Breaking down the UC tuition increase policy

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On Wednesday, the UC Board of Regents is set to discuss a controversial tuition hike policy that proposes to link student tuition to the level of state funding the university receives.

In recent weeks, the tuition increase policy has been criticized by state officials, students and some faculty members alike for what it proposes to do — and for what some call a lack of transparency to the public with regard to its formulation and announcement. The university has said the policy offers a stable and predictable tuition plan for students and their families — and is an option the university had to consider in the wake of state disinvestment.

The tuition increase policy comes at a time when the university has seen a dramatic decline in state funding. Current funding for the university from the state is $460 million less than what it was eight years ago despite the enrollment of more students.

As the regents head into their board meeting, they are set to discuss a number of financial issues such as approving the 2015-16 budget and looking at the long-term financial planning of the university.

But for many, the focus of Wednesday’s meeting will be whether or not the board will pass the tuition increase policy. Below are some details to understand the proposed policy.

Who are the regents?

The UC Board of Regents is the independent governing body of the University of California. It has full powers in the organization and governance of the university, and it meets six times per year to discuss the future of the university, policy, funding and budgeting, among other topics.

The board itself consists of 26 voting members — 18 are appointed by the governor, one is a student regent and the remaining seven members are ex officio, meaning they hold the position by virtue of holding another office. For example, the ex officio members include the lieutenant governor and the speaker of the state Assembly.

regents.july2013.2-900x598Currently, there are 16 appointed regents, seven ex officio regents, and the student regent is UC Berkeley alumna Sadia Saifuddin. But Gov. Jerry Brown appointed two new regents to the board Monday —  John A. Perez, state Assembly speaker emeritus, and Eloy Ortiz Oakley, the superintendent-president of Long Beach City College.

University officials have said the board has been largely supportive of the policy. But that might change, considering the two new regents Brown appointed — who must still be approved by the state Senate, yet can sit on the board in the meantime — who may express dissent.

What exactly is the tuition policy? How much will 2015-16 tuition cost?

UC President Janet Napolitano introduced the policy as a five-year plan for predictable tuition increases. Essentially, tuition and systemwide fees will increase by up to 5 percent per year for all students, assuming the state increases its funding to the university at 4 percent increases each year.

This brings 2015-16 in-state systemwide fees to $12,804 from $12,192. In the hypothetical situation that the state continues the increases for the next five years, in-state systemwide fees could be $15,564 in 2019-20.

But there could be no tuition increase — or less of a tuition increase — if the state provides more than those percentage increases. Conversely, there could be higher increases if the state provides increases at a lower level than expected.

Who does it affect?

Students who receive financial aid will continue to pay the same amounts they currently do. This is because roughly one-third of the revenue garnered from the tuition increase would go back to financial aid. More than half of UC students have their systemwide fees fully covered by aid. The university estimates that roughly 30 percent of students would foot the full price — those who do not receive financial aid, in other words.

That being said, the tuition increase policy will raise about $459 million in additional funds, and $73 million of that will go back to financial aid. The university says this policy will also allow it to enroll at least 5,000 more California students.

What is the state’s plan?

The policy clashes with how the governor envisions the state will fund the university. In a compact with the university, Brown has said the state will keep increases at those 4 percent levels if tuition remains frozen, as it has for the past three years. Brown is expected to appear at the regents meeting Wednesday, where he will likely express his dissent. Lt. Gov. Gavin Newsom, Speaker of the Assembly Toni Atkins and Perez have also expressed their dissent.

Where does the money go to?

The revenue will go to meeting retirement contributions, employee health benefits, compensation, enrollment growth, academic quality investment and deferred maintenance.

What is tuition? What do students pay for?

Technically, the sticker price of college is a little more complicated than just tuition. Students pay for tuition and a student services fee, which make up systemwide fees. Tuition — formerly referred to as the educational fee — can be used for the UC operating budget and go to costs of instruction. The student services fee is used to support programs that benefit students and are complementary to the instructional program.

Follow The Daily Californian at @dailycal on Twitter to receive live updates. Staff writers Sophie Ho, Daniel Tutt, Jean Lee, Bo Kovitz, Sahil Chinoy, Adrienne Shih and Suhauna Hussain will also be tweeting.

Sophie Ho is the executive news editor. Contact her at [email protected] and follow her on Twitter @sophanho.