Gov. Jerry Brown requests $50M sequestration from UC funding

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In a revised May budget proposal released Thursday, Gov. Jerry Brown requested that $50 million be sequestered from University of California funding until recommendations from an April 25 California State Auditor’s report and other state commitments are implemented by the university.

California State Assemblymember and chair of the state’s Assembly Higher Education Committee Jose Medina, said he agreed with sequestering $50 million from the university until the University of California Office of the President shows it has implemented the audit’s recommendations, adding that he “agreed with the governor’s thinking that he is holding office’s feet to the fire.”

In reference to state audit’s allegations that UCOP had $175 million reserves in undisclosed funds and interfered with campuses’ survey responses to the audit, Medina said he took the audit “at face value” and did not dispute the findings.

The only way the legislature has to make sure UC complies is with the power of the purse strings,” Medina said. “I do hope … taking all those steps, that there will be more transparency and more oversight on the part of the regents and their transparency with their funds.”

According to Jason Constantouros, a fiscal and policy analyst at the Legislative Analyst’s Office, the state legislature appropriates a portion of the state general fund, approximately $3.5 billion, to UC funding — this governor’s sequestration request calls the state to set aside $50 million of this appropriation.

Constantouros said the university will receive the funds if it meets three conditions. First, the university must implement the first set of the state audit’s recommendations for UCOP and the regents by April 2018. Second, the university must complete the piloting of activity-based costing across three university campuses to help the state and university better assess and reevaluate the cost structure of the UC.

Third, the university must provide sufficient evidence that all university campuses, except UC Merced and UCSF, are on track to meet an enrollment ratio of 1 new incoming transfer student for every 2 new incoming freshman students by the 2018-19 academic year.

Constantouros noted the format of the sequestration request is somewhat modeled after previous actions the state has taken in previous years, such as the requirement for the university to adopt a policy limiting nonresident enrollment as a condition for receiving $18.5 million to support university enrollment growth.

Medina said he did not believe the sequestration was a threat to university funding, calling it “a way to ensure accountability.”

The university does not believe the $50 million hold will adversely affect it, and fully intends on meeting the requirements for funds to be released, according to UC spokesperson Ricardo Vazquez.

“We have made significant progress on the activity based costing issue, and the 2-to-1 transfer issue and we will continue to demonstrate our commitment to cost containment,” Vazquez wrote in an email. “Also, as President Napolitano has said, we will fully and thoroughly implement all 33 of the recommendations to the Office of the President that were contained in the state audit.”

Bobby Lee is an assistant news editor. Contact Bobby Lee at [email protected] and follow him on Twitter at @bobbylee_dc.