan Brostrom, the UC system’s executive vice president for business operations, said the university will seek alternative funding, such as borrowing from one-time reserves, if it is not awarded additional state funds. But he warned that one-year budget fixes are not sustainable in the long run, noting that the university’s plan to reinvest in academic programs that suffered cuts in recent years will be in jeopardy without state funds to support it.
Aware of the stakes, many of the regents advocated greater investment from the state. Regent Hadi Makarechian said increased UC debt over the years is largely attributable to diminished state funding.
“The state is not choosing the right priorities,” Makarechian said. “I want to make sure we understand how important it is for the state to fund this institution.”
Additionally, board chair Bruce Varner said he hoped the university could mobilize students to lobby the state for greater funding.
“We can engage the students in getting us to talk to the Legislature,” Varner said. “We need to recognize the fact that there is a great return on this investment.”
Brown will propose a state budget for 2014-15 in January, at which time the university will have a better idea of the state funding it can expect.
The proposed UC budget also assumes the university will bring in about $26 million in additional revenue by increasing nonresident enrollment by 2,000 students. Furthermore, the budget assumes the UC system will receive $25 million from new philanthropic ventures.
Still, the regents’ discussion focused on keeping tuition affordable and predictable.
“Moving forward, I think that we need to think about how our present actions are going to impact the future,” said Student Regent Cinthia Flores.
UC President Janet Napolitano announced Wednesday that she intends to develop a sustainable tuition model for the UC system beyond simply freezing tuition for next year.
“The freeze is to give us a year to get it right, so we can drive into our board and the state what our vision is and where we’re going,” Napolitano said. “There’s not a state in the country that has anything remotely like the UC. So we’re going to fight for it for the long haul and not just one year at a time.”
Contact Libby Rainey, Adrianna Dinolfo and Connor Grubaugh at [email protected].