UC Berkeley budget problems stem from state pressure

Campus issues: Revenue generation in Christ’s budget relies too heavily on benevolence and charity

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Willow Yang/Senior Staff

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Carol Christ has a clear philanthropy vision.

In the Christ Administration’s budget for 201718, Christ and her team envision a campus in which donations are a primary source of revenue.

Indeed, revenue generation was bandied about during the lead-up to the new budget. The plan reveals that revenue makes up 52 percent of the gap between a $110 million budget deficit and Christ’s goal of a $57 million deficit at the end of the fiscal year.

Some of this revenue will come from the development of campus programs: “new or expanded academic programming in University Extension, Summer Sessions, Concurrent Enrollment, Self Supporting Graduate Professional Degree Programs and via Professional Degree Supplemental Tuition,” according to the Office of the Vice Chancellor Chief Financial Officer.

Many of these proposed programs are incredibly optimistic and lack solid definition. And even if these programs come to fruition, a great deal of this revenue generation has been written into the budget with the expectation of additional private gifts. Philanthropy is unreliable. The last few years have each been the best year yet in terms of alumni donations, but that can’t possibly be sustained forever.

Moreover, whether these new gifts come from alumni or from random beneficiaries, the hope is that individual divisions will raise substantial funds themselves. The College of Natural Resources even wrote that their 2 percent budget cut — the largest proportional cut among academic departments — will lead to a “negative impact on staff morale (and) high levels of faculty frustration and complaints.”

Some campus units can’t become more self-sustainable. Many less marketable departments within the College of Letters and Science will now also be responsible for generating this donation revenue, placing them into difficult positions. Cuts should not fall to departments that cannot generate revenue to meet their deficit reduction goals.

Christ and her team are trying to make something out of nothing, and while the budget has a lot of problems, the new administration was put into an impossible position.

It’s not the administration’s fault that they’ve had to craft a budget that looks like this. People often say that UC Berkeley’s educational model is unsustainable, but the only reason for this growing unsustainability is the ever-shrinking allocation of resources from the state.

The truth is that no matter how much California would like to believe it, public universities should not be run like private institutions. Many of the stuffier Ivies sit atop vast stores of wealth and live lavishly off alumni philanthropy, but public schools shouldn’t work like that. Increased philanthropy may be a short-term solution, but until UC Berkeley can once again rely on the state for the majority of its funding, its public mission and identity will increasingly be under threat.

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  • Professor S Freeman

    The UC Berkeley education model is OBSOLETE (and costly). Students are required to live in the VERY EXPENSIVE area around Berkeley and physically attend class in large OBSOLETE (and costly to maintain) lecture halls. The MODERN DISTANCE LEARNING education model does not require your physical presence or large lecture halls.
    See: ASU Online http://asuonline.asu.edu/

  • Emily Stafford

    It is time to look real hard at the al business model. What are the employee benefits packages compared to private industry? Revisit tenure. Have hard evaluation standards and get rid of underperforming employees including faculty. If taxpayers are going to subsidize they should get their moneys worth.

  • Nadesan Permaul

    The salaries paid to Chancellors at the end of their tenure while bad optics has no impact on the overall University or campus budgets. The stadium debt is now water under the bridge, and the campus will have to address it over the long-term. The Chancellor is looking at options, but this will be a complex financial issue over time. The state’s disinvestment has been embarrassing for a state that purports to support progressive values such as public education. Now that the state budget has stabilized somewhat, its time for lawmakers to look at investing in all levels of higher education in the state. The only other options are to raise tuition or generate more private funding.

  • jim hoch

    “Philanthropy is unreliable” This suggests three paths, 1) charge students more by increasing fees or reducing aid, 2) produce alumni who donate like the ivies do. It’s not random, they select students based on their projected propensity to donate, 3) spend less.

  • Nunya Beeswax

    Over the last 20 years, the state’s contribution has gone from 40% of Cal’s budget to 13%. If you want that to change, you’re going to have to make it clear to your Assembly representatives that that’s what you want.

    Brown has decreased funding for UC and capped out-of-state admissions. He (fairly obviously) wants to turn UC into an undergrad diploma mill rather than a research university. That would be a terrific shame.

    • still trying

      The State is trying to make a point and statement. Get your financial house in order. You can not continue to give money away. Dirks does not deserve the pay he is getting nor does UC Davis’ last chancelor. All of this while UC Davis medical Center has turned away sick kids because they were on Medical. All while paying the Head of medicine 100’s of million a year in salary and benefits. Get real.
      http://fox40.com/2017/04/17/underserved-communities-call-out-uc-davis-for-rejecting-medi-cal/
      http://www.kcra.com/article/why-some-medi-cal-patients-cant-go-to-uc-davis-medical-center/9521584

      Why is Berkeley in trouble? It is called debt. They spent nearly a billion on the stadium and training center and must direct student funds and State funds to pay for them. You are an educational facility not a triple A sport club. Spend the money on education and you would have the money you need to provide all that is required. You need to learn the facts and history of Berkeley’s money problems. They did not start with State funding but bad money management by those you are getting paid to do nothing. Dirks is going to write a book on State payroll but the State will get non of it. Dirks gets it all. UC is a mess and needs the swamp cleaned. No- I do not like trump, but the phrase is true.

      • still trying

        Berkeley is still paying Tedford more than 5 million a year and he isn’t even here. Berkeley’s sports program is a money pit and is taking money away from education. There have been so many bad choices over the past 2 decades made by UC, it is disgusting. And by the way, as a tax payer, I resent the poor money skills UC has shown. You should be upset as well. It’s your money too. Why do you think tuition is so high. Not because of the State funding,but poor money skills. You use the same excuse as those who want to repeal prop 13. Prop 13 is not the problem, but bad money management by the State. The funny thing is, most State reps went to UC. I guess they did learn something from UC. How to handle money-poorly.